Perhaps no other company exemplifies customer-centricity as well as Amazon. They do everything to make their customer experience as frictionless as possible. From one-click ordering to nearly effortless product returns, Amazon has become an unstoppable force in e-commerce. Beyond that, customers trust Amazon. By some metrics, Amazon is the most valuable brand in the world.
But, Amazon’s employee experience isn’t quite as distinctive. Job site Indeed gives them an overall employer rating of 3.6 on a scale of 5. That’s respectable, and it edges out Walmart’s 3.5. But, Amazon doesn’t rank in the top echelon of retail employers. Costco and Wegmans, for example, both score 4.2.
Who’s the top retailer on Indeed’s employer rankings? It’s H-E-B, the Texas supermarket chain that was recognized as the grocery retailer customers preferred most. (Amazon did well on that ranking, too, placing third.) H-E-B’s employer rating was 4.3, making them not only the top retailer but also #3 on Indeed’s list of allranked companies.
Just to make that clear, the same company, H-E-B, that beat every competitor in the eyes of their customers also topped every competitor in employee experience ratings. That’s nota coincidence.
While H-E-B and Amazon take two of the top three spots for customer preference, they achieve that status by different means.
Amazon’s loyalty is transactional. Customer experience is driven by their systems and technology. While things have changed a bit since the coronavirus outbreak, Amazon has been not only fast, but phenomenally dependable. If they said it would be on your doorstep Wednesday, it got there Wednesday. I, and millions of other customers, love how easy it is to buy from Amazon.
Amazon’s superb logistics and execution create trust in the brand. They also minimize the need for customer service interactions. Over the last few years, I’ve placed dozens and dozens of orders with Amazon but have neverhad a voice conversation with a real person. The only Amazon humans I’ve actually seen are anonymous delivery drivers who silently deposit goods on my doorstep.
Many customer experience experts say loyalty is driven by delighting and surprising the customer. Or, by exceeding their expectations. I don’t take issue with that. Premium brands like Ritz-Carlton dobuild tremendous loyalty among frequent guests by, at least some of the time, delighting them.
But, even though I’ve never had a delightful, “wow” experience with Amazon, I am incredibly loyal to the brand. Amazon never surprises me, they just deliver as promised. They do exactly what they say they are going to with boring perfection, which is precisely what I value in an e-commerce company.
Some customers may find a ten-hour phone interaction the pinnacle of customer service. I don’t. I’ll go with robotic efficiency and instant gratification every time. Because of Amazon’s focus on minimizing customer effort, they are a hero in my recent book, Friction.
Amazon’s vision of a perfect retail experience also leans toward frictionless shopping. They are currently refining theirAmazon Gostore concept - walk in, grab what you want, and leave. No lines, no checkout process at all. Unremarkable, but effortless.
In contrast, H-E-B builds an emotional bond with their customers. H-E-B expects you to interact with their people. You get your steaks from a butcher, your birthday cake from a baker, and human cashiers and baggers do most of the checking out process.
As I described in mylast article, H-E-B has built a sense of shared identity with its customers based on its Texas roots and presence. Persuasion expert Robert Cialdini calls this “unity” — his seventh principle of influence.
Texans begin with a much stronger sense of shared identity than citizens of any other U.S. state, and H-E-B builds on that in every element of their marketing and customer experience. H-E-B becomes part of that identity, or, in the term popularized by social psychologist Henri Tajfel, part of the same “in group.”
In the words of one Epicurious writer, “H-E-B is Texas.” People who move out of Texas tend to say things like, “I miss myH-E-B,” adding the possessive you wouldn’t normally see attached to a Safeway or Dollar General.
Priya Krishna, a food writer for Bon Appétit and the New York Times, underscores this point in a conversation with Texas Public Radio:
H-E-B’s fanatical loyalty levels are one reason Amazon insiders once recommended the e-commerce giant buy the Texas chain. Ultimately, Austin-based Whole Foods became Amazon’s entry into groceries.
H-E-B’s Texas identity goes far deeper than Texas-shaped cheese and city-themed product names. When disaster strikes, H-E-B is a first responder in Texas. Their remarkable effort after Hurricane Harvey spawned memes like these:
H-E-B’s actions aren’t driven to generate press coverage, they are part of the company’s DNA. Their efforts are conducted under the slogan, Texans Helping Texans.
H-E-B got serious about the possibility of a coronavirus pandemic long before national and state leaders considered it important. In early January, they began laying plans on how to handle supply chain issues. They analyzed the experience of Chinese retailers. While their shelves still emptied during the first wave of panic buying, H-E-B was in a far better position to quickly restock shelves, set purchase limits, and implement sanitizing procedures.
Amazon and H-E-B both have powerful customer loyalty, but their employee engagement diverges. And, the difference runs on the same fault line as their customer interactions.
If Amazon’s customer experience is transactional, so, it seems, is their employee experience. Unpacking the Indeed ratings mentioned earlier, their best rating factor is for pay, where they score 3.7. Other metrics, like culture and management, all fall between 3.2 and 3.4. Their “workplace happiness” rating is 68, an average rating. 73% approve of Jeff Bezos’s performance as CEO.
H-E-B scores far better on the same metrics, with all of the ratings falling in the 3.8 to 4.1 range. Workplace happiness came in at 77, well above average. An astonishing 93% approve of the job Charles C. Butt is doing as CEO.
How does H-E-B keep its employees so happy and engaged? Many factors can affect employee culture and engagement, but I’ll single out one important one, the same one I described above: unity, or, if you prefer, shared identity.
