How Creating Distinction in the Marketplace Creates Meaningful Customer Experiences

Scott McKain is a Hall of Fame keynote speaker, a multi-time bestselling author, and probably the best voice on the stage that you’ll ever hear.  Below is a conversation about creating meaningful customer experiences through a focus on distinction.

Dan Gingiss: You honed your voice in radio earlier on in your career. Is that right?

Scott McKain: I started working in radio on my 14th birthday. It was more because my parents owned the local grocery store, and I think the station thought they’d buy more commercials because, you know, guys know when you’re 14, your voice is changing. It doesn’t sound like this. But that was very fortunate. I worked for a while in radio and a while in television and had that media background. So it’s really been a a nice journey.

Photo of Scott McKain

Dan Gingiss: That’s awesome. Scott, you’ve had a long and illustrious career. I was actually looking something up and saw that you are coming up on your fortieth year of being a member of the NSA [National Speakers Association, of which I am also a member]. That’s incredible. Tell us something that’s happened to you in the last almost 40 years, that maybe you haven’t shared on stage before. Or that is just sort of a fun story to help us get to know Scott McKain a little bit better.

Scott McKain: Wow, what a great question. Yeah, you didn’t know you could become a member at five, did you? 

Dan Gingiss: Right! Exactly. Very impressive, Scott.

Scott McKain: I got paid for my first professional speech at 18 years old. I had been a state officer of FFA, Future Farmers of America, and an ad group paid me to come speak. It was the Kentucky Farm Bureau and I got paid for my first professional speech, at 18. And so I’m really excited, I’m thrilled about it. I grew up on a farm. I grew up in a rural community, so I had a lot in common with the audience.

After the speech was over, the meeting professional hands me the check and I said, you know, I’ve got to ask. I’m really amazed. Why would you hire an 18 year old to speak to your group? And he used the old line. He said, you know, it’s like a dog walking on its hind legs. It doesn’t have to be that good, you’re just amazed it can.

Dan Gingiss: So that encouraged you then to make it into a career?

Scott McKain: Yeah. That’s how I got started in the National Speakers Association and how I got started and speaking was I was basically the dog on its hind legs. That is where it all came from.

Dan Gingiss:  You know, you mentioned something I want to come back to. You said that you had a lot in common with your audience. I’m wondering because I try to use the fact that I worked in corporate America for 20 years to kind of establish that credibility with an audience, because oftentimes I’d been sitting in their chair.

Tell me about a time that either you had a lot in common with an audience or I’m assuming you’ve also spoken to some audiences that you’ve had very little in common with. Obviously, you’re such a great speaker, you can still inspire them. But how much does that audience relationship that whether you really can feel like you’ve been in their shoes? How does that how much does that help?

Scott McKain: I mean, that’s one of the things I’ve learned in the early days when I was trying to build my business. I’d take anything that I could get. I remember one time I was speaking in front of a group of coal miners, and I don’t know how they got the information, but it started with a guy going up and tapping on the microphone and said, “All right, we’ve got a guy here today. He knows a lot of jokes and probably a lot of them are dirty. Please welcome Steve McKlain”.

Dan Gingiss: Hey, there ya go! As long as he doesn’t make the check out to Steve, right?

Scott McKain: Exactly. Well, I just want to make sure that’s right. But, you know, it was a great learning experience because the mistake that I made was trying to be all things to all people. I went through a personal tragedy in my life and it took me out of the business to a great degree for a few years. And so, when I got back in, I didn’t know how to make myself stand out. You know, why would somebody choose me instead of [someone else]. I wasn’t the 18 year old that could talk anymore. You know, now I’m trying to figure this out as as an adult. And so I started trying to learn about what it would take to create distinction.

How did you set yourself apart in the marketplace? And part of what I found in the market was that there was a lot there about differentiation. But what always struck me, you know, my folks owned a grocery store. What I learned about the customer experience was started, you know, working and stocking shelves and waiting on customers in my family grocery store. And the line that I always used was I could slap every customer in the face and be different. But that doesn’t mean they’re going to come back and buy from me again. So I was looking for something that was more than merely differentiation. What would it take to create something compelling for customers?

And when I couldn’t find that, as I was struggling to find it in my own business, the blinding flash, the obvious was, hey, there’s a lot of other folks may need this, too. And that was the journey to talking about distinction and and the ultimate customer experience. We own the trademark on that term, the ultimate customer experience, and it’s really been a passion of what I talk about, but more importantly, it’s what I experienced from the family grocery store to other businesses where I’ve been an employee, to organizations where I’ve been on their board of directors or had been an adviser consultant. It’s all been part of that same journey.

