Your #1 source for auto industry news and content


Increase Consumer Loyalty at Your Dealership with These 4 Customer Experience Strategies – Joseph Michelli, NYT Best-Selling Author

On today’s show, we welcome back Joseph Michelli, customer service expert and New York Times best-selling author, to discuss how your dealership can develop a worthwhile customer service strategy.


Joseph Michelli: Hey Jim, it’s great to be back with you, thanks.

Jim Fitzpatrick: Sure. So you recently had a blog post that we’d like to talk to you about, The Secret Sauce to Customer Experience is a Blend of Four Ingredients. Tell us about that.

Joseph Michelli: Well I don’t know how secret any of this is, but you gotta have a hook, right? Clearly, speed is critical to successful customer relationships today like no other time in history. Customers wanted it before you even had it really, so making it as rapidly into the life of the customer as possible. I work with Airbnb for example, and just speed of the load time of the website alone is one of those indicators of the success of a brand today.

And clearly convenience, I know you’ve had my buddy Shep Hyken on, he’s written a book called The Convenience Revolution, without a doubt convenience is at the core of what customers want, the most effortless experience possible.

Customers are looking for knowledgeable staff, they’ve always wanted knowledgeable staff, they just want it more quickly and they want that knowledge to them as conveniently as possible.

And then finally they want you to make sure that your service has a human component that is friendly, engaging, welcoming, appreciative, all the dimensions that humans overlay onto it.

So, in many ways these things haven’t changed, but I think execution of those four ingredients predict whether or not you’re gonna be a success today, tomorrow, and if you’re gonna have sustainability.

Jim Fitzpatrick: That’s right. So you talk about double down on investments in people, process, and technology. Can you drill down on that a little bit?

Joseph Michelli: Yeah, if you’re gonna deliver these four ingredients, if you’re gonna mix them into the stew, there’s only three ways you can get them into there. One is either through your people, some of it is gonna be through changing processes that make it more convenient or increase the ability for your customers to get what they need quickly, and the other is gonna be through the technologies that you leverage.

Now, to say that is that you have to do all three. Any brand that relies exclusively on one or the other tends to struggle. Certainly technology is at the forefront, the digital revolution is about us and we have to be sure that we can do it. But when people want people, they need to be able to opt-in to a human who’s really fully capable of delivering the knowledgeable service, for example.

Jim Fitzpatrick: That is so true, I find myself doing that where I’m like, “Representative, representative.” You know?

Joseph Michelli: Yeah, there’s been some global studies now that say people expect more and more and more technology over time. But they also expect people to play a more important role, albeit diminished in terms of the scope of it, but deeper into the relationships with people. So I don’t think people are going away anytime soon.

Even though there are websites out there that literally predict the likelihood your job will be replaced by a robot, fundamentally there are certain functions of human interaction I think we’re gonna always need people for.

Jim Fitzpatrick: Yeah, for sure. Talk to us a little bit about artificial intelligence with the customer experience, because that’s something, as you just mentioned, is rapid. It’s everywhere. Is it a good thing, is it a bad thing?

Joseph Michelli: Yeah, I can give you an example, Airbnb for example, if you were to list a property and maybe you forgot to mention you have bunk beds in a picture that you show on a website, so it’s not in your listing. We now have visual recognition, they can tell that that’s actually a bunk bed, it’s learning those kinds of facts.

So even though you did not state it in your listing, and let’s say that I’m somebody who happens to search for properties historically that have had bunk beds, they will actually select for me, based on their understanding of me, the artificial intelligence understanding me, they’ll select your profile even though I’ve never stated a preference for bunk beds and you’ve never even stated a bunk bed in your property. The point is, visual recognition, artificial intelligence, constant machine learning, it’s gonna change the way things are done.

That said, that means more and more we have to deliver technical items that are personalized, that are selecting for your wants, needs, and desires. And that technical personalization does not replace personal care. At Starbucks, personalization comes in knowing that I drink a non-fat latte in the morning and that they should only message me on lower fat products. But that does not replace the need for my barista to greet me by name when I come in.

Jim Fitzpatrick: That’s a very good point. Do they greet you by name when you come in? You literally-

Joseph Michelli: Well I’ve written two books about them, so-

Jim Fitzpatrick: I was gonna say, you literally wrote the-

Joseph Michelli: I don’t know if the word’s out, but they’ve got it.

Jim Fitzpatrick: You literally wrote the book on it, two of them. Talk about the importance of customizing your product presentation, to elaborate a little bit more.