Virtually all of H-E-B’s U.S. employees are Texans. When the chain emphasizes its Texas identity to customers, employees also see that. Whey they come to work, they are surrounded by Texas-themed imagery and branding that remind them that they are part of the same “in group” as their customers and their managers, all the way up to Mr. Butt.
And, with H-E-B’s initiatives like racing to disaster sites with supplies, its employees see that the firm’s commitment to Texans isn’t an empty mission statement.
This adds an extra dimension to customer experience. Other companies have to create a culture of being helpful and courteous to customers. H-E-B can build on the inclination of Texas people to go out of their way help their fellow Texans.
Both Amazon and H-E-B responded quickly to not just retain existing employees but also ramp up hiring in response to the coronavirus crisis. In mid-March, Reuters reported that Amazon temporarily increased their minimum worker pay from $15 to $17 per hour, and said overtime hours would be paid at twice the worker’s hourly rate.
H-E-B employees aren’t as well compensated as Amazon workers. According to Payscale, baggers average $9.67 per hour, cashiers $11.62, and overnight stockers $13.44. Like Amazon, H-E-B announced a $2 temporary wage hike for all of its hourly employees.
But, H-E-B labeled the increase “Texas Proud Pay,” making it clear that this was part of the company’s effort to help Texans. And, in addition to the pay hike, they began serving their employees 50,000 chef-prepared meals weekly. Emotionally, that was likely more impactful than the extra money. In the words of H-E-B’s announcement,
Note the phrasing which mentions “taking care of each other”before“Customers.” I don’t think these are words we’d hear from the relentlessly customer-centric Amazon.
The tens of thousands of free meals make a big difference, too.Jason Bradshawis the author ofIt’s All About CEX!and, like me, an advocate for emphasizing both customer and employee experience. He emphasizes that showing yourappreciation for everyone is one of the most powerful tools to improve experience. Free, high quality meals for tired, stressed-out workers shows appreciation in a more effective and personal way than a slightly bigger paycheck.
H-E-B clearly sees the company, it’s employees, and the communities it serves as part of the same identity.
Amazon is no doubt a good corporate citizen, but when they were planning to build a second headquarters they used a questionable approach. The firm held a combination of an auction and a bake-off to see which city and state would offer the best amenities and incentives.
Shopping for a new location is a common business practice, but many viewed Amazon’s approach as an unequal contest between a greedy firm and cash-strapped communities desperate for quality jobs.
When Amazon selected Long Island City in Queens as one of its two new locations, there was so much community and political pushback that the firm canceled the project.
While H-E-B does get tax breaks for some of its projects, it’s difficult to imagine the firm pitting Dallas, Houston, and Austin against each other to extort the best incentives for a new headquarters. Even in more normal times than today, their focus is on supporting their communities - that’s where their employees and their customers are.
To help its communities, H-E-B earmarks 5% of pretax profit for local charities - something they have done since the 1930s.
Employees can always tell when a company is serious about a topic or if they are just paying it lip service. H-E-B’s actions show that caring about their communities is part of the company’s ethos.
We’re in the middle of the coronavirus crisis, and we are beginning to see the impact of these differences in employee engagement.
Amazon isexperiencing unrestamong its workers despite the additional pay they are offering. Strikes and sick-outs have interrupted work in some locations. Amazon fired the leader of one action, resulting in New York City launching aninvestigation. It’s too soon to tell how big of a threat this worker unrest will be to Amazon’s efforts to keep delivering vital consumer supplies. Nevertheless, the idea that Amazon’s role could be disrupted by its own people is ominous.
So far, things are less acrimonious at H-E-B. When the firm realized that resupplying its stores and helping customers was going to overwhelm its normal staff, management put out a call for volunteers from its headquarters.According to Tina James, H-E-B’s Chief People Officer,
Office workers warehoused goods, stocked store shelves, and ran cash registers to keep supplies moving.
Perhaps I’m reading too much into James’s choice of words, but the phrase “give some relief to our stores” implies a team effort. The emphasis wasn’t, “We’ve got to take care of our customers,” but rather, “We’ve got to help our friends in the stores take care of our customers.” Once again, a common identity unifies everybody.
Motivating workers will get even more difficult as the crisis continues. Fatigue will build, and, at least in the near term, the danger of infection will increase. As researcher and author Dan Ariely has shown, money is not the best motivator. Over time, intrinsic motivation - seeing a purpose in your work - is much more powerful.
When you fear a potentially deadly disease, are you more likely to show up for work for an extra few dollars per hour, or because you know your friends and neighbors are depending on you?
Unfortunately for the rest of us, H-E-B’s approach to its business and brand isn’t a template that can be easily copied. To begin with, Texas is unique among the states for its sense of identity and pride.
Beyond the Texas connection, H-E-B’s family roots and private ownership help avoid the short-term thinking that plagues many public firms. That’s another advantage they and Amazon have in common. A big factor in Amazon’s success has been Jeff Bezos’s refusal to let current period earnings and the company’s stock price influence decision-making.
Nevertheless, any firm can emulate H-E-B’s behaviors to get more loyal customers and more engaged employees. Here are a few ways:
Amazon has shown that putting customers first can lead to disruption and even domination compared to companies that make shareholders their priority. And, this laser focus has made Jeff Bezos the richest man on the planet. The rest of the shareholders have seen astounding returns, too.
But, don’t feel sorry for the owners of H-E-B. Forbespegs the Butt family net worth at $11 billion, tying them with the Rockefellers for #23 on the list of America’s Richest Families. Not bad for a Texas grocer, particularly one who puts customers, employees, and communities first.