Innovative Customer-Engagement Strategies in the Global Marketplace

Whether it’s adding rock climbing walls to cruise ships or setting up home delivery for the Cairo McDonald’s, business executives go to great lengths to build customer loyalty. But oftentimes the key to keeping customers isn’t fancy amenities but rather an investment in the company’s employees, according to the participants in the panel discussion “Innovative Customer Engagement Strategies in the Global Marketplace,” held at the University of Miami’s inaugural Global Business Forum on January 15. The panelists, representing different industries, offered case studies of how they oriented — and reoriented — their respective business models to please customers around the world.

Knowing the customer is an obvious first step. For Collective Brands, a footwear company, that meant sending a team to live with families in Latin America for a week to explore how and why certain shoes ended up in their closets, said CEO Matthew Rubel.

At Four Seasons, customer strategy starts with a basic emotion: empathy, according to Barbara Talbott, executive vice president, marketing. In a survey, more than 60 percent of the hotel chain’s wealthy customers said they agreed with the following statements: I am working harder than ever. I never have enough time. I don’t get enough sleep.

In response, Four Seasons makes it its job to cater to their needs. That means offering one-hour pressing and four-hour dry cleaning services, for example, and allowing guests to call room service from the car on the way to the hotel so that a meal is waiting for them on arrival. Amenities need not be expensive: One of the most appreciated add-ons, Talbott said, is providing workout clothes and sneakers for guests to borrow while they’re at the hotel’s fitness center, so that they don’t have to pack their own and possibly end up checking luggage.

“It’s just about a thought process that starts with who are the customers, why are they here and how would it be possible to make things better for them,” Talbott said.

Panelist Jose Armario, group president for McDonald’s Latin America and Canada, recalled how the restaurant chain embarked on a customer-centered strategy in early 2003, after management realized that years of expansion had caused the company to lose its focus. Unlike Four Seasons, McDonald’s customers around the globe have a varied profile. What could the company do to please them all?

In the end, the answer varied from city to city, restaurant to restaurant, Armario explained. Success happened when decisions were made at a local level.

“We are undeniably a well-known brand,” Armario said. “We are also a local neighborhood business run by a mom and dad with their children running alongside them.”

McDonald’s decided to provide a framework so that its geographic management teams could come up with their own local solutions based on company-wide priorities — including customer engagement.

New ideas emerged. McDonald’s in Egypt started home delivery, a concept that later spread to parts of Asia and Latin America. In Australia, McDonald’s opened a McCafe coffee shop within a restaurant — a concept now in 30 countries including Germany, Singapore and Brazil.

“We’ve been able to see greater innovation that we’ve been able to replicate to other parts of the world with similar consumer needs,” Armario said.

Decentralization has also worked for Royal Caribbean Cruises, said Chairman and CEO Richard Fain, another panelist. When he started at the company in 1979, 90 percent of the cruises operated out of South Florida. Today, half the business is international, a shift requiring a new mentality. Now each country operates its own marketing, sales and finance teams, which allows them to cater cruise packages to local customers and customs. That strategy has proved especially successful in China: Two years ago Royal Caribbean had one ship operating for six weeks. Now it has two ships operating year-round.

Regardless of where they are operating, though, one part of the company’s customer philosophy is universal, Fain said — the staff has to deliver the “wow factor.” That translates to installing wave pools for surfing, climbing walls, even ice rinks. “It’s a very visual experience,” he explained, “and it’s not what one would expect. It says something about overcoming the stereotypes that cruising is for sedentary people.”

The panelists agreed that service was key to keeping customers.

Hiring the right people is as important as “‘location, location, location’ [is] in real estate,” Talbott said. “It’s tough to change and so much of the value is right there.”

Different companies do that in different ways. Four Seasons interviews applicants at least four times, she said, to get a sense of whether they like helping people. Collective Brands has prospective employees complete a survey that asks whether they “love shoes,” Rubel said. People who do well at the company have most likely said yes. Royal Caribbean takes some prospective workers through a mock cruise ship cabin, having them make a bed and do other tasks required for the job. That cuts down on turnover, Fain said.

“We get crew members who are not only qualified but know what they are getting into and are pleased when they get there,” Fain said.

Armario said that McDonald's includes employees, not just consumers, in its definition of "customers." He added that for many of the company's employees, "we are their first entry into the workforce … a responsibility we take seriously. Just as we have worked to elevate the customer experience at the drive-thru or front counter … so we have tried to elevate it behind the counter and in the employee crew room."

Treating employees with respect results in them taking pride in their work — something customers notice, Talbott said. At Four Seasons, the company’s motto is the Golden Rule, which is understood around the globe. It also works hard to incorporate local customs, such as making sure the food in the staff cafeteria meets local standards or, in the case of Bali, that the new laundry machines are blessed according to local custom before use.

“We all want to be understood and treated as individuals. It starts with respect and an openness,” Talbott said. “When [the staff] is treated that way, it’s much easier for them to extend that to the customers.”

By Marika Lynch