What is customer experience and why is it so important to your business? Regardless of your pricing, products, or positioning, at the end of the day you succeed or fail based on whether people enjoy working with your company. That comes down to customer experience, and it starts even before the top of the funnel and goes well past the purchase of a product. Yury Nabokov, the Customer Experience Manager at Machias Savings Bank (and regular co-host of this podcast) sits in the guest seat this week to help us improve our customer experience.
Rich: Well today is going to be a very exciting and special day in the Fast Forward Maine podcast booth. I’m joined by a transformative leader who is in the business of creating emotional, personal and engaging experiences. Currently he works at Machias Savings Bank as the customer experience manager and marketing strategist. He is also a frequent contributor on topics of UX, innovation and digital marketing. He brings a wide range of insights extracted from his previous work in academia, healthcare and entertainment.
In 2017 for his contributions to the digital initiatives at Machias Savings Bank, he was named Emerging Leader by the Bank Administration Institute. A year later he was presented with the Rising Star award from the New England Financial Marketing Association.
My guest holds two undergraduate and two graduate degrees, with the recent additions of executive leadership degrees from the Wharton School in strategic leadership and Rutgers University in customer experience. I’m very excited to be turning the tables on my friend and cohost of this very podcast, Yury Nabokov.
Yury: Wow. I’m delighted to be here, Rich. I cannot believe that you decided to have me on this podcast as your guest.
Rich: Absolutely. Now I’m going to turn the tables, turn up the heat. You gave me a whole bunch of questions, but I’m just going to ask my own. No, I’m just kidding. I did need some help kind of putting together this because I wanted to talk about customer experience, and who better to talk about customer experience than you.
Yury: I appreciate that.
Rich: So let’s start with a little bit of history. How did you start at Machias Savings Bank?
Yury: Well it’s been a lengthy journey. As you know, I’m an immigrant. I came from Russia.
Yury: Right? Yes, I came to the states in 2008. I started my academic pursuits at New England School of Communications. That’s where I got my second undergrad. And then I continued with Husson University where I obtained two Masters.
But the starting point in my relationship with Machias Savings Bank and becoming part of that family, it was a part time gig at the time of social media when the social media was still a fad. I was given an opportunity to experiment with their social media program and actually help them build a social media program part-time. And one of the coolest stories is that within the first 12 months of me collaborating with Machias Savings Bank marketing team, we managed to be named one of the Top 7 financial institutions in the United States of America, according to the Independent Community Bankers Association. So, yeah, and that was the starting point of my relationship with how I started with Machias Savings Bank.
Rich: Which is quite a recognition for what’s relatively at the time was a small community bank in the top right corner of the country. And to be number seven across the country is pretty impressive.
Yury: Yeah. You know, we actually also included that into our statement of conditions at the end of the year, because we were all shocked that our community recognized the work that we did so well and they just sort of reciprocated with the things that we thought would matter to them. So just win/win for both.
Rich: All right. Well today I wanted to talk a little bit about customer experience. So let’s start with some basics because I want to wrap my head around this. What is the difference between customer experience and customer service?
Yury: That’s a good question, Rich, I’m glad that you asked. Or I’m glad that I asked you to ask me.
Rich: It was on my short list.
Yury: Yeah, I figured that. Well, I think it’s important to mention that if you think about customer service you usually contact customer service when you have a predetermined condition, all you care about is to obtain the answer or resolve something.
However if you take a step back you think about how do you get there. Do you get to customer service through phone, through email, through chat? Is this process personalized, meaning do you wait on the line or do you preschedule when you want to be contacted? Whether it’s an emergency within the next couple of minutes, or when you have an opening in your calendar when you can schedule you want to be contacted at 12:30, because that’s when I take lunch when I have spare time.
So the process of getting there to get into your answer is actually the experience. So you know, that that would be the most basic way to explain the difference between experience and service.
Rich: So are there ways that you can measure customer experience? You’re in charge of customer experience for the bank, so what are some of the KPIs that your coworkers in leadership look to from you to be able to say, “Yes, we’ve improved our customer experience” or “Actually we’ve taken a step back”?
Yury: Perfect, thank you. So the three key components that matter to us or that part of our scorecard – the three measurements of likelihood to recommend – that’s your NPS (net promoter score). The second one is the overall satisfaction with products and services that we render to our customers. And the third one is convenient and easy, or the ease of doing business with Machias Savings Bank. So last year we completed almost 3,000 surveys that range from phone interviews with the customers, and retail and business and also email for transactions. Whether you interacted with the financial service specialist or you use online banking or mobile banking, and what is your overall experience with it.
