Marginally Better S01E01: Experience & Excellence

Join host Joe Taylor Jr. as he explores the fine line between customer experience triumphs and costly missteps. From Starbucks’ turnaround to Walgreens’ recent struggles, Joe breaks down what happens when businesses lose sight of what truly matters—delivering a great customer experience at its core. Tune in to hear how plexiglass barriers and impersonal service can drive customers away and why Zappos is still more than just a shoe store. Let’s take a sharp, insightful look at where companies go wrong and how they can course-correct before they lose touch with their customers.

Links from this episode:

• Explore what factors are at play when Walgreens shutters close to 1,200 stores over the next three years.
• Find out just how badly the plexiglass move affected Walgreens.
• Walgreens’ Executives admit that the shoplifting threat was ‘overstated’ as they grapple with the customer fallout.
• Walgreens’ CEO discusses the flip side of investing in increased security.
• Cal Newport shares his TikTok experience.

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Transcript:

[00:00:00] Announcer: From the global headquarters of Johns and Taylor in beautiful New Jersey, it’s marginally better. Here’s your host, Joe Taylor, Jr.  

[00:00:11] Joe Taylor, Jr.: On the show this week, I believe that customer experience and business performance go hand in hand. You can and will improve your company’s margins by investing in experience. 

[00:00:23] So I’ve got three textbook examples of companies that burst onto consumers radar with transcendent. Service experiences and they later paid the price when they drifted away from those core values. We’ll deep dive into the recent fortunes of Walgreens who placed a bad bet on locking your most urgently needed items behind walls of plexiglass and will examine what your business can do to protect itself in case your favorite social network suddenly disappears. 

[00:00:55] That’s all coming up after the break on marginally better. 

[00:01:04] Welcome to Marginally Better, a show about business, innovation, and the American economy. I’m Joe Taylor Jr.  

[00:01:10] By training, I’m a Master Certified User Experience Consultant. And when working with our team at Johns & Taylor, I’m helping our clients build websites or apps at the sweet spot where their business goals and customers desires intersect. 

[00:01:25] But I’ve also reached this point in my career via some unusual routes. As a radio producer and journalist, I’ve spent years telling stories. And figuring out what entertains audiences. And I also spent six years working in Apple during the transition between the Steve Jobs and the Tim Cook eras. So, I know what it takes to ship outstanding products backed up by transcendent customer experiences. 

[00:01:49] So I was inspired to launch the series because there’s a lot of chatter and pessimism, especially about online user experiences, and I won’t debate that. I’ve walked away from plenty of project proposals where a business wanted us to goose their revenue numbers by making their experience a little worse, and I’m proud that our team’s never taken that kind of job. 

[00:02:13] So as I’ve experienced them, The past few decades have been about businesses figuring out how to disrupt their competition through technology. We’re now at the point where everyone’s using the same old growth hacks. Some tactics that our industry declared unethical 20 years ago are now getting taught as basic procedures in coding boot camps. 

[00:02:36] And if you’ve listened to or read any of the work from folks like Ed Zitron, Corey Doctorow, or Molly White, you know that consumers are getting fed up and they’re calling companies out on bad behavior. People are waking up to the idea that they’re not boxed into a single choice for a particular good or service. 

[00:02:57] And under those conditions, the next few decades will reveal a new cohort of hyper successful companies that can jumpstart their fortunes by distinguishing their online and offline experiences. And sure, there’s still an overarching school of thought in business that austerity maximizes profits. But you don’t have to run your business that way. 

[00:03:22] I believe that customer experience and business performance go hand in hand. You can. And will improve your margins when you invest in experience. And you don’t just have to take my word for it. Let’s talk about three textbook cases of brands that exploded revenues by investing heavily in the customer experience. 

[00:03:44] [Music continues softly]  

[00:03:46] You know that feeling when you walk into a store or call customer service and you’re already bracing yourself for the worst. You’re preparing for battle with some mythical bureaucracy that seems explicitly designed. To frustrate you well today we’re going to tell you about something different something that actually works  

[00:04:08] [Music shifts to a more upbeat tone] 

[00:04:09] in 2008 Starbucks did something that sounds almost ridiculous Now they closed every single one of their US stores for three hours – not for renovations or deep cleaning, but to retrain their baristas to make the perfect cup of coffee. Now their CEO at the time, who had just returned to the company, called it their transformational moment. And here’s the thing, it worked. Their customer satisfaction scores went up 20% that year. More than that, their stock price, it tripled over the next five years. Now as the New York Times reported at the time, quote, Starbucks, once a magic name on Wall Street, is increasingly seen there as just another big food chain, end quote. So they used the training reboot to kick off a wave of growth built on their reputation for quality products and services, and most importantly, experiences. 

