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Becoming an Experiential Brand

Release Date: February 22, 2022 • Episode #205

Live events can also be great way to gather insights into your customers while providing an exceptional experience. More companies are designing events to provide almost over-the-top experiences to help engage with their customers. So how do you design a great event AND gather the insights you need to improve your customer experience? Host Steve Walker welcomes Jonathan Yaffe from AnyRoad to discuss how some companies have become an experiential brand.

Jonathan Yaffe

Jonathan Yaffe
AnyRoad
Connect with Jonathan

Highlights

Retail is not dead, it’s evolving

“It’s not the death of retail. It’s a bifurcation. What I mean by that is you see this graveyard of commoditized retail chains that are literally shutting down every week because they’re just selling things. And then you have the other side, which is the retailers that are actually becoming experiential brands, and they’re using that valuable commercial real estate not to sell things, but actually to create those experiences. You see Nike turning some of their stores into basketball courts. They don’t care if you buy their shoes online or in a store. That doesn’t matter. The important thing is going on trying on a pair of Jordans and playing basketball against the Nike employee in the store.”

What about the pandemic?

“[Companies] didn’t pull their spend for experiential. They just said, how is this going to adapt to the new, the new normal? And we made it very quick and early bet on Zoom and digital platforms like that. And sure enough, our our customers were successfully able to migrate their experiences digitally, which had incredible, incredible ROI. And the amazing thing now is post-pandemic in real life, experiences are skyrocketing out of the pandemic to levels far higher than even 2019. But digital experiences also continue to grow, and they don’t actually cannibalize each other.”

Transcript

The CX Leader Podcast: "Becoming an Experiential Brand" : Audio automatically transcribed by Sonix

The CX Leader Podcast: "Becoming an Experiential Brand" : this wav audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Steve:
Live experiences can be exciting, highly engaging, and even provide valuable insights for your CX program.

Jonathan:
You bring your best friends to this crazy Red Bull event, and there are people jumping out of airplanes, going down mountains on tricycles and somebody comes up to you and hands you an ice cold Red Bull, this actually creates an emotional bond that not only changes your perspective of the brand, but ultimately changes your behavior and thus your lifetime value to the brand.

Steve:
Using live experiences to gather customer data on this episode of The CX Leader Podcast.

Announcer:
The CX Leader Podcast with Steve Walker is produced by Walker, an experience management firm that helps our clients accelerate their XM success. You can find out more at walkerinfo.com.

Steve:
Hello, everyone, I'm Steve Walker hosted The CX Leader Podcast and thank you for listening. As we like to say each week, it's never been a better time to be a CX leader, and this podcast explores topics and themes to help leaders like you leverage all the benefits of your customer experience and help your customers and prospects want to do more business with you. One thing I've missed during the pandemic are live events, especially music concerts. There's just something about the energy you feel when a mass of people are gathered to experience their favorite brand, but live events can also be a great way to gather insights into your customers. So how do you design a great event and gather the insights you need to improve your customer experience? Well, I'm very excited for my guest today. He's going to help us explore the value of live events. Jonathan Yaffe is the CEO and co-founder of AnyRoad and experience relationship management platform, enabling global brands to properly measure, scale and implement their experiential marketing campaigns. Jonathan, thanks for being on The CX Leader Podcast.

Jonathan:
So great to be here, Steve. Thanks for having me.

Steve:
We have not met before. We're just doing a little prep here before we started to record. But I'm fascinated with your business and your background. And for those of our listeners here that may not be familiar with you or AnyRoad, just give us a little background on your journey and what led you to create AnyRoad and and just sort of how you got to where you're at today.

Jonathan:
Yeah, it's a kind of a whirlwind story, but my first job right after college was that a little company called Red Bull.

Steve:
Oh, a "little" company.

