Leaders in Customer Loyalty, Powered by Loyalty360
Leaders in Customer Loyalty, Powered by Loyalty360
Leaders in Customer Loyalty Brand Stories featuring Office Depot | Enhancing the Customer Experience in Today’s Work Environment
In an era where retail continues to evolve at breakneck speed, Office Depot and OfficeMax are setting a new standard for how customer loyalty is earned, nurtured, and scaled. With hybrid work as the new norm and customer expectations growing more complex, Office Depot is meeting the moment with a bold blend of personalized service, smart data use, and culture-driven execution.
At the heart of this transformation is Kevin Moffitt, President of Office Depot's integrated business unit. Moffitt joined Office Depot over 13 years ago, initially focusing on e-commerce and digital strategy. His career spanned financial services, nonprofit, and consulting sectors before settling into retail, where he's spent the last two decades. Today, he oversees both Office Depot’s digital platform and its physical retail operations. Moffitt recently joined Mark Johnson, CEO of Loyalty360, on the Leaders in Customer Loyalty podcast to discuss how the brand is redefining customer engagement, what it means to create emotional loyalty in modern retail, and the strategic priorities driving the future of Office Depot's loyalty programs.
As industries face significant challenges, brands must assess their offerings, customer experience and customer loyalty programs as well, to ensure they're delivering value. Retail has seen major disruption, yet some legacy brands are thriving by adapting store formats, rethinking customer engagement and introducing unique offerings. The office supply industry may not be known for innovation, but Office Depot and Office Max are leading the charge. With greeters at the front door for personal experience, a focus on understanding the business customers and experts readily available in-store, they're setting a new standard. This stands in stark contrast to other brands where, as we know, you can throw a bowling ball down the aisle and not hit anyone. Today we have Kevin Moffitt, president of Office Depot and OfficeMax.
Speaker 1:He is leading the transformation within the organization and he's joining us again on Leaders Customer Loyalty series today. How are you, Kevin? Nice to have you.
Speaker 2:I'm great Thanks for having me back. Repeat customer.
Speaker 1:Repeat customer. It's all about customer loyalty in the Customer Loyalty Podcast, so this is great. For those who may not be familiar, can you give us a short introduction to Office Depot, office Max?
Speaker 2:Sure, office Depot, office Max, one of the largest office supplies retailers in the United States. We have a pretty large chain of stores, as well as OfficeDepotcom, our digital platform, and a whole bunch of customers who rely on us every day to help keep their businesses up and running.
Speaker 1:Absolutely. You have a very important role with the organization, obviously president of the dual entity. Can you tell us a little bit more about your role with the company and how you got to where you are today and maybe even some roles that kind of led up to your current position?
Speaker 2:Sure, my background is actually in e-commerce and digital marketing strategy. I've worked in multiple industries, from financial services to nonprofit to consulting, and then I've been working in retail for the last about 20 years, joined Office Depot 13 years ago in their e-commerce area, eventually was asked to move over to our store team, and now I have responsibility for the integrated Office Depot business unit that includes our e-commerce and physical store businesses combined.
Speaker 1:Excellent. We talked a little bit last time about customers, the big belief that customers are changing, evolving regarding their preferences, their interests. When you look at how the customers are evolving in the retail space and their expectations as well, how has Office Depot responded to that change, that evolution?
Speaker 2:Yeah, I think one of the most critical trends for us to navigate over the last few years has been the shift in work styles, right, People working remotely, people now embracing a hybrid options whether that's two days in the office, three days in the office, one day in the office really trying to create a sense of flexibility to adopt to what works best for each individual user, and it does feel like each business is also exploring what's going to work best for them. We've actually seen quite a bit of stability in how customers are embracing hybrid and remote working going forward. The question at the beginning of the pandemic was well, how long is this going to last? And now I think the question is very different, which is you know, how can we best optimize for the future? Right? What can we do to help support our customers and keeping them efficient and effective wherever they are, however they're working?