[00:05:09] Should they do it again?  

[00:05:10] Starbucks has received some criticism lately. Detractors worry that catering too specifically to a fickle younger demographic has increased wait times when their queues are full of complex customized TikTok drinks. Another few months into the tenure of a new CEO who’s promising to once again bring the company back to its roots, this time by ensuring that they can deliver a high-quality handcrafted beverage in four minutes or less, we’ll be seeing what happens. 

[00:05:42] [Contemplative piano note] 

[00:05:47] Now imagine you’re running an online shoe store and you decide to do something that goes against every principle of efficient business operations. You tell your customer service reps to spend. As much time as they want on the phone with customers. No time limits, no scripts, just talk.  

[00:06:07] And that’s precisely what Zappos did. They even amplified what is now a pretty famous story. Maybe you’ve heard it, where one of their reps spent over 10 hours on a single call with a customer. Not because there was a problem, but because the conversation just kept going.  

[00:06:25] [Light percussion joins the background music] 

[00:06:26] When Amazon bought Zappos in 2009, they paid 1.2 billion. The New York Times detailed this at the time, calling it a testament to the power of customer service in the digital age. 

[00:06:43] And Zappos continues to exist inside of Amazon as a standalone brand, even though Amazon itself often beats Zappos pricing and delivery speed, all because of the loyalty built from those powerful early customer experiences.  

[00:07:01] [Music swells slightly] 

[00:07:03] You know, what’s interesting about Netflix, they could have stuck with their DVD by mail service. 

[00:07:08] It was working, people liked it, but they saw something coming, a shift in how we consume entertainment. And instead of fighting it, they did something remarkable. They disrupted themselves. They created an impossibly complex algorithm that could predict what you want to watch.  

[00:07:27] But here’s what’s fascinating. They didn’t just use it to recommend movies. They used it to decide what. And the first major original series wasn’t just a shot in the dark. It was based on data showing their subscribers liked certain actors, genres, and similar shows. The results, Netflix went from a company worth about 2 billion in 2008 to, well, let’s just say it’s market cap today has made those early investors very, very happy.  

[00:07:58] Financial times captured this transformation in a 2013 piece, which a decade later they’re facing criticism that the algorithm has gotten too heavy handed, and that it’s focusing too much on second screen delivery instead of letting creative professionals make great work, but it was that willingness to commit so fully to the customer experience that vaulted them from a niche blockbuster competitor to the kind of company that can hire a Beyonce to mount a football halftime show that’s not even at the Super Bowl. 

[00:08:38] [ Music fades to single piano notes] 

[00:08:40] You know, it’s funny. We often think about business as this cold, calculating thing, numbers, profits, bottom lines. But what these stories show us is something different. They show us that sometimes the most calculating thing you can do is care about your customers.  

[00:08:58] Each of these three cases, there are two possible outcomes. 

[00:09:02] Those companies can choose to disrupt themselves and regain their reputations for powerful customer experiences, or they can sit back and watch while someone new to the market pushes the boundaries of that experience even further.  

[00:09:16] We’ll be here watching and tracking together right here on Marginally Better. 

[00:09:22] After the break, the button Walgreens can press to unlock a revitalization in their stores. Stay with us. 

[00:09:35] Welcome back to marginally better. I’m joe taylor jr It’s a story we’ve all seen play out in our neighborhoods the local pharmacy once a cornerstone of the community Now with bare shelves behind plexiglass Items locked away in cases and store closing signs in some of the windows This is what’s happening at Walgreens, where an effort to stop shoplifting may have ended up driving away the very customers they were trying to retain. 

[00:10:03] This story goes back to 1901. Charles Walgreens, Sr. worked in a succession of drugstores in Illinois, eventually purchasing the store he was working in, embedded in the corner of a Chicago hotel. According to company historians, Charles hated the status quo in the drugstore business. He thought Drugstores were dark, unwelcoming places. 