Jonathan:
Little a little back then. Not that many people knew that it was in the United States, had just come to America, and I got hired onto the marketing team and this totally blew my mind because we were spending billions of dollars per year on experiences. This was 20 years ago, 20 years ago, and we believed even back then that digital marketing and digital customer experience were completely oversaturated. Right. We see we see thousands, tens of thousands of advertisements every day. We receive tons of surveys through the email, and these don't actually change our behavior at all. But you bring your best friends to this crazy Red Bull event, and there are people jumping out of airplanes, going down mountains on tricycles, DJs are playing, people are dancing. Everyone's having an amazing time and somebody comes up to you and hands you an ice cold Red Bull. This actually creates an emotional bond that not only changes your perspective of the brand, but ultimately changes your behavior and thus your lifetime value to the brand. So we spent over $1 billion per year on this. Clearly, it worked. Red Bull has by far our number one market share, but it drove me absolutely crazy that we had no data. So cut to now. It's 20 years later, and the world is both more experiential, but it's also more data driven. So I founded AnyRoad to build the platform for the experience economy to really take customer experience into the next level far beyond surveys and how bad was this United Airlines flight on a scale of zero to 10 and more into how do we use experiences that scale to change behavior and build relationships with your favorite brands?

Steve:
So when did you found AnyRoad?

Jonathan:
About eight and a half years ago.

Steve:
And you provide sort of this a similar Red Bull like experience for other brands that want to engage in this type of activity? That's which sort of building off of?

Jonathan:
Yeah, So we don't actually build the experiences. Usually the experience are built in in-house or sometimes through experiential agencies who we partner with. Generally, brands come to us when they're kind of at the Red Bull phase where they're investing, I don't know, hundreds of millions of dollars, sometimes billions of dollars into experiential and intuitively we are experiential human beings, right? We crave human connection, especially now after the pandemic. We're going outside, we're participating in music events and sporting events and wine tastings and all these kinds of experiences. And these brands are investing absurd amounts of money and experiential, and they believe that it works. But they have no data behind it, and they come to us and say, Look, we. This is a core form of our engagement with our consumer base, but we have no data intelligence around it, right? So our platform powers the logistics and operations for all these experiential programs while building strong relationships with consumers and pulling in a ton of data.

Steve:
So without giving away any trade secrets or whatever you can share, could you just give us a couple of examples? Either generic or branded, if you can?

Jonathan:
Absolutely. Lululemon very proudly proclaimed recently that they are no longer a yoga company. They are now an experience company. They spend about $300 million per year on free yoga classes in all their stores globally and now online, too. They believe that people take these yoga classes, have a higher brand perception and increase lifetime value, and they have no idea if this is true. Coca-cola spends over $3 billion on experiential field marketing that doesn't have any real ROI data on it. BMW spends over $1 billion on car test drives, driving experiences. They've been built around the theme park in Munich called BMW World. We have brands like Michael's art stores that do over 1.2 million art classes per year. Brands like Budweiser that do over one point six million brewery experiences per year. Really, it goes on and on. The thing that all these organizations have in common, though, is they look at experiences as one of the most valuable ways for them to interact with their consumer base globally. And and frankly, the experience economy is just getting stronger.

Steve:
So some of these are. You could also apply this to a virtual world, can't you?

Jonathan:
Absolutely. And that's what COVID taught us. Pre-COVID we were all about, you know, from my Red Bull background in real life in-person experiences. And then this little pandemic hit that kind of turned off that faucet. But the amazing thing is that our customers started coming to us and saying, Look, we are still going to invest heavily in experiential, what's that going to look like? Right? They didn't pull their spend for experiential. They just said, How is this going to adapt to the new, the new normal? And we made it very quick and early bet on Zoom and digital platforms like that. And sure enough, our our customers were successfully able to migrate their experiences digitally, which had incredible, incredible ROI. And the amazing thing now is post-pandemic in real life, experiences are skyrocketing out of the pandemic to levels far higher than even 2019. But digital experiences also continue to grow, and they don't actually cannibalize each other.

Steve:
Well, I was excited to talk to you for several reasons, but one of them we talked about of offline there is my fascination with sort of sports activation and live sporting events. I'm a big F1 fan. So for our listeners that don't know, Red Bull actually has an F1 team that's very successful won the Championship this year. But I'm also thinking like, we're here at kind of, you know, we're recording here a week or so before the Super Bowl. There's tons of engagement that goes along with with almost every big time sporting event today, right?

