Why are customer loyalty scores plummeting—even when satisfaction metrics are strong? In this episode of Marginally Better, Joe Taylor, Jr. explores the disconnect between Customer Experience data and tangible business results. From the surprising collapse of TGI Fridays to the 20% of companies connecting feedback to revenue, this episode unpacks what it really takes to drive customer retention in 2025. Plus, Joe shares a pivotal childhood lesson in user experience from his very first (and very failed) drive-thru business.
Episode Links:
- The Wall Street Journal explores how and why TGI Fridays fell.
- Customer experience is trending downward, putting many brands in a vulnerable position. Forrester’s 2024 U.S. Customer Experience Index shows that overall CX quality has dropped to its lowest point on record.
- Top 5 customer experience trends to watch in 2025.
- Predictions of how CX will evolve and how we can lead the charge into the future.
- Five steps to running the Wizard of Oz Method in UX.
- How the first drive-thru at McDonald’s came to be.
Transcript:
[00:00:00] Announcer: From the global headquarters of Johns and Taylor in beautiful New Jersey, it’s Marginally Better. Here’s your host, Joe Taylor, Jr.
[00:00:11] Joe Taylor, Jr.: On the show this week, only 20% of customer service professionals say they know how to connect customer feedback to bottom line results. We’ve got the research that shows how you can help your business get into that one in five.
[00:00:26] We’ll spotlight the decline of a brand synonymous with the fun singles bar scene of the 1980s. What role should TGI Fridays play in a culture where eating, drinking, and dining habits have radically evolved?
[00:00:41] And I’ll share what I learned from my most disastrous day on the job as an aspiring fast-food entrepreneur at the age of seven, and why what I discovered that day plays a big part in how I talk to our clients about AI.
[00:00:56] That’s all after the break on Marginally Better.
[00:01:00] Welcome to Marginally Better, a show about business, innovation, and the American economy. I’m Joe Taylor, Jr.
[00:01:11] Something curious is happening in the world of retail; customer experience, or CX as many folks like to call it, has reached a paradoxical moment. While companies are improving at delivering good experiences, customer loyalty is declining.
[00:01:27] According to Forrester’s latest research, customer loyalty hit an all-time low in 2024. And it’s not because companies aren’t trying. The problem isn’t a lack of data or technology. Businesses have more ways than ever to track, measure, and analyze customer behavior. The real issue is that they’re often looking at the wrong things.
[00:01:52] Some of the industry’s most optimistic research, and we’ve got links to it in our show notes, suggests that only one in five CX teams will successfully figure out how to connect their customer feedback to actual bottom line results this year.
[00:02:08] Think about it. What good is a high satisfaction score if customers don’t return? What does a perfect survey response mean? If people aren’t recommending your brand to their friends? The numbers look good on paper, but they’re not telling the whole story.
[00:02:27] Meanwhile, the gap between online and physical shopping experiences remains a challenge. Customers expect seamless transitions between digital and physical spaces. They want their online browsing history to inform their in-store experience, and they expect sales associates to know their preferences before they walk in the door. When these expectations aren’t met, they’re increasingly likely to disappear.
[00:02:55] The solution isn’t more technology; it’s better integration and more proactive engagement. Companies that invest in actual omnichannel experiences. Are seeing their customers become three and a half times more likely to purchase additional products and services. But achieving this requires breaking down the silos between departments. Something only 20% of companies are expected to accomplish in 2025.
[00:03:23] Perhaps most telling is the decline in customer feedback itself. Year after year fewer customers are taking the time to share their thoughts with companies. They’re not posting on social media as much. They’re not writing as many reviews. They’re not even telling friends and family about their experiences. Instead of complaining, they’re simply moving on to other brands.
[00:03:47] As we move deeper into 2025, the message becomes clear. Successful customer experience isn’t about collecting more data or about achieving higher scores. It’s about creating genuine connections that make customers want to come back. It’s about turning metrics into meaningful actions.
[00:04:07] Most importantly, it’s about understanding that in the race to measure everything, we sometimes forget to measure what matters most, the relationship between businesses and their customers.
[00:04:20] The great irony of 2025 might be that in an age of artificial intelligence, virtual reality, and hyper-personalization, the key to customer loyalty still comes down to something remarkably human – the ability to make people feel genuinely valued, understood, and appreciated.
[00:04:42] After the break, it’s gonna take a lot more than whiskey, sauce, and mozzarella sticks. To save TGI Fridays. You’re listening to Marginally Better. Stay with us.
[00:04:55] It is Marginally Better. I’m Joe Taylor, Jr.
[00:05:04] There’s something about walking into a restaurant where the walls are covered in vintage memorabilia. The servers wear striped shirts and suspenders, and it’s always supposedly Friday.
