Benevolence in Action: Seeking Opportunities to Amaze and Delight

Benevolence in Action: Seeking Opportunities to Amaze and Delight

A Review of FANS! Not Customers: How to Create Growth Companies in a No Growth World, by Vernon L. Hill

When the late, legendary entrepreneur David H. Murdock hired me in 2002 as a Senior Vice President for Marketing at Dole Food Company, I’d naively believed that our customers were people buying bananas, pineapple, and other produce at grocery stores.  To do my job, I had to first wrap my head around the concept that Dole’s customers were in fact the retailers themselves, whose customers were in turn those buying our products at the checkout aisle. My job was to market the healthy benefits of our produce to customers (retailers) and consumers (shoppers).

I came up with an analogy to describe the two categories of nonprofits as I understood them -- the “symphony” model and the “soup kitchen” model.

Understanding this distinction helped me a great deal when the trustees of The Atlas Society recruited me back in 2016 as the nonprofit’s CEO.  I came up with an analogy to describe the two categories of nonprofits as I understood them -- the “symphony” model and the “soup kitchen” model.  In the former, the customers and the consumers are largely the same; in the latter the customers (the donors) were paying for services rendered to the consumers (beneficiaries).  

For most of The Atlas Society’s history, the organization had titled more into the symphony model -- the donors were by and large the consumers of the events and publications it produced.  My vision to shift the model more towards the soup kitchen version, catering to young people as our consumers.  Convincing longstanding customers to invest in new strategies to engage this younger demographic with Ayn Rand’s ideas, was met by equal parts of skepticism and enthusiasm.  

This was completely understandable.  Some were satisfied by the old model, and the means of reaching younger audiences (e.g. social media, viral videos, graphic novels, podcasts) seemed baffling, if not downright repugnant.  Others welcomed change, understanding that we had a real opportunity to harness the revolution in how ideas are transacted, and a necessity to face facts when it came to changing reading habits and the new ways in which content was being consumed. 

As the lead character in Amor Towles’ A Gentleman in Moscow observed: "It is the business of the times to change...and it is the business of gentlemen to change with them."

As the lead character in Amor Towles’ A Gentleman in Moscow observed: "It is the business of the times to change...and it is the business of gentlemen to change with them."

My challenge -- then and now -- would be to deliver superior value by finding ways to amaze, delight and educate both our consumers (young people) and our customers (donors)  By and large, I believed that if we could demonstrably deliver superior results in engaging young people with Rand’s ideas, we would retain and grow our base of donor support -- and given the quadrupling of annual revenues over the last nine years, we’ve succeeded in that regard.

But beyond results, I started searching for other ways to go the extra mile for our customers.  They had plenty of other opportunities to invest their scarce philanthropic resources.  Were there ways we could deliver superior customer service, in the way we thanked donors, involved their children and grandchildren, sent tokens of appreciation that would be meaningful to them -- and those they cared about, even their pets?

As the entire team leaned into the mission of customer/donor appreciation, we learned a lot.  We learned that many donors felt taken for granted by other causes they support, and that handwritten thank you notes (and sometimes personal videos), remembered birthdays and anniversaries, special gifts, regional social clubs and online “happy hours,” and even swift apologies when we screw up went a long way towards building deeper, more authentic bonds with those who make our work possible.  

We treated donors not just as potential sources of funding -- but also sources of good ideas they had implemented in their own careers, ideas that could now be applied to enrich our own customer experience.

We treated donors not just as potential sources of funding -- but also sources of good ideas they had implemented in their own careers, ideas that could now be applied to enrich our own customer experience.  One such donor was Vernon Hill, founder of Commerce Bank in the U.S. and Metro Bank in the U.K. who during a meeting in Philadelphia gave me a signed copy of his book, FANS! Not Customers: How to Create Growth Companies in a No Growth World.

The tome turned out to be a treasure trove of ideas about branding, innovation and above all, dedication to a customer-centric business model, based on his experience disrupting one of the staidest industries of all -- banking -- and building a customer-obsessed empire. Hill's unyielding mantra: "Our raison d'être is simple: we want FANS, not customers." In example after example, he showed how his banks earned loyalty and deep connection from customers by delivering relentless delight and over-the-top service.

