January 19, 2012
NRF: Hospitality Dwarfs Service
Danny Meyer, CEO and founder of Union Square Hospitality Group, believes providing good service is only the starting point to delivering on customers’ expectations. Instead, hospitality, which involves connecting with consumers at an emotional level, is where retailers should be looking to tap the “most powerful differentiator” for their business.
Mr. Meyer, who owns 25 restaurants in New York City ranging from Union Square Café and Gramercy Tavern to Blue Smoke and Shake Shack, spoke Tuesday at the ARIL Customer Service Awards luncheon at the NRF convention. He is also the author of the best-seller, “Setting the Table.”
If a dining or shopping experience was graded on a 100-point scale, only 49 points would relate to service or performance, with the remainder tied to hospitality, contends Mr. Meyer.
Good service — roughly defined as providing a quality product and delivering it efficiently — is now largely expected across businesses, especially with blogs and websites like Trip Advisor and Yelp spelling out shortcomings. He also noted that the “shelf life of a good idea” has evaporated with the word-of-mouth capabilities of the internet.
With the challenges of differentiating around quality and service, Mr. Meyer said that retailers must increasingly endeavor to create “an experience where people feel like if they don’t come to our place of business, they’re missing out on life’s great experiences.”
That’s where hospitality comes in. He said hospitality “is about the experience on the part of the person receiving your performance whereby at the end of receiving your performance, they are made to feel that you are on their side.”
At his restaurants, hospitality comes from the servers that command a high HQ (hospitality quotient). A high-HQ person “is at their happiest when they’re making someone else feel good.” They have an innate ability to make others feel comfortable and particularly “know when I want them and they know when I don’t want them.”
He urged retailers to similarly focus on hiring high-HQ staffs and then “unleashing their personality” at the store level. While competitors can replicate many of the service aspects of the business, “no one on earth can take out their iPhone and take a picture and copy that feeling.”
Adds Meyer, “It doesn’t cost more money to look somebody in the eye and smile and ultimately it doesn’t cost more money to hire people who care deeply about how they treat each other.”
BrainTrust
Recent Discussions
Discussion Questions
Discussion Question: How does the concept of hospitality expressed in the article relate to the retail space? What lessons could a server at a high-end restaurant offer to a store associate?
Poll
Love the quote about taking a picture and not capturing the feeling. So important. I think it is important to realize that those high HQ employees are rewarded by tips so they not only “can” do it, they are rewarded “for” doing it.
That’s why I think the only hope for struggling retailers is to connect their service/or lack thereof to pay. I choose commission as you all know, but you have to reward the individual for connecting to another individual — not the whole crew.
The wall so many initiatives hit is the analytical personality saying, “Yeah and how do we do this with $8 employees?” Zactly.
The difference between providing “customer service” and “hospitality” (or the equivalent idea in retail) can make the difference between a satisfied customer and a committed one. Bridging this gap — from satisfied to committed — becomes a vital part of any company’s customer relationship and brand management programs.
The challenge is the sheer number of retailers and service providers who need to get the basics of customer service figured out first. It’s surprising how many retailers still don’t operate efficiently and still can’t get the right goods on the shelf when the customer expects to find them. (And non-retailers need to do a better job providing their equivalent of “goods on the shelf.”) Get the first step right, and the second step — toward hospitality and customer commitment — becomes easier to achieve.
Great customer service is as important in retail as it is in restaurants. Creating a welcoming environment at retail is a vital part of overall customer satisfaction. Happy customers are more loyal and generate positive word of mouth.
An associate of mine is offering a free webinar on turning irate customers into loyal customers. He’s an expert in this area. You can learn more here.
Retailers and restaurants need to hire staff that care about helping people and making customers’ lives easier. And management should reward those sales associates that deliver on that promise.
“…sometimes it’s nice to go, where every body knows your name.”
Norm knew it — and clearly Danny Meyer knows it — people want to feel welcomed, comfortable and special when receiving service of any sort. And not just in the hospitality business.
Think about it. How much more likely are you to be satisfied with the mechanic’s service, the carpet cleaning guy or the loaf of bread you just bought if it is delivered with a smile and an honest attempt to meet your needs?