Jonathan:
Absolutely.

Steve:
And so how would a brands start to activate around a live experience or what is the kind of the secret sauce to making sure it's appropriate and supportive of the brand?

Jonathan:
Yeah, I think I think number one, it's figuring out what segment of your consumer base you're trying to to go after. Right? As an example, we have we have some partners who use experiential to to solidify relationships with existing customers, right? Harley-Davidson is a great example of that, right? Harley-Davidson organizes rides right with their their their staunchest loyalists and most hardcore fans all over the United States, right? So you own a you want to hog and you can go out on a Harley ride with a bunch of other Harley Riders. And these things are sponsored often paid for by Harley to bring together their community, right? So they're really through these experiences, really going after people who are already bought into the ecosystem, but actually engaging them even further, right? And then on the on the other extreme, you have brands like like Dick's Sporting Goods that are actually turning a lot of their stores into these House of Sports locations with like massive rock climbing walls, batting cages, hockey lessons and frankly, a lot of these experiences serve not just to bolster relationships with existing customers, but actually bring new customers into the ecosystem, right? So you happen to live near a house of sports. You are not a loyal shopper of Dick's Sporting Goods when you start actually going there for these experiences and these activities. You are more likely to then become a loyal Dick's customer

Steve:
That Dick's example is a great one and you know, I think I'm starting to get it now, Jonathan. I'm assuming some of that was in response to the online disrupting traditional bricks and mortar retail, right? They have. They have to figure out a reason why you'd want to bring your body into the store.

Jonathan:
Absolutely. I mean, if you read the news, there are retail brands literally shutting down every single week and going out of business. Why?

Steve:
I see them in the malls.

Jonathan:
Absolutely. And it's become completely commoditized. Why would I ever walk into a store again when I can buy things cheaper online, faster delivery, better customer service, not have to deal with like a long line of people. Better returns have now caught up, right? So I can return things for free. Why would I ever walk into a store again? Right. So these brands are basically we're we're seeing this bifurcation in retail. It's not the death of retail. It's a bifurcation. What I mean by that is you see this graveyard of commoditized retail chains that are literally shutting down every week because they're just selling things. And then you have the other side, which is the retailers that are actually becoming experiential brands, and they're using that valuable commercial real estate not to sell things, but actually to create those experiences. You see Nike turning some of their stores into basketball courts. They don't care if you buy their shoes online or in a store. That doesn't matter. The important thing is going on trying on a pair of Jordans and playing basketball against the Nike employee in the store. You see Apple running iPhone photography classes and digital music making classes inside a lot of their stores in these experiential and experiential halls and rooms. There you see Michael's with art classes. You see Lululemon Athletica with yoga classes, you see REI and Patagonia with rock climbing walls and wilderness classes. And frankly, the brands that are not looking at retail locations as a way to launch experience of that scale will probably mostly be out of business in the next 10 years.

Steve:
So again, I'm I'm still learning about this. I'm so fascinated by it, but you keep using the term experiential brand. Could you define that for me?

Jonathan:
Yeah, I think that the way that it started was you are a brand that sells something, whether that is wine or pants or what have you. And the brands that are thriving now are brands that are experiential brands that happen to be selling something on the side. So we were talking about Red Bull, right? Red Bull is an experiential brand, right? Like, they sell the experience they happen to make money selling this amazing, you know, highly caffeinated beverage to give to give people to give people wings and energy. But frankly, their primary form of engagement is experiential, right? So when I use the word experiential brand, I'm looking at brands that are not necessarily thinking that the future of engaging with the customer base is like email marketing. Like how many interesting emails did you get marketing to you in the last 24 hours? None big. You know you delete them immediately. What we're looking at is the brands that know that experiences are the kind of highest form of engagement with their their consumer base, regardless of what they sell to make money.

Announcer:
Are you looking for a little recognition for your hard work as a CX leader? Well, here's just the opportunity. Applications are now being accepted for the U.S. Customer Experience Awards. Finalists and winners will be named in 19 different CX categories, and you could submit an entry in multiple categories. This could be the chance for your team to finally get the recognition it deserves. To find out more and submit your entry, go to usacxa.com.

