Happy MR Podcast Podcast Series

Ep. 575 – How Customer-Obsessed Companies are Winning, with Marbue Brown, Founder of the Customer Obsession Advantage

Our guest today is Marbue Brown, founder of “The Customer Obsession Advantage” and author of the “Blueprint for Customer Obsession.” 

Prior to starting his own consulting firm, Marbue has served as the Head of Customer Experience at Chase, Global Lead of Customer Experince at Amazon, and Senior Director of Customer Experience Measurement at Microsoft. 

Find Marbue Online:

LinkedIn: https://www.linkedin.com/in/marbue-brown-43a8a52/  

Find Jamin Online:

Email: jamin@happymr.com 

LinkedIn: www.linkedin.com/in/jaminbrazil

Twitter: www.twitter.com/jaminbrazil 

Find Us Online: 

Twitter: www.twitter.com/happymrxp 

LinkedIn: www.linkedin.com/company/happymarketresearch 

Facebook: www.facebook.com/happymrxp 

Website: www.happymr.com 

Music: 

“Clap Along” by Auditionauti: https://audionautix.com 

This Episode is Sponsored by:

This episode is brought to you by Michigan State’s Marketing Research program. Are you looking for higher pay, to expand your professional network, and to achieve your full potential in the world of market research?

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This episode is brought to you by  HubUX is a research operation platform for private panel management, qualitative automation including video audition questions, and surveys. 

For a limited time, user seats are free. If you’d like to learn more or create your own account, visit hubux.com.


[00:00:00]

Jamin Brazil: Hey, everybody. You are listening to the Happy Market Research Podcast. I’m Jamin Brazil, your host. Our guest today is Marbue Brown, founder of the Customer Obsession Advantage and author of the “Blueprint for Customer Obsession.” Prior to starting his own consulting firm, Marbue has served as the head of customer experience at Chase, global lead of customer experience at Amazon, and senior director of customer experience management at Microsoft. Marbue, thank you very much for joining us on the show.

[00:00:36]

Marbue Brown: Jamin, it’s a pleasure to be with you and looking forward to having a very stimulating discussion.

[00:00:45]

Jamin Brazil: The Michigan State University’s Master of Science in Marketing Research Program delivers the number one ranked insights and analytics degree in three formats. Full time on campus, full time online, and part time online. New for 2022, if you can’t commit to their full degree program, simply begin with one of their three course certifications. Insights design or insights analysis. In addition to the certification, all the courses you complete will build towards your graduation. If you’re looking to achieve your full potential, check out MSMU’s programs at broad.msu.edu/marketing. Again, broad.msu.edu/marketing. HubUX is a research operations platform for private panel management, qualitative automation including video audition question and surveys. For a limited time, user seats are free. If you’d like to learn more or create your own account, visit hubux.com. I’m very excited about jumping in to discuss your book. But before we do that, let’s get a little bit of context. Tell me about your parents and how they informed what you do today.

[00:02:03]

Marbue Brown: Well, before I even talk about my parents, let me start off by saying that I’m originally from Liberia and I grew up in Liberia. So there’s a couple of things I’m gonna say about my parents where that context is important. But you know, I couldn’t have asked for a better set of parents who set a very phenomenal example for me. My father passed away before I was two years old. But as I grew up, everybody who I ever met that knew him spoke of him in such glowing terms that I just had a sense of pride about him. But also, it instilled in me that I have an amazing legacy to live up to. And to be quite frank, my mother was chief among those who spoke about my father in glowing terms so much so that when she eventually remarried, I always wondered if my stepfather would get jealous sometimes when she was talking about my own father and my birth father. My stepfather was also amazing, by the way. So that was most of what I know about my father I’ve learned from other people talking about him and it was just super positive. My mom also, she was an incredibly accomplished educator. She was the first woman on the continent of Africa to be president of a university. And among other things, she instilled in me the value of a great education. During my years growing up, I spent a lot of time with her on the University of Liberia campus as she progress through the ranks from dean to vice president of academic affairs and finally president. And for me, it was a forgone conclusion that not only when I go to college but I would get advanced degrees and would it be masters or PHD, right? So I wind up getting both a master’s in math and a master’s in statistics which really catapulted me into what I do today. But additionally, I have to say that my mom set an amazing example for me in so many ways. She was just a portrait of courage. If you know anything about universities in Africa, sometimes they and government don’t always see eye to eye on stuff. And let’s just say that my mother always stood on the basis of her principles and didn’t back down even in the face of what sometimes were very perilous situations. So that’s who my parents were and that’s how they kind of got me into what I do today.