Through the combination of practical experience and being where they are and also learning. You know, that that was the other thing. What a great learning laboratory when I was young because I didn’t have any content. So, what would happen is people would come up and give me an idea, so the next speech I’d share their idea and one of two things would happen. Either they would write it down, which told me it was a good idea. Right? That’s why they’re writing it down. Or somebody would come up saying, hey, I’ve got a better idea.

So, for a decade, I was really collecting this is kind of a learning laboratory of what really worked on the frontline of businesses. And I was speaking to smaller businesses. You know, Apple wasn’t hiring me then. And so now when Apple does hire me, then I can speak about what’s really happening on the front lines, and in stores, and with their customers.

Iconic book cover

Dan Gingiss: I love it. Man, I have so many follow up questions. I just have to make the comment first. When my kids were younger, we used to play this game, My Father Runs A Grocery Store, and for you it was actually a real thing.

Scott McKain: It was a real thing!

How to Create Distinction in the Marketplace

Dan Gingiss: So that’s pretty cool, but I love the word distinction. And, you know, it is a word that that makes you distinctive, obviously, but it’s not a word that is heard as often as some of the other ones like differentiation. And I think my guess is that’s one of the reasons you picked it. I also like when I think of distinction, you know, my family was in the formalwear business and I kind of think of something that is just really nicely put together or higher end, you know, as a way of being distinctive. But tell me how you use it. And, I think I’m kind of looking for… Help me better differentiate between distinction and some of these other adjectives.

Scott McKain: Sure. I think there’s three levels, Dan. And by the way, I got my prom tux at Gingiss Formalwear!

Dan Gingiss: Oh, fantastic!

Scott McKain: Just so you know. I never shared with you before that. But anyway, there’s three levels. The lowest level is sameness. You know, we hear the phrase the sea of sameness, but it is a reality. And to me, sameness is when the customer can’t ascertain meaningful differentiation between you and the competition. The only way that somebody becomes a customer is that they make a choice.

So how do they make that choice? Well, it’s either going to be driven by there’s an advantage that you have, or if they can’t come up with that, then that’s when it becomes a price choice. If I see no meaningful differentiation between you and the competition, then to become a customer, I have to create something. So I’ll create based on price, because that’s the area that’s easiest for me to compare.

So once we get beyond sameness, now we create differentiation. There’s something about us that’s different from our competitors. But the highest level is distinction. And that’s when that differentiation becomes so meaningful. It has such traction with the marketplace that we become the provider of choice. So different isn’t better unless it has real meaning for customers.

I’ve worked with businesses and I’m sure you have to, Dan, that think that the differentiation is that their logo is red. That that’s what makes you different, but it doesn’t make you distinctive. And when we look at the organizations that have truly created distinction in the marketplace or have even risen to the highest level, which is iconic.

When they get to that point, there’s something about them, something about the fabric of what they do. You know, it’s woven into the fabric. And in recorded history, no customer has ever said, ‘I love doing business with those guys, they’re exactly like everybody else.’ If they’re exactly like everybody else, there’s no passion to that choice. We’ve got to create that in the marketplace today.

Dan Gingiss: Yeah, just like nobody’s ever said, ‘Let me tell you about the perfectly average restaurant I went to last night.’ So, it sounds like it’s possible to create distinction from the experience, obviously. But it’s also there’s some companies that create distinction based off of the product or service they offer because nobody else is doing that. It seems like that’s getting harder and harder to do, though.

You mentioned competing on price, which of course, I like to call it a loser’s game, because everybody ends up losing. Competing on product, though, has become really hard too. And, one of the examples I love to bring up is one of the most innovative companies in the world, which is Uber. Except a couple of years after it launched, it was copied by Lyft and by others. And now, is their offering that distinctive anymore? Hard to say. So, how does a company go about creating distinction, and should you be looking towards product or towards experience?

Scott McKain: Yes. What a precise answer, right?. One of things I wrote a book about in the book Iconic, is that customers really only have two variables by which they judge us, and that is promise and performance. So what does the customer perceive that we have promised them in advance of the relationship? And then, how did we perform judged based upon the promise?

Now, you can really drill deeply into this when you start talking about customer perceptions and how they perceive the promise. But, at the bare bones, if we look at promise and performance, those are the only two factors that gives us four options there. One is low promise, low performance, for lack of a better choice. You know, we’re Sears. We’re not delivering much, but we didn’t promise you much either.