Speaker 2:And you know that's been one of the biggest challenges, and for us it's really meant thinking a lot about our furniture, our workspaces, our technology products, as well as our copy and print services to support remote workers who may not have access to this central corporate headquarters, where everything was pretty much taken care of for you, so you had a printer that was maintained for you. You had an IT team to support your Wi-Fi network. Now customers are having to do many of those things on their own, and so really thinking about our services business in particular, and how we've evolved that to help support remote and hybrid workers, has been a big, big theme over the last couple of years.
Speaker 1:Excellent. So you talked about kind of the evolution. Obviously, as you mentioned, depending on the job position, if it's partially remote, completely remote, that's going to create kind of a disparate set of expectations and needs. Listening to your customers, understanding kind of what they have an interest in, but also being able to predict for the future, is very important. So you know, how are you listening to understanding your customers and how are you planning for that next gen future?
Speaker 2:Yeah, our customer feedback is absolutely critical to us. So we're extremely fortunate that the majority of our sales, the large majority of our sales, come through our loyalty programs and that gives us access to customer information that is invaluable, right, not only their order history, but also their feedback, their direct feedback, and we look at that on a per location basis. So each store we track our net promoter score for that store. We also track our greeting score, which is customers telling us whether they were welcomed into the environment when they entered the store, welcomed into the environment when they entered the store. And you know that greeting is really important to us because we are a customer service focused retailer.
Speaker 2:Many retailers you know their focus is on purely on operations get the product in the back, put it on the shelves, make sure that it has the right price tags on it. You're going to see, if you walk into one of our stores, tremendous amount of interaction. You're going to hear people talking, which is not always the case anymore in more mass retail, and we're really proud of those interactions because we think that a big part of the value that we provide our customers is the ability to come in and talk to someone in the areas that they need help in, whether that's purchasing a printer, whether that's creating a custom sign for an opening. You know we're opening open house or we're just opening a business for the first time. You know it could be something that is very complex that we're creating for them in our copy and print center, which happens all the time. Obviously, you need some communication in order to do that, and so I think that real focus on person to person, human to human, face to face helps to differentiate our experience from just about anybody else.
Speaker 1:Now, I think that's very important too, especially sometimes you're going to large retail stores and you can throw a bowling ball down the aisle, right, and you'll never find anyone to help you. And invariably I was with my daughter this weekend, who goes to school Bowling Green. We had to go to a large discount retailer and wanted some makeup and cosmetics, right, and they're all behind a lock and key, but going and finding that person can be challenging. And then we went to a home goods retailer right across the street and we had to find a couple of screws and nuts and bolts for her, and the level of service there was just completely dichotomous, right, and that truly drives that emotive loyalty. Especially, as you mentioned, the workforce is more complex, right. Getting your printers to work and getting technology to work, even though it's more quote unquote, easy to use, it can be very challenging, and being there for them is a huge thing. That drives that emotional connection.
Speaker 2:So that's great to hear. Yeah, and look, we're really proud of it, and I understand every retailer has their own business model, but for us, if we're going to support our customers' needs, it's not just convenience and it's not just price. Right, there is a value layer on top of those things that will encourage a customer to continue to come back to us, versus the nameless, faceless online alternatives. Right, you never have a face-to-face interaction with an online-only retailer, and you know, while they can provide products fairly quickly, you know we also are really proud of our omni-channel capabilities that allow us to get products to you even faster than just about anybody else. Right, our in-store pickup program continues to be one of the fastest, if not the fastest, ways to get a product that you need right away. And, believe me, when a business customer or a parent of a student who has a school project due the next day, you can't wait a day or two to receive your products. You need them now, and so our 20-minute guarantee is something that we are really, really proud of.
Speaker 1:That's awesome. So you look at the changing customers customer loyalty is very central and the brands who do a kind of a larger customer-centric focus of the organization. The customer loyalty program and the customer loyalty focus is very important, but keeping up that with market trends right, what consumers want? You talked about how you listen and the program provides ample feedback in that regard. How do you keep up technology or maybe other market trends around customer loyalty to make the program so successful?