[00:04:34]

Jamin Brazil: Your book is in the cross hairs of what I’ve been talking about for the last five years. Estrella Lopez-Brea, she was the head of insights for the serial group, I believe it was called- is called which is a joint venture between Nestle, and Cheerios, and whatever they sell cereal to about a 136 countries. Very big deal, General Mills, that’s who the other party is. And the business is called Watermark Consulting. In that report, they talk about the importance of customer experience which was discovered by them through analytics that they did in the Fortune 500. And what they found was that companies that employed customer experience at the point of decision, they outperform the index by about 45 points. Whereas in the Headline, those that didn’t, they underperformed by 76 points. So no longer is it a question of, “Should we employ customer experience?” The question is really, “Do we wanna be in business or not?” And if the answer is yes which obviously it is, then you better use customer experience or have that as a key part of your strategy. This, of course is exactly your book and you’re also kind of in line with the career that you’ve had at some of the most amazing brands in the world- Blueprint for Customer Obsession. So why don’t you tell the listeners a little bit about the book. I did get a chance to read some of it already so- then, we’ll jump into some specific questions.

[00:06:00]

Marbue Brown: Yeah. So Blueprint for Customer Obsession is this book came about because Amazon popularized the phrase, “Customer obsession” and that phrase was coined to describe the extreme focus on the customer that they have in the business. And as the term became popular, a lot of people started to use it. But it’s not very clear, that all the people who were using customer obsession were speaking the same language or meant the same thing, right? And so, one of the things that I set out to do in writing Blueprint for Customer Obsession is to make very clear how customer obsession is distinguished from being customer centric or being customer focused. And so, we layout eight differentiators in the book that separate customer obsessed companies from their peers who are in one of those other categories. That’s what we set out to do. And then, really give people a way that they can assess where they are on this continuum of customer obsession and how they can put together a pack to get into the actual category of being customer obsessed, if that’s what they choose to do. And that’s essentially what the book is about.

[00:07:23]

Jamin Brazil: When you think about the end part, the path, is that a- and I haven’t gotten to that part, I do apologize. Is that more of a workbook style where some of it employ that with their team?

[00:07:31]

Marbue Brown: It’s not necessarily a workbook style. But what we’ve done is we’ve laid out a continuum in a quick reference guide if you will that enables people to look at different categories across the spectrum from companies that are customer indifferent to companies who are customer aware, or customer focused, or customer centric, or customer obsessed. And so first of all, they can look at where do they actually fit on this spectrum and that will inform them what kinds of things do they need to do differently to get to the next step. But then, we also have a set of questions that they can work their way through that would help them to jump start that process and enable them to map out a path. So that’s how it’s laid out.

[00:08:23]

Jamin Brazil: Today, I think most companies would self-describe themselves as being customer obsessed. So let’s just start out to be really clear, what does it mean to be customer obsessed? And what would the outcome be? What is the output of that?

[00:08:41]

Marbue Brown: So let me give you a couple of illustrations of things that customer obsessed companies do. And then, other companies would ask themselves- they would do well to ask themselves if they have anything in place that is similar to this. I used to buy some oatmeal Bob’s Red Mill Steel Cut Oats from Costco. This hold a pretty sizable package of that for $7.99 and there was a time I went into our nearby Costco to get that and couldn’t find it. So I thought I’d go to Amazon and get it there instead. I went to Amazon and I saw a bag of Bob’s Red Mill Steel Cut Oats for $17.99. And so, I’m going back and forth, “Is this the same size one?” I was just- I was trying to figure out this out. So I thought, “All right. Just go read the customer reviews.” So the very first customer review on Amazon said, “Don’t buy this at Amazon. You can buy the same thing at Costco for $7.99.” Now, most companies will probably just take that review down. Amazon never will because the fact is, it’s in the interest of the customer. And some folks would look at that and say- in fact, there were people who actually said to Jeff Bezos when he allowed these kinds of reviews on his site, “You don’t understand your business. You make money when you sell things.” And Jeff says, “No, we make money when we help customers make great buying decisions.” And so, that’s the kind of extreme thing that a customer obsessed company would do. They would have that out there and they won’t take it down because they’re gonna help the customer make the right decision in terms of buying that. Now, the flip side of the story though is it also challenges the folks in Amazon retail to think about, “How come we can’t sell for that price?” And figure out what do they need to do to be able to compete effectively with their counterpart who is Costco selling this for very different price than they had it for- less than half. So this is the kind of thing that a customer obsessed company would do. Now, let me flip the script up a little bit and give another type of example. As I was putting things together on the book, I came across this one example of a lady who was taking a Christmas tree back to Costco in January saying the tree had died. And they took it back, all right? Well, that’s kinda like their extreme return policy at work. And you know, when you look at these kinds of things that these companies do, a people almost have to shake their heads and say, “Who does that?” But the companies that are in the customer obsessed categories is typical of them to have these types of policies that are basically extreme in the customer’s favor. And so, that’s an illustration of what makes them different from their peers. Because their peers when it comes down to adopting a policy and there’s a tiebreaker that has to be made between the customer and maybe business results, guess who’s gonna win? It’s not gonna be the customer. But when the company is customer obsessed, customer breaks the tie. So hopefully, that answers the question for you.