And those three metrics are part of all of our studies. We conduct 11 studies across all the business lines. And so basically those are the areas that I oversee and then report back to the senior leadership team as well as the key stakeholders across the organization.
Rich: So are you doing those kinds of research projects yourself, or do you hire an outside firm to come in and do those for you?
Yury: There are different ways to tackle that. For the institution of our size with thousands and thousands of customers across the entire geography of Maine, it’s kind of hard to do it yourself. So we have a vendor that helps us to conduct those surveys.
But on the other hand, if you want to start kind of like, you know, implementing or developing customer experience program at your organization, you can start with interviewing your employees. You know, that’s the easiest and the fastest way to go about it to collect insights and feedback from their interactions with their customers.
Plus, if you have the existing customer base and you have a group of customers that are loyal or willing to share their insights, you know, just a couple of emails. That’s another way. And I think the most valuable way of conducting studies with your existing customers is actually interviews. Just invite them to the office, take them out for lunch, and run them through the list of questions that you have.
Rich: All right, so you’re doing both internal and external. And I think in a perfect world, that’s the best way to go. Very often somebody might like you and they won’t necessarily tell you if there’s improvements that should be made in customer experience because they want to please you or whatever it may be.
It was interesting that you said you should start with your employees. So obviously, flyte new media, much smaller venture than Machias Savings Bank. At this point in time there’s eight of us. And so you’re suggesting that for me to improve the customer experience or to get a handle on it, that I should talk to my employees first. What kind of questions would you recommend that I ask my employees if I wanted to improve?
Yury: Well, you know, if we’re thinking about improvement, a couple of things we’re thinking about most likely, retention of the existing customers. So the staff – your team – are the ones most likely to interact with your customers. And the first question would be, “When was the last time you talked to X, Y, and Z? What are the needs of those customers?”
So when you start developing those line of questions, thinking from the point of view of how can we increase or improve the experience of our customers. What value can we add? How often do we interact with them? And then quite honestly, how often do they want us to interact with them?
If you don’t have those type of things, those are the questions that you should be asking your employees. From there, if you think about customer experience, I think it’s an iterative approach. You know, right or wrong, as long as you have something then with the insights from your employees, I think you can start building that program.
Rich: So as we start to find maybe problems in our customer experience, places for opportunity for improvement; maybe the lines are too long, maybe the parking’s no good, maybe there’s been some bad customer service experiences that we’ve had in our companies. What are some of the steps that you might recommend that we take to make changes? And obviously it depends on what are the problems. Parking is going to be a different issue than bad customer service. But when you start getting this data, how might you roll it out so you’re making some real improvements in the customer experience?
Yury: Well customer experiences sounds like a very broad topic. Anything you touch is customer experience. The way the website looks, the way the customer schedules meetings and appointments, it’s all part of the experience. So one of the very helpful tools that you can utilize to determine the areas for improvements or the things that you should be paying closer attention to is called ‘customer journey map’.
And a couple of things for those who are listening, I actually have an example of a customer journey map in front of me, so I’ll try to describe it for the audience.
Rich: Oh, that’ll be easy to describe.
Yury: Exactly, right? So, you know, uh, on two axis, a horizontal and a vertical axis. So on the horizontal axis we are mapping the five stages in the ways customers interact or consume our services. So the first one is the ‘awareness stage’. That’s when the customer identifies a type of issue or a problem they’re trying to resolve.
Rich: I see. I have too much money in my mattress, I should find a bank.
Yury: I love that. So then, you know, we transition from awareness to ‘consideration’. That’s when we identify the problem as a customer, then who is the best service provider to address the issue.
From there we get into the’ acquisition’ part. That’s when me as the customer is choosing between all sorts of agencies and I’m coming to flyte. So that’s the acquisition part.
Then actual servicing, how does your company address my needs? You know the, how do you render whether it’s meetings, phones, all sorts of things. And then the final piece on that horizontal axis is the ‘retention’. What does your team do to retain me? So you know, that’s kind of like these are the customer’s stages and the customer life cycle.
But if you draw the vertical axis, that’s where we’ll list the customer goals, customer actions, touchpoints and channels, customer thoughts, overall customer experience, pain points and opportunities to improve. So that’s the areas where you can actually list a top and bottom, meaning customer facing experience, what the individual experiences. And on the back end, what type of steps your employees are taking, whether they’ll log in information into the CRM or they’re following up with you to have a brainstorming session.