Speaker 2:Yeah. So for us, we've really been focused in the last couple of years around our small business customer. Obviously that's been our core since we started the business 40 years ago, long before I joined the organization proposition to them that they think will differentiate us from other providers. We call that program Business Select and we've been very successful in growing that program over the last year, really since the last time we spoke, and essentially I think of that as providing something similar to an associate discount type of a program to our small business customers, who are our best customers, most profitable, highest sales, highest frequency, and with this program we're seeing that their frequency, their purchase frequency, is much, much stronger than our average customer. So really focusing in on that specific customer base and finding ways that we can serve them better than anybody else can is a key to our success going forward. Okay.
Speaker 1:And the Office Depot OfficeMax rewards program very successful. You've talked a little bit. Can you tell us about some of the recent updates or enhancements that you've made to the program since the last time we spoke?
Speaker 2:Yeah, I mean, that's really one of them is the business select focus has certainly been a big priority for us.
Speaker 2:Another piece that we're putting into place we're actually launching in the process right now of launching a new loyalty platform loyalty platform leveraging an external partner to help standardize and automate the connections between our databases, our loyalty rewards, the actual process of generating the rewards and making that simpler, but also encouraging specific behaviors.
Speaker 2:We have a really successful program that we allow customers to bring in their used ink cartridges, for example, into our store and to receive rewards for those ink cartridges. Obviously, it's good for the planet, gives a little bit of benefit back to the customers, gives them a reason to come into our stores and interact with our associates, so it's a win-win-win situation. But we also give customers rewards for interacting with us. Giving a review for a product, for example, is one way that we can do that. We want to look at other ways that we can encourage those kind of engagement activities that aren't purely order driven but keep a customer connected with us and even advocating for us. We know that viral marketing word of mouth is critically important to any brand's success at this point. So we really want to make sure that we're encouraging our customers to stay connected with us, hopefully have a great experience and then tell their friends and family about those experiences as well.
Speaker 1:Absolutely. There's a big push right now for value. We hear about it often, we have meetings with brands on a weekly basis and we talk about different topics around customer loyalty and this whole idea of value value to the program, value of the brand to the customer, value of the customer to the tiers. Right, so it's a multifaceted word right now, the dimension of how it's used. So when you look at your loyalty program, you know how are you ensuring that it remains valuable to both the business customers and the individual shoppers?
Speaker 2:I think one you know there's. There's so many ways to look at value. As you've said right, value is certainly a price metric, but it's also convenience metric and value. Your time has value and we've heard very clearly from our business customers especially, that you know I want to make sure that my time is being used as effectively as possible.
Speaker 2:I want to use my time to get more customers and get more sales, versus trying to find the right product for me, and so having the ability to go in and quickly narrow down, whether that's through our website or having a conversation in store with an associate, that's an incredibly valuable portion of the overall program that just about everything you buy will qualify for loyalty rewards and in some cases, depending on the product category, even more rewards than the standard amount. But that consistency is also important. Customers don't want to try to have to figure out well, is the reward going to apply to this order, is it going to apply to this product? You know they don't want to do a bunch of complicated math and so just having that simplicity and the consistency where you know if you shop with us, you're going to consistently get that rewards, it's going to be available in your account and you can use it without any kind of hassle. I think that's critically important as well.
Speaker 1:Okay, when you look at the KPIs, what KPIs are you looking? Because you just did a transformation in the program and I actually love learning more about that. What was the process like of even moving the platform? Because that's an Augean task, right? That's a Herculean task. To get a program, make sure everything works right. It doesn't necessarily always go on time. The software may not end up doing what you thought it would be, the consultants may not. So how did the program move go?
Speaker 2:Yeah, so we're right in the middle of it now. So it's not live yet. We're in the production process right now. But one of the critical aspects for us was that we required this move and I think this is important for any technology platform conversation to be additive to the customer experience right. So we weren't looking to go in and just throw everything out and start from scratch. The program has a tremendous number of participants who have expectations that have been set over a long period of time, and we want continuity. We want them to know that this is reliable, essentially for this to be a non-change for them, with the exception of any new features and capabilities that we want to add on top of the already existing program. And that's really what this platform allows us to do is more efficiently connect the dots behind the scenes so that we can power a really great customer experience that seems completely seamless to the customer standing in the aisle talking to our associate Okay.
Speaker 1:When you look at the move of the platform platform, what's next for your customer loyalty efforts? Everyone's talking about AI, from automation to personalization, you know, bringing on potentially CDPs or different ways to, you know, content delivery networks. What's next for you from a customer loyalty perspective?
