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:

Announcer: From the global headquarters of Johns & Taylor in beautiful New Jersey, it’s Marginally Better.

Here’s your host, Joe Taylor Jr.

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 margins by investing in experience.

I’ve got three textbook examples of companies that burst onto consumers’ radar with transcendent service experiences — who later paid the price by drifting 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 we’ll examine what your business can do to protect itself if your favorite social network platform suddenly disappears.

That’s all after the break on Marginally Better.

Welcome to Marginally Better, a show about business, innovation, and the American economy.

I’m Joe Taylor Jr.

By training, I’m a Master Certified User Experience consultant. 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.

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. I also spent six years working at Apple during the transition between the Steve Jobs and Tim Cook eras, so I know what it takes to ship outstanding products backed up by transcendent customer experiences.

I was inspired to launch this series because there is 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 goose their revenue numbers by making their experience a little worse. I’m proud that we’ve never taken that kind of job.

As I experienced them, the past few decades were 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 getting now taught as basic procedures in coding bootcamps.

If you’ve listened to or read any of the work from folks like Ed Zitron, Cory 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. 

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 is still an overarching school of thought in business that austerity maximizes profits. But you don’t have to run your business that way. I believe that customer experience and business performance go hand in hand. You can — and will — improve your margins by investing 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.

[Music continues softly]

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.

[Music shifts to a more upbeat tone]

In 2008, Starbucks did something that sounds almost ridiculous now. They closed every single one of their U.S. stores for three hours—not for renovations or deep cleaning but to retrain their baristas to make the perfect cup of coffee. Their CEO, 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. But more than that, their stock price? It tripled over the next five years. 

As the New York Times reported at the time, “Starbucks, once a magic name on Wall Street, is increasingly seen there as just another big food chain.” So, they used the training reboot to kick off a wave of growth built on their reputation for quality products and services.

Should they do it again?

Starbucks has received some criticism lately. Detractors worry that catering too specifically to a fickle younger demographic has increased wait times when queues are full of complex, customized TikTok drinks.

They’re a 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 they can deliver a high-quality, handcrafted beverage in four minutes or less.

[Contemplative piano note]

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…. talk.

That’s precisely what Zappos did. They even created this 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.

[Light percussion joins the background music]

When Amazon bought Zappos in 2009, they paid $1.2 billion for a company that started by selling shoes out of a small apartment. The New York Times detailed this remarkable journey in their piece “A Satisfied Customer? Just Wait Until He Tells His Friends” from May 2009, calling it “a testament to the power of customer service in the digital age.”

Zappos continues to exist inside Amazon even though Amazon itself often beats Zappos pricing and delivery speed — all because of the loyalty built from those powerful early customer experiences.

[Music swells slightly]

You know what’s interesting about Netflix? They could have stuck with their DVD-by-mail service. It was working. People liked it. But they saw something coming – this shift in how we consume entertainment. And instead of fighting it, they did something remarkable.

They created this impossibly complex algorithm that could predict what you want to watch next. But here’s what’s fascinating – they didn’t just use it to recommend movies. They used it to decide what shows to make. Their first major original series? It wasn’t just a shot in the dark. It was based on data showing their subscribers liked certain actors, genres, and similar shows.

[Music becomes more contemplative]

The result? Netflix went from a company worth about $2 billion in 2008 to… well, let’s just say its market cap today would make those early investors very, very happy. The Financial Times captured this transformation in their 2013 analysis, “Netflix: The Data-Driven Entertainment Revolution,” which revealed how the company’s deep dive into customer preferences reshaped not just its business but the entire entertainment industry.

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 Beyonce to mount a football halftime show that’s not even at the Super Bowl.

*[Music fades to single piano notes]*

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.

In each of these three cases, there are two possible outcomes. 

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.

We’ll be here watching and tracking together — right here on Marginally Better…

After the break… the button Walgreens can press to unlock a revitalization in their stores. Stay with us.

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.

This story goes back to 1901. 

Charles Walgreen 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. 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 and added more variety of products, figuring 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.

[Brief musical transition]

A few years ago, Walgreens had a problem. They were losing inventory –  retailers track this with a metric they call “shrink” – at an alarming rate. So they did what seemed logical 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.

