Experts of Experience - Episode #63: Why Customer Experience is Your Best Competitive Advantage

Release Date: January 15, 2025 | Presented by Salesforce Customer Success

Introduction

In Episode #63 of Experts of Experience, hosted by Lauren Wood from Mission.org, the spotlight shines on Steve Martosi, a serial entrepreneur renowned for his successful ventures across diverse industries. Steve’s portfolio includes GroupMe, a group messaging app acquired by Skype; Blade, the innovative helicopter company; Splice, a royalty-free music platform for creators; and Supper, a companion app designed to optimize supplement routines.

Lauren and Steve delve deep into the intricacies of building businesses with a keen focus on Customer Experience (CX). This episode unpacks how CX can serve as a formidable competitive advantage, especially through leveraging emerging technologies like AI and GPT.

Steve Martosi’s Approach to Customer Experience

Steve Martosi emphasizes that his primary focus is on the product experience rather than viewing CX as an initial differentiator. He believes in creating products that he himself would use, ensuring authenticity and genuine utility.

Steve Martosi [02:11]: "I first think about the product that I want to exist. Usually, I'm the first user of the product or at least I want to have something come into existence."

Steve highlights his preference for building unique products rather than iterating on existing ones. By starting with the experience he desires, he naturally extends this vision to cater to diverse market segments.

Lauren Wood [02:45]: "You being the original user gives you a major step up because you are building this for yourself."

This user-centric approach was evident in GroupMe, where the app was developed to address the immediate needs of staying connected during events like concerts. Steve recounts the spontaneous creation of GroupMe during a hackathon, underscoring the importance of addressing real, personal problems.

Balancing Feedback and Intuition

A significant portion of the discussion revolves around the delicate balance between customer feedback and entrepreneurial intuition. Steve advises against over-relying on initial feedback, especially when it's hypothetical, advocating for a gut-driven approach in the early stages.

Steve Martosi [11:15]: "Don't overbuild in the beginning. Get enough in the market so that you can start listening."

He shares instances where early user research led to pivoting his strategies, such as the initial reluctance towards certain social features in Sepco that later gained popularity. Steve underscores the necessity of releasing a viable product early to gather authentic feedback.

Lauren Wood [05:09]: "How do you think about that and how do you make that decision?"

Steve Martosi [16:01]: "Your biggest competition is people giving up on themselves. You just don't want to let someone get frustrated with the process."

The interplay between intuition and feedback is portrayed as a dance, requiring agility and responsiveness to evolving customer needs without losing the original vision.

Building and Leading Teams

Steve delves into his philosophy on team building, emphasizing short feedback loops and collaborative design by team. He believes in fostering an environment where team members feel empowered to experiment and learn from failures.

Steve Martosi [19:00]: "We do a team-wide kind of show and tell every day right now."

Regular in-person meetings, such as on-site or off-site gatherings every six weeks, play a pivotal role in strengthening team cohesion and empathy. These interactions facilitate open communication, allowing team members to discuss challenges and brainstorm solutions collectively.

Steve also highlights the importance of maintaining company culture during rapid growth phases, drawing from his experiences at Splice where scaling posed challenges to cultural preservation.

Steve Martosi [26:02]: "Be open enough to be honest about metrics, be honest about user feedback."

Subscription Models and Revenue Streams

The conversation shifts to revenue models, where Steve shares insights from his experiences with Splice. Initially, he admits that Splice Studio suffered from not having a subscription fee, which limited its potential.

Steve Martosi [36:45]: "I thought it wasn't good enough. If I had charged for it, I think we would have gotten a stronger signal if people committed to it."

Upon introducing Splice Sounds, Steve adopted a low monthly fee of $7.99 and implemented a revenue-sharing model with content creators. This strategy not only mitigated piracy issues but also created a flywheel effect where creators were incentivized to produce and market their content on the platform.

Steve Martosi [39:43]: "We shared major amounts of our revenue with the content creators... creating an epic flywheel."

When discussing Sepco, Steve emphasizes ethical approaches to AI and collaboration with existing institutions rather than disruptive tactics. This philosophy extends to maintaining trust and ensuring that the business model aligns with customer interests.

Steve Martosi [43:23]: "The brand is just as important as another layer in the customer experience."

Maintaining Customer Connection at Scale

As businesses grow, maintaining a strong connection with customers becomes increasingly challenging. Steve advocates for process-driven methods like having a dedicated user research team and engaging in practices such as dogfooding—using one's own product internally to gain firsthand experience.

Steve Martosi [28:09]: "Using your own product is just one way to create fun experiences for people to use the product."

He also shares innovative team activities like Beat Relay, where employees collaboratively create music, fostering a deeper understanding and connection with the product.

Steve stresses the importance of transparency and accessibility to customer feedback across the organization, ensuring that every team member is attuned to customer needs and experiences.

Steve Martosi [27:23]: "From the telemetry perspective, everybody sees every piece of feedback that comes in."

Inspiring Experiences and Advice

Towards the episode’s conclusion, Steve shares personal experiences with airlines that impressed him, highlighting the significance of exceptional customer experiences beyond his primary business ventures.

Additionally, he imparts crucial advice for Customer Experience (CX) leaders:

Steve Martosi [48:30]: "Keep your team inspired. Let your team's excitement about their impact in the world drive them to build great customer experiences."

This underscores the importance of inspiration and purpose in maintaining high levels of customer satisfaction and employee motivation.

Lauren Wood [49:07]: "The inspiration that why, how are we impacting other people's lives is really what will carry you through."

Notable Quotes

• Steve Martosi [02:11]: "I first think about the product that I want to exist. Usually, I'm the first user of the product or at least I want to have something come into existence."

• Steve Martosi [11:15]: "Don't overbuild in the beginning. Get enough in the market so that you can start listening."

• Steve Martosi [16:01]: "Your biggest competition is people giving up on themselves. You just don't want to let someone get frustrated with the process."

• Steve Martosi [36:45]: "If I had charged for it, I think we would have gotten a stronger signal if people committed to it."

• Steve Martosi [43:23]: "The brand is just as important as another layer in the customer experience."

• Steve Martosi [48:30]: "Keep your team inspired. Let your team's excitement about their impact in the world drive them to build great customer experiences."

Conclusion

Episode #63 of Experts of Experience provides invaluable insights into how prioritizing Customer Experience can transform and sustain businesses. Steve Martosi’s experiences across multiple successful ventures illustrate the profound impact of a customer-centric approach, balanced with entrepreneurial intuition and strong team dynamics. For leaders and entrepreneurs alike, this episode serves as a compelling resource for building products and organizations that not only meet but exceed customer expectations.

For more episodes and insights on customer experience, visit Mission.org and follow Experts of Experience on your favorite podcast platform.