Speaker 2:I think for us, it definitely ties in with personalization, and you know we're working not only with our loyalty platform provider, but also with our marketing platform provider and connecting the dots between the two to allow us to do a far better job of personalizing our outbound communications, emails and SMS. We're working right now on a major project to significantly increase the amount of personalization capabilities that we have available to us, and you can imagine we have incredibly rich data, particularly for our business customers, on their shopping preferences, on their frequency. So you know what is their rhythm. Do they buy ink from us every month, every two weeks, every two months? Business cards, do they you cards? Are they on a three month repurchase cycle? So we can start to use that data not just to facilitate their purchase processes that they're consistently on, but also introduce them to new categories, and that's absolutely critical as well.
Speaker 2:What we know is that our customers and that's absolutely critical as well what we know is that our customers, you know they're creatures of habit. We are a replenishment-based business to a large degree and there's a lot of things that we can do that not necessarily every one of our customers is aware of. So you know, leveraging personalization AI to you know to figure out exactly when is the right time to introduce some of these cross-sell messages into the conversation. I think that's a very interesting use of the technology.
Speaker 1:Absolutely. Last time we spoke, you talked a little bit about the personal interactions in SOAR. You talked about it today just the greetings right when they come, and make sure these greetings, make sure uh, the customers are being intended to in a way they want to be tended to. Client telling is a big, important piece and, as you said, you're kind of moving towards personalization. You know, uh, how do you these personal interactions in store? Uh, how does that evolve? Uh, can you take some of the data you mentioned and and use clienteling to to help, uh, you know, edify the, the customer in in, uh, the person, the CSR, whoever is in store to help personalize? How are you evolving around personalization?
Speaker 2:Yeah, there's really two key ways. So one is that every one of our associates is equipped with a mobile device on their person at all times, right, and so that gives them amazing access to data that would be the envy of just about any retail associate just a few years ago, and I would say even today. We are far ahead of the curve in terms of the power that that tool represents right there in the hands of the associates so they can access tremendous information about products and services. But it also allows us to run an incredibly efficient operation that then provides the maximum amount of time to the associate to have those personal interactions right. If they're spending all of their time trying to figure out where products are in the store, then they're not going to have a lot of time left over to have that. You know what's the best printer for me conversation that we really want to prioritize. So increasing the efficiency of the associate is critical to opening up the door to those more personalized transactions that you can have in the aisle and that point of sale that you can have in in the in the aisle and that and that point of sale.
Speaker 2:The other way is that we we have a long heritage now of really thinking about our store managers, our general managers of our store locations, you know, as the leaders of their small business and in many cases their business is not that small right.
Speaker 2:So really thinking about their business as as their own and having accountability in the same way that any small business owner would for their customer file, and so our general managers personally reach out to our top customers in each of those locations. They will keep them up to date on important new promotions or just ask them if there's any way that we can serve them, ask them how their business is going. You know, just keeping that personal connection alive, even when they're not in the four walls of the stores, is, I think, a really important differentiator for how we look at this business. I mean, you talk about clienteling. To me that is a clienteling model, right, and it is generally, you see it, more in a services business than in a retail business. But we truly believe we are a hybrid of the two and we need to operate with best practices from both sides, and I think that's one great example of how we do just that.
Speaker 1:Last question we have here Actually we have two. What are two or three things you're most proud of about your customer loyalty program or, more holistically, your customer loyalty focus within the organization?
Speaker 2:Yeah, so you know, recently I am most proud of the growth of our business select program. It's been absolutely amazing. Our store teams have really embraced that program and, frankly, it's helping a lot of small businesses to stay really efficient in a very challenging economic environment that we're operating in right now. So I'm really proud of that. And, from just a larger organizational perspective, our culture we call it the 5C culture here at Office Depot, with customer in the center in my mind right, customer being, I think, the most important of our five Cs you know our entire culture is focused on bringing that customer centricity to life every single day. All of our metrics are based on driving sales supported by customer engagement. So again, looking at NPS every day, looking at greeting scores, reading all of our customer feedback and responding to all of our customer feedback, whether positive or negative, is really, really important to how we operate as a business.
