Starting With a Named Account Based Program is a Money Move…….Literally.
May 20, 2010Am I the only one that finds it strange that so many companies kick off their customer experience and loyalty programs focused on market stats, customer satisfaction scores and Net Promoter Scores (NPS) – quickly are left wondering, now what? They ask themselves, what do we do with this? So you have the scores and data points, but are they actionable? Can you quantify the results of your program? If not, then why do it at all? My recommendation: Don’t do it. If you don’t take action on your results, you might as well not do it at all. You will do more harm than good and alienate your customers that kindly took the time to provide feedback.
This is why I would argue before you run off to create your Business, Consumer or Partner NPS program; you take pause and build your Named Account Loyalty Program first. This program is actionable; it will give you real quantifiable results that you can build from. Step 1: Bring in ROI that justifies your team’s existence, Step 2: knock the ROI goals out of the park, Step 3: grow your program freely. If you don’t start with something that will drive action in your largest named accounts in your most strategic relationships that drive 80% of your revenue, you are missing the boat. Does your program show value? What are the results? Quantifiable results. My list of ROI from our account based program is long but getting to the point that you are most interested in……we have influenced $68.5M in new and existing sales opportunities in just 12 months. Go for the money move and start with an account based program!
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Case Examples, Lessons Learned, Loyalty Research | 
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Posted by cherylgutierrez
Why don’t companies measure real customer loyalty?
May 15, 2010A recent SupportIndustry.Com report: 62% of participants reported that they do not measure customer loyalty in terms of customer profitability including revenue contribution, customer references and referrals. When you dive in you see it’s a low response rate and probably not statistically significant. That said, there still are many companies out there not doing this. So I have to ask, why bother at all – what return are these efforts showing?
Most (not all) of the respondents reported measuring a customer satisfaction index. So they have a customer feedback program of some sort in place and are capturing valuable information… are they using it wisely? What return can these companies show on their investment in running those surveys? Perhaps they are using it for call center agent coaching / performance management. Perhaps they are using it for “beauty contests” in an effort to show how good they are at satisfying customers?
Whatever they are doing, I hope they use this study to wake up to a new reality: treating your customers as assets leads to significant ROI. As just 2 examples of the hundreds out there, recall the credit union that is reducing customer acquisition costs, or the B2B software company that is measuring improvements in customer retention by improving the customer experience.
Any thoughts on this topic are appreciated… how do we get the word out that “There’s gold in them thar customers!” if companies only went looking for it?
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Posted by Steve Bernstein
The Importance of “Importance”
May 12, 2010It’s such a simple word – we all know what “important” means – but when it comes to prioritization most of us seem to suffer from, “Everything’s important!” Take customer feedback. Many companies ask their customers to tell them how important something is in order to help prioritize improvement initiatives. But does this work?
A recent McKinsey article shows once again that “stated importance” – asking customers to tell you what’s important to them – doesn’t help you in the prioritization effort:
“We found a big difference between what customers said was important and what actually drove their behavior. Customers insisted price was the dominant factor that influenced their opinion of a supplier’s performance and, as a result, their purchasing decisions. Yet when we examined what actually determined how customers rated a vendor’s overall performance, the most important factors were product or service features and the overall sales experience.”
It’s critical to prioritize the right areas that will maximize loyalty at the lowest cost. Make sure to think “outside in” – what’s really important to the customer that will result in increased revenues?
As another example, what’s the most important thing about airline travel? If prompted, most people would say that safety is their #1 priority. But I think Rainman is the only person I know that actually makes his flying decisions based on this attribute.
As the folks from McKinsey show, it’s critical to derive importance. Correlation isn’t always enough: discovering which attributes are most directly tied to customer success is a good first step. But if you are making investments in the enterprise it’s important to prioritize optimally, given both hard dollars and opportunity cost if you start going down the wrong route. Regression techniques can show you the way, especially when linked to financial outcomes that can predict the benefit side of a change in business process.
OK, so I digressed in this post since the essence of the McKinsey article is on customer experience, not on “stated vs. derived importance.” I’d like to get back to that point, where we can discuss the strategic nature of proper account management. In the meantime I’d love to hear your thoughts.
5 Comments | Loyalty Research, News | Permalink
Posted by Steve Bernstein
From Detractor to Promoter in 140 Characters
May 6, 2010I am – obviously- a believer in companies having a comprehensive client satisfaction assessment program. I think it’s an important metric to track, a useful tool for planning, and an ethical way to run a business. And while I think it’s important to have metrics and tracking and predictive tools, I am finding it equally important for companies to incorporate social media into their client satisfaction process.
A few months ago, I ordered a $25 padded insert to turn a regular bag into a camera bag. I didn’t know the vendor, but I had seen them referenced online, their website was good, and they had what I needed. I ordered, paid, and sat back and waited for delivery.
The next day I received an email from the vendor that was two lines:
The status of your order has changed.
The new order status is: Backordered
Huh. That is…hugely uninformative. I wrote back asking if they could give me more details, even just let me know how long it was backordered, and sat back and waited for reply.
I didn’t get one.
Now I was about 99% sure that this was a legitimate business and that I’d receive my item at some point. But there was 1% of me that felt like, well, I just gave my credit card info to someone, and then they told me my items would come eventually, and I have no idea when that eventually is actually going to be, so… I think maybe I just got screwed.
A quick search on Twitter showed this merchant has a Twitter account. Because I’ve never had a thought that didn’t get filtered through social media in some form or another, I quickly threw out a flag to this company to see what would come of it:
Within a few hours they had responded with someone’s direct email address and offer to check on my status. I was offline and didn’t get their reply immediately; a few hours later they then emailed me directly (I have to assume they noted my last name from my Twitter account and looked up my email address and order info) indicating that they had located my item and would send it out that day. And 48 hours I had my item.
It’s worth noting that through all this, I still hadn’t/haven’t received an email back from my initial inquiry.
What does this tell me?
- Tenba Bags is a legit company that has a really bad automated email process… but luckily has at least one employee that understands how to use Twitter
- Without Twitter, I’d still be waiting for a response from a customer service representative.
- Customer Service is more pressing to companies when they can personally account to their customers, and when their customers can reach out in a very transparent way
It means a lot to me that they worked quickly to resolve my issue and make it right, but I have no doubt that wouldn’t have been the case if I hadn’t publically and transparently reached out. They can – and did- ignore my email, but when negative mentions are available in public searches, that’s harder to dismiss. Frankly, I don’t really care why they solved the problem, I’m just glad that they did, and in a way that literally took me less effort than typing 140 characters.
Mine is not a unique case. Popular blogger Dooce got Maytag all up in arms when she twittered her negative experience to her million + followers, and I’ve seen Overstock.com go out of their way to fix a problem discovered through twitter for people with ten followers, to the tune of replacing a broken item and providing store credit.
Places like Twitter and Facebook are where recommendations are happening. Companies owe it to themselves to interact with their customers through these mediums. If I ran a company like that, I would expect that every single complaint (or less than positive mention) was responded to promptly and personally. Every Single One. I’m not alone in this; Zappos has a twitter account set for EXACTLY this purpose. They respond to every mention, even the positive ones, and I have to assume that they have incorporated these responses and mentions into a “Closing the Loop” feedback metric of some kind as a part of their greater client satisfaction process.
And as for me? Well, Tenbabags reaching out to me through Twitter (and subsequently solving my problem) turned me from someone who would have grudgingly given them my money and likely never returned to someone who now goes out of their way to recommend them to others. Is there any better outcome than that?
1 Comment | Case Examples, Lessons Learned | Permalink
Posted by LizScott
