Starbucks CEO Howard Schultz has a new book out (Onward: How Starbucks Fought For Its Life Without Losing Its Soul), and is making the PR rounds.
The book tells the story that during Starbucks’ meteoric rise in the early 2000’s, the company lost its compass and forgot its brand essence.
In a recent interview with Katie Couric, he explained that “Growth became a strategy, as opposed to an outcome…(It) wasn't about quality, and more importantly, it wasn’t about the customer or the partner.” And when he’s talking about partner, he’s talking about Starbucks employees.
This is an incredible admission on the part of a Wall Street scrutinized CEO, and I would make the case that Schultz is not alone in blaiming part of the problem on his company’s loss of focus. Some radio CEOs might be quietly nodding their heads in agreement. And while Schultz puts some of the blame on the economy, he explains the essence of Starbucks:
“We were never in the coffee business serving people; we were in the people business serving coffee.”
That’s an interesting take, and it speaks to that need to connect with the customer. At CES in January, Paul and I were amazed and pleased about how companies like Ford, Verizon, and Time Warner were all singing out of the same hymnal when they all proclaimed that “It’s about the customer.”
And as every CEO knows, it is a minority of customers that generates the majority of the revenue (or ratings). And it’s the same in pretty much every business on the NYSE.
So why then does radio often overlook, ignore, or even disdain some of its most rabid listeners? Whether it's rudeness on request lines (or simply not bothering to answer them), poorly training talent who interface with the audience in person, or making fun of regular contest winners – calling them “Prize Pigs” – radio oftentimes doesn’t get it.
Every successful company has a name for its most enthusiastic customers. For Starbucks, it’s “Super Regulars” – guys like me who are in and out of their stores 365 days a year.
In radio, they’re “Prize Pigs” and station employees have traditionally mocked them, laughed at them, and turned the other way when they visit the station to pick up a prize.
The fact is these are the types of people that radio should be cultivating and learning more about. How well connected are they on Facebook? Do they recommend the station to friends and others? How can we find more listeners who live and die with the station and the jocks?
When it comes to connecting with customer desires, radio is famous for asking the wrong questions. We find out their favorite songs, the station that plays too many bad songs along with the good ones, and how the music rates on the hard/soft scale.
But rarely, if ever, do we ask about what type of relationship our audience wants with the station they listen to most, and how radio can meet those needs and desires.
That’s the essence of social media initiatives – not “making money on Facebook.” Instead, the goal ought to be learning how to create, engender, and build better relationships with the local listeners who keep radio in business. That's a major focus of our new Techsurvey 7, which is in the field right now. Yes, it's important to know how many listen to Pandora and how many own smartphones, but a key is to better understand the level of engagement they desire with radio, and how stations can best meet those needs.
Radio can learn a lot from CEOs like Howard Schultz and Alan Mulally. Their companies are bigger than any broadcasting corporation, but their attention to the customer experience is what makes them successful.
Let’s retire the name “Prize Pigs” right here and right now, and dedicate our efforts to truly serving the listener – while she is still enthused enough about our brand to be a P1 or click “like” on our Facebook page.