[00:05:15] In November 2024, TGI Fridays, the restaurant chain that helped pioneer the American casual dining experience, filed for bankruptcy. Its US locations had dwindled from 329 in 2020 to just 161. But this isn’t just a story about numbers, it’s about how an American icon lost its way and what it tells us about how we eat, drink, and come together in 2025.
[00:05:44] The story begins in 1965 when Alan Stillman opened the first TGI Fridays in Manhattan. It wasn’t just a restaurant; it was one of America’s first singles bars. The walls were decorated with Tiffany lamps. The bartenders competed in elaborate cocktail making competitions, and the whole place hummed with the energy of possibility.
[00:06:08] By 2008, that single bar had grown into an empire of 601 restaurants doing $2 billion in annual sales. but somewhere between the brass rails and the potato skins, something happened. The world moved on, but Fridays stayed Friday.
[00:06:32] Ray Blanchette, who started as a manager in training in Philadelphia in 1989, watched it happen. His first restaurant pulled in 2000 guests daily and $140,000 in weekly sales. He rose through the ranks, eventually heading up the company’s European division before leaving in 2007 to run other casual dining companies. but Friday’s called him back. In 2018, he told reporters it was his dream job. By 2019, he appeared on the CBS television series, Undercover Boss. And if you haven’t seen the show, it’s where a CEO dons an elaborate disguise to work entry-level roles in their company. Blanchette got behind the bar and noticed big problems.
[00:07:24] Now to his credit, Blanchette tried lots of ideas to turn things around. He launched new value menus. He introduced $10 cocktails. He even rolled out virtual delivery brands during the pandemic. But sales kept falling. By 2023, facing mounting pressure from bond holders and a failed merger with a UK franchisee, Blanchette resigned as CEO. He didn’t leave Fridays entirely, though. He bought seven company owned Fridays locations in the Northeast and focused on running them himself as a franchisee.
[00:08:00] Now this is a story we’ve seen before; the slow decline of a beloved institution. And while the same thing has happened to thousands of smaller food service businesses over the past few years, Fridays filled a gap in many communities where mom and pop businesses might not have maintained traction or where the structure of a change restaurant operation made going out more affordable or attainable for its patrons.
[00:08:28] The concern in many places where Fridays closed up shop is that there aren’t many viable businesses ready to take over those locations. So this is really a story about disruption, about what happens when the world changes faster than you can change your menu.
[00:08:47] So what can be done? After hearing from some industry experts who’ve operated and analyzed successful restaurant chains. Our team curated a few pieces of advice for whoever takes the reins next.
[00:08:59] First, remember what made you unique. You might scoff at the idea that there’s a distinction between any of these big chain restaurants, but plenty of people can tell you exactly what sets a Chili’s apart from an Applebee’s, from a TGI Fridays.
[00:09:17] TGI Fridays was born as a place where people could connect over drinks, food, and conversation. And as we’re moving on from the isolation of the pandemic, when many of us are returning to offices for the first time in years, there’s a need for that third place between work and home. That shouldn’t change, but how we facilitate that connection needs to evolve. Dating apps replaced singles bars. But there’s still a need for reliable, affordable places to get good food and drinks with coworkers, family or friends.
[00:09:54] Second, embrace the fast casual revolution, but do it your way. Counter service operators like Chipotle and Sweet Green have shown that people want fresh food served quickly, but that doesn’t mean abandoning table service altogether. It just means recognizing that some customers like a different kind of experience. And a quick lunch served at the bar, can meet a single patron’s need for about the same price as a bagged fast-food meal in their car.
[00:10:27] Third, improve the infrastructure before updating the menu. Blanchette’s Undercover boss experience highlighted one of the biggest challenges in operating restaurants, the physical condition of the establishment. Maintenance is one of the first areas restaurant managers cut back on when times get tough. But a broken bathroom and a grimy floor are among the first things customers notice when considering a table. When you listen to people review chains like O’Charlie’s or Texas Roadhouse, they talk about the food and the overall experience, and that doesn’t include sagging ceilings and staffing shortages.
[00:11:08] Now I didn’t know until reading about it of the Wall Street Journal’s exhaustive report about TGI Friday’s, we’ve got a link to that in the show notes and you should definitely read it, that Tom Cruise filmed scenes for his film Cocktail at the original location’s bar. His hot shot bartender character was based on the kind of people who turned that single corner bar into a global phenomenon. The scene captures something essential about the brand. It wasn’t just about the food or the drinks, but the show, the experience and the feeling that something special could happen there any night of the week. Maybe that’s what needs to be rekindled. Not the same vibe that closed out the Reagan Bush years, but that same sense of possibility. Because in the end, this isn’t just about saving a restaurant chain, it’s about preserving a piece of American culture and about keeping alive the idea that somewhere, somehow it can always be Friday.
[00:12:12] After the break, what I learned from the worst business I ever started… on my front lawn when I was seven. That’s when Marginally Better continues.
