Do Scores Matter if You Don't Know What is Critical to Your Customers?

Last week, I wrote about the importance of knowing what drives customer dissatisfaction, which dealt with data interpretation and the need to dive more deeply into the business issues as well as the data.

There are exploratory ways to interpret data and more analytical methods as well. The key to correct interpretation is knowing which approach will deliver insights to your business. As I said in my last post, coming to the wrong conclusions even with good data is a possibility without using the right tools. In the case of customer loyalty, you could be investing in programs that have little or no impact on the customer’s intention to buy again or you could be ignoring “dissatisfiers” that diminish a customer’s perception of your critical attributes.

So, there are a few initial questions to ask:

• What do you believe are the attributes that contribute to your customers’ loyalty?
• Are you measuring those attributes specifically in any data gathering exercise including social media monitoring?
• Do you classify these attributes in terms of their impact on the customer or importance?

The example below is from an article titled Guests’ Perceptions on Factors Influencing Customer Loyalty, which appeared in the March 2010 issue of the International Journal of Contemporary Hospitality Management.

Customer Service : Dissatisfier

Cleanliness : Neutral

Room quality : Dissatisfier

Value for money : Critical

Quality of food : Dissatisfier

Family friendliness : Neutral

The authors selected typical product and service attributes for a guest at a hotel and designed questions around those.

Using simple regression, they did something very interesting and in my view very revealing about the data they collected. The usual loyalty question was asked (intention to return) and all other questions were tested against this one. Then, questions above a median score were tested individually and those below the median also were tested in the same way. The results were plotted against agreed criteria from Critical to Neutral.

Critical Attributes were significant in both tests and would be considered a driver of loyalty as well as a reason to switch. These have high compliments and high complaints. Performing well in other areas won't compensate for low performance here.

Dissatisfiers were significant in testing low performance but not when high performance was tested. So, if customer service is bad, it influences a decision to switch but an average experience doesn’t critically drive loyalty. These are the attributes that should be maintained but not at the expense of more critical ones.

Neutrals generally may not be noticed by customers and although bad performance would reduce perceptions of quality, it would not be to the point where quality is considered poor.

There are some lessons to be learned, I think, from this type of data interpretation:

• Simple statistical tests are used in a way to deliver insight that would be difficult to obtain with exploring low and high scores alone.
• Knowing whether a key attribute delivers the loyalty factor; whether it has no affect or whether it destroys loyalty is so valuable in terms of designing the customer experience and making the right investments.
• This is the kind of "I know" insight that is compelling when reporting on Voice of the Customer issues.

How are you measuring customer loyalty? Do you know what is critical; which areas need only a minimum performance to maintain loyalty and which attributes have no impact on loyalty at all?

Can You Hear Me Now? It's Your Customer Calling

Does anyone still breathing believe that we can succeed without customers? I didn’t think so. If people don’t want what we’ve got to sell, we’re toast. So, there should be no argument that customer satisfaction and loyalty are goals we should be eagerly pursuing since the pundits tell us that it costs five times as much to acquire a new customer as it does to keep one.

I know, some of you are saying satisfaction and loyalty, yes, “but not at all costs” and “not the wrong customers for our business”. Exactly. So how are you managing those customer issues for your benefit and theirs?

Hello? I’m Out Here and Here and Here…: There are so many channels from which to collect customer feedback and each one potentially provides data gold. However, what is interesting may not be useful. Before buying, jettisoning or adding onto your business intelligence platform, a game plan is imperative.

Customer orientation is a critical part of developing a business strategy. It’s hard to describe competitive advantage and competencies unless we’ve defined how we will deliver products and how we will serve our customers. Business intelligence needs to be aligned with both strategy and customer needs. A company’s market research used to be private; now it is open and available on every social media outlet and search engine just by mining customer comments. We shouldn't ignore the qualitative nature of data and fail to integrate that into other customer data sets as it is necessary for ongoing strategy development

See Your Company Through Your Customers’ Eyes: It’s disappointing to deal with companies that seem to have no idea how many customer touchpoints they have and infuriating that they are not integrated. It’s inexcusable that frontline employees are neither selected nor trained for a service job. If you invite some of your co-workers into a room with a big white board and start mapping customer interactions, it is a mind-boggling exercise. Or, just read your customer comments online.