[00:10:26] He had some big ideas that changed the shape of his entire industry. Everyone who entered that first Walgreens was greeted by the store manager and sometimes by Walgreen himself. He widened aisles. He added a bigger variety of products. He figured customers would swing through for more day to day needs along with their prescriptions. And he pioneered private label products, often making better versions of the things he was copying.  

[00:10:57] A few years ago, Walgreens had a problem. Like other retailers in the United States after the pandemic, they were losing inventory. Retailers tracked this with a metric they call “shrink” – and it was an alarming rate. So, they did what seemed logical to them at the time. They started locking everything up. Deodorant, shampoo, toothpaste, items that used to sit innocently on open shelves were suddenly behind plastic barriers, requiring an employee with a key to access them.  

[00:11:30] The company’s CEO, Tim Wentworth, recently admitted what many customers had already figured out. 

[00:11:37] Tim Wentworth recording: “I just met with our head of, of asset protection to look at some of the creative things that we are looking at, both as a company and as an industry, as it relates to the customer experience on shrink. I don’t have anything magnificent to share with you today. It is a hand-to-hand combat battle still, unfortunately. But, uh, but it does impact how sales work through the store. Because when you lock things up, for example, you don’t sell as many of them. We’ve, we’ve kind of proven that, uh, pretty, pretty conclusively.” 

[00:12:03] Joe Taylor, Jr.: It’s a perfect example of how solving one problem can create many more. Walgreens announced it would close hundreds of locations this year. Part of a larger plan to shutter about more than a thousand locations over the course of a few years. bring the company’s U. S. footprint from well over 8,000 locations to slightly more than 6,000. 

[00:12:25] Wentworth has told investors that the issues facing Walgreens are common among the entire industry, and he’s been floating plans to take the company private. However, the core of this debate extends beyond locked up merchandise and stretched staffs. It highlights a fundamental disconnect between security and service as well as between protection and accessibility. 

[00:12:48] [Musical shift to more optimistic tone]  

[00:12:51] So what could Walgreens do differently? We’ve got three pieces of advice that could help them get back on track. 

[00:12:59] [Upbeat transition music]  

[00:13:04] First, customer service as security. It’s not enough to just throw more people on the sales floor. Walgreens must consider re imagining what security looks like in a retail environment. Instead of a security guard standing by the door, looking intimidating. You can have well trained employees actively walking the aisles, engaging with customers. 

[00:13:27] They’re not just there to prevent theft. They’re there to help you find the right sunscreen or explain the difference between cold medicines or suggest a good multivitamin. This goes back to the practice that Charles Walgreen started himself all the way back in 1901.  

[00:13:46] This approach has worked remarkably well for companies like Costco, where engaged employees and excellent customer service have helped keep their shrink rates low without having to resort to fortress like security measures.  

[00:14:00] It’s very common at high end retailers to cross train floor staff in both customer service and loss prevention techniques, but it’s more likely that you could hire someone from the community who’s paid well enough that they can authentically engage with their neighbors who are regular customers while maintaining a watchful presence over the store. 

[00:14:22] Now that may not be a popular move at a public company that desperately wants to report a lower payroll line item. That may be another reason why they’re thinking of taking the company private. But this is probably way less expensive than enduring that shrink and surviving an exodus of customers who don’t prefer to wait for attendance to unlock a bottle of detergent. 

[00:14:45] [Thoughtful musical transition]  

[00:14:46] Second, let’s talk about the Walgreens app. It’s a great first step. It solves lots of problems by moving some of the interaction from the pharmacy counter to your phone. And sure, not everyone wants to interact with Walgreens through an app all the time, but if your competition increasingly looks like Amazon and maybe Uber, the app might be the way to go. 

[00:15:09] Walgreens already has functionality in their app that lets you pre order items from throughout the store and shelve them for pickup. However, if you read employee reviews on Reddit or Glassdoor, you’ll hear a common refrain that the company has under invested in the number of people it needs to deliver on the app’s promise. Overtaxed workers have to run around the store collecting items like it’s a scavenger hunt. Even as they’re trying to maintain order while at the photodesk.  

[00:15:36] The app only rewards you for planning ahead. It doesn’t account for impulse purchases, the kind that Charles Walgreen rightly predicted would become the foundation of his business. 