The company’s CEO Tim Wentworth recently admitted what many customers had already figured out: “When you lock things up, you don’t sell as many of them. We’ve kind of proven that pretty conclusively,” he told investors.

[Thoughtful pause]

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. That would bring the company’s U.S. footprint from well over 8,000 locations to slightly more than 6,000.

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.

[Musical shift to more optimistic tone]

So what could Walgreens do differently? We’ve got three pieces of advice that could help them get back on track.

[Upbeat transition music]

First: “Customer service as security.” 

It’s not enough to just throw more people on the sales floor. Walgreens must consider reimagining what security looks like in a retail environment. Instead of a security guard standing by the door looking intimidating, you have well-trained employees actively walking the aisles, engaging with customers. 

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.

This approach has worked remarkably well for companies like Costco, where engaged employees and excellent customer service have helped keep shrink rates low without resorting to fortress-like security measures. 

It’s very common at high-end retail 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 regular customers while maintaining a watchful presence over the store.

That may not be a popular move at a public company that desperately wants to report a lower payroll line item. But it’s probably way less expensive then enduring the shrink, and surviving an exodus of customers who don’t prefer to wait for attendants to unlock a bottle of detergent.

[Thoughtful musical transition]

Second: Let’s talk about the Walgreens app. It’s a great first step and it solves lots of problems by moving a lot of 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 even Uber? The app might be the way to go.

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 underinvested in the number of people it needs to deliver on the app’s promise. Overtaxed workers have to run around a store collecting items like a scavenger hunt, even as they’re trying to maintain order at the photo desk.

The app only rewards you for planning ahead, though. It doesn’t account for the impulse purchases Charles Walgreen rightly predicted would become the foundation of his business. 

Here’s where Walgreens might take a cue from the hotel industry. If I check into a Hilton property, I can usally request a digital key that unlocks my room, even if I have bypassed the front desk.

If I’m a trusted customer at Walgreens, why not let me unlock those cabinets myself with my smartphone app? If you absoluetly must keep some items under plexiglass, why not give me the key?

And third – this idea of being a community touchpoint 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 could partner with local health organizations to offer wellness workshops. They could create community health hubs where people can get basic health screenings, nutrition advice, or even mental health resources.

Think about their new micro-fulfillment centers – why not use the space they free up in stores to create comfortable consultation areas? They could offer telehealth services, vaccination clinics, or diabetes management programs. The pharmacy counter could become a health education center. Their new focus on superfoods and wellness products could expand into learning opportunities – cooking demonstrations for healthy meals, sessions with nutritionists, or wellness challenges that bring the community together.

[Music shifts to more contemplative tone]

These changes would require significant investment, yes. But they’re investing anyway – in locks, in security systems, in inventory control. Why not invest in something that could actually grow their business instead of just protecting it? Something that could 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.

[Music begins to fade]

It’s a vision of retail that’s less about transactions and more about transformations. It is less about protecting inventory and more about serving people. And in the end, isn’t that what a neighborhood pharmacy should be about?

After the break — what happens when your favorite internet service disappears?

That’s up next on Marginally Better.

It’s Marginally Better — I’m Joe Taylor Jr.

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. But here’s the thing – the response wasn’t exactly what you might expect.

“I would probably forget about it in a short time,” says Zack, a 24-year-old regular user quoted in The New Yorker. And he’s not alone. While TikTok influencers were performatively “crying themselves to sleep,” most users displayed a kind of shrugging acceptance. It’s a pattern we’ve seen before.

Remember when AOL was everything? When that “You’ve Got Mail” sound was the heartbeat of the internet? Or when Digg was the front page of the web? Their declines sparked genuine mourning among fans, but we all found ways to move on. 

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.

The real 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 and YouTube Shorts are all part of the same ecosystem now.

[Music swells slightly]

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.

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

[Music begins to fade]

Platforms come and go. But good stories? Those stick around. 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.

Thanks for listening to Marginally Better.

If you like what you heard, please help us by leaving 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.

If you want to get behind-the-scenes notes from me and the rest of the team, go to Marginally Better Show dot com or follow the link in our show notes.

Marginally Better is a Calufrax radio production. 

Our producer is Nicole Hubbard, with research by Connie Evans.

I’m Joe Taylor Jr.