Create a Single View of a Customer: I’ve said it before: customers do not care about our silos. It’s not their job to sort out which department is responsible for resolving a problem. A fragmented approach rather than Outside-In customer experience design means that your employees have a perspective of your customer based on their job roles not on customer expectations.

It’s Called Voice of the Customer: I design a lot of feedback and research surveys and I am sent a few as well. It takes me less than 30 seconds to decide whether or not I’ll complete a survey depending on how it’s constructed. Questions should be properly worded and of an appropriate length; be free of bias; be actionable and be linked to the customer experience as well as the company’s metrics and Key Performance Objectives.

I’ve been on a data and analytics soap box for a while and there is no doubt that through collection of behavioral, rational and experiential data, we are doing a better job of knowing who buys from us and why. To understand what we didn’t sell and why requires tapping into customer emotions. Maybe someone will develop an App for that. Until then, we have to collect, aggregate and understand qualitative data to hear what are customers are feeling as well as saying.

To paraphrase a line from my newest favorite film, The King’s Speech, your customers have a voice. Yes, they do.

Interest or Commitment: Knowing the Difference Could Change the Way You Manage

One of my clients recently sent me this quote from Peter Drucker that has had me reflecting on its true message and how it is applied, especially in business:

“There is a difference between interest and commitment. When you are interested in doing something, you do it only when circumstances permit. When you’re committed to something, you accept no excuses, only results.”

For me, being interested implies a passive mindset whereas commitment seems active, which is confirmed by dictionary definitions: “the trait of sincere and steadfast fixity of purpose”. While interest is associated with curiosity about someone or something, commitment is the “act of binding yourself (intellectually or emotionally) to a course of action.” Interest is more cerebral perhaps while commitment is both cerebral and visceral. Isn’t commitment what we want and need in our organizations to be successful? When leaders talk about connecting to the ‘heart and the mind’ aren’t they referring to commitment?

I have a few thoughts on how to listen for and instill commitment day-to-day in our businesses:

Strategy: is business strategy a story that inspires people to bind themselves to the direction in which you want to go?

Leadership: before employees are committed, leaders have to demonstrate their steadfast fixity of purpose. It’s a trait not a slogan (“We are committed to our employees.” “We are committed to our customers.”)

Culture: is the business environment a community that binds people together to achieve a common purpose or a federation of possibly interesting activities?

Employees: is the hiring process geared more toward uncovering interests than discovering commitment?

Customers: do we expect commitment from our customers while only being interested in what they can do for us?

The late Peter Drucker’s ideas and writing continue to provide enduring lessons of what motivates people and moves organizations toward a higher level of performance. As I said to my client as we exchanged emails, Drucker was a no nonsense thinker who understood the duality of our 'heart and mind' selves.

Does anyone have a favorite Drucker thought?

Hot Customer $ervice in the $ummer Time

We’ve been sweltering through a crispy summer in Atlanta and I finally had to bite the bullet to install a new HVAC system.

Of course in these new days of austerity, it wasn’t a matter of picking the prettiest system; oh no, I had to do my homework. Onto the web sites I went, looking at systems, any deals that could be available and, most importantly, what my friends and neighbors are saying about the two contractors I short-listed.

While I had used a locally well-known provider for 15 years, I had a very disappointing experience with one of the company’s executives last year. However, I decided to give them the opportunity to make a service recovery and quote for my business. And, I added another local contractor that had very positive online reviews. Both quotes were very similar but I couldn’t shake the bad experience I had had with my current vendor.

After dithering for a month (it’s $10,000 after all; not exactly an impulse purchase), I phoned the sales person for the second contractor. We discussed scheduling and the fact that in this Sahara-like summer, I couldn’t do without air conditioning for a day and a half. Without hesitating, he arranged to bring a room air conditioner 5 days before the work was due to start because “there is no reason why you have to be uncomfortable”.

Do I have to tell you who got the business?