[00:15:48] So here’s where Walgreens might take a cue from the hotel industry. If I can check into a Hilton property, I can usually request a digital key that unlocks my room, even if I have bypassed the front desk. So if I’m a trusted customer at Walgreens, why not let me unlock those cabinets myself with my smartphone app? If you absolutely must keep some items under plexiglass, why not just give me the key? 

[00:16:16] And third, this idea of being a community touch point deserves much more attention. Walgreens has over 6,000 locations left even after their planned closures. That’s 6,000 opportunities to be more than just a place to pick up aspirin. They can partner with local health organizations to offer wellness workshops. They can create community health hubs where people can get basic health screenings, nutrition advice, or even mental health resources. They can offer telehealth services, vaccination clinics, or diabetes management programs. The pharmacy counter can become a health education center, and a focus on superfoods and wellness products can expand into learning opportunities. You could demonstrations for healthy meals, sessions with nutritionists or wellness challenges that bring the community together.  

[00:17:11] These changes would require a significant investment. Yes, but they are investing anyway in locks, security systems, inventory control. Why not invest in something that could actually grow their business instead of just protecting it? 

[00:17:28] Something that can transform their stores from places people have to go to places people want to go, better customer service creates stronger community connections. Digital innovations make health services more accessible, and when people see your store as a valuable part of their community, they’re more likely to protect it, especially in the absence of independent local competitors. 

[00:17:52] [Music begins to fade]  

[00:17:54] It’s a vision of retail that’s less about transactions and more about transformation. It’s less about protecting inventory and more about serving people. And in the end, isn’t that what a neighborhood pharmacy should be about?  

[00:18:11] After the break, what happens when your favorite internet service disappears? 

[00:18:15] That’s up next on Marginally Better. 

[00:18:25] It’s Marginally Better. I’m Joe Taylor Jr.  

[00:18:29] Do you know that feeling when something you use every day disappears? That’s what happened to 170 million Americans when TikTok went dark in response to a law and a whole bunch of political mess. And we won’t get into that, but here’s the thing; the response wasn’t exactly what you might have expected. 

[00:18:50] Zach, a 24 year old regular user of TikTok, got quoted in the New Yorker saying, ‘I would probably forget about it in a short time.’ And he’s not alone. While TikTok influencers were performatively crying themselves to sleep, most users displayed a kind of shrugging acceptance.  

[00:19:09] And it’s a pattern we’ve seen before. Remember when AOL was everything? You’ve got mail. That sound was the heartbeat of the internet. Do you remember when Dig was the front page of the web? Their declines sparked genuine mourning among fans, but we all found ways to move on. And as for TikTok, the response has been more like watching a favorite restaurant close. Sad, sure, but you’ll find somewhere else to eat. Even though TikTok reappeared after about a day, the disruption made many users question whether they needed the service.  

[00:19:45] The story here isn’t about loyalty, it’s about adaptation. The influencers and small businesses who built their livelihoods on TikTok’s algorithm are still scrambling. But many had already hedged their bets across platforms; Instagram Reels, YouTube Shorts, they’re all part of the same ecosystem now.  

[00:20:05] Here’s what’s fascinating, the businesses that thrived most on TikTok weren’t necessarily the ones with the most significant budgets or the slickest production. They were the ones who understood its language. Quick, authentic, often imperfect. A restaurant showing the sizzle of a dish being made, a bookstore employee’s genuine reaction to a new release. That’s the kind of stuff that caught fire.  

[00:20:30] So what now? Smart business owners are realizing something important. It’s not about. platform. It’s about the connection. Whether TikTok returns permanently or not, the lesson is clear. Don’t build your house on rented land. Use social media as a tool, not as a foundation. Create content that can live anywhere. Build your email list. Strengthen direct relationships with your customers. 

[00:20:56] Platforms come and go, but good stories, those stick around. 

[00:21:01] And maybe that’s the real story here. Not about what we lost when TikTok went dark, but about what we might find when we look up from our phones. 

[00:21:19] Thanks for listening to Marginally Better. If you like what you heard, please help us out. Leave a quick review on Apple podcasts. It will help us spread the word about the show to people like you who care deeply about great customer experiences.  

[00:21:33] If you want to get behind the scenes notes from me and the rest of the team, go to marginallybettershow.com or follow the link in our show notes.  

[00:21:42] Marginally Better is a Calufrax radio production. Our producer is Nicole Hubbard with research by Connie Evans.  

[00:21:48] I’m Joe Taylor, Jr.