On Metrics: Brand Recommendation or Satisfaction with the Experience?

I was recently in a new client’s office discussing the merits of using Net Promoter Score (NPS) or Top Box Overall Satisfaction (OSAT) as the key customer experience metric. That lively discussion highlighted the differences in the two metrics. At Market Force, we think about and use them in very different ways—and it has to do with the exact question being asked.

NPS asks “How likely are you to recommend [brand name] to a friend or colleague?” The question focuses on engagement with the brand itself, and very likely reflects everything from the brand reputation to the products offered. Consider Apple and the iPhone as an example. However, if you are interested in measuring a transactional experience in a multi-location business—we advocate using a different question: “How satisfied were you with your experience at this Apple location?” The questions then become focused on the experience in the store rather than the connection to the brand itself.

In Market Force’s customer experience (CX) management practice with multi-location businesses, we see both metrics being used. We recommend using a 1 to 5 scale, with 1 being not at all satisfied and 5 being very satisfied, or delighted. We report top box OSAT as the measure of choice. There are two primary reasons for this choice. First, it’s very actionable at the location level. Based on absolute and relative benchmarks, our clients can set performance goals for every location unique to their individual needs. Second, our panel research clearly shows that competition in every industry is very tight. Receiving a 4 instead of a 5 on a satisfaction metric means anywhere from a 2x to 12x difference in likelihood to recommend. To be competitive you must create a best-in-class/top box experience; you must delight, not just satisfy, your customers.

Our financial modeling work has found that overall satisfaction—and the critical drivers of that metric—predict revenue growth metrics, ranging from same store sales growth for restaurants to revenue per available room for hotels. Our survey design practice advises implementing both questions—satisfaction with the experience and brand recommendation—to get both views. And we clearly advise not being solely dependent on NPS as a metric for your multi-location brand. Your operations teams may see a NPS result as intangible and very difficult to improve their score while specific transactional experiences may seem more in their span of control.

For more detail on how Market Force links financial data to customer experience metrics, please see a recent webinar that we conducted with Forrester on the topic. In this webinar, our own Dr. Cheryl Flink, Chief Strategy Officer for Market Force, compares notes and best practices with Harley Manning, Vice President and Research Director–Forrester. And of course, our Customer Experience eBook provides a very detailed perspective on implementing a comprehensive measurement strategy. 

Time to reconsider the Financial Services Customer Journey

According to Deloitte nearly three quarters (72%) of consumers still want to use their local branch to access financial services. This emphasizes the importance of the branch experience on customer loyalty—at least for now. However, our most recent competitive benchmark shows over one in ten banking customers are not satisfied with their relationship with their primary bank. This makes brands vulnerable to losing market share. Overall, 12% of all banking customers are considering switching banks in the next 6 months, with individual brands ranging from 10% to 19%. Our study also shows that many financial companies have a long way to go in order to create a positive encounter with most of their touchpoints. Look at the following:

  • 1 in 6 consumers are dissatisfied with their experience interacting with their bank’s call center
  • Nearly 1 in 5 customers had a recent problem; fees were the most common problem, followed by operations issues while inside the branch
  • Of those with a problem, 13% said it was not resolved, resulting in a net loss of 46% in overall satisfaction

The research also shows that the advisory experience clearly impacts customer loyalty. Consumers continue to visit their banks’ physical branches to speak with and advisor—and over two thirds were very satisfied with that interaction. However, although bank advisors execute well on the basics such as explaining products and services, they miss opportunities to build relationships by asking questions to understand consumers’ needs and following through on commitments. Most large scale financial institutions are investigating the customer journey and the impact each touchpoint has on customer satisfaction. They would do well to consider the following:

  1. Driving Satisfaction: To create true loyalty, and not simply complacency, banks need to deliver an excellent experience that makes it easy to do business with the bank and builds a sense of trust with consumers. This means focusing on consumers’ financial well-being with great advisory services and creating transparency regarding fees.
  2. Resolving problems is critical: Besides impacting overall satisfaction, unresolved problems lead to decreased recommendation rates. Very few disappointed consumers tell brands they were disappointed, and that leaves brands open to loss of wallet share and poor ratings in social media.
  3. Banking brands have opportunities to differentiate: Banking customers scored their primary banks low on concern with the customer’s financial well-being, understanding unique needs, and even community investment.