Joseph Michelli: Well, I really think the goal now is to understand … If you can understand at the individual level and deliver products that are segmented to individuals, boy, that’s amazing. But you should at least know your core customer demographics, you should know those four or five customers that are representing 80% of your overall product array.

Joseph Michelli: You should understand how each of those four are different, not only demographically based on their ages and lifestyle challenges associated with where they are in their stage of life, but you should really understand what they read, what they experience in terms of preferences of products, and you should be able to adjust the way you deliver your overall experience at least through those four segments.

Joseph Michelli: A lot of work gets done now on mapping the journey of each of those core segments, and we talk about that as branded segmented customer experience delivery. That’s where brands are playing now. If you think one size fits all and you’ve got four different key demographics, you’re probably gonna succeed with one of them, and the other three you’re gonna see creep out to other product providers who are more customized.

Jim Fitzpatrick: Okay, all right. So company culture and relationship with employees has a direct effect on overall customer experience, talk to us about that.

Joseph Michelli: Yeah, Richard Branson would say the employee is everything, and other customer-centric brands, Steve Jobs was always favorable to say the customer is everything. And neither of them are right, it’s a chicken and egg reality. The University of Michigan has shown direct linkage here.

If you can increase employee engagement, it has been shown to increase customer engagement, which has been shown to increase profitability. That’s the trifecta, right? It’s human experience creation that we’re focused on, whether you call those customers internal customers, employees, external customers, those who are consumers, it doesn’t really much matter as long as you’re constantly trying to engage both by creating human experiences that serve their needs, both practical and emotional.

Jim Fitzpatrick: And when hiring an employee to execute your customer experience vision, what do you look for?

Joseph Michelli: I think it really is about behavior interviewing because you can’t put in what God left out. If a person is not a human service provider, you can train the heck out of them, and they’ll be at best lukewarm and below average.

What you really are looking for is some basic aptitude in social intelligence, the ability to understand emotionally, some empathy for other human beings, the ability for you to take another person’s perspective, to diffuse conflict, to take that extra step. I call it “otherness”, it’s one of our brand values, and it’s either in there or it’s not.

I think a lot of us have become selfish over time, it’s all about me, me, me, me. Some people have no capacity to put that aside in their professional role to function on behalf of them, them, them. People who get it really succeed, I think the more you are directed toward others in business, the more success that comes to you. The more you focus on yourself, the fewer customers will come to you.

Jim Fitzpatrick: Yeah, for sure. So a friend of mine’s got a chain of retail stores, and he said with this unemployment rate so low, they’re referring to it as full employment now. If you don’t have a job now, you’re just really in trouble. Everybody’s hiring, everyone’s looking for good people.

He said, “The people that I have, I feel as though they are subpar for sure. But it’s the only ones I could get.” What do you say to somebody like that, that knows going in that we’re hiring people that are just not gonna live up to our standard, but we have to have somebody standing behind the cash register.

Joseph Michelli: It may be a starting point to keep the doors open, but I think over time you really are going to have to continually be recruiting and grooming more people to come into the cycle, and getting rid of the people who are really not capable of doing anything more than fog a mirror.

I often say that there’s no employees out there in retail food service because they’re all at Chick-fil-A. There are no good employees, they’re all at Chick-fil-A. How do they get to Chick-fil-A? Something about the culture of Chick-fil-A, something about the training, something about the investment in the people was longer term than simply just bringing in whoever we can get here and hope to keep this thing rolling, the other companies that have those employees.

I would suggest to you that, yes, it’s difficult, it’s harder than it’s probably ever been, it’s the same challenge for all brands. But some great brands have figured out that they may have to start there, but they’re not gonna end there. They’re gonna be on a constant journey to upgrading the quality of their people, and creating better and better experiences and holding those people accountable. And if it takes constantly recruiting to bring people in to backfill, so be it, but the only ones who are gonna stay are the ones who are capable of representing this brand that cares about people.

Jim Fitzpatrick: Right. So what do you say to the person listening right now that says, “I hear what you’re saying, Joseph, but man, these darn millennials just don’t really care. They just wanna come in and work as little as they can and take home a paycheck, and God forbid you say anything to them.” What’s your advice for them?

Joseph Michelli: Frankly, I’m always saddened whenever we characterize any group of people as being such. But the fact of the matter is, let’s say there are generational differences, there were from my generation to my father’s generation. The job for us is to figure out to take the best of both generations. Clearly, those baby boomers like myself don’t have it all figured out, nor do the millennials. Millennials can learn something from us, and we can learn something from them.

