A customer loyalty lesson learned from my friend’s emergency trip to the hospital

A friend of mine works at a Starbucks not too far from my house. I’ve known him for several years and he became a barista at Starbucks maybe a year or two ago.

Well, earlier this week he was rushed to the hospital because his lung collapsed. He’s been at the hospital ever since, sometimes returning home but frequently staying at the hospital overnight for observation. He seems to be doing okay, although we’re not yet sure why his lung collapsed.

Now here’s what shocked me: I just found out today that some of his Starbucks customers came to visit him in the hospital.

That’s impressive customer loyalty! In fact, that goes beyond customer loyalty to a true relationship!

Loyal customers are profitable customers. They buy again and again with very little prompting, and they talk up the business to others.

I’ve found that creating customer loyalty is rarely something that happens at the business level. It happens at the employee level. Customers may become loyal to businesses (and a lot of Starbucks customers are loyal to Starbucks!), but customers more frequently and more easily become loyal to the people in those businesses.

So, are you helping your employees create customer loyalty?

  • Give your employees the freedom to stop and chat with customers. By comparison, a lot of retail-based companies take the approach “if you have time to lean, you have time to clean”, and their staff rush around cleaning instead of pausing for a moment to strike up a conversation with a customer. The downside is that your employees might not get that counter as clean as you’d like it. The upside is higher profitability from customers who feel that they have a relationship with the person behind the counter.
  • Give your employees the tools to strike up a meaningful conversation and build a relationship. Not everyone is socially savvy, so a few conversation starters is a good way to help your employees.
  • Give your employees the freedom to go the extra mile for customers. They do anyway (everyone learns how to game the system to give a little extra to those extra-special customers) so why not help them by giving them lots of ideas.
  • Give your employees the authority to fix mistakes. Nothing takes away from loyalty-building like an employee who says, “I have to call my manager to fix that for you.” Help them know what challenges they will likely face and what an adequate response those challenges might be, then give them the authority to fix it.
  • Give your employees a reason to be proud of the company they work for. Do good things; make a good product; strive for high quality; smile a little and try to brighten your employees’ days.

When you have employees who love where they work and are empowered to fix things and have the freedom to build relationships, they will create massive amounts of customer loyalty.

There’s are risks that comes with this employee-specific customer loyalty, and I think that employers are so afraid of the risks that they skip the loyalty-creating ideas I’ve listed above.

The risks include:

  • Employees who create customer loyalty and are empowered to do so become more marketable and therefore potentially less loyal to an employer.
  • Customers who are loyal to employees may move with an employee if that employee quits and moves to a new business. We see this happening in industries like beautician/hairdressing, where someone moves to a different salon and advertises that old customers are welcome at the new salon.
  • Employees could abuse the additional freedom (intended for relationship-building) or authority (intended to fix problems).

These are risks, but the downside created by these risks can be mitigated with fair pay, empowering management, and an enjoyable work environment. Sometimes you will get employees leaving, customers following them, and employees abusing the system. But more often than not, you’ll get customers who become fiercely loyal to the employees who serve them.

How loyal are your customers? Are they so loyal that they would visit one of your employees in the hospital?

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Just read: ‘Seven Strategy Questions: A Simple Approach for Better Execution’ at Henry Alzamora’s blog

At Henry Alzamora’s blog, writer Robert Simons offers up seven questions that businesses need to ask themselves to focus their efforts and execute more effectively.

I’ll list the questions here, but go over to Alzamora’s blog for more details:

  1. Who is your primary customer?
  2. How Do Your Core Values Prioritize Shareholders, Employees, and Customers?
  3. What Critical Performance Variables Are You Tracking?
  4. What Strategic Boundaries Have You Set?
  5. How Are You Generating Creative Tension?
  6. How Committed Are Your Employees to Helping Each Other?
  7. What Strategic Uncertainties Keep You Awake at Night?

Read the questions and further explanations at: Seven Strategy Questions: A Simple Approach for Better Execution.

Lists like these are extremely valuable to help you focus and cut through the clutter of the things that vie for your attention. Take the time today to start answering these questions in your own business.

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Just read: “The food court king” at CanadianBusiness

Every mall has a food court and, it seems to me, basically the same options: Usually a couple of Asian food places, an Italian place, a burger-and-fries place, and a sub place. The brands are usually pretty similar from one mall to another (at least in the malls I’ve shopped in).

Turns out, someone has been dubbed “the food court king” for his growth and broad brand lines represented at many food courts across Canada.

Stanley Ma is the founder of MTY, a food services company whose specialty is branding. They have 26 brands (some acquired and some developed in-house) and over 1,700 stores across Canada.

Read the article here: The food court king. Don’t miss the key lessons from this article:

  1. Good growth is thoughtful, strategic, and patient.
  2. Effective branding is an asset.
  3. Successful businesses find synergies among its products and brands.