Dan Gingiss: I was going to say, maybe the IRS.

Scott McKain: Yeah, these are the laggards, right? I mean, they don’t promise much, they don’t perform exceptionally well, but we didn’t expect that anyway. Then you have high promise and low performance. Those are the frauds. They’ll say anything to get the business, but once they’ve got the business, then they don’t take care of you as a customer. They’re just not making more promises to other prospects. So, sooner or later, it catches up with them. Those are the frauds in business.

The really fascinating one to me is the low promise, high performance. You know, let’s under promise over deliver.

Now, we’ve been taught for a long time that that’s a good thing. But, recent studies out of the University of San Diego reveal that over a period of time, customers begin to view you as manipulative, if that’s your approach, because the perception becomes you’re sandbagging the promise to make yourself look like a hero. You’re not over delivering to help me as a customer, you’re setting yourself up to manipulate how I feel about you. So that’s not a good long-term strategy.

Then we get high promise, high performance, and those are the disruptors. So you look at an Uber that has been there and what they have to do is to advance the promise and simultaneously accelerate the performance. So, you see Uber then getting into Uber Eats, and we’ve also seen their experimentation in Uber Health. One of the things they realized is one of the real roadblocks to medical care for senior citizens is simply getting to the doctor’s office.

So, how do we get a senior citizen who might not be using a smartphone? How do we accelerate the promise of what our service can provide while we advance our performance and continue to deliver at a high level? That’s breathtakingly difficult to do, but it’s required of you to stay at that extraordinary level.

Dan Gingiss: Yeah, I love that. And I think that especially as customers expectations continue to increase, we have to be one of those companies that sets high expectations that basically tells the customer upfront, you know, hang with us. If you’re willing to give us your money, we’re willing to give you something exceptional. And that is what so many people are looking for these days. So, I think, Apple’s probably another great example of that. We know, every product that comes out, is going to be fantastic. When’s the last time they had a dud of a product?

Even when they came out with the first Apple Watch, it didn’t sell quite as well as all the other things, and everybody was wondering, oh, no, maybe they screwed this up. And they just launched the third or fourth version, and, you know, it’s still been very successful. So, I think it’s really interesting to set the high expectations and then be sure that you can meet them. And I would add to that, don’t be afraid of high expectations.

I mean, why are we in business, right? We’re in business to serve our customers. Without customers we don’t have a business. We should be doing everything we can, not just to attract them, but to keep them. And so to me, that’s where this whole thing with experience comes in.

‘Taxi Terry’

Dan Gingiss: So, Scott, I want to go backwards in time. And we were talking about Uber and innovation, and I want to go backwards to a similar industry, and that is the taxi industry. And I know that you have a classic Scott McKain story about a certain taxi and I’m hoping that you will share the abbreviated version here.

Scott McKain: Well, I was giving a speech in Jacksonville, Florida. The flight’s late. I’m dead tired, as you’ve done a million times as well, Dan. This was pre-Uber, so you get in line to get the cab, and I just wanted to get to the hotel and get to sleep. I’ve got a breakfast meeting with the client the next morning. It’s already after midnight. And my cab pulls up and the driver jumps out of the cab points at me at the front line and shouts, ‘Are you ready for the best cab ride of your life?’

So, I get in the backseat of the guy’s cabin, he jogs over and gets my bag and puts it in his trunk and jumps to the driver’s seat and spins around to me in the back seat, sticks out his hand and says. ‘Mr. McKain?’ And I went, ‘Yeah, how did you know my name?’ He said he saw it on my luggage tag, figured he might as well use it. He said, ‘I’m Taxi Terry.’ And I’m thinking, why did I get stuck with a motivational cab driver?

On the ride, he tells me these incredible things that he does to personalize the experience for his customers and to really take care of them. And he’s got an iPhone and a bracket on the dash with a magnifying glass with the weather on it. So I can see the upcoming weather forecast. Something I could look up on my own phone, but I thought it was cool that he thought to provide something unexpected for his customers. He recorded our conversation in the cab, and I ask him why he was so set up to do that. And he takes information from his conversations with his customers and he enters it, he said, “into my CRM.”

Now I’m thinking, a cab driver, right? So the next time he remembers what to bring up in the conversation. Crazy good stuff, right? Gets me to the hotel, jumps out of a cab, gets my bag out of the trunk, he holds my bag, my suitcase, he walks it up to the bellman, hands my luggage to the bellman and says, ‘Presenting Mr. McKain.’ I’ve never been ‘presented’ before. No receipt, no nothing. He’s got a Web site. You go on the Web site and you print out your receipt and reserve your return trip.