Steve:
My guest on the program this week is Jonathan Yaffe. We've been learning a lot about experiential brands and how that can contribute to the customer experience. So let's get into a little bit about AnyRoad and and how would you take an event and then start to marry up some of this data around the experience that the participants are having one on one? How do you do that and how do you get the data and then what do you do with the data?

Jonathan:
Yeah, great question. It all starts with data capture, right? So we live in a world where we are very concerned about our data privacy, and frankly, a lot of large brands have no idea who their customers are. Right, so I've been I've been shaving with Gillette razors since I was about 12 years old exclusively have only used Gillette razors, but I don't buy Gillette razors from Gillette. I buy them from Walgreens or Amazon. And frankly, because of that, Procter & Gamble has no idea who I am. They don't have a one on one relationship with me. But now Procter & Gamble has started to really increase their experiential footprint, right? And through creating amazing experiences that I want to participate in, I can actually opt into these experiences, share my data with a brand that I really have a lot of admiration for Gillette, and suddenly there's a double opt in relationship there, right? So really, what it comes down to at the beginning is data capture, right? How does Red Bull capture the data? Again, completely opt in. Nothing sketchy, privacy wise. How does Red Bull capture the data around all of the people who are who are interacting with the brand through these experiential programs? How is Lululemon saying Who's coming to our yoga classes and how do we understand them demographically, geographically? What's their customer loyalty type? And that's kind of where it starts. Where it ends is saying, if we know enough about these consumers and we know about their spend in their brand perception, we can actually tie the customer experience data directly to revenue. Right. So we can say that a certain certain types of people participating in certain experiences actually will spend three times more next year, and that is predictable revenue growth for the company.

Steve:
Yeah. And that is the holy grail in the CX space is being able to tie it to actual business impact. So one kind of interesting aspect of this is, I think you're sort of advocating that all brands will have to be experiential brands. And you know, some of my background is is more on the B2B side where you know, you actually like in a pure consumer product, you know, you can create a image of a product right through pure marketing. But when you're experiential, the experience better meet that image that's been projected or you got a world of hurt, right? I mean, and that's, you know, I think it's always been true in in B2B that because you live with the service and the and the solution so much longer that you can't really just cast a brand image and hope that it sticks. It's it's got to be backed up by the experience. And now you're seeing that really in these fast moving consumer goods because they they have become experiences.

Jonathan:
Absolutely. Absolutely. I mean, we don't really touch the B2B space, but it is fascinating. You're right, you see brands like Salesforce who spend one hundred and $40 million per year on their Dreamforce, their Dreamforce conference? Yeah, didn't say a million dollars a year. Yeah, that's a lot of money. And I mean, they're still trying to figure out what the ROI of that is. You know, I mean, this is one of the things that really is, you know, is a little shocking to the system when when the biggest pushback we get from experiential is, well, digital marketing is so much better to scale. And like these digital first brands like, you know, if you are internet first, like why even bother with offline, you know, experiential. But what you're seeing is that some of the most successful internet first digital brands are going all in on in-person, right? You have like brands like Warby Parker, the glasses company, right? Right. It started just selling glasses online, and now they're scaling out all of their stores, their physical retail stores because it actually bolsters that that consumer experience. You have with three brands like board a yacht club and NFT organizations and and crypto communities that are going all in on in-person conferences and in-person parties and like, these are like pseudo anonymous organizations, some of them that are bringing people together from all walks of life. But they're still saying, you know, life does not happen in a discord channel. Life does not happen in email, life happens in life. And so it's really heartening to see that no matter how digital the world gets, brands are still reverting back to in-person experiential because it has by far the highest ROI.