Obviously, the loaf of bread is a much lower risk/investment than that car repair is going to be. But isn’t it nicer to have the checkout attendant smiling instead of openly bitching to her coworkers about the latest contract offer — even if you are just going through the self scan?
Sincere hospitality is extremely effective to win customers, maintain customers, and most importantly, to stimulate referral and recommendation. Yes, it works! I don’t know if it’s intentional or coincidental, but I have found hospitality to be highly effective at Starbucks, AT&T stores, Apple stores, and Trader Joe’s, just to name a few.
Consumerdom is divided into two gradable classes: hosts and guests. Each wants a totality kinship with the other. That makes hospitality a rental fee for retail space in a successful restaurant. Hosts and high H-Q persons capitalize on that knowledge by performing well and thus are rewarded accordingly.
Guests want to feel they will always receive an enjoyable experience as a reward for their patronage. Successful hosts strive to create an environment that mesmerizes away all possible misgivings and causes patrons to feel that if they don’t come to my place they will, as Danny Meyer said, be “missing out on one of life’s great experiences.” When that is accomplished, Eureka!
This doesn’t seem like a new 2012 wisdom unfurled.
Well, how can you NOT agree with all this? To my mind, everything here has always been a part of good customer service, and to me, at least, adding new terms to it and trying to break it into components is, well, just not really adding anything new or helpful to the party.
Danny Meyer knows what it takes to create differentiating retail experiences, which is what restaurants do. His book should be mandatory reading for any retail manager in any industry.
There are, especially in New York, lots of great restaurants. The fact that Meyer’s group has consistently expanded and succeeded in the most challenging restaurant market in the world is testament to his concept and execution of hospitality as a core strategy.
Retail associates need to focus on customers, greet them and welcome them like guests. While it’s not an overly complex exercise the challenge is identifying prospective employees that understand how to genuinely relate to people in a way that is not self-centered.
It’s also important to understand that from a managerial standpoint, this requires prioritizing employees over guests. While this is counter-intuitive for many, it’s fundamental. In the seminal book on customer loyalty, “The Loyalty Effect,” Fred Reicheld espouses the same point: loyal customers are a function of loyal employees.
We’ve so rarely experienced true hospitality that it is something we’ve come to expect less of. True that it is something to focus on in the hiring process. Incumbents can learn and need to have excellent examples to emulate.
The differences between the restaurant business and corporate retailing are pretty stark, even between chain restaurants and chain retailing. The restaurant business is all about experience and differentiation. Customer-facing staff is an essential component of that differentiation.
Corporate retailing is all about delivering commodities or near-commodities at the lowest possible price, which requires the lowest possible delivered cost. There’s little room in the equation for highly compensated store-level personnel. It’s just not about the experience for customers, it’s about convenience (read: no hassles) and price, price, price.
Mr. Meyer’s hospitality quotient is particularly applicable, however, to independent retailers. Their business model is completely different than chain retailing, and is built around experience and inter-personal interactions and relationships. A team with a high HQ is an essential point of differentiation, and is the key element in building true customer loyalty.
I regularly advise my independent retail clients to hire only those people that truly share the animating passion of the business, are truly committed to it, and who have the natural ability to engage and help others in a genuine and authentic way.
I totally agree with this article, and I tell my employees, that I don’t pay them, the CUSTOMER DOES. Without a satisfied customer, none of us have jobs, so check your attitude at the door, and smile when you are here. There is no excuse for accepting anything less, no matter how tough business is.
I agree. We’ve always talked about “Ultimate Hospitality” as part of the in-store experience. Beyond hiring the right associates, it ultimately comes down to the experience that employees receive from the company and local management. The retailers who deliver the best experiences (including the Ultimate Hospitality) are inevitably great places to work.
The key lesson a server could teach a retail associate? Know your product, know your customer, and proactively engage and serve the customer.
Nice topic. Thanks.
