5

key differentiators that

set elite companies apart
How world-class companies are raising the bar for great CX
In today’s Experience Economy,
putting your customer at the center
of your business is no longer a
competitive differentiator—it’s a
basic requirement.
Having a usable, enjoyable, trustworthy experience that helps people achieve
their goals is a necessity consumers have come to expect. So what is it about
an experience that keeps customers coming back? What sets world-class
brands apart?

To better understand how the bar for great CX is being set, we looked to some
of the world’s leading brands. Among multiple third-party reports, we noticed
several companies that were consistently named as CX leaders. We recruited
consumers and loyal customers of companies from this group to explore how
elite brands are rewriting the CX playbook and setting the stage for even better,
more connected, and loyal customer relationships.

5 KEY DIFFERENTIATORS THAT SET ELITE COMPANIES APART | 02

Study
CX leaders

Apple Nike

methodology Coca-Cola
Costco
Starbucks
Target
Edward Jones USAA
To better understand the role emotions play in experiences and
identify additional differentiators of elite brands, we conducted a Google Zappos
three-part study of 11 of the world’s top brands. We chose brands Lexus
that appeared on two or more industry top CX indexes,
like Forrester’s CX Index or the NPS B2C Leaders report.
Study demographics

Within the study, we wanted to explore the following:

• What types of experiences are these brands providing? 11

• What can others learn from them?
companies

• What is a “best-in-class” experience?

242
men and women
between the ages of 18
and 55 residing in the
US and UK

5 KEY DIFFERENTIATORS THAT SET ELITE COMPANIES APART | 03

In order to answer these questions, for each company, we gathered feedback
in three categories: mobile website acquisition flow, loyal customers’
experiences and opinions, and brand messaging.

o ile e site ac isition o

Participants were asked to perform a task and comprehend the content
on a mobile website, then share their overall experience with usability,
credibility, loyalty, and appearance.

Loyal customers’ experiences

Loyal customers were interviewed via Live Conversation and were asked
to share why they’re loyal to the brand, what value they see in the brand,
and why they feel the brand is superior to its competitors.

Brand messaging
Participants were asked to share adjectives they’d use to describe a
brand, then watched the brand’s most-viewed commercial from the last
12 months. After watching the ad, they were given the opportunity to add,
change, or remove the words they previously shared.

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What we found
Elite brands do all the “usual” things that you’d expect from established, customer-centric companies
like ensuring ease of use, aesthetics, trust, and efficiency.

But they don’t stop there.

As we uncovered insights from each of these three categories, it was clear these brands were making
significant investments in connecting with their customers. We identified five key differentiators that
set them apart:

1 Stellar employee experience

2 Excellent in-person experiences

3 Seamless omnichannel experiences

4 Personalized, high-touch experiences

5 Connecting with customers through emotional design

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1. Employees are the key to
meaningful connections
Great CX and an engaged and fulfilled workforce
go hand-in-hand within world-class companies. A
study by the Temkin Group found that companies
that deliver great CX have employees that are
1.5X more engaged than those who have less
satisfactory CX.

Great employee experience is about making

a real, emotional connection with the people
that represent your brand to customers, every
day. Fostering emotional connections between
companies and employees, and employees and
customers was a clear differentiator in this study.

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Take USAA, one of the companies in our study, for example. The financial services company that serves
the families and veterans of the United States Armed Forces. Although the company’s primary function
is to provide financial services, it understands its audience and gives its employees the training and
background they need to be equipped for the challenge. The organization understood that active
service members, veterans, and their families had a unique set of circumstances and perspectives that
would be hard to understand if it wasn’t experienced firsthand.

To help give employees the context and empathy required to best serve their customers, employees
spend a day in boot camp, with a real drill sergeant and even preparing and eating MREs (pre-packaged
meals soldiers eat in the field). The drills had a dual purpose of giving employees a rare look into the
lives of the people they’re there to help while cementing powerful connections between colleagues for
future support, guidance, and encouragement.

Those emotional connections were apparent to loyal USAA customers. One customer shared how she
was courted away from another insurance provider after the company expressed genuine concern for
her family:

My daughter was in an accident, and they

asked if she was OK. They were concerned.
I wasn’t scared of them like I was with other
insurance companies. I left [another provider]
because of that.”
-USAA customer

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Starbucks was also recognized for its stellar employee experience, and customers mentioned pleasant
interactions with in-store baristas as a driver of loyalty.

Starbucks customer

Many do business with Edward Jones because they’ve built their business on in-person interactions
and, according to their annual report, they have “intensive advisor training where they stress the
importance of face-to-face interactions with customers.”

They are friendly and not stuffy or scary like it

could be. The difference I have experienced so
far is having the person assigned to me. It is nice
having a rep (for lack of a better term).”
-Edward Jones customer

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 2. Focus on in-person
experiences
While digital is all around us and shows no signs of
slowing down anytime soon, those aren’t the only
experiences consumers care about. Much has
been said about the “death of brick and mortar” but
recent research indicates that’s not the case at all.