It just absolutely blew me away. So I’m speaking to IBM. Next morning, I get up. I’m giving my speech. I said, ‘hey, last night at the airport, this guy said, ‘are you ready for the best cab ride of your life?” And the audience in unison went, “Taxi Terry!” They’re huge fans.

So the kicker to the story is so that Uber comes into play and I’m my project with IBM is over. I’d ridden with Terry about 15 times during the project, so now I’m going back there. So I call him. You know, I want to make sure how he’s doing with Uber and everything else is going on.

His business is better.

In part because he went to companies in the Jacksonville area and he said, ‘I’ll be your Vice President of Transportation. You need point-to-point rides? Hey, I got great I got great cars to do that. You need group transportation? I got vans. You need fleet transportation for executives? I have a stretch limousine. You don’t have to worry at all about transportation for your office. I’m your solution.’

As long as it’s about point to point rides now, Uber’s in the conversation. But now when you’re providing whatever solution that you need and you’re doing it with this ultimate customer experience, now you’re creating distinction. There is a reason I choose you instead of pulling out my phone and getting a ride on Uber. I mean, I know you’re gonna be there, you’re gonna be in advance, you’re gonna have the vehicle that we want. I know that you’re gonna think ahead. It’s all of the things, Dan, that you and I talk about, about what it takes to get customers to repeat their business and to refer the business.

And I’ve had several friends, our pal Laura Otting being the latest one, who when they go to Jacksonville, call Taxi Terry. It is an example of what you and I want for our clients. And that is that people tell stories about the extraordinary experience just as I’m doing about Taxi Terry. That’s that’s what this is all about.

Scott McKain speaking to Volkswagen

Dan Gingiss: And that kind of storytelling is better than any marketing that any company can do because it’s so much more authentic and credible and genuine. And yeah, I’m sure everybody that you’ve told that story to wants to go and and be in Taxi Terry’s vehicle when they’re there. I think it was super interesting to compare his service to Uber. I find that today a lot of times people are somewhat negative towards some of the technology companies that have succeeded.

And I think where we see this the most often is Amazon. And I love Amazon. I’m a Prime member. I use every service of theirs, because it’s amazing. Now, am I disappointed that certain other companies have gone out of business? Well, sure. Do I think that’s entirely Amazon’s fault? Not at all.

Related: The Amazon Customer Experience Remains Elusive To Other Retailers

I want to give you an example. I think I may have shared this before on the show, but I know I haven’t shared it with you. Toys R Us was a company that when they went out of business, that store looked exactly like it did when I was a kid. It had never changed. It was just products on a shelf. Whereas you compare it to something like the Lego Store where throngs of kids rush to the Lego Store because they know they can play with Legos and they can have an experience while they’re there.

Well, I was walking downtown Chicago and there was this mom and pop toy store and they specialized in board games, but they had other toys as well.

And there were two things that I noticed at first when I walked in was that the woman behind the counter was basically a human version of Amazon’s recommendation engine. She said, ‘Oh, you like Settlers of Catan? Well, you’ll love this game and this game and this game.’ And I was thinking how credible that was because she wasn’t necessarily trying to sell me, but if she knew the intricacies of how to play the game and she knew that if I liked that kind of strategy game, I would like this game.

But the thing that really wowed me was in the back of the store, they have a board game library. And you can check out any game. You can sit down at the table and you can play the game before you buy it. And this is important because board games today, I mean, it’s not like Monopoly and Clue and Sorry, where you can get it for ten bucks. These are like 50, 70, 80 dollar games. And so before you make that investment, you want to see if you like the game. Tuesday night they have singles nights where they invite people to play board games. And I’m thinking to myself, ‘these are all the things that Amazon can’t do.’

So of course, a mom and pop store can thrive in an Amazon world just as Taxi Terry can thrive in an Uber world. But you do have to be different. You have to think differently and not just lament that some big company has come and taken some business. I think that’s a toy and game store that’s going to last for a very long time because people are willing to pay a little bit more for the experience that they’re getting.

Scott McKain: Great story. It’s so, so true. I mean, that’s how our family grocery store survived. We had big bucks competition move in. And my dad without a college education, but with a heck of a lot of street smarts and commonsense said, ‘they’re always gonna beat us on the price of a gallon of milk. They’re always gonna beat us on the price of eggs.’ And the other thing he’d seen is when big box competition moved in, what local store owners, mom and pop stores tried to do was match the number of hours and match their prices.

