How to Create a Superstar Customer Experience

What's going on everybody! Welcome to the First Class Founders podcast. The goal of this show is to equip you with powerful mental models and frameworks so that you can master the art of decision-making. On each episode, I introduce and apply these concepts in real-world scenarios. My name is Yong-Soo Chung and I'm the Founder of Urban EDC, an e-commerce brand selling everyday carry gear, and GrowthJet, a Climate Neutral Certified third-party logistics company. 

In today's episode, we're going to discuss how to create that perfect customer experience, one that could earn you a theoretical 10-star review on a customer review. We're going with 10 stars because on a typical rating scale, it only goes up to 5 but today, we're going to shoot for the holy grail - a 10-star review that goes beyond the 5 out of 5 stars.

Next, should you ever fire your customers? What about the popular saying "the customer is always right"?

By the end of this episode, you should have a clear idea on how to enhance your entire customer end-to-end experience and know when you should let go of a customer.

Plus, you'll want to stick around until the end where I discuss a simple framework when it comes to approaching customer service that will change the way you think about customer experience and customer support, which in essence, is a subset of the entire customer experience. I'll explain why later in this episode.

Let's get down to business!

Let's begin today by breaking down what a customer is. A customer is any person or business that is paying for your product or service. I know this may sound pretty basic but hear me out on this.

So let's say you are a solopreneur, growing a newsletter business for which you're getting paid via sponsorships.

Who is your customer? Is it the readers of your newsletter?

No, not exactly. 

Technically, your customers are the companies that have chosen to sponsor your newsletter, not your readers.

You might be thinking... wait, that doesn't make any sense. Isn't my job as a content creator to provide as much value to my audience so they continue to open and read my newsletters?

Well, yes... but your audience isn't your customer. You want to provide as much value to your audience so that you can keep attracting your customers, the brands who will sponsor your newsletter.

Ultimately, your sponsors are the ones paying your bills, the software that you're using, your team, and any other expenses you may have.

It's incredibly important that you know who your actual customers are so that you can begin thinking about their user journey.

We'll revisit this growing newsletter business in a bit.

Now, let's shift gears and talk about the elusive 10-star review.

I've adopted this from Brian Chesky, Co-founder & CEO of Airbnb.

So what is a superstar experience? 

If you want to build something that’s truly viral, you have to create an absolutely incredible experience that you tell everyone about.

So in Brian's case with Airbnb, he took the guest experience and imagined what a one, two, or three-star experience would be. 

For example, let's say you book a place on Airbnb. You finally get to your destination. You're tired and exhausted from traveling several hours. You knock on the door. They don’t open. You knock again. No answer. If they never show up and you’re upset and you need to get your money back, that’s a one-star experience. Now for a two-star experience, maybe they finally let you in but the place is messy, your neighbors are loud, and they didn't provide any clean towels. Maybe it's a three-star experience if everything is great but there is no heater and you are freezing during the night.

Okay, so what would a five-star experience look like? You knock on the door, the host lets you in immediately and you stay there comfortably for a night. Great. That’s not a big deal. You’re not going to tell every friend about it. You might say, “I used Airbnb. It worked great.”

So let's go beyond 5-stars. What would a six-star experience be?

A six-star experience: You knock on the door, the host opens and welcomes you by giving you a tour of the house, and perhaps there would be a welcome gift on the table. It would be a bottle of wine, maybe some cheese and crackers. You open up the fridge. There’s water. You go to the bathroom, there are clean towels and toiletries. The whole thing is great. That’s a six-star experience.

So what’s a seven-star experience? You knock on the door. The host greets you and says, "Welcome! I know you're into surfing, so I left a surfboard out here for you. I’ve also compiled a list of all the best places to learn surfing. It’s going to be an amazing experience. By the way here are the keys to my car. You can use it to go surfing. And one more thing - there’s a hot new restaurant that just opened up down the street. I got you a table there tonight.”

Okay, you get the idea. So what would a ten-star check-in experience look like?

A ten-star check-in would be like this. You'd get off the plane and there would be a swarm of people cheering your name welcoming you to their country. A private limo would be waiting for you and as you step into the limo, your chauffeur hands you a glass of your favorite wine celebrating your arrival. You get to your destination, and the host comes out with his entire family and welcomes you with the best home-cooked meal you've ever had. The entire stay is perfect and you've made a lifelong friend with the host.

Now, some parts of this experience may not be feasible. But the whole point of this exercise is for you to think beyond the typical five-star experience and shoot for even higher.

You have to reverse engineer the hypothetical ten-star experience. Suddenly, having a surfboard in the house may not seem too crazy, right? It might be challenging logistically, but this is the kind of stuff that creates a great experience.

Do this same exercise with your own customers in your business and you may uncover parts of their journey that you could improve without adding additional overhead.

Speaking of reviews, if you're enjoying this episode so far, please consider giving us a 5-star review on Apple Podcasts or Spotify by going to firstclassfounders.com/review. I read every single review and it would mean a lot to me. I would really appreciate it!

Okay, now, I want to go back to the earlier example we did where you have a growing newsletter business.

