Why Extraordinary Experiences Create Loyal Customers

When the taxi dropped me off the second time I arrived at the Four Seasons Hotel in Sydney Australia, the bellman greeting me saying, “Welcome back, Dr. Zak. Your room is ready for you.” I stood dumbstruck. Sure, I had been there the week before, but how the heck did he know it was me –– and I was back? That was 15 years ago, and I have never forgotten it. The experience was extraordinary. And, of course, when I can, I stay at The Four Seasons.

Extraordinary performance, like I received at the Four Seasons, only happens when leaders make it a priority. The twentieth century’s leading management thinker, Peter Drucker, recognized this 50 years ago, writing, “Leadership is lifting a person’s vision to higher sights, the raising of a person’s performance to a higher standard…” This is more important now than ever.

The growth of the experience economy has pushed the demand for extraordinary customer service from luxury to mid-priced and even low-priced products and services. Clerks at the small footprint grocer Walmart Neighborhood Market walk customers to the correct aisle and shelf when they request help, just like at more upscale stores such as Trader Joe’s and Whole Foods. Amazing customer service is not only a differentiator, but also drives customer loyalty because of what extraordinary experiences do to the brain.

I have spent the last decade measuring brain activity to understand why extraordinary customer service experiences are so valuable. This research shows that the extraordinary has a very peculiar neural signature, and that by knowing this, one can reverse engineer the process to consistently create extraordinary experiences.

Two neurochemical signals appear when something extraordinary occurs. First, the brain releases the neurotransmitter dopamine, which travels to the brain’s prefrontal cortex and builds anticipation for the experience. This causes people to focus on the here and now. When the experience also has social content, as nearly every customer experience does, the brain also releases the neurochemical oxytocin. Oxytocin reflects the degree of emotional resonance the experience generates. The brain additionally uses emotional responses to assign value to an experience. Extraordinary experiences not only seem good, but they are also tangibly and measurably good in the brain.

“Immersion” is the name I have given to the neurologic state of anticipation and emotional resonance. Immersion is now measurable using a smartwatch app, showing not only whether an experience is extraordinary, but exactly when the extraordinary happens. This means designers can curate customer experiences to increase their immersion over time and identify superfans of the experience neurologically. And it gets even better. Highly immersive experiences are stored in long-term memory in a way that makes them more easily accessible than ho-hum experiences. Recalling an extraordinary experience, like my stay at the Sydney Four Seasons, is itself enjoyable and creates a desire to repeat it. This is the neurologic basis for customer loyalty.

Years of research by my lab have shown that extraordinary experiences are unexpected, narrow one’s focus to the experience itself, require human connection, and nearly always provoke post-experience actions including recommendations and social sharing. The components of the extraordinary come as a package, not in isolation from each other. My Four Seasons example above meets all four of these criteria.

Here’s an example of a good idea poorly executed. In 2015, American Express launched a rewards program aggregator called Plenti. Plenti members earned points for purchases at retailers such as Exxon-Mobil, Rite-Aid, Walmart, and Macy’s, whether they used an American Express card or not. Accumulated points earned for necessities like gas and groceries could be used to reward oneself with a new sweater or pair of pants. In a neuroscience experiment my group performed in collaboration with American Express, we showed that the greeting by the cashier telling the customer how many points he or she had was the most immersive and enjoyable part of the program. Plenti was ultimately shut down because the many retailers in the network were not sufficiently trained or incentivized to enthusiastically share points information with customers during every checkout. Neurologically, the point total would be unexpected, and when the cashier was excited to share the information, the brain would become immersed. Indeed, building “social” into an experience nearly always increases its immersion.

The traditional view is that businesses exist to solve customers’ problems. The modern approach is that businesses that want long-term success need to bring joy to customers. Immersion is the brain-based foundation for enjoyment and builds a desire to repeat the experience. At the same time, amazing customer experiences improve customers’ emotional and physical health and might even extend their lives. They do this by strengthening pathways in the brain that prepare people to have future extraordinary experiences again. Immersing customers is not only good business, but also for society.

At the Drucker School of Management, we believe that extraordinary leadership begins with understanding people. Paul Zak’s research and teaching reflect this deeply, applying neuroscience to improve customer experience, strengthen organizational culture, and build lasting impact. His work exemplifies Peter Drucker’s vision of management as a human-centered, values-driven discipline designed to serve both people and performance.

About the Author

Paul J. Zak, PhD, is Professor of Economic Sciences, Psychology, and Management at Claremont Graduate University and founding director of the Center for Neuroeconomics Studies. A pioneer in the field of neuroeconomics, Zak is the author of Immersion: The Science of the Extraordinary and the Source of Happiness and The Moral Molecule. His TED Talk on trust and oxytocin has been viewed by over 2 million people and translated into 22 languages. He is the founder of Immersion Neuroscience, a platform used globally to measure and optimize emotional engagement in real time.

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Excepted from Immersion: The Science of the Extraordinary and Source of Happiness. Lioncrest Publishers, 2022, by Paul J. Zak