You ended up with exhausted owners who couldn’t serve customers well because they were so doggone tired and and stressed out because their margins were gone. What Dad did was reduce the number of hours that we were open to the prime hours of shopping and intensify the customer experience. We did stuff like home delivery of groceries way back then, because that’s something we would do that, we knew that was not in the the system of a national chain. It made all the difference. And that’s what we’re talking about here. That’s exactly it. 

How To Become Distinctive

Dan Gingiss: Now, is it better to know a little about a lot of things or to be really knowledgeable in one or two areas, especially as you strive to have some influence and you become a speaker and somebody that people look to?

Scott McKain: Right. My first book many, many years ago was called All Businesses Is Show Business because I had the greatest part-time gig in the world. I was a movie reviewer that was syndicated all over the place. And part of what I learned from that was what Hollywood knows about the importance of being very precise with the genre.

And the line that I wrote 20-some years ago was ‘the mindshare precedes market share.’ Most of us always want to grow our business. All of us want to be successful. But we tend to think that if we’re broad, that gives us more opportunity. Instead it’s counter-intuitive. It’s exactly the opposite. You’ve got to get them thinking about you before they’ll invest in you, before they’ll buy from you. And you can’t create mindshare on such a generic and broad message.

I mean, no one wants to see the romcom-horror-comedy-action-thriller with superheroes, you know? Pick the lane, you know, get in the lane. And that was one of the great learning experiences for me. I thought the broader that that my business was, the more opportunity it presented. Instead, the more that I could make it precise, the greater I could build mind share in that specific area, and therefore, the market share follows. So that’s that’s what I would certainly recommend, is to be known as really knowledgeable in a specific area.

Dan Gingiss: Yeah, I completely agree with you, Scott, from the perspective of being an entrepreneur and starting your own company and looking at clients. I have one asterisk I would add on there. I always found when I was in corporate America that it did benefit me to be to know enough to be dangerous. About almost everything the company did. In fact, I often would get my whole team together to listen to the quarterly earnings calls. That was a great way to know not only what was going on in the company, but what the executives and what the media and the analysts thought was important.

I think when you are on the flip side, as an employee for a company, I would argue that, yes, you still want to be known for being an expert in something. But it is also a good idea to either befriend people in other areas of the company or get yourself to a point where you know enough to be dangerous. Personally, I later found myself in in those roles. I got moved to a different part of the business. I knew something about it because it wasn’t starting from scratch.

Scott McKain: So let me give you a specific specific example with that. What you choose about what you know is is critical. When I was a 21-year-old national FFA officer, I had the privilege of having a private meeting with the then chairman of General Motors. I asked him, ‘the day that you were hired by General Motors, they probably hired a thousand other people.’ At that point, General Motors was the largest employer in the United States. I said, ‘but you became the chairman. So out of all these hundreds of thousands of employees that you have, why did you get to be the chairman?.’

And he said, ‘I specialized in making my team as smart and smarter than I was about whatever our project was. Because what I learned was I couldn’t get promoted unless there was somebody ready to take my place. If I hadn’t grown the people on my team where it was easy for them to see that somebody on my team could take my place so I could go someplace else.’ So he said, ‘what I became known as was a specialist in developing other people.’

And that ties in with what you’re saying is that’s what Thomas Murphy became known as. And he said so then and I thought, ‘that’s such a great line.’ He said, ‘I developed a reservoir of goodwill in my organization. I had helped so many other people that then when it came down between me and another person, I became the obvious choice. Because I had helped them, they wanted to see me get this position.’ He said, that’s how he got there. So, you know, it’s a great distinction to make, in that you don’t want to be known for knowing the most about the Coronavirus. What you want to be known for is how do people get through a pandemic?

Does that does that make sense? Because if all you know is a specialty of this particular virus, then when this virus passes, they’ll find somebody else to be the specialist. But if that is how we deal with pandemics now, all of a sudden you’re always valuable. Regardless of what the virus is. That’s probably a bad analogy, but it’s the approach of, what you select as your point of distinction is going to be incredibly important in terms of longevity.

Dan Gingiss: Great points, thank you so much. I really appreciate it. You’re a guy that I look up to and appreciate to call a friend. Keep doing the amazing things that you’re doing.

This interview was edited for length and clarity. Watch the entire video interview on YouTube. Links to books are Amazon affiliate links, meaning this site receives a (very) small referral fee. It does not change your price.

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