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Carol Roth's future file: In the era of the customer experience, you should compete on value and not on price

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The theme of this year's Nextiva conference, NextCon, was the customer experience. And Small Business Trends did a great job of covering the event. Indulge yourself and check out the cover, as there were a ton of great speakers, including Brian Solis, The McKeown, and Google's Lawrence Cole, as well as Tomas Gorny, founder and CEO of Nextiva.

I had the pleasure of speaking with personality of business television and bestselling author Carol Roth, who focused his opening session on customer loyalty, and the Idea that it calls Customer Experience 3.0. Here is a transcript of our conversation. To hear the full conversation, click on the built-in video or SoundCloud player below.

Small Business Trends: I'm sitting here in the sun in the fun of Phoenix, Arizona, at NextCon 17. Speaking of fun, Carol Roth is with me Carol, thank you for joining me.

Carol Roth: I like that my introduction is fun.

Small Business Trends: You did a plenary session and a main panel here at NextCon, all around the customer experience. But before you jump into that, you do a lot of things …

Carol Roth: Yes.

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Small Business Trends: Why not tell us a little more about some of these things?

Carol Roth: My short version is that I am an entrepreneur and I play on television. But the experience goes from creating an inherited planning product called Future File to help you organize your wishes and information, and help your loved ones in case of aging or death issues. I am also an investment banker in recovery, I made a few billion dollars of transactions, a successful New York Times author of the Entrepreneur Equation. As I said, I am in front of a camera for all types of people, usually a few times a week. And my favorite treat is that I have my own figurine.

Small Business Trends: Not everyone can say it, so it's pretty cool.

Carol Roth: Yes, thank you.

Small Business Trends: At this conference, the whole theme is around the customer experience and you talked about the customer experience three points oh. Perhaps you could give us a little insight into what that is, and how did we go from version 1.0 to version 3.0?

Carol Roth: Customer loyalty is really at the heart of all the marketing and selling that needs to be done these days, because technology has made it so easy to reach everyone that everyone has benefited from that. While you can reach everyone, you can not really get their share of mind. And so, it's all about how I engage the customer with whom you already have this relationship to not only sell more to this customer, whether it's more frequently or with upsells, but how to use them as a way to pass the word in their own circles of influence. That's the fundamental reason why I focus so much on customer loyalty. I think the way we get from 1.0 to 3.0 is if you think about the old school that's a customer loyalty program, you think about your app or your punch card, buy 9 get the 10th free or earn a dollar point, but it does a lot of different things.

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It almost creates this level of price competition. Buy 9 and get the 10th free is like a 10% discount. You have to work very, very hard to get, and this allows other people to try to reduce that. It also creates loyalty to a program, rather than your brand or business.

I find it's a very bad strategy for companies, because people end up in what you give them, compared to the value proposition that you offer them in the business. And then it influences people who are spending directly, but it does not take into account the influencers who indirectly bring people into your business. And so, as we move from version 1.0 to version 2.0, which uses influencers in the same way, version 3.0 is really about building relationships with customers. Understand them, listen to them, know that they care about them. Or knowing that you care about yourself, and that you really focus on establishing a genuine relationship between you as a business and what you offer to that customer.

Now, that sounds very, very simple. Okay, we understand that we should be nice to customers, we should build relationships. This is not easy to do, and that is why so few companies have done well. And part of the reason it's so difficult is that everyone is listening to what I call their own radio station, WIIFM – What & # 39; s In It for Me.

As a company, you must determine for each customer what will inspire them with loyalty and then, understand in this particular situation what the customer is, it's something different depending the life cycle where you are with this customer. I've therefore created a template with five pillars of loyalty that you can use to facilitate this process, but the one thing I always say to businesses is that you must always listen. It always starts with listening, because even if you know the five pillars, if you apply it to the wrong customer at the wrong time, you will still not create that relationship.

Small Business Trends: What is the hardest thing businesses face or have difficulty understanding how to deliver consistent and successful customer experiences over time?