I’m a big fan of trying to create reciprocal mentorship relationships, because the millennials on my team have taught me so much about social media and social engagement, things that I have no organic sense about. And I have, I think in large measure, taught some of them the importance of thinking beyond the short term benefit to you when it comes to delivering a gift to a customer. I mean that in a sense of we both have to give and get based on our core competencies.

And if that’s true for some of the people you’re recruiting, then be the leader who grows them into something that’s gonna be more successful for them long term, and also be open as a leader to learn from them to help you grow as well.

Jim Fitzpatrick: That’s right. One person that I spoke to that owns a company said, “I lay down the law with them and I try to work with them the best I can, but if they don’t rise up to what our standard is, then they don’t work here.”

Joseph Michelli: I think … I’m not so sure what the law is anymore in anything in business, but I do think that largely we need to set expectations and we have to set behavioral expectations, and people who can’t behave in that way need to move on to other forms of employment.

I think that most people want to achieve and be great every single day, I think most of us wanna make a difference in our world and not just exchange carbon dioxide for oxygen. So, because of that, I think you can inspire most people to be greater today than they were yesterday, and that’s millennial, Gen X, Gen Z, you name whatever gen you want.

Jim Fitzpatrick: If the shoe fits, right?

Joseph Michelli: Exactly.

Jim Fitzpatrick: Customer experience strategies for new customer versus a returning customer, talk to us about that.

Joseph Michelli: I think the strategy should always be we want customers to not only come back but tell others. That should be the strategy.

Jim Fitzpatrick: Create fans.

Joseph Michelli: Now, if you have an existing customer, the goal is to groom them and maintain a relationship with them where they wanna tell others. A lot of times we have existing customers and we’re just chasing the shiny ball of the new customer acquisition. I love to bring the people in … The people who came to the dance, I want them to stay with me. I’ve already paid the cost of acquisition for them, I’d like to leverage them as part of my sales team.

So my job is really to get them to be advocates, to give me nines and 10s on net promoter scores, to tell them about the importance of the referral business, to see what I can do for them that would enable them, not only to enjoy their experience, but want others like themselves to experience what they have experienced through our business. That’s the strategy.

And if you do that, then the acquisition really handles itself instead of you having to really market a promise that people have to wait to see if you’ll deliver against in your experience.

Jim Fitzpatrick: Gotcha. Talk to us about your latest book.

Joseph Michelli: Oh, brand new book’s coming out this year, it’s about Airbnb, it’s called The Airbnb Way. And all of us are hosting, you’re hosting this show with me right now, I’m hosting people in my home here to share some ideas with them as well, we’re all hosting nowadays. In the share economy, it’s becoming increasingly important to help people learn how to deliver hospitality.

The new book is gonna talk about how does Airbnb encourage all those who represent the brand, all these independent business owners, to demonstrate an Airbnb belong anywhere experience. But at the same time, how do great hosts create this environment of welcoming, belonging, and engagement that we’re talking about for traditional businesses.

Jim Fitzpatrick: That’s awesome. When will that book be out?

Joseph Michelli: From your lips to God’s ears, as soon as McGraw-Hill can publish it, it’ll be out, and I’ll make sure that we keep you informed.

Jim Fitzpatrick: And what’s the name of it, what’s the title of the book?

Joseph Michelli: It’s called The Airbnb Way.

Jim Fitzpatrick: The Airbnb Way, which is along the same lines as all of the phenomenal books that you’ve already published, right?

Joseph Michelli: Yeah, we’re saying we’re now publishing customer experience from A to Z. We’ve written about Zappos, so now we have Airbnb, we’ve got a bunch in between as well.

Jim Fitzpatrick: That’s phenomenal. Joseph Michelli, I wanna thank you so much for joining us, this has been phenomenal today. I know that our viewers get so much out of it when you join us on the show, so thanks again, and let us know when the book comes out, we’ll put it on our website so that everyone can pick it up from Amazon or wherever it might be.

Joseph Michelli: I probably will just do that, Jim. Thanks so much for having me.

Jim Fitzpatrick: Thank you.

CBT News
CBT News
For over 10 years, CBT News has been informing and helping automotive retail professionals grow their businesses and thrive in their careers through an awarding-winning, on-demand streaming platform. With exclusive interviews featuring the biggest names in the industry, daily newscasts, up-to-date market data, and exclusive articles covering the latest trends, CBT News is your #1 source for auto industry news and content.

Related Articles


Latest Articles

From our Publishing Partners