Welcome to the Concierge Economy!

Pete Blackshaw
Feb 17, 2018 · 6 min read

If service is the new marketing, especially in the high-expectation “always on” digital age, is your bell ready?

This was my question to a TEDx audience at Switzerland’s University of St-Gallen (Switzerland) around what I dub “The Concierge Economy.” I’ll resurrect the topic on a panel I’m leading at SXSW next month.

To win with consumers today, we need to think and act like a concierge. I also underscored that digital technology — combined with human touch — allows us to act like a concierge in ways we never dreamed of before, and at scale

The concierge is the person you approach at the hotel when you have questions and needs. Could be restaurant advice, a jogging path recommendation, or some tips on how to explore the town. A great concierge anticipates, answers, and guides, and always does so with a friendly and inviting face.

In today’s digital economy, consumers are proactively reaching out to brands, companies, non-profits and even government more than ever before. They want answers. They want advice. They want guidance. They are ringing our bell, and they are increasingly empowered by mobile devices of all kinds.

Thanks to mobile, consumers expect fast, 24/7 service. They are using instant messenger and bots. The concierge is reappearing through smart refrigerators, voice activation, and a whole menu of internet of things. All of this means far less friction in asking questions…anytime, anyplace, any device.

Digital Roots of The Concierge Economy

The “Concierge Economy” finds its digital roots in basic search. Google search is a classic service interface. World’s deepest FAQ. Where do you want to go?

But’s that’s just the beginning. Most phones have some form of voice assistant, but in the last several years, over 50 million “voice” devices have entered the home. And #CES2018 confirmed beyond a sliver of doubt that Google Assistant alone will double or triple those numbers in the next year or two.

When a consumer asks Alexa or Google Home a question, he or she is looking for all manner of consultative advice and solutions, from the weather to step-by-step meal or recipe preparation tips.

In our home, Alexa truly acts like a hotel concierge. Here’s an example of my daughter Leila asking Alexa paired with an iPad questions about recipes. We actually developed this voice + browsing capability in my job at Nestle.

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Interesting, Alexa the concierge has become a welcome member of our family, akin to a family pet. From setting the clock for cooking or kid-pick up and quick weather queries to on-demand music, Alexa is quickly becoming a world class concierge.

Concierge Bots? Then there’s chat bots, an automated form of instant messaging where the bot can answer any number of queries and questions. In the last year and a half, tens of thousands of chat bots have been launched on Facebook alone.

When I spent a week in China earlier this year for leadership training, the Concierge Economy was alive and well on wildly popular platforms like WeChat.

The Rise of Invitational Marketing

What’s unfolding in front of us is a form of invitational marketing. We’re not targeting consumers with advertising. They are coming to us!

And the explosive rise of service automation and artificial intelligence is opening up attractive opportunities to manage the inbound curiosity (or concern) with impact.

Brands that win in eCommerce do so because they have mastered the art and execution of great service — from superb delivery to beautifully timed thank yous. Indeed, the ones we often rave about don’t just deliver great value, but the emotion of empowerment. “Please rate us!” The very best do both.

Look at Zappos.com (owned by Amazon). Notice how the concierge operating principles are embedded throughout the site and app. Zappos practically begs for questions, queries, and even — yes even — complaints. The CEO wrote a best-seller entitled “Delivering Happiness.” He channels his “inner concierge” into every aspect of his business operations.

Worth noting that the so-called Sharing Economy is raising the concierge bar in a huge way. It’s 100% service driven, and heavily incents concierge-like behavior. The ratings and reviews that undergird Uber, Lyft, AirBnB primarily source heavily from the degree to which drivers and hosts meet and exceed customer needs.

Just ask any Lyft driver who offers you free water, or can’t stop chit- chatting. Or the AirBnB host who gives you a personal “ask any question” walk-through of the home

Assigning Value to the Concierge Economy

My favorite course at Harvard Business School– one which still shapes how I view the world, and prioritize my work — was “Service Management.”

This course revolved around a so-called “service-profit chain” that establishes a critical relationships between profitability, customer loyalty, and employee satisfaction, loyalty, and productivity. Put another way, profit and growth are stimulated primarily by customer loyalty…as well as empowered employees.

Not long after graduating from business school, I put this proposition to the test via a company I founded, PlanetFeedback, which routed millions of letters and comments from consumers to companies about all aspects of brand performance.

What became obvious in studying the data is that most word-of-mouth — or buzz, or earned media — sources from service experiences, and concierge-like behavior.

Well trained employees who really know their stuff and offer great advice consistently win not only our loyalty — and repeat, or premium purchase — but also our tweets, likes, pins, Instagram pics, and ratings and reviews.

Just consider the Apple store employee blending live-interaction and advice with purchasing via an iPad. Apple gets tons of love online for this type of service. Even their “Genius Bar” has many characteristics of the best hotel concierges. Getting this right is at the heart of the winning with customers in the digital age.

There’s another silver lining here. We have complicated issues in our industry — ad proliferation, ad interruption, data privacy breaches. Embracing the Concierge Economy is a golden opportunity to shift the conversation to an area that’s widely embraced by customers.

I mean, have you ever seen someone download an “answer blocker” for a call-agent or a service desk. Unless we’re wildly reckless, this is unlikely to happen.

Then again, none of this is easy. For instance, we can’t treat technology or automation as a solve-all. Consumers love many aspects of service automation, but they hate automation that leads to wrong answers, or forces them through a maze of unnecessary hoops.

I recently signed up for a few chat bots and received an endless stream of bot spam. To win with customers, we need to act like a true concierge, not an ad bully.

We also need to maintain a sense of objectivity. There’s nothing worse than asking the concierge for trusted recommendation of a great restaurant only to find out that his recommendation was incentivized. No one likes a shill. My book, Satisfied Customers Tell Three Friends, Angry Customers Tell 3000 (Doubleday) underscored this point…again and again.

Lastly, to be a great concierge, we’re all going to need to be become better listeners. Always-on, empathetic and nuanced listeners. And we’ll need to get much better at translating the database of questions and concerns we build over time into smarter responses and quick win opportunities.

So this is our moment!

A movement is afoot where a fire-hydrant of questions, queries, voice-commands, sensor signals, bot clicks and more are coming at us across a multitude of channels and devices and selling opportunities. And it’s not going to slow down anytime soon! Trust me!

Is your bell ready?

Pete Blackshaw

Written by

Proud padre. Author. CEO, Cintrifuse startup incubator and syndicate fund. Recent Nestle Global Head of Digital Innovation. Proud alum: UC Santa Cruz, HBS.

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