Carol Roth: I think that's the factor of consistency. I think people really want to be one and finished. I've done this thing for you once, we're good. And now I am going to go and focus on someone else. And as we know in our personal lives, it does not work very well. You can not bring home flowers once and you can expect that it will forgive you for life, you never have to bring back flowers, is not it? This appreciation must be demonstrated throughout the relationship, or the relationship is broken, is not it?

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It's the same thing with business relationships, that's that the level of consistency, I think, is really difficult. And then, the other thing that seems to me really difficult is the personalization, which should not be difficult at all, between social media and conversations and technology. It is very easy to create what is called an intimacy file.

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I know it sounds great Victoria's Secret, but I do not say it that way, just a folder where you know things about people, you know their favorite sports teams, you know they're not. they have kids, you know their favorite food, anything, so you can just pull those notes and find out what makes that person go tick, and then be able to apply that good postman . I think what companies do, is that they have their shtick. We will give everyone this, it's our gift, it's our booty …

Small Business Trends: Customized, you get what others get.

Carol Roth: You get what everyone else … Then it becomes very transactional. And loyalty is never transactional. And so, if you do not take the time to understand the person and do something special for her, she will know it. They will know that it is … you are the guy who arrives with flowers the first day each time. Note that I am allergic to flowers, and that maybe you should have shown yourself with chocolates.

Small business trends: Yes. Well, what do you think of companies like Amazon that … They do not necessarily have a delicate relationship, but people like Amazon because they deliver the things that they appreciate a lot, which is, two days free shipping; you give me my stuff, you make my job easier, it is not fancy, but it is the experience that people are looking for.

Carol Roth: That's exactly it. The "easy" is a huge pillar of loyalty. If you can make sure that someone can do something easily, especially nowadays, where time is precious, it is easy to do it, it has a very large choice, so you are one, and if you have a problem, they never ask you about it, they take care of it. They really deliver on what I call the pillar of customer service, and that is why Amazon is so successful. Many people think that's because Amazon has low prices, if you really do Amazon shopping, I tell you right now, Amazon does not have the lowest prices. ..

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Small Business Trends: More now.

Carol Roth: Yes. You can usually find what you are looking for elsewhere, but you are looking for …

Small Business Trends: You said yesterday, always compete for value, do not try to compete on the price.

Carol Roth: You never want to compete on the price, you still want to compete on value, and that's what they did. They started with the price to get your attention, but it's this customer service, it's this added value that allows you to stay with Amazon. As long as they are in the field and range, it will be so much easier for you to do business with them, and that is why they dominated all the industries in which they entered, and will likely continue to do it.

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Small Business Trends: And on this note, give us one or two things that next year, that it will be really important for, especially for SMEs, to have a good time. be right when it comes to the customer experience; if it's related to technology, or if it's just the good old days. What do they really need in the next few years?

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Carol Roth: I think it always comes back to the base. We always say, oh what is the vision for the future? I think the future vision is still tools, but the tools always help the underlying fundamentals that never really change. Understanding your customers and leveraging your existing customers will continue to be more and more important. I know that it's very attractive or that you may think that it's the right thing to do, that I have to go out and get new customers, but if you have not spent any time with your existing customers, frequently, or prompting them to look for products and services that you can offer them, so whenever they buy, they buy more from you, you do them and yourself a disservice.

If you do not use referrals directly or indirectly, you are hurting yourself and them and their friends. I really think it comes down to this center of interest. When you try to attract a new customer, if you have an existing customer who can do it for you, their level of influence with a new customer is going to be much higher than your ability to reduce all the noise. That's why most small businesses have not spent time returning to their existing base and trying to monetize this, and the amount you can increase your business from these people who really have that passion. your business. Who, at least no, they can trust you. It's the easiest thing they can do as a small business.

Small Business Trends: Where Can People Learn About What Carol Roth Does?

Carol Roth: Yes. You can visit me online at carolroth.com, on Twitter, especially if you have a slightly distorted sense of humor at @CarolJSRoth, and please check Future File at futurefile.com so that we can help you protect your loved ones in their greatest time of need.

This is part of the series of one-on-one interviews with opinion leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the built-in player above, or subscribe via iTunes or via Stitcher.

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