I feel confident in speaking directly about this article. I am a server at Union Square Cafe. For the past two years, I have experienced Mr. Meyers culture and principles first hand. It WORKS! What I trust implicitly is the product/house first. All of the food comes from a passionate kitchen. The wine list is built to enhance that collaboration. The house itself has an incredible history; staff and guests alike have a very deep connection to it. My job as a server is to take the intangible principles, the 51% that Mr. Meyer touts in his book, and pay attention to the variables that are not consistent — the guests.
Every time a guest sits with me, it is an opportunity to bring to them what I trust is an outstanding dining experience. I have to listen to what they want and also be in tune with how they want it. It’s a very simple and yet at the same time, an extremely complex balancing act. A dining experience is very different to people and it’s up to me to gather as much information as possible, something this company can do with incredible nuance. Some folks just want to be seen out and be around people, or impress a date, or close the deal, or see if we really live up to the hype (we do!)
It doesn’t take much to slow down ones interactions with people, extrapolate personal feelings or judgements about them, and then get to the essence of what they want out of hospitality. It takes a second to be kind and have compassion for guests. Once that is established, it’s even easier to get them to trust you and have a good time. I think the house itself is quite touched and it infuses everything this article touches on. AND it has food and wine! Maybe everyone should make a trip in to eat, just to see what I mean.
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Love the quote about taking a picture and not capturing the feeling. So important. I think it is important to realize that those high HQ employees are rewarded by tips so they not only “can” do it, they are rewarded “for” doing it.
That’s why I think the only hope for struggling retailers is to connect their service/or lack thereof to pay. I choose commission as you all know, but you have to reward the individual for connecting to another individual — not the whole crew.
The wall so many initiatives hit is the analytical personality saying, “Yeah and how do we do this with $8 employees?” Zactly.
The difference between providing “customer service” and “hospitality” (or the equivalent idea in retail) can make the difference between a satisfied customer and a committed one. Bridging this gap — from satisfied to committed — becomes a vital part of any company’s customer relationship and brand management programs.
The challenge is the sheer number of retailers and service providers who need to get the basics of customer service figured out first. It’s surprising how many retailers still don’t operate efficiently and still can’t get the right goods on the shelf when the customer expects to find them. (And non-retailers need to do a better job providing their equivalent of “goods on the shelf.”) Get the first step right, and the second step — toward hospitality and customer commitment — becomes easier to achieve.
Great customer service is as important in retail as it is in restaurants. Creating a welcoming environment at retail is a vital part of overall customer satisfaction. Happy customers are more loyal and generate positive word of mouth.
An associate of mine is offering a free webinar on turning irate customers into loyal customers. He’s an expert in this area. You can learn more here.
Retailers and restaurants need to hire staff that care about helping people and making customers’ lives easier. And management should reward those sales associates that deliver on that promise.
“…sometimes it’s nice to go, where every body knows your name.”
Norm knew it — and clearly Danny Meyer knows it — people want to feel welcomed, comfortable and special when receiving service of any sort. And not just in the hospitality business.
Think about it. How much more likely are you to be satisfied with the mechanic’s service, the carpet cleaning guy or the loaf of bread you just bought if it is delivered with a smile and an honest attempt to meet your needs?
Obviously, the loaf of bread is a much lower risk/investment than that car repair is going to be. But isn’t it nicer to have the checkout attendant smiling instead of openly bitching to her coworkers about the latest contract offer — even if you are just going through the self scan?
Sincere hospitality is extremely effective to win customers, maintain customers, and most importantly, to stimulate referral and recommendation. Yes, it works! I don’t know if it’s intentional or coincidental, but I have found hospitality to be highly effective at Starbucks, AT&T stores, Apple stores, and Trader Joe’s, just to name a few.
Consumerdom is divided into two gradable classes: hosts and guests. Each wants a totality kinship with the other. That makes hospitality a rental fee for retail space in a successful restaurant. Hosts and high H-Q persons capitalize on that knowledge by performing well and thus are rewarded accordingly.
Guests want to feel they will always receive an enjoyable experience as a reward for their patronage. Successful hosts strive to create an environment that mesmerizes away all possible misgivings and causes patrons to feel that if they don’t come to my place they will, as Danny Meyer said, be “missing out on one of life’s great experiences.” When that is accomplished, Eureka!