Steve:
Yeah. My guest on the podcast this week is Jonathan Yaffe. He's the CEO and founder of a firm called AnyRoad, and we're having a fascinating discussion about brand experience and experiential brands. My listeners know that we are in a strategic partnership with Qualtrics. The software platform and Qualtrics is trying to create this category called X.M. – Experience Management. In the four pillars of that really are customer, employee, brand and product. And I think you're giving us a great example of how brand relates to customers, for sure. And you know, we've talked about the products, you know, the product is obviously a piece of that. But the, you know, the experience has got to match it up. We haven't talked at all about employees, but in this, you know, time of great resignation in the battle for talent, I got to believe that there's some spillover benefits for the culture and ability of the organization to attract talent.

Jonathan:
Absolutely, absolutely. And the one thing I always think about is that it's what it comes down to is it's about intentional creation of that culture and intentional creation of the employee experience. Rather than trying to play catch up with like pull surveys and be like, who's negative in the organization?

Steve:
So it's really about this magnet that attracts all the key stakeholders around the the experience and making it a cool place to do business with cool place to work. Cool place to be associated with. So I'm sure that in your experience of Red Bull, that the employees got to participate in some of these experiences as well, and that was probably a big perk.

Jonathan:
Absolutely. I mean, it was, you know, my my current job is the best job I've ever had, but that was a close second. Being able to just create these, these, you know, I'm a small part of that, but help to create these massive category defining experiences and just make people happy.

Steve:
And you know, you talked a little bit about this with tying it to the ROI. But just again, from kind of your experience, what is the ultimate endgame for a company's customers if they can really move their experiential brand forward?

Jonathan:
Yeah, yeah. So you mentioned Qualtrics, Qualtrics really laid the framework for customer experience, right? So we really look up to them and they've obviously executed amazingly, and we look at this as kind of taking this one step further, right? So the way that organizations first started to look at customer experience is let's let's find the red flags, right. Let's eliminate the bad experiences..

Steve:
Break fix.

Jonathan:
Right? And so and that's super valuable. And the way that organizations are now starting to look at it is how can we actually craft experiences that will predictably change consumer behavior in a certain way? Right? So if you are coming to an F1 event, how do number one, how do I create an experience around that that is going to pull you in and make you feel more connected with the brand and ideally increase your spend on the brand? And secondly, how to actually target the correct market segment and consumer segment that will actually have that kind of reaction.

Steve:
Jonathan, we've reached that point in the podcast, where I ask every guest every week to give our listeners what I call take home value. This is your best tip based on the information you've shared with us today that a CX professional could take back to what they're doing, integrate into their current program and actually see some results, which I think you're all about.

Jonathan:
Yeah, my take home value is really that we should shift our thinking about what consumer engagement means. And what I mean by that is many people in the consumer experience world and the customer experience world are looking at engagement as somebody who looks at an impression of something on Instagram or somebody who opens an email. And I really believe that there's a lot of opportunity that's missed here to actually build long term lasting relationships. And I've never found a better way to do that than scaling truly amazing, transformative experiences. So no matter what your company does, I really implore you to figure out what what would it look like if we became an experiential brand that happened to sell something else?

Steve:
Jonathan Yaffe is the CEO and founder of AnyRoad. Jonathan, thanks for being a guest on The CX Leader Podcast really enjoyed our chat.

Jonathan:
I did, too. Steve, it's so great to be here with you.

Steve:
And if our listeners would like to continue the dialog, you want to give them your website or LinkedIn profile or something so they can reach out to you?

Jonathan:
Yeah, everything is AnyRoad on LinkedIn. I'm jonathan@anyroad.com, and you feel free to send me an email directly.

Steve:
Great. And if you want to talk about anything else you heard on the podcast today or about how Walker can help your business's customer experience, feel free to email me at podcast@walkerinfo.com. Be sure to check out our website cxleaderpodcast.com to subscribe to the show and find all of our previous episodes. We organize them by series topics you can sort through and find with over 200 episodes in the can now you can find just about any kind of topic you would like to find out about it. You could also drop us a note or suggest a topic for a future podcast. The CX Leader Podcast is a production of Walker, we're an experience management firm that helps companies accelerate their experience management success. You can read more about us at walkerinfo.com. Thank you for listening. And remember, it's a great time to be a CX leader. We'll see you again next time.

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