[00:12:20]

Jamin Brazil: Yeah. There’s two things that stand out to me. One is, it’s a funny story about the Christmas tree. I’ve never heard that. I have a friend who- they’re kinda like, I’m gonna tell you right now, just like out the gate. I always leave going, “Who does that?” But they recently moved and they apparently found some frozen pizzas that they bought at Costco or some place at the bottom of their freezer which they had there for, they don’t even know how long. Over the years, right? Multiple years. And they’re like, “What are we gonna do with these?” And so, they literally took them back to Costco and got a refund.

[00:12:56]

Marbue Brown: And you know, if the kind of thing that you say, “Who does that?” But by the way in the book, I described 10 companies that you would think of as customer obsessed. And as you might guess, Amazon’s in the book and Costco’s in the book. They both are. But that’s the kind of thing that customer obsessed companies do. And let me say something a little bit more about this. Look, returns is an area that’s a big challenge for retail. If they are really into preventing returns fraud to minimizing returns cost, it’s a big cost for them. And so, some would look at the Costco policy and say, “You know, this is an invitation to returns abuse.” Well, let’s just say it works for them. And it works for them. Their numbers with their members are just phenomenal. And so, the thing about these customer obsessed companies is they’re not hurting even though they have these extreme types of policies.

[00:14:00]

Jamin Brazil: Yeah. One of the statistics that you cite in the book is Costco has a 90% retention rate of- or renewal rate of its Costco memberships year over year.

[00:14:09]

Marbue Brown: That’s right.

[00:14:10]

Jamin Brazil: The other example that I wanted to give or wanna give is a company called is Fry’s Electronics which I don’t believe is in business any longer. They’re very popular, started in the 90s in the Bay Area, San Jose area and grew very rapidly. They actually had a return policy that was so adverse to the customer, it was just ridiculous, very frustrating. They incentivize- I happen to know one of the people that worked there, they incentivized their return clerks. These are people that would help process any item, default item, or whatever and they incentivize people- their staff based on the lack of returns. So if I went in with a potentially a $100 item to get it for return and- because it was defective or whatever and that person was able to negotiate down that return rate, they were incentivized or commissioned based on that delta. And it was just- it was a very frustrating, difficult experience if you did ever have something that went wrong and needed to get it resolved. And I think it’s an interesting kinda counterpoint, right? And of course, now they’re no longer in business but a company that’s very focused on driving the financial model to their benefit at the expense of the customer experience.

[00:15:24]

Marbue Brown: And then in the end, they wind up paying for, right?

[00:15:27]

Jamin Brazil: Right.

[00:15:27]

Marbue Brown: And they pay for it one way or the other. In the case of that company no longer in business, in the case of customer obsessed companies, their financials just keep getting better and better even though the things that they do are counter intuitive. And sometimes on the surface, they don’t make economic sense. But then, their customers aren’t casual consumers. They’re rabid fans. Right?

[00:15:55]

Jamin Brazil: Yeah.

[00:15:55]

Marbue Brown: They keep coming back and guess what? They’re bringing friends, and family, and acquaintances with them. And their numbers just keep growing.