Bill was on time and dutifully dragged the unit upstairs and down until we found a window that would accommodate it. He installed it, tested it and ensured there was no escape of precious cold air into the outdoors. And he did it all cheerfully on a day with a 106 -degree heat index.

I’ve told everyone who is even mildly interested about my customer experience and why I didn’t select the first vendor. Of course, if anyone asks me, I’d happily recommend Bill and his company. I’ll also be doing online reviews because I found them very helpful when I was looking for a new HVAC contractor.

Lessons learned?

• It takes only one conversation to lose a long time customer so if you have the words “Customer Service” in your title and you don’t live up to it, be prepared to lose your revenue base over and over again.

• What your web site and marketing materials say had better align with how your employees behave with customers; it’s becoming easier to spot the differences. And, in this economy, people are fed up and aren’t putting up with sub-par service.

• It only takes one small thing, in my case, the offer of a loaner air conditioner several days in advance of the installation, to completely surprise and delight a customer. We are so hardened to expect customer “no service” that when the unexpected happens, it produces multiples of satisfaction versus the actual expenditure of resources.

• Online reviews are routinely part of a customer’s research. Ignore them at your peril. Google never forgets!

• Word-of-mouth referrals and recommendations are incredibly important for any company.

• Going above and beyond, often in small ways that are personal, is the greatest source of satisfaction, which will drive intention to buy, refer and repurchase. When everything else is equal between you and your competitors, this kind of differentiator stands out.

What is your company doing to surprise and delight your customers? Do you monitor what people are saying about you – or do you think customers don’t really take notice of other peoples’ opinions?

What Business Are You In? Really.

I’ve got a whole key ring full of bar-coded plastic tags that designate my “loyalty” to a particular store; I’ll bet you’ve got fistfuls as well. Are they an indication of my loyalty? Can you measure my loyalty with that piece of plastic?

Companies like Southwest Airlines and Zappos know they are in the customer service business; they just happen to fly airplanes and sell shoes. We all are in the business of serving our customers and that is a tall order when, for years, we organized our businesses around products.

I don’t know about you, but I have a list of criteria that my brain churns through in the midst of a buying decision. If someone wants my business, they have to demonstrate that they know me, respect my needs and provide an experience that suits me.

If you say you’re customer focused, show me. Nothing wears me out faster than marketing messages that bear no relation to the actual experience. Who thinks of this stuff?

Have you ever listened to your own voice mail or help desk systems? Finding the balance between efficiencies and customer experience is a challenge but there is no excuse for making it so hard to talk to a human that we have to Google to find out how to do it. What’s more important than a customer anyway?

Your web site may be great but your (fill in the blank) department lets you down. There are so many ways I can touch your company and if all the touchpoints aren’t designed for my buying experience, I may be leaving and you won’t even know it.

Why can’t the person I’m talking to make it right when there is a problem? As Mick Jagger said, “I try and I try and I try but I can’t get no satisfaction.” Why is there more chain of command in Customer Service than the Pentagon? If your customer strategy spells out how you’re going to deliver a customer experience and the culture supports it, employees should have the tools and skills to make the decisions.

Why are your marketing “campaigns”, coupons and emails so generic? Is it that you don’t really know me, or that you don’t care? You collect so much information from me with that plastic tag and yet you don’t connect the dots.

Please do not expect me to complete a survey foisted on me by an employee who is asking me to give him top marks. This is no way to reward employees or to gather valid customer data.

Loyalty programs are part of customer relationship management but they don’t guarantee that you have hearts and minds. I don’t think loyalty is bought; it’s earned over time by designing the experience customers tell you they want and ensuring the company is aligned around it. What are you doing to earn the loyalty of your customers? Is it more than another piece of plastic for my keyring?

Let's Get This Party Started: Winning the War for Customers

I’m officially declaring the Gloom and Doom funk over! I think we’ve all spent too much time examining the lint in our own navels and have found it much too interesting. Maybe it’s the minute-by-minute access to disasters or the endless shouting by talking heads that has us paralyzed but we won’t get better if we don’t get busy.