Learn more about MTY and see what brands they own at MTYgroup.com.

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HP places a big bet on its future competitiveness

HP recently hired former SAP CEO Leo Apotheker as their new CEO. Some people are calling it a foolish move. I think it’s smart. I think HP is making a big bet on a strategic move that could transform the company.

First, a little background, just to review some of the recent events at Hewlett-Packard:

  1. CEO Mark Hurd, who made HP into a lean, financially successful organization (with significant marketshare in hardware) in the past five years, was faced with a sexual harassment accusation.
  2. An investigation determined that the company’s sexual harassment policies were not violated but the company’s business and conduct policies were violated, due to some inappropriate payments from HP to an HP consultant with whom Hurd had a personal relationship.
  3. Hurd resigns.
  4. Hurd is hired by software giant Oracle.
  5. HP threatens that it will sue Hurd for a non-compete clause in his contract.
  6. HP backs off of their lawsuit.
  7. HP hires former SAP CEO Leo Apotheker as CEO.

That’s the backstory. Now let’s dig a little deeper:

Admittedly, Hurd did something stupid and his resignation is not a surprise. Oracle made a good move in hiring him because Hurd’s background as an efficient, cost-cutting machine will help turn Oracle (which tends to be somewhat inefficient because of its acquisition-heavy growth-plan) into a more profitable enterprise. [Note: It’s already doing well… but Hurd will make it better].

HP was wise to back off of its threat to sue Hurd. That would only attract bad press and make HP seem to be a poor loser.

But what about its move to hire Apotheker? That has been met with some mixed opinions. (If you haven’t yet, check out this BusinessWeek article which points out that SAP suffered under the 2-year-long leadership of Apotheker).

In spite of some of Apotheker’s baggage, I think HP is making an aggressive — and fairly smart — move. Here’s why:

Hewlett-Packard has long competed in the computer hardware space, easily straddling both retail and business sectors and enjoying a fairly significant marketshare (thanks to Hurd). Consumers probably think of HP as “the printer people”; medium and large businesses may have desktops supplied by HP.

The problem is, hardware is a commodity business and very price sensitive. Prices are aggressively decreased as low-cost competitors vie for limited dollars. Equipment is easily outsourced, driving costs and prices down. At the same time, businesses with pinched budgets look to extend a previous computer hardware investment by delaying equipment upgrades.

For companies with good marketshare, there is some benefit to being in this space (as HP has shown), but expenses are high and there is a lot of downward pressure on price, so profits are always a struggle.

The real money is in software. Software – especially enterprise software – can be expensive to development but, once built, it is very cheap to sell and install. (Similar to pharmaceuticals, where the first pill sold cost millions to develop but subsequent pills cost a mere fraction of a cent).

Not surprisingly, HP is looking to compete in the enterprise software space. HP offers some enterprise software solutions but their offerings pale in comparison to the offerings at Oracle and SAP.

SAP is the only company that offers any competition to Oracle. (Well, maybe IBM is up there, but I don’t think it’s as significant of a player). HP tends to be down one tier, competing with other smaller players for the scraps left over from Oracle and SAP.

Apotheker knows software, and as a former SAPer, he knows his main competitor Oracle. In fact, he likely knows more about Oracle than Hurd knows, he definitely knows more about SAP than Hurd knows, (thus he brings a superior competitive advantage) he likely knows more about enterprise software than Hurd knows, and he has experience in the enterprise software space – the very space that HP covets.

I believe Apotheker’s biggest challenge will be turning a hardware company into a software company. Apotheker’s primary experience in leadership has been in growing a software company. He’s been with SAP since the late 1980’s and although his work as a CEO wasn’t met with enthusiasm, he did have some success in the previous years where he founded country-specific versions of SAP and was president of regional teams.


  • HP has an interesting advantage over Oracle (and SAP). They have hardware in a lot of companies. I believe they could easily achieve a foothold in the same way that Microsoft does – by adding basic HP software on their equipment, then creating enterprise solution add-ons that customers can purchase which run seamlessly with the pre-existing HP software.
  • Find a space where Oracle and SAP are lacking and innovate there. (SAP has been slow to move into cloud-based computing and social media adoption. I think Oracle is a little better but maybe HP has an opportunity here).
  • HP should also start playing catch-up, Oracle-style: by acquiring or developing significant joint partnerships with smaller innovative software players looking for funding and growth.

Disclosure: I have written content for SAP (while it was run by Leo Apotheker) through a SAP content partner, and I am currently in a consulting contract with HP as a technical writer. These are my opinions only! I have tried to remain as neutral as possible and have not received compensation for this blog post, nor have I been asked or authorized to write it.

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