In fact, according to research by A.T. Kearny, 81%

of Gen Z consumers prefer to do their shopping
in-store, rather than online. Gen Z consumers,

81%
of Gen Z consumers prefer to do their
shopping in-store, rather than online.
-A.T. Kearny
people born between 1997 and 2012, currently
total 7.1 million in the US alone and are expected to
eclipse the Millennial population in the near future.
This group, often referred to as digital natives, is
raised with technology at their fingertips—yet their
preference is for in-person experiences over digital.

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 And it’s not just Gen Z who prefers to visit physical locations. A Google/Ipsos survey found
that 60% of consumers would rather shop brands that had a physical presence over those
that were exclusively online.

Part of that may be due to the saturation of digital experiences in our daily lives, creating an
empathy gap between consumers and the companies they’re interacting with. The drive to seek
out in-person interactions indicates that there’s still a need for physical, in-person experiences.

The companies in our study appear to recognize this and many had a clear focus on
creating meaningful in-person experiences. Whether it was through offering a wide variety
of products to great customer service to the overall ambiance of the location, these brands
understand the emotional impact of connecting with consumers face-to-face.

When we are in store purchasing a new

product or trying a new product or getting
repairs, we consider it an activity. My
children like to go and play on the iPads,
and we are looking for what is so great
about the new iPhone or new iPad pro.” Apple customer

-Apple customer

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Target customers considered the in-store experience a unique differentiator of the brand.
Consumers alluded to the variety of products and serendipitous shopping behaviors in store.

I pass the accessories and see something I need.

Then I go to the clothing section, and then I have
to walk through the home goods. There is a feeling
I shouldn’t be doing this because I am going to
see something I’m going to want to buy. It is the
excitement of finding something...”
-Target customer

They have so much no matter what you

need, unless you are looking for an
atomic bomb. You go in looking for chips
and you spend $500.”
-Target customer

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Costco was another company that stood out among the brands as having a great in-store experience
that seemed exploratory with an element of fun.

Costco customer

Starbucks customers also talked about the general “feel” of the coffee shops.

...the ambiance, and the environment, and sitting, and the

way I get treated. It is very peaceful if I am stressed, so I
get a good place to hang out.” Another said, “You can take
a deep breath [when you are there].”
-Starbucks customer

A physical presence instilled a sense of trust with Edward Jones customers.

Edward Jones customer

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3. Seamless omnichannel
experiences and ecosystem
There’s a reason this is a major differentiator: it’s
not easy to accomplish. Customer-centric brands
put a significant investment in time and resources
to understand how their customers experience
their brand across touchpoints and channels.

From researching a purchase to interacting with

chatbots for customer service, today’s consumers
have a dizzying number of touchpoints with
brands, all of which add up to nearly countless
opportunities for companies to earn—or lose—the
loyalty of customers.

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PWC notes that consumers have a low tolerance for bad experiences at any touchpoint, with 17% of
consumers abandoning a brand after a single bad experience and 59% jumping ship after several.

This means that brands can’t risk ignoring any details at any point in the customer journey. The elite
brands in our study were prime examples of how the investment in seamless experiences across
touchpoints strengthens customer loyalty.

Lexus, Target, and Apple customers all pointed to the seamless continuity of the brand experience
that keeps them coming back.

All the navigation controls are well laid out and easy to
follow. When I am inside the house, I put the location in
and when I get to my car it syncs with my phone.”
-Lexus customer

We got our iPhones years ago and then the computers

and they can talk to each other. We are all connected. Why
would you go elsewhere once you find yourself connected?”
-Apple customer

Lexus customer Target customer

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4. High-touch for high value
Making consumers feel understood and seen
as essential to creating experiences that inspire
loyalty. But there’s a big difference in consumer
expectations when it comes to buying a pair of
shoes versus a car or investing your life savings.

According to a PWC survey, 86% of consumers are

willing to pay more if it means they’ll have a better
experience. The same survey found that 49% of
consumers made impulse purchases after having a
more personalized experience.

86%
of consumers are willing to pay more if it means
they’ll have a better experience online.
-PWC
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 It’s natural that higher ticket or higher importance items raised the bar for consumer expectations.
The importance of a more intimate customer experience was evident with the brands in our study
that offered higher-ticket products like financial services or luxury automobiles.

Lexus, Edward Jones, and USAA earned praise from loyal customers by taking the customer
experience a step further to make the experience feel tailored just for them.

I have had no problems with the car, and the

service the dealership provides is really good.
[They] have collected the car from my home or
workplace or if I needed a courtesy car. And they
have kept me updated. Customer service has
been really really good. When I purchased,
it wasn’t a fast sell. There was no pushing.”
-Lexus customer

They want to help you as an individual

achieve your own unique desires and plan.”
USAA customer -Edward Jones customer

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5. Emotional design
Emotions aren’t a topic that typically comes up
in the boardroom. They’re squishy. They change.
They’re hard to quantify into neat metrics and
measure quarter over quarter, year over year,
however, they also happen to be the one thing
that connects us all together.