Speaker 1:Okay and last question. We have somewhat self-serving, but what can Loyalty360 do to help you and your team and the broader industry with regard to their customer loyalty efforts? Are there areas of focus you would like us if it was more on or questions you'd like to ask?
Speaker 2:I think the biggest one right now I'm sure is top of mind, is every company now calls themselves an AI company, inundated with artificial intelligence and advanced uses of technology that may or may not be real, right, maybe more hypothetical or vaporware in some cases than you know. You could help us, as practitioners, kind of cut through the hype and really understand what are the use cases that we should be focused on right now. What are the key drivers of client engagement and who out there are really using the tools in a substantial way that you know can just help us focus on the things that really will make a difference.
Speaker 1:Excellent. And now it's time for the wonderful quick fire questions. We like to keep these two. This definitely makes you unique, for sure the one word or a short phrase response the first question what word or short phrase do you use to inspire others?
Speaker 2:like to say that you know our, our customer. Treat your customer like you would, like you would treat a friend or family member walking into the store, and I think that that really encapsulates everything. That is the golden rule of our model of retail.
Speaker 1:Okay, well, what is your least favorite word that others may use?
Speaker 2:I do not like the word irregardless. That is a double negative and you should not use it. So my old English teacher really brought that into my brain many years ago. Regardless is a word, irregardless is not.
Speaker 1:Excellent, this is an interesting one here. What is your favorite food?
Speaker 2:I love sushi. I'm a big sushi connoisseur, and if I had to say something specific, it would be Maryland crab cakes as well. Those two fight for the leaderboard in my mind.
Speaker 1:Okay, what excites you at work?
Speaker 2:Getting to work with an amazing team and an incredible customer file, touching so many communities across the country.
Speaker 1:And what do you find tiresome at home or at work?
Speaker 2:Oh gosh tiresome. I find I get bored really easily, so I constantly need new challenges. That's what I. That's how I would summarize it.
Speaker 1:OK, is there a book that you read that you'd like to recommend to colleagues?
Speaker 2:Yeah, the one that I just recently recommended to our team last week, is called A CEO, only Does Three Things, and I won't spoil it and tell you what the three things are. You'll have to check it out to find out. Really, really inspiring book.
Speaker 1:That's great. I'm a big proponent of the three thing rule. Right, what are the three best things you can do for the organization From passion, from productivity, from a value-add perspective? Other things should go out the window, so I've been preaching that a lot recently. Three and it's yeah, I love that rule. I'll check that out. What profession are the one you're currently involved in? Would you maybe like to try?
Speaker 2:Oh my gosh, the list is endless. I was trained as a documentary filmmaker, so we put that in the list. Historian, archaeologist, architect Should I keep going on? That's good We'll see, we'll see where life leads.
Speaker 1:Okay, what do you enjoy doing that? You often don't get the time to do All of those things.
Speaker 2:I really like to travel and I enjoy my time traveling with family, but it would always be nice to have a little more, isn't it?
Speaker 1:Yeah, absolutely, who inspired you to become the person that you are today?
Speaker 2:My dad. My dad is a serial entrepreneur. He has started six different small businesses and really engaged with the local small town that I grew up in and, you know again, constantly pushes himself to learn new things and try new things. Great role model.
Speaker 1:Excellent and last question how do you want to be remembered by your friends and family?
Speaker 2:Good dad, decent husband, somebody who did cool stuff, working with cool people.
Speaker 1:Perfect, well, great, well. Kevin, thank you very much for taking the time to join us again on the Leaders of Customer Loyalty Series. It was great speaking with you again. Just your passion for the customer, for the product, for your in-store associates, your employees, is great to hear and we appreciate everything you guys are doing for customer loyalty and you guys continue to set the bar. So it was great to hear.
Speaker 2:Really enjoyed the conversation again, so who knows, maybe we'll keep it going at some point in the future.
Speaker 1:That's good, perfect. Well, thank you, everyone else, for taking the time to join us today in our Leaders in Customer Loyalty series. Until next Thursday, have a wonderful day.
Speaker 2:Thanks everybody.