Toby Russell, the Founder and Co-CEO of Shift, is driving transformation in a market that has long been associated with terrible customer experiences and a low level of trust:the used-car sales market.
Despite warnings that you needed a miracle to scale a car sales business, Russel founded Shift with a philosophy that exceptional customer experience could make a difference. On this episode of Business X factors, he reveals how Shift has found a way to radically improve experiences in buying used cars, the lessons he learned from his previous venture, and the challenges he met on the road to offer a seamless, hassle-free purchasing experience for customers.
Main Takeaways:
- Poor customer experience = opportunity: When a buying experience is terrible, there’s a strong chance that consumers are hungry for something new and different. Work back from what customers need and look for gaps. Examine the customer’s end-to-end experience and design a system that delivers everything the customer needs.
- Customer experience as priority No. 1.: In many businesses, customers or product quality are sacrificed in deference to the bottom line. This alienates current customers and puts you at odds with prospective customers before they even walk through your door. Happy customers – the kind that will return and recommend you to others – are customers that feel confident in their purchase. Take out the guesswork for your customer, provide them with a high-quality product at a fair price that they can trust.
- When changing a massive industry, find ways to differentiate yourself: Making waves in an established industry – especially one with a bad reputation – is no easy task. To avoid getting seen in the same light, find ways to stand out. For Shift, this meant not only committing to providing a great customer experience, but also getting creative with how consumers could engage with the company (i.e. online).
Key Quotes:
“Buying a car is a massive deal. It’s the second, if not the first largest purchase that most people will make in their lives and it’s terrible. So, we just saw tons of opportunity in each of those, because we personally had bad experiences and thought that technology could be used to really transform the space.”
“The traditional industry was built very much on a zero-sum mindset of, let’s construct this for the dealer to be able to negotiate for advantage… So, I have to go in ready to fight and negotiate. I can’t trust. I can’t be sure whether the car will be good or not. That is just crazy in my mind that that could exist, and we think that there’s a much better way.”
“I remember having a conversation with the first leader of our San Francisco hub… and she was saying, Toby… every car sale is like a miracle… The amount of complexity and logistics and things that have to happen, and the total lack of systems is extraordinary… This is a hundred percent unscalable and I’m not sure we’re ever going to get there.”
“Too often, the customer experience is forgotten from the start, or is unintentionally deprioritized as the business grows and scales and things like margin, marketing efforts, or internal organizational structures are put on the forefront. Plus, add on a layer of complexity to the business or industry that the company is operating in, and they could be in for a whole heap of trouble.”
“There’s just a tremendous amount of opportunity for e-commerce to really grow in this space because it’s a huge industry built very much around traditional retail. And I think all of e-commerce is fundamentally different from that and a tiny part of the market today, relative to what it will be. I think, what we’re going to see in three to five years’ time, you’re going to look back and be like, ‘Oh my gosh, I can’t believe I didn’t just buy my car online.’
“Downturns have their upsides and they force discipline and they force a lot of efficiency and reflection on long-term ability. And they reinforced the criticality of resilience. If you were an entrepreneur, often your number one success attribute is resilience.”
“Work back from the customer, not forward from business. So, be sure you’re clear on what you’re trying to achieve for your customer and start that. We didn’t do that at Taxi Magic. We were working forward from business.”
“Elevate each other, this is totally a team sport. It’s not about having one or two MVPs. It’s about how everybody works together and actually ups the game of each other.”
“See it, solve it, ship it. What does that mean? Anybody can be a problem identifier. It’s about solving problems and creating a machine that solves problems.”
“Change the world. Don’t just mess around with 3%, 5% changes. Look for the five X , the 10 X, go after that.”
Bio:
Toby Russell is a co-founder and co-CEO of Shift.
Previously, he was the Managing VP of Digital at Capital One, where he led the bank’s technology transformation to mobile. In 2007 Toby co-founded Taxi Magic (now known as Curb), the first on-demand mobile transportation booking technology company. He also led a $12 billion renewable energy and efficiency investment program for the U.S. Department of Energy and worked as a Project Leader at the Boston Consulting Group.
He holds a Doctorate from Oxford University.
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