Let's say your newsletter is thriving and you're attracting a lot of brands to sponsor your newsletter.

You get an offer from 2 different types of companies.

The first sponsor is a great fit for your audience and is willing to work with you on your terms but their budget isn't big so their offer isn't that great.

The second sponsor will pay you a lot more but they're being very demanding about the placement of the ad within your newsletter. They want to use larger images and a larger size font to really stand out. It might compromise the look and feel of your newsletter.

Which sponsor should you pick and why?

So let's say you go with the bigger sponsorship deal. You're in a cash crunch and you're thinking, I'll just make an exception this time. Just once.

You sign the deal and start inserting them into your newsletter without much consideration for how the new larger placement with images might impact your readers' experience. 

Then, you start noticing your open rates going down significantly with each newsletter campaign.

You think to yourself, this is not good. What happened?

Well, it turns out that the new placement of the sponsorship is too loud and it's turning off your audience.

So you reach back out to your new sponsor and explain to them what's happening. Then, you ask if they would be willing to be flexible and go back to your own terms of the sponsorship placement for a lot lower price.

Your new sponsor is furious. They're not backing down and now, they're becoming even more demanding about their placements. What a headache.

So what should you do here?

Should you keep going and let your audience engagement decline for a while?

In this case, it might be best to fire your customer, who is your sponsor, and say goodbye.

Quite often, I see entrepreneurs falling into the trap of putting too much weight into the monetary side of a deal and not enough consideration for the other variables in play.

I've made this mistake myself and I learned the hard way when it comes finding the right partnerships.

In my own business, GrowthJet, we had one client who at the time was our largest paying client. He treated our team with disrespect and when he left eventually, he ended up leaving us with 2 unpaid monthly invoices after he kept promising us that he'd pay. Then, he started ghosting us becoming unreachable via email and phone.

It took us 6 full months after hiring an attorney and threatening to sue the company that he finally paid.

In hindsight, we should have seen this coming with this particular client and ended the relationship much sooner to avoid the headaches that we had to endure in the aftermath.

The important lesson here is that you can and should fire your clients if they're being problematic to you or your team or compromising the integrity of your service or offering. 

There will be plenty of other partnerships in the future and finding a great partner who understands your needs as well as theirs is important for fostering a long-term, two-way relationship.

If the partnerships you find are purely one-sided, you'll struggle to work with them.

Find partnerships in your business who you enjoy working with long-term, even if that means taking the less lucrative path in the short term. You'll thank yourself later.

Remember that you always want to play the long game with the right people. Your results will compound much faster this way over time.

One more side note on this newsletter sponsorship example before we move on.

I mentioned earlier how your sponsors are actually your customers, not the audience you're writing to.

This creates an interesting dynamic where you are serving your readers but you're getting paid by someone else.

So what can you do when your audience, the readers that you're serving, aren't your actual customers?

Well, in the sponsorship model, you should do your best to really seek out sponsors who you personally would recommend to your audience.

In other words, you should think of your sponsors as an extension of your personal brand.

Does the sponsor embody the same ethos and values as you?

Ideally, this is a product or service that you personally use on a daily basis and you genuinely love.

While the sponsorship model can work well if done right, in my opinion, the better business model is one where you're in financial alignment with whom you're serving. 

Meaning, if you had a subscription model where your readers paid you each month for the valuable content that you share each week, this is a vastly different business model that's directly aligned with serving your customers.

Here, you don't have to worry about compromising your readers' experience in any way. You can just focus on creating the best content for your audience.

Always ask yourself who you're serving and if your paying customers are aligned financially with the goals of your audience.

And that is exactly why we don't have any sponsors for this podcast and instead, we use a subscription membership model.

It allows us to stay true to serving our listeners directly without an added layer of potential conflict of interest.

So, this would be a great time to tell you a bit more about our First Class Founders Membership and what benefits come with becoming a member.

All billionaires have one thing in common: they master the art of decision-making. Throughout their lives, they collect great frameworks and mental models and call on them when needed. And that is why First Class Founders exists. The main benefit, the reason why you want to listen to First Class Founders, the reason why you want to upgrade and gain access to all of the members-only perks is because First Class Founders gives you the tools to build your very own problem-solving toolkit so that you too can become a great decision maker like Charlie Munger, Jeff Bezos, and Elon Musk. If you want to get the most out of First Class Founders, head on over to firstclassfounders.com/join. You'll get access to monthly bonus episodes delivered to you via a private, members-only podcast feed. You'll also be able to participate in a monthly Ask Me Anything episode, also released through the private podcast feed, which by the way, removes all interruptions like this one so you can enjoy a clean listening experience. Your support will go directly towards making the First Class Founders premium members-only experience even better so that all of us can keep learning and growing together. Again, you can go to firstclassfounders.com/join.

Okay, back to the show.

Let's end with a framework that will help you re-think what customer support is.

So earlier in the episode, we mapped out what a ten-star customer experience might look like. Bring back your customer journey for a second.

What is the function of customer service within this customer journey?

It's actually quite simple - customer support steps in when the expectations of your customers don't match the reality of what your customers perceived to be true in the first place.

Let me repeat that one more time.