Hill’s constant courting of customers, creative approach to branding, and intense attention to detail paved the way to fortune. After starting with Commerce Bank in southern New Jersey in 1973, Hill grew it to $50 billion in assets and 440 locations before selling it for $8.5 billion in 2007. Forbes hailed him as one of the elite CEOs, alongside Larry Ellison and Warren Buffett, who delivered 23% compounded returns over two decades.

"We were about to deliver something that market research couldn’t measure," Hill writes, "a level of service that people couldn’t compare with anything they previously experienced: a unique retail experience."

Along the way Hill turns skeptics into evangelists. 28 years after founding Commerce Bank in New Jersey, when Hill took the concept to Manhattan, the press scoffed: How could a Jersey upstart compete in the Big Apple? "But we were about to deliver something that market research couldn’t measure," Hill writes, "a level of service that people couldn’t compare with anything they previously experienced: a unique retail experience." They arrived with "real service and convenience," and the fans followed. 

Similarly, launching Metro Bank in London in 2010 amid a banking cartel, Hill faced doubters. Yet, by spotting opportunities the incumbents ignored—like reintroducing the safe deposit boxes the established banks had long abandoned—he zeroes in on unmet customer needs: "The incumbents owned 88% of the market when we arrived and by shutting down this aspect of service, they sent tens of thousands of customers racing into our arms. Box fees alone now pay most of the rent for our stores... It’s what I call found money. The cartel lost it; we found it."

Hill's tales of "surprise and delight" are infectious. Picture this: On a rainy day at Metro Bank's Holborn store, employees spotted 20 people queuing in the downpour for an ATM across the street. "It made us crazy seeing their inconvenience," Hill recounts. So, they grabbed raincoats and umbrellas, marched over, and escorted them inside to their dry ATMs. Or the evening a customer left his checkbook behind after closing time. An employee didn't just hold it—he called the man, learned he was at a nearby pub, and delivered it personally. "Needless to say, the man and his friends were so blown away... many new Metro Bank accounts followed." 

"Fans tell their friends about you. They join your team. At family and friends’ barbecues, they tell everyone about something magnificent your employees did for them, above and beyond the call of duty."

These aren't scripted PR stunts; they're the organic result of an intentional culture aiming to spot opportunities to turn customers into fans, because "fans tell their friends about you. They join your team. At family and friends’ barbecues, they tell everyone about something magnificent your employees did for them, above and beyond the call of duty."  

By seeking out similar opportunities to meet our donors needs -- whether it involves playing matchmaker, or helping with business introductions, or sending bouquets to hospital rooms, or sending “Ayn Rand care packages” to grandkids, or showing up to help downsize a library -- we were not only able to retain and upgrade our existing donor base, the “barbecue effect” also meant as word spread, long lapsed donors and new donors stepped forward to join our community.

One example: Steve, a new supporter who’d previously been directing nearly $100K in annual support to another Objectivist organization, was pleasantly surprised by the heartfelt appreciation and creative attention to detail he received from our team.  As we gradually began to earn more and more of his support, he connected me with the female CEOs of two other libertarian organizations he supports, and joked that like Rand’s favorite Charlie’s Angels television series, he thought of us as “Stevie’s Angels.”  So using the iconic Charlie’s Angels design, I made up a Stevie’s Angels t-shirt to wear to our next meeting -- plus one for him and two for the other female leaders.

Happy to report that the funding that had previously flowed to another Objectivist organization is now fully committed to The Atlas Society.  Creative, outside the box touches -- like this and those Hill describes -- really can make an immense difference in turning customers/donors into FANS.

Hill emphasizes the importance of design, presentation and over-the-top live events (like bank grand openings) as another means he deployed to concretize the essence of his banks’ brand in the service of turning customers into fans.

