Starbucks Invests in Its Employees



The Importance of a Holistic Approach to Building Brand Loyalty

Brand Loyaltypic
Brand Loyalty

Blue World Voyages CEO John B. Richards is a well established presence in the Scottsdale, Arizona, community who has engineered growth strategies for a number of leading corporations including Starbucks and Life Time Fitness. In the recent LinkedIn article “Where does your Loyalty Program stand? Is anyone safe?,” John B. Richards shed light on the challenges of building brand loyalty within a disruptive digital marketing environment.

While software-driven big data provides actionable, real-time insight into customer performance hierarchies, this alone is not enough to maintain loyalty among today’s easily distracted consumers. The most effective approach uses a holistic combination of “high impact information” and focused engagement that emphasizes building meaningful relationships.

Ideally, these relationships involve several factors that create “a lifetime of value,” including purchase quality, frequency, and growth, as well as the overall depth of the connection. While data-driven approaches can better target offers, branding, and rewards, engagement is a “high touch” undertaking that requires exceeding expectations in the actual product or service delivered. Over-engineering loyalty awards can have a negative effect when the consumer is bombarded with complex and confusing information, and even erode a customer’s brand allegiance.

Retail in a Changing World – the Starbucks Experience

Starbucks pic

John B. Richards has engaged with various companies where he significantly contributed to their growth and success. At Starbucks Coffee Company, John B. Richards was president of retail in North America then promoted to president of North American operations. He presided over stunning sales growth from $400 million to $2.5 billion on the back of rapid store expansion, which peaked with a new store opening every 18 hours.

Sharing his Starbucks experience, Mr. Richards notes that retail has been coming under threat from technology, namely in the form of the Internet and e-commerce. Yet Starbucks retails a very traditional product, coffee, and has managed to grow and prosper. The company focuses on several service principals, including choosing locations that are both convenient and high traffic, a consideration often overlooked by entrepreneurs.

The retail beverage company also focuses on transaction efficiency and speed as time has become a more precious commodity. The Starbucks Card cut initial transaction time, as swiping it was quicker than making purchases with cash.

Lastly, the company embraced technology, focusing on leveraging the Internet to improve service and create brand loyalty. It introduced online ordering and launched a loyalty program to reward patronage. Thus, in a technology dominated world, there can still be success in retail by focusing primarily on service principles.

The Four Seasons Model of Customer Service

Four Seasons Model pic
Four Seasons Model

Drawing upon extensive experience in the retail and service industries, John B. Richards provides strategic direction that leads to business expansion. For 10 years, John B. Richards served as Executive Vice President of Four Seasons Hotels, helping build the company from eight to 42 properties during his tenure.

Part of the reason for the global success of Four Seasons is its service culture, which has four elements:

1. Who we are. Four Seasons defines itself as a leading entity in the hospitality industry that focuses on the quality of its service and locations. In doing so, the company satisfies the needs of its customers and positions itself as a leading hospitality brand.

2. What we believe. A belief that the company’s people are its most important asset is critical at Four Seasons. All employees have a sense of pride in everything they do, and they carry themselves with dignity as they work together to achieve the company’s larger aims.

3. How We Succeed. At Four Seasons, success is defined as achieving a reasonable profit while providing benefits to guests, employees, and the hotel owners.

4. How we behave. Operating on the idea of “do unto others as you have would have them do unto you,” Four Seasons treats guests, employees, and business partners with respect and a professional attitude.