[00:16:06]

Jamin Brazil: And even willing to spend more money for the same product just in order to support the brand that consumers love. One of the examples that you gave or terms that you coined I would say is- and this is in quotation marks because it’s an excerpt from your book, “Bet the farm on extreme customer centric policies.” Bet the farm on extreme customer centric policies is the term and you cite a couple of examples, some of which we’ve already talked about. One of my favorites and I’ve used this for years is the make it right policy by Ritz Carlton where the- anybody in the business has a $2,000 or has the liberty to spend up to $2,000 to satisfy some customer’s need- whatever that customer might be. You also cite Chick-fil-A, their closure is on Sunday, which represents probably- I mean, I can’t remember the exact amount of money. But conservatively, I would think it would be at least 20% revenue increase if they were open on Sunday. Yet, they’re closed. So you’ve got these major brands that are making business decisions and policies that are quite literally- it seems like almost to their detriment. And yet to your point, they’re unlocking cash at record levels year over year. How is a policy like this a differentiator in the market?

[00:17:25]

Marbue Brown: I think that some of the examples that we gave just a moment ago, it is why people go to these companies to do business. A lot of times, somebody wants to buy something and they may see that particular item at another place. And then they say to themselves, “Why would I buy it there if I can buy it at Costco? And I know that if I have to return it, I can.” Now, they may never return it. In fact, their returns might be a super small percentage of the time but it gives them that confidence in shopping that says, “You know what? I can do that if I need to. And so, that’s my safe place. That’s my happy place.” Or this customer says, “Hey, if I go to Amazon and I check out all of those reviews and I understand what’s going on, I can make the right decision about the purchase that I need to make. And also, guess what? My returns at Amazon are friction less too.” So these kinds of things separate these companies out from their peers and they become the destination places. They become the place that people want to go whether it’s to search for stuff, whether it’s to purchase stuff, whether it’s for travel. They become the destination places. And that’s what differentiates them from their peers.

[00:19:01]

Jamin Brazil: It’s interesting. Yet, these line items in a PNL, your financial statements like returns and that’s always a negative. Right?

[00:19:09]

Marbue Brown: Mm-hmm.

[00:19:10]

Jamin Brazil: So it goes against- maybe included in cost of goods or some other location. But in a lot of ways, the treatment of that should- or a proportion of it at least should be more in customer engagement. Because it is representing a benefit to the customer and subsequent customer annual value versus this being this kind of the top penalty that brands might be thinking about. And when I think about a small company, 10 million dollars or 50 million dollars, these kind of upstart firms like I’ve kind of lived my career in. If we wanted to make a- our own- our similar policy, what sort of rubric- what kind of rules would we need to put in place when we think about what that policy should contain?

[00:20:00]

Marbue Brown: Well, let me start up by saying first of all that customer obsession as a business strategy is a great strategy for small companies, for startups, OK? It’s part of how startups become big and great companies. Let me just mention Zappos is one of those companies that grew extremely rapidly. One of those early companies that you call a unicorn, if you will. And one of the reasons they grew like that was because they had a customer obsesses mindset. And in some respects, they kinda beat Amazon at their own game and Amazon went and bought them. It still operates pretty much independently. And so, as customer obsessed as Amazon is and Zappos is, they do things somewhat differently but bottom line is it helped them to grow rapidly. Chewy is another company that has grown rapidly. Adopting the same kind of customer obsessed mindset as their business strategy. So let me start up by saying that this is a great business strategy for smaller companies and startups that are looking to become very large companies. But I think the first thing that these companies need to do is they need to be prepared to embrace the principle that if something is good for the customer, it’s good for business. Even if right at the moment, they don’t have complete line of sight to how it will benefit them economically. Now, let me be clear. I’m not talking about recklessness, I’m not talking about giving away the store. But what I am saying is that generally, if you adopt that principle and you base your policies on that type of principle that if it’s good for the customer it’s good for business, it will pay off and it will pay off handsomely over time. And sometimes, a lot faster than these companies have thought. So that’s one thing that has to happen. Second thing is that the companies need to work backwards from the customer. And sometimes when you say that it’s not all that clear. But a lot of times, companies work back from the competition. They’re thinking about what is the competition doing. Sometimes, companies work backwards from conventional wisdom. What’s the conventional wisdom on how to do this particular thing? Sometimes, they work backwards from products that they already have in place or services that they already have in place. And they think in terms of brand extension or those kinds of things but they don’t necessarily work backwards from the customer. And if they work backwards from the customer, they would wind up getting to a different point in terms of what they wind up bringing to the market and how that’s going to help customers. Let me give an illustration of something. When Apple introduced the iPhone originally, the iPhone was not compatible with Mac OS. And bottom line is, those folks had to mandate to go out and create a great phone, didn’t have mandate to go out and create a phone that was compatible with Mac OS. So working backwards from the customer, they built a great phone. Now eventually, it was linked to Mac OS and you’ve got the whole ecosystem. But if they didn’t work backwards from the customer, they just work backwards from the competition or any of those other things that I mentioned, they would have wind up in a different place.