Throughout the book, Hill emphasizes the importance of design, presentation and over-the-top live events (like bank grand openings) as another means he deployed to concretize the essence of his banks’ brand in the service of turning customers into fans.  He credits much of this magic to his wife, Shirley—the "brand queen" whom he married in 1973, the same year Commerce Bank launched. Her influence permeates the book's emphasis on design as a "competitive weapon." "Go ahead, judge our bank by its cover," Hill quips, noting that while Apple stores averaged 5,400 visits a week, Commerce Bank's averaged 12,000 in 2006. Grand openings became circus events with live bands, stilt walkers, and free food

This inspired me to lean into ways to make the themes of our events (student conferences and fundraising galas) unique and unusual -- Yoga one year, Superheroes the next, Chess (with outsized chessboards and players), another year, and this year, “Making Objectivism Multiplanetary.”  What could we deliver at our events that attendees wouldn’t experience at others?  Speed painting, ferris wheels, and Cirque-de-Soleil inspired performances ensued.

By recognizing the deep emotional bond people have with their pets, Hill found creative ways to further reinforce the emotional bonds his business shared with its fans.

Hill also inspired me to expand the line of products (donor gifts) for pets (e.g. water bowls, kerchiefs, collars) and kids (e.g. bibs, onesies, toddler t-shirts) emblazoned with slogans like “Who is John Galt?”  At first Hill raised eyebrows with "Dogs Rule and Kids Rock!" campaign.  But Metro Bank's dog-friendly policy--complete with treats, water bowls, and free bandanas—has fans stopping him on London streets: "Aren’t you the banker with the dog?"  By recognizing the deep emotional bond people have with their pets, Hill found creative ways to further reinforce the emotional bonds his business shared with its fans. Similarly, Metro Bank understands that most customers are also parents or grandparents, with programs like their “5 for 5 Club” in which kids under 11 can open savings accounts, or learn about money, finance, savings and the importance of having a budget through their “Metro Money Zone” educational program.

The most important practical insights of the book are to be found in its chapter, "Eight Ways to Be AMAZE(ING)", in which Hill shares the mnemonic device he employed to build a consistent company culture--and while the original audience might have been Metro Bank employees, it's also a useful framework for anyone wanting to revolutionize their own organization. From "A - Attend to Every Detail" ("Retail is in the detail") to "E - Exceed Expectations" (an employee lending her umbrella to a suited customer in the rain, sparking new deposits and accounts), Hill distills his playbook. 

Hill also described his practice of deploying mystery shoppers to visit competing bank branches to look for opportunities to exceed expectations with his own customers.  No bikes allowed in other banks?  Hill welcomed them in.  Lengthy and complicated processes to open new accounts?  Hill streamlined Metro Bank’s process to 15 minutes.  More often than not, his sleuthing exposed competitors' apathy: no greeters, no follow-ups, just indifference.

When I personally donate to other liberty organizations, I’m investing in work I care about -- but I’m also not above taking notes on how my donations are thanked, and what kind of follow up I receive. Can I learn from what organizations are doing -- and from what other organizations are not doing?   As Atlas Society founder David Kelley, Ph.D famously observed: “If we are right we have nothing to fear, if we are wrong we have something to learn.”  How can we keep learning, and elevating our customers’ -- and consumers’ -- experience?

Hill's own journey adds inspirational depth. The eldest of six from Vienna, Virginia, he was captivated by McDonald's profitability on a 15-cent burger as a teen. After Wharton, he dove into real estate, developing over 100 McDonald's sites (even touring with Ray Kroc), before circling back to his first love: banking. At 26, he raised funds for a new charter, birthing Commerce with one office and nine colleagues.

Give your customers, donors, or students “legendary service, and one day your company will be a legend too."

In FANS! Not Customers, Hill doesn't just diagnose the problems with staid industries in sluggish economies—he prescribes a cure: "Emotional brands create massive value; building FANS not customers creates emotional brands." This book is a rallying cry for entrepreneurs of every stripe -- from executives, to nonprofit leaders to educators: Give your customers, donors, or students “legendary service, and one day your company will be a legend too.”  From a legendary entrepreneur, this advice, if taken, will serve as a force multiplier, creating legions of loyal fans who will evangelize for your brand.

As Ayn Rand reminds us: "Capitalism demands the best of every man - his rationality - and rewards him accordingly. It leaves every man free…to go as far on the road of achievement as his ability and ambition will carry him."  FANS! Not Customers continues to inspire me to go farther down that road, confident that those extra miles will bring the smiles and mutual appreciation of enthusiastic customers and consumers alike.