These are big undertakings and require a strong discipline to develop the right strategy when they begin the customer process. Consider the following when you embark on a customer journey strategy:

  • Do advisors ask the right questions to ascertain needs and make solid product recommendations?
  • Does your bank have the right processes in place to listen and respond if customers have issues—and is the response consistent across channels?
  • Are you listening to your customers across all of the relevant online, social, and conventional channels?
  • Are you aggregating and disseminating information in effective ways?
  • Do you have a clear picture of reality in terms of your ability to execute against your standards and training?

Market Force’s banking customer journey maps assess the channels customers use to engage with your bank. We will help you identify customer expectations and frustrations at every touchpoint—and show gaps in the overall omni-channel experience. If effectively designed, your customer journey mapping can create an effortless customer journey—and that will insulate you from customer defections and help you improve the number of products each customer wants to purchase from your bank. That’s a great ROI.

Contact our experts today to schedule a free 30 minute consultation that will help you determine whether it’s time to consider a customer journey strategy for your banking customers.

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Charles is a customer experience management expert with over 28 years experience. In that time, he has assisted more than 200 service related companies with their efforts to improve customer experience and loyalty. His education and training includes advanced graduate degrees in Statistics and Market Research Methodology.

Hospitality Industry: The Inside Scoop

The hospitality industry is growing. IBISWorld reports: “While the Hotels and Motels industry is highly susceptible to changes in the global economic environment, the industry has experienced robust growth over the five years to 2016. Thanks to increases in travel spending, corporate profit and consumer spending, industry revenue has grown every year since 2011, as the economy improved and domestic and international travel rates increased. As a result, the Hotels and Motels industry has outperformed the broader economy over the past five years, driven by a combination of high demand from leisure and business travelers and international tourists. Over the five years to 2016, IBISWorld expects industry revenue to grow at an annualized rate of 4.2% to reach $169.2 billion, as consumer confidence and spending spike, raising revenue 2.4% in 2016 alone.”

In new research by Market Force, we found that consumer loyalty—and the opportunity to capture growth—depends on each hotel’s delivery in six areas of excellence:

  1. Overall condition of the hotel
  2. Value for money paid
  3. Helpfulness of staff
  4. Ease of check-in
  5. Bedding comfort
  6. Safety of guests and belongings

In the research, guests rated their satisfaction with their most recent hotel stays. 16% said the hotel delivered poorly on all six of these factors—and satisfaction with the stay was a very low 6%. In contrast, 29% said their hotel delivered well on all six factors—and 92% of these were highly satisfied with their stay. These satisfaction ratings led to very high loyalty—with hotel brands varying widely in their scores. (We will publish the brand level results in a press release in September.)

These results highlight the enormous opportunity to capture growth in the hospitality industry. Satisfied customers are loyal to the brand—and that loyalty allows hotels to command a higher RevPAR rate (revenue per available room) as shown in this case study. To help you measure customer satisfaction and impact on REVPar—or simply to evaluate your current customer experience measurement programs—call us at 1-877-329-9621. We’d be glad to discuss ideas for helping you improve your guest loyalty and financial success for every location. 

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As Chief Strategy Officer, Cheryl aligns Market Force's strategic direction with our clients' strategic objectives. She oversees the North American client base, Analytics and Insights, Winnipeg Operations and Marketing. She has a Ph.D. in social psychology and broad business experience in both private and public companies.​

Blended Index: How to Create a CX Single Metric

The use of blended indices is quickly becoming a best practice as companies attempt to connect the dots across many sources of data being collected for their organizations. No single measurement tells the whole story—and that’s particularly true of multi-location businesses. Why? Because locations are looking at operational excellence metrics, satisfaction and loyalty metrics, as well as financial metrics to understand how they perform. And how they perform needs to be within the context of the brand itself and peer groups. In order to make sense of the rich data sources, we recommend constructing a blended index.