Customer support exists to fill in the gaps between your customers' expectations in their journey of what should have happened vs. the reality of what actually happened.

Let's do a very basic example so that you can grasp this concept with more clarity.

Let's say you have an e-commerce business selling candles.

Your customer is browsing your website casually going through their usual customer journey.

This customer loves the scent of Sandalwood and discovers that you sell a Sandalwood scented candle.

They add the item to their cart. During the checkout process, your website states that you ship out orders the next day. Your customer is excited because they have a house party coming up that weekend and this candle would be perfect for the party.

Okay, now let's pause right there.

What have you promised them so far?

1) You've promised them a candle that smells like Sandalwood and...
2) You've promised them that you'll ship the candle in a carefully packaged box the next day so that they can get the candle in time for their house party that weekend.

Now, these are expectations that this customer has as part of their user journey.

If any of these expectations or promises are broken, you're going to hear from your customer.

And this is customer support.

In a perfect world where your customer journey is mapped out perfectly where clear expectations are laid out and met consistently, you shouldn't have any support requests. But we all know this is unlikely.

So in a nutshell, customer support fits within the journey of your customer. It's a subset of the entire customer experience. Any time there is a discrepancy between expectation vs. reality, you're going to increase your customer support requests.

Now, let's say you're seeing a sudden uptick in your customer support requests.

You're getting overwhelmed by the number of requests increasing.

To resolve this, you should always use the Pareto principle, otherwise known as the 80/20 rule.

The 80/20 rule is a common mental model that states that roughly 80% of outcomes come from 20% of causes. In other words, a small percentage of causes have an outsized effect.

Here, you can use the 80/20 rule to identify what your bottleneck is and prioritize it so that you can significantly reduce your customer support requests.

We did a deep dive into bottlenecks in episode 4. If you want to know the difference between bottlenecks and constraints, and how to use constraints to empower your business, give it a listen! I'll link it in the show notes.

It's critically important to eliminate bottlenecks from your business flow. 

Think of your entire business operation as a production plant. Everything is humming along until something breaks in the process, which in turn, increases your overhead cost in both time and money.

You want to catch your problem early in the production line. The further you catch your bottleneck, the bigger the cost of fixing it.

For example, going back to the candle shop, let's say that your customers are blowing up your inbox saying that those Sandalwood scented candles actually don't smell like Sandalwood.

Now, we have to identify what the bottleneck is. Did your manufacturer change the ingredients? Or did they mislabel the candles themselves? Or did your third-party logistics partner mislabel the products?

Identifying the problem earlier in the workflow and stopping it will reduce your cost and headaches. If it turns out that your manufacturer mislabeled the candles, you could add in a QC process with your manufacturer to make sure the candles all smell the way they should. Here, you're catching the problem early in the production process to help you eliminate the cascading downward impact as the mislabeled candles get shipped to your customers.

What you don't want to do is attempt to just fix the issue by sending a replacement candle to your customer and that's it. Always be identifying your bottlenecks to its root cause and implement a process change that will resolve all future issues.

Let's summarize today's lesson.

When you think about your customer journey, try imagining what a ten-star experience for your customers might look like. Not everything might be feasible, but you may find some hidden gems that you can implement right away.

As for your customers, be pickier about who you want to work with long-term. Never prioritize short-term benefits over long-term goals. Don't be afraid to cut ties with your clients if they're being unreasonable in their requests.

Lastly, when you think about your entire customer experience, remember that customer support requests are simply the gaps between your customers' expectations vs. reality so do your best to set proper expectations and craft a customer journey that reflects that.

Before we end, I'll leave you with one more story that ties all this together.

A few years ago, Steve Wynn, founder of Wynn Resort & Casino, was staying at a Four Seasons with his family in Paris. Excited to check out the city, they ordered breakfast to their room to get a head start on their day.

Wynn's daughter only ate half of her croissant, carefully leaving the other half for later. Now at this point, her expectation is that her half-eaten croissant would be left untouched when they returned back from exploring the city.

But when they got back, his daughter was crushed to see that the croissant had been taken away.

Here, Wynn's daughter's expectations fell short of reality.

But then, the entire family was surprised by what happened next.

The light on the hotel room telephone was blinking, indicating that there was an unread message. It was the front desk explaining that housekeeping had removed the half-eaten croissant, thinking that they would prefer a freshly baked croissant upon their return instead.

It turns out that the hotel kitchen crew had been notified and a new croissant had been set aside for Wynn's daughter, ready to be delivered whenever she wanted.

This demonstrates an important point in designing a customer experience journey.

You should always think about ways to surprise and delight your customers. Instead of just filling in the gaps with customer support when their expectations aren't matched with reality, think about how you can leave little positive surprises along their journey to exceed their expectations. 

This is a great way to separate yourself from other competitors in your industry.

Okay, that's it for today!

On the next episode of First Class Founders, it's all about productivity. We're going to dive deep into some of my own favorite productivity frameworks and mental models so that you can accomplish more within the same amount of time. If you're a productivity nerd like me, you don't want to miss out on this one. Tune into the next episode!

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Thanks for listening and I’ll see you on the next episode of First Class Founders!