Business always has been tough, even when everyone said we’d never had it so good. Finding good people; finding great customers; finding terrific ideas: haven’t these always been our challenges? Sure, the pace of change is much faster and there are a lot more consequences to our global business network. There’s always something so why not acknowledge that it is what it is and let’s get going to find new customers and keep those who have selected us as their provider of choice.

So, what’s on our To Do list? I can think of a few positive things to perk up our customer focus:

Paint a Picture: what is your vision of your ideal customer experience and how are you measuring up? Gather information and insights directly from customers and employees (who are very good predictors of how things really are with customers) and indirectly from web searches. There is a lot of comment in cyberspace and some of it could be about you. Ask your customers about all aspects of the experience including, for example, first call resolution, ease of self-service and access to information on your web site and so on.

Get a Plan: close the gaps between what you want your customer experience to be and what your audience says it is. And, execute it! A plan is not action and hope is not a strategy. You might be surprised at how galvanizing it is for your employees to experience the momentum of putting ideas into action.

Tell a Story: current and prospective customers are more engaged by success stories than by product features, brochures and fact sheets. Buying is an emotional experience and stories tap into that reservoir.

Give Them Something to Talk About: Engage in authentic conversations in ways that your customers prefer: social media, your web site, guest blogs, anywhere. Ask them to write reviews and participate in online focus groups. People are flattered by the invitation and most of the time, are happy to provide feedback (note: just don’t overdo the frequency) IF it’s done in a personalized way.

What else should be on our To Do list? Let’s get busy and start the party. End of funk.

Done Here, Felt Everywhere: Behavior Matters More Than Ever

The Gulf oilrig explosion and its aftermath is an example of how what we do (or fail to do) impacts others we don’t know in ways we haven’t even considered. Did the relentless push to drill, baby, drill faster to save money and to get the oil (revenue) flowing as quickly as possible compromise BP’s values? Lives have been lost; livelihoods are endangered; ecosystems and economies may never recover. Even my condo in Hilton Head has seen an increase in rentals because vacationers don’t want to risk a holiday on the Gulf coast. The ripple effect will be felt globally through many channels in very quantifiable ways.

We are so intertwined and so connected, thanks to technology and the Internet; we are so darned global that more of us have the power to impact other people’s lives than ever. So, how we behave; how we treat others and how we build trust with employees and customers have an exponential impact on them, on others we can’t even identify and on our own businesses.

Leaders: this is where you come in.

The CEO of BP can hug all the fisherman in Louisiana he wants but if he put profit before ethical behavior (by short circuiting safety for example), what does that say to his employees in terms of their own behaviors? How should customers react? What has this done to BP’s prized Brand? Judging by recent loyalty scores for Toyota, for example, customers and would-be buyers take time to recover when confidence is shaken.

BP’s Values are Progressive, Responsible, Innovative and Performance-driven. It looks good on a web site but do they influence behaviors and decisions? Time will tell and the whole world will be judging.

As a leader, Tony Hayward needs to demonstrate how he and his company will rise above PR, litigation and playing the blame game to behave in a way that inspires confidence and trust. That behavior will ricochet around the world in social media channels and news outlets as fast as the bad news is traveling. His recent performance on Capital Hill suggests that this is not a lesson Mr. Hayward has learned yet.

Dov Seidman, author of the book, How, says that we all now live in the “Era of Behavior”. He argues that too many of us are behaving by situational values or whatever the situation allows. Sustainable values on the other hand inspire us to do what should be done in every situation; they strengthen relationships for the long-term and reinforce our reputation in the global networks that drive our brand performance.

If how we behave doesn't match what we say on web sites, in annual reports or corporate communications, how successful do you think we will be with issues like employee engagement, customer commitment or organizational culture change? Behavior matters. End of story.

Making Customers Matter: Eight Things You Can Do Right Now

We are all trying hard, I think, to get back on track with employees and customers after a particularly difficult time over the past 18 months or so.

In my video blog, I discuss a unique concept that you can apply today to create a positive environment for employees as well as a great customer experience.

Do you see The Spillover Effect in your companies? Are the eight drivers some of the behaviors and outcomes that you focus on for better results?