This doesn’t seem like a new 2012 wisdom unfurled.
Well, how can you NOT agree with all this? To my mind, everything here has always been a part of good customer service, and to me, at least, adding new terms to it and trying to break it into components is, well, just not really adding anything new or helpful to the party.
Danny Meyer knows what it takes to create differentiating retail experiences, which is what restaurants do. His book should be mandatory reading for any retail manager in any industry.
There are, especially in New York, lots of great restaurants. The fact that Meyer’s group has consistently expanded and succeeded in the most challenging restaurant market in the world is testament to his concept and execution of hospitality as a core strategy.
Retail associates need to focus on customers, greet them and welcome them like guests. While it’s not an overly complex exercise the challenge is identifying prospective employees that understand how to genuinely relate to people in a way that is not self-centered.
It’s also important to understand that from a managerial standpoint, this requires prioritizing employees over guests. While this is counter-intuitive for many, it’s fundamental. In the seminal book on customer loyalty, “The Loyalty Effect,” Fred Reicheld espouses the same point: loyal customers are a function of loyal employees.
We’ve so rarely experienced true hospitality that it is something we’ve come to expect less of. True that it is something to focus on in the hiring process. Incumbents can learn and need to have excellent examples to emulate.
The differences between the restaurant business and corporate retailing are pretty stark, even between chain restaurants and chain retailing. The restaurant business is all about experience and differentiation. Customer-facing staff is an essential component of that differentiation.
Corporate retailing is all about delivering commodities or near-commodities at the lowest possible price, which requires the lowest possible delivered cost. There’s little room in the equation for highly compensated store-level personnel. It’s just not about the experience for customers, it’s about convenience (read: no hassles) and price, price, price.
Mr. Meyer’s hospitality quotient is particularly applicable, however, to independent retailers. Their business model is completely different than chain retailing, and is built around experience and inter-personal interactions and relationships. A team with a high HQ is an essential point of differentiation, and is the key element in building true customer loyalty.
I regularly advise my independent retail clients to hire only those people that truly share the animating passion of the business, are truly committed to it, and who have the natural ability to engage and help others in a genuine and authentic way.
I totally agree with this article, and I tell my employees, that I don’t pay them, the CUSTOMER DOES. Without a satisfied customer, none of us have jobs, so check your attitude at the door, and smile when you are here. There is no excuse for accepting anything less, no matter how tough business is.
I agree. We’ve always talked about “Ultimate Hospitality” as part of the in-store experience. Beyond hiring the right associates, it ultimately comes down to the experience that employees receive from the company and local management. The retailers who deliver the best experiences (including the Ultimate Hospitality) are inevitably great places to work.
The key lesson a server could teach a retail associate? Know your product, know your customer, and proactively engage and serve the customer.
Nice topic. Thanks.
I feel confident in speaking directly about this article. I am a server at Union Square Cafe. For the past two years, I have experienced Mr. Meyers culture and principles first hand. It WORKS! What I trust implicitly is the product/house first. All of the food comes from a passionate kitchen. The wine list is built to enhance that collaboration. The house itself has an incredible history; staff and guests alike have a very deep connection to it. My job as a server is to take the intangible principles, the 51% that Mr. Meyer touts in his book, and pay attention to the variables that are not consistent — the guests.
Every time a guest sits with me, it is an opportunity to bring to them what I trust is an outstanding dining experience. I have to listen to what they want and also be in tune with how they want it. It’s a very simple and yet at the same time, an extremely complex balancing act. A dining experience is very different to people and it’s up to me to gather as much information as possible, something this company can do with incredible nuance. Some folks just want to be seen out and be around people, or impress a date, or close the deal, or see if we really live up to the hype (we do!)
It doesn’t take much to slow down ones interactions with people, extrapolate personal feelings or judgements about them, and then get to the essence of what they want out of hospitality. It takes a second to be kind and have compassion for guests. Once that is established, it’s even easier to get them to trust you and have a good time. I think the house itself is quite touched and it infuses everything this article touches on. AND it has food and wine! Maybe everyone should make a trip in to eat, just to see what I mean.