So when you start, plotting those type of journey for a specific customer, then you start identifying the opportunities for improvement and actually identify areas that you may have not even considered prior as part of the experience.
But one thing that I want to make sure that we all understand is, you need to conduct those customer journeys for a specific customer. So you can’t just say, “Customer is doing X, Y, and Z.” We have personas. So if you think about generational differences, millennials or whatnot, kind of like a tech savvy individual who value their time and would like to have more self-service options. Versus an individual who may not necessarily be keen on using technology but would like to have face to face. So their experience may be they will be obtaining the same product and service, but the way they get there is totally different.
Rich: They may be taking a different path, and that makes sense. So for you also, besides just the generational thing, for a bank it may be about commercial versus residential type things, people looking to save, people looking to borrow. For us it may be somebody who is looking strictly for a website versus somebody who has a website and looking for marketing help or looking for LinkedIn training or whatever, and each one might have a different one.
But that matrix that you mentioned before, so that helps us I think almost like before we get started, kind of come up with a game plan. But of course once the game starts, everything changes. So that’s where I think those surveys come in and the research comes in to continually improve because we may think we know what a good customer experience is, but it’s up to the customer to tell us. Correct?
Yury: Well one of the examples that I think is a fairly good success story that I love to share is, we recently launched a product that allowed our customers to basically begin the relationship without even leaving their homes, just on their mobile device. But when we launched the product we celebrated, everything looks great, everything works, we’re just crushing it. Here we are.
But then we start collecting information for this particular type of interaction with the customer. And we started identifying that, first of all there was a very low conversion rate. It’s like, wow, what’s not working? It’s convenient, it’s fast, and it’s easy. So after collecting a couple of surveys, we actually discovered that the reason there was a very low conversion rate is that customers didn’t have enough information. And we were like, “Oh, wow. It seems so simple”. But you know, without actually collecting this information, we wouldn’t have known what the problem was. We had a hypothesis that we should maybe increase a phone size or increase the button. So you get into this kind of like a rabbit hole without really knowing what the problem is, because every single everything seems to be a problem when there is something that is not really working and you can’t really pinpoint it. So you know, those surveys really helped us to find a solution fairly quickly.
Rich: So I noticed in your notes you’ve got something about the voice of the employee versus the voice of the customer when it comes to all this. And obviously our employees are often the people who are actually having contact with the customers. Why is it so important to pay attention to the voice of the employee when we’re thinking about the customer experience?
Yury: Well, a couple of things. It is important to understand that they are, first of all, if they are the ones who interact with the customers the most, certain things we may not have even identified through the interviews because it’s kind of like a retrospective. A customer had an experience, we may not be able to reach them right after that experience happened. But in the moment when the customer is face to face or on the phone with our service representatives, that’s the opportunity for us to capture this information.
And our employees are the very first ones to actually identify the problem with the customer. They’re the ones who can identify the patterns, if those patterns emerge on an ongoing basis again and again and again. You know, if customers are always asking like, “I don’t know, your hours of operation on holidays.” So that employee may actually get fed up with a question, then say to the team like,”Hey guys, is there anything we can do about it? Maybe a banner on the website or an update on social media and stuff like that.”
The other thing, also why the voice of the employee program is critical, it also gives you opportunity to identify ways to empower the employees to resolve the problem. Because if the employees don’t really know that you actually have a program that is focused on improving customer experience, they may not even know who to report about the existing problem. They may address it in the moment and they may think that that’s the best way to go about it without actually resolving the issue itself. So, that is another element to keep in mind.
Rich: They also may make a short term poor decision because they’re looking to, “Oh, I’m going to not do this because it’ll save money for the company”, not realizing that they’re jeopardizing the long-term success of the company because we’ve decided that customer experience is at the forefront of our relationship. And not understanding that having those communication opportunities is critically important, I would say.
Yury: And you know, speaking about opportunities, I think it’s important to mention that customer experience is a mindset as well as a strategy. Because if you think about customer experience and the needs of the customer as the core of your business, some of the decisions that you’re going to make may actually be not financially rewarding short term. In the long term, yes, but short term it may be kind of like an upfront investment that is just basically costing you money. So if you want to be a customer focused or customer centric organization, it needs to be a part of your culture, it needs to be a part of your mindset, as well as the part of your policies, procedures and your strategies.
Rich: And it is critically important. And something that’s happened at flyte over the years is, we have a piece of project management software that really streamlines the process of designing and building a website. And it’s really great for our team because everybody knows exactly what the project is and we can tell if we ahead, are we behind, all these sort of things. We can communicate with the client that way.