[00:23:48]

Jamin Brazil: It’s such an interesting framework that you’re describing. And yet, it’s so obvious.

[00:23:53]

Marbue Brown: Yeah. Obvious except that it isn’t right that-

[00:23:56]

Jamin Brazil: Right.

[00:23:58]

Marbue Brown: So you got to be prepared to embrace the principle that if it’s good for the customer, it’s good for business, that they need to work backwards from the customer and let the needs of the customer break any ties. And then, they need to ask themselves if they have a policy that’s so customer centric yet so unexpected, that it makes customers do a double take and they feel like, “These folks have my back. They thought about this before I thought about it.” I’m gonna give you another- a little crazy example. My wife and I were on vacation in Mexico and we belonged to this hotel group that has a bunch of hotels. And if you stay in one, you can use the facilities of any other one. And so- but they also give you free tours and all this kind of thing. We had done all the free tours so we decided we were gonna make our own tour. At the time we’re in Cancun, we went to the hotel in Playa del Carmen. And from there, walked over to the back, took a ferry in to Cozumel. So we’re walking around in Cozumel taking in all the sites and all that sort of stuff, it was a super hot day. So we go over to the sister hotel in Cozumel. And as we’re walking into the hotel, the podium right at the entrance to the hotel, the guy standing there says, “Hey, what’s the matter? Is it raining out there?” He was kinda kidding around because we were all sweating. He says, “What’s the matter? Is it raining out there?” Then, he reaches under the podium and he pulls out a tray. And the tray has cold towels in it that you can wipe your face with. And you get that and you say to yourself, “Have these guys thought of everything or what?” They knew it was hot out there, they knew people were gonna wanna refresh themselves, and that sort of thing. But they thought about it ahead of time. This is the kind of thing where when a company does that, it’s customer centric but it’s also in some respect unexpected. And you have to ask yourself if the policies that you’re putting in place fit that description. And these are the kinds of things that folks have to do to put this sort of stuff into place. And Blueprint for Customer Obsession gets into many more details about the kind of things that I’m talking about here. But hopefully, that gave you a good framework for how to think about this.

[00:26:25]

Jamin Brazil: Yeah, it sure. It’s a great, high level and I’m looking forward to doing a deep dive into the book. I’m starting right now, the time of the recording, this is October 27th, 2022. And of course, I’m starting to think about 2023 strategic plan. In which case, the book and the material inside of it are gonna be definitely part of that discussion so it’s timely for me. So I’m very appreciative of you and your time, I do have one more question though. What is your personal motto?

[00:26:53]

Marbue Brown: Well look, one of the things I wanna share is having had the opportunity to lead a bunch of teams, one of the things that I always share with my team is that you have a job so you can have a life. But you don’t have a life so you can have a job. And really, what comes down to is that you need to do something that you really love. And if you’re doing something that you really love, it’s not work. This is something that I share with folks who work with me, who work as part of my teams and I think it’s something really good for people to hold on to.

[00:27:32]

Jamin Brazil: Our guest today has been Marbue Brown, founder of the Customer Obsession Advantage and author of the Blueprint for Customer Obsession. Marbue, thanks for being on the show.

[00:27:44]

Marbue Brown: Well thank you so much, Jamin for having me. It’s been a pleasure speaking with you. And I hope we provided some nuggets for all the folks who are out there listening today.

[00:27:56]

Jamin Brazil: I don’t think you have to worry about that, I certainly got some nuggets out of it. So I think that having done almost 500 of these, I’m sure some of our listeners did as well. Everyone else, I appreciate you and your attention. If you found value in this episode, please take time. Tag it on social media, LinkedIn is preferred. Add me and I will send you a free t-shirt. Have a great rest of your day.