A recent Nike commercial illustrates this nicely.

After watching the US Women’s Soccer Team
win the World Cup, the nation was inspired, fans
or not. Nike captured the pride, sportsmanship,
teamwork, and commitment of the team in an ad,
shortly after their win.

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 The ad elicited strong emotional reactions from viewers and soon went viral. While it was
clearly a Nike ad, the spot wasn’t specifically about anything Nike was selling. It was about
people, it was about the powerful emotions that go hand-in-hand with winning, losing, and
playing the game.

Nike ad highlight reel

The power of those responses made us wonder: Is emotion the key to forging a meaningful
connection with customers? Is that aspect of humanity that’s hard to quantify the key to a
brand’s success? Other industry research indicates this might be the case. According to
Forrester’s 2019 CX Index, emotion plays a strong role in customer loyalty—even more so than
ease of use or effectiveness.

Similarly, in a study conducted by Harvard Business Review, researchers found that customers
that are emotionally connected with a brand are 52% more valuable than those that are
simply “highly satisfied.” Harvard professor Gerald Zaltman went so far as to say that 95% of
purchasing decisions are driven by emotion.

95%
of purchasing decisions are
made by emotions
-Harvard professor, Gerald Zaltman

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How consumers feel about their interaction with a brand is a major driver for loyalty. According to a
recent survey by Deloitte Digital, 60% of loyal customers use emotional language to describe their
connection to their favorite brands, and 62% of consumers felt they had a relationship with their
favorite brands.

These statistics highlight the importance of going far beyond just providing a product or service.
Successful brands understand the importance of nurturing a relationship with their customers
which requires trust, reliability, and most of all, an emotional connection—a connection that can be
influenced by design.

Coca-Cola was also mentioned as a company and brand that’s created strong emotional
connections through consistency, taste, availability, and reliability. When asked to use words to
describe the brand, people used words like “classic,” “timeless,” “iconic,” and “delicious.”

I think that the brand is very consistent. There

has never been a time ‘did you hear about what
Coca-Cola did’ or read about something. When
you think of a soda, it comes to mind.”

-Coca-Cola customer

If you want a soda that tastes

good and has a kick, it will give
you the perfect balance.”
Coca-Cola customer -Coca-Cola customer

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Apple products also inspired emotional responses from customers. Some likened owning or
shopping for products to a fun and trusted experience with a friend for family member.

[Apple products are like] someone I could

rely on and trust like my mom. She was my
best friend. Every time you needed her, she
was there for you.”
-Apple customer

It is joyful and it makes using Apple

products look fun and easy.”
-Apple customer

Some Nike customers felt a strong emotional connection because of the company’s celebrity
endorsements. One participant recalled the connection they felt with the brand when wearing
the same clothes as famous athletes.

“They’re a brand leader because of their marketing and the

athletes that they align themselves with. I like basketball and
golf so Tiger, Lebron, Kobe...I associate that with Nike as
a result. If you go back from 10-12 years ago when I would buy
a shirt from them they were the slicker mock neck look and I
saw Tiger wearing it.”
-Nike customer

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Zappos’ quirky commercial helped customers perceive the company as both “fun” and
“customer-centric.” These same reactions were evoked based on digital interactions with Zappos.

Zappos customer

A Google customer noted the seamless ease of use made her happy.

Google customer

One USAA customer noted how the company made them feel secure and cared for.

It feels like they are looking over your

shoulder and making sure you are OK.”
-USAA customer

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Differentiation
throughout the
customer journey
Great CX is a living, breathing relationship between a company and its
customers, driven by an organization’s continuous focus on the customer
across every touchpoint along their journey.

Companies that succeed, like the brands in this study, are constantly talking
to their customers to explore and understand their world and their needs.
Those efforts lead to customers who feel an emotional connection with their
favorite brands, and that connection drives loyalty and customer value.

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According to a Harvard study, customers who were fully connected with a company were 52% more
valuable than customers who were simply satisfied with the brand. Ultimately, what sets a brand
and an experience apart from the rest is the complex layer of understanding and empathy that only
human insight can uncover.

+52%

+13%
Baseline
-18%

Not emotionally i hly satis ed Perceive brand Fully connected

connected but not fully differentiation and satisfied,
connected and satisfied, but and able to perceive
not fully connected brand differentiation

The CX landscape is evolving, and what differentiates the leaders from the laggards is a dedicated
focus on the customer experience across every possible touchpoint, including digital, in-person,
personalization, employee experience, and emotional connections. World-class brands meet their
customers where they are by listening to them, in their own words, and change right along with them.

5 KEY DIFFERENTIATORS THAT SET ELITE COMPANIES APART | 23

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