But what we’ve discovered over the years is there’s a percentage of clients who absolutely hate that piece of software and they just want to email us. And it took us a while because we were like, no, no, no, trust us, this is better. But it wasn’t better for them. So we do a little bit of extra work for those type of clients now and we’re like, listen, if you want to call us call us, if you want to email us, email us. We’re still going to document everything in this piece of software because we need to internally. But I don’t want to put you through that. If you can’t stand looking at that thing, you don’t ever worry about again.
And you know, that’s just another opportunity where you sometimes need to take a look at the long term value of the clients – especially when you get into retention – versus the short term, like, but it’s easier this way. Because that’s just not going to keep clients who are like, “Yeah, it was really efficient in the most painful way possible.” They’re not going to stick around.
So I was just talking the other day to our mutual friend, Jay Baer, and he’s all about the customer experience for sure. And he really feels that customer experience is going to be – if it’s not already – the new differentiator. Like at the end of the day, customer experience is all that matters. What do you feel about that?
Yury: Well thank you for asking. You cued me up quite well. I have three different stats that I wanted to share with the audience as well as you, Rich and Cody.
So the first one is the Tompkin Group found that companies that earn $1 billion annually can expect to earn on average – and listen to this – an additional $700 million within three years of investing in customer experience. So that’s revenue boost.
According to a Walker study, they found that by the end of 2020 – here we are – customer experience will already take price and product as the key brand differentiator.
And the third one is, going back to the price and the experiences, that according to research from PWC (Price Waterhouse Coopers), 86% of the buyers are willing to pay more for a great customer experience.
So it’s no longer about products and the price. Customer experience is starting to be at the forefront of what determines the decisions that we make and how we go about choosing the brands that we want to make part of our interactions or part of our lives.
Rich: I think that makes a lot of sense. And obviously products and price are always going to play a part, but that also just falls maybe under the umbrella or into the lens of customer experience. You know, we all have those moments in everyday life where we’re willing to pay more or wait longer for something that has more perceived value for us because we want to be associated with that brand, or we love the farm to table experience, or we really like this band instead of the other bands so I’ll wait in line for that band if that’s what it takes, whatever it may be.
So customer experience may just be a better lens to use going forward where it’s not just like there’s only one person selling a bagel and that’s the bagel I’m going to buy, where there’s so many different choices out there. It really comes down to what is the best experience that I can get, and that’s what people are willing to pay for.
Yury: You know, one of the fairly recent experiences that I was very moved by. Last weekend my wife and I went to Boston, she wanted to see her food blogger, it was her book tour. So we went there and I actually returned to the hotel where I stayed prior before. Before we came back I emailed them ahead of time and I said, “Hey, you know, it’s something very special my wife and I are doing, I just wanted to let you know I’m coming back. I loved the experience the first time so looking forward to another great time.” So when we came back, first of all, they knew that we were coming. They gave me a list of recommendations of the things we should do while we were checking in, because you know, the check in is fairly simple these day. And on top of it they threw a room upgrade because they knew it was a special thing for me. And all they said is just, “We really hope that you will enjoy your day in Boston”. It didn’t cost them anything, the room was available as is, and it wasn’t booked so it was just sitting idly there.
But now I am a brand ambassador. I’ll always tell everyone, if you’re planning your trip to Boston, please stay at Yotel. It’s a thing. It is a kind of like a minimalistic experience. You have a fairly exquisite internal design, but again, minimalistic with a safe space. And yeah, I mean, anyway, just do it.
Rich: All those safe spaces are important. Alright Yury, here’s the question I’ve been waiting for. You’ve probably been practicing in front of a mirror. If you could change one thing about the business ecosystem here in Maine, what would it be?
Yury: I think the most important thing that I would focus on is actually changing the brand of Maine. I want people across the nation know that Maine is not the destination to just retire or visit during the weekend. I think Maine has a phenomenal culture, hardworking people, and a great environment. So, you know, we need to start focusing on better branding for our state. And we need to demonstrate that it’s the place where you can come to and make your dreams come true. And I did it for myself 12 years ago when I came to the United States of America, and out of all the places in this beautiful country, I decided to stay in Maine.
Rich: All right. This has been fantastic, Yury. It’s been fun to put you in the hot seat. Where can we send people if they want to connect with you online?
Yury: Feel free to hit me up on LinkedIn. Y U R Y Nabokov, just like a famous author, or, visit my personal website, yurynabokov.com.
Rich: Awesome. Yury, thanks so much for staying here today. I appreciate it.
Yury: I’m looking forward to the next two hours with you.