[00:12:27] It is Marginally Better. I’m Joe Taylor, Jr.
[00:12:33] And to close out the show today, I want to tell you a shameful tale of the least successful business I ever operated and how what I learned informs a specific kind of work I do today as a user experience consultant.
[00:12:49] Let’s go back to 1975. I was two, growing up just outside Philadelphia and something that would change my life and all our lives was happening on the other side of the country.
[00:13:02] McDonald’s was not the first American fast-food chain to operate a drive-through. In fact, there had been drive-in diners with car hops and drive-through restaurants of all kinds for decades. If anything, McDonald’s had been a little resistant of the idea.
[00:13:19] According to company historians, brand managers and franchisees at the time couldn’t agree on the architecture or even the features of a drive-through McDonald’s. Should it have multiple lanes like you saw at banks at the time? Should there be a garden over the canopy? And would you have to shut down existing stores to build new drive-through facilities?
[00:13:43] Now, while folks argued about those questions, the McDonald’s in Sierra Vista, Arizona was trying to solve their own big problem for some of its most important customers. This McDonald’s was just outside an army base, and it was popular with everyone there. But sales dropped when the base started enforcing a rule that soldiers had to remain in their vehicles if they wore their fatigues off base. Now that’s when David Rich, the licensee at that store, figured out the fastest way to get food into his customer’s hands without them having to get out of their cars, a sliding window in the wall near the kitchen. That’s it. He improved his store sales by 40% that year, and solidified a huge part of car culture within a few years after that.
[00:14:37] So let’s fast forward another five years, and like a lot of kids growing up in the early 1980s, I was mesmerized by the McDonald’s drive through. It seemed magical.
[00:14:49] You’d roll up to this menu board, shout your desires into a speaker. Pick up all your food at the window. Incredible. Right? So when the kids in my neighborhood were all getting old enough to run our own lemonade stands, I wanted to one up them. I wanted to run my own drive through restaurant.
[00:15:08] So I built an elaborate menu board. I listed a bunch of things I knew we had in our kitchen and I put ’em up for sale. I had not yet learned about profit margins. Again, I was seven. So I realize now that offering ham and cheese sandwiches for 50 cents was a tremendous bargain for my customers to keep up the gimmick, I made my customers shout their orders into the speaker box, which really was just something I drew on a cardboard sign with a magic marker. And I made them walk up to the pickup window, down the fence from where I was standing, and that’s where my buddy would make change and conversation while I sprinted into the house and assembled some of the hastiest lunches you could imagine.
[00:15:54] For folks who are younger than me who might not believe this tale, this is what we Gen Xers talk about when we say we were left unattended a lot. So talking about this years later with some of the adults from our neighborhood, they insist that they were humoring us and they thought it was cute that we were playing make-believe McDonald’s. They, however, did not make-believe eat all my parents’ lunch meat. They bought a bunch of those sandwiches. We were in trouble over this for years.
[00:16:25] But here’s why this was such a pivotal experience in my life. It taught me that when you’re speaking through an interface of any kind, you have no idea what you’re dealing with. On the other side, it could be a live person in the building six feet away. It could be someone at a call center on the other side of the world. It could be, in our case, two 7-year-old kids who didn’t even have a trench coat.
[00:16:50] It taught me to remain skeptical about the solutions. So many folks try to sell customer experience managers. If you’re adding a chat bot to your website, are you disclosing that to your customers or are you trying to pass it off as human? If you offer live chat, are you setting the expectation with your customers about what that chat agent’s really empowered to do?
[00:17:13] When you’re planning and testing elements of your customer journey, I recommend using a test with a fun name coined by my colleagues at the Nielsen Norman Group. They like to call it the Wizard of Oz interface, just like the book, and the movie, and the musical. It references the fact that, spoiler alert, there’s just one guy behind that curtain operating a scary mechanical head.
[00:17:36] So if you are doing a little bit of experimental user testing, you don’t need to install a whole system here. You can just run the test with one real person sitting on the other side of that chat window or that search bar. Manually returning the results that your perfect world solutions hopefully going to provide. Trying things out this way lets you figure out if your potential solutions got enough courage to face your customers or if you’re just gonna have to throw a house on it.
[00:18:06] And the fact that I am that far down the metaphor well means my time’s up for this episode. Thanks for listening to Marginally Better.
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[00:18:25] If you wanna get behind the scenes. Means notes from me and the rest of the team. Go to marginallybettershow.com or follow the link in our show notes.
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[00:18:44] Marginally Better is a Calufrax radio production. Our producer is Nicole Hubbard with research by Connie Evans.
[00:18:50] I’m Joe Taylor, Jr.
[00:18:54] Calufrax…mean little planet.
Joe Taylor Jr.
After a decade in broadcast media, Joe developed early online platforms for NPR, PBS, and AOL. Today, he helps our clients tell compelling brand stories through audio, visuals, and software.