WHAT is a blended index?

A blended index creates a composite score from multiple data sources, spanning operational and customer metrics. The algorithm must normalize the data so that scales are not an issue (e.g. mystery shopping on a 100 point scale, customer satisfaction on a 5 point scale, or contacts on a number of complaints/1000 transactions). The algorithm should also flex to weight specific metrics. This single score provides the brand—and your locations—with a holistic view of performance across all metrics.

WHY should I have a Blended Index?

A blended index that spans across operational and customer metrics helps you understand performance as a whole. The magic happens when you bump that information up against a financial metric like same store sales growth, revenue per available room, or volume of gas sold. You’ll then want to understand the performance of every location on that grid to determine where you will want to require better operations, more marketing to drive traffic, management changes, and adoption of best practices.

HOW do I get value from a Blended Index?

The final step in maximizing your value from a blended index requires socializing the information with the rest of the organization. Executives and managers from both operations and marketing need to understand the numbers. More importantly, they need to drive action across the organization. Finding the critical drivers—specific actions that can be taken to change scores on the blended metric—must happen. Without that commitment, you’ll be looking at data that stays the same and never changes—and that will not help you grow your brand. 

Sam McKeveny is Head of Program Development, North America at Market Force Information. Sam consults with client executives to design program architectures that systematically improve operational execution, customer delight and sales growth.

Customer Experience Management: Revamp Your System!

Have you been measuring the same things in your customer experience surveys for the past three years? Has your mystery shopping program been in place with little change? Has it been 6 months or more since your team met to clearly assess your measurement program—including spend and ROI? If so, it’s time to step back and do a clear-eyed evaluation.

Too often, measurement systems are left running untouched for months or years. That’s a mistake. The market is dynamic, customer expectations change, and your own products and services change as well. Granted, there is a cost to making changes:

  • You do want a stable measurement system to track and trend results;
  • If compensation is tied to results, changes may need to roll out slowly;
  • There’s work involved—and that includes aligning stakeholders.

However, the benefits of carefully evaluating and fine-tuning your program far outweigh the challenges. You will want to:

  • Find the gaps. What methodologies need to be added to assess brand and store level performance? What focus areas or questionnaires need changed?
  • Align the questions. Remember to construct a questionnaire matrix to ensure that you use the same wording and scales across your measurement instruments.
  • Evaluate communication. Go out to franchisees, the front line, managers—all users of the data—and ask whether they are getting what they need to better manage their business. If they aren’t, you’ll need to rethink that strategy.
  • Raise the bar. Demand more of your teams. We have one client who raises standards every year in order to remain best-in-class. The bar he’s set in demanding exceptional customer experience has become a real challenge to competitors.

Market Force provides CX Strategic Planning workshops to assist with this process. We’d be glad to discuss how we might help you. In the meantime, check out a video published by The Telegraph interviewing Cheryl Flink, Chief Strategy Officer for Market Force. You’ll find some great tips for designing your customer experience management program. 

Gino Virgadamo is a Key Account Manager at Market Force Information, specialising in the pub, restaurant and petrol-convenience industries. Over the past 4 years, he has helped businesses understand key drivers & trends, as well as provide strategic planning to drive ROI and stay ahead of the market. 

Our Wireless Carriers: What We Love and Hate

Smartphones. Ubiquitous, necessary, entertaining, and the way we connect to our world. Behind those smartphones are our wireless carriers who provide the infrastructure that allow us to make calls, download data, watch videos, play games, and read the news. So what kind of customer experience do the wireless carriers provide—and what do we love and hate about them?

Market Force has just released the results of its CX competitive benchmarks for wireless carriers in both the US and the UK. In addition to identify category winners the research pointed to some key themes:

What We Hate:
  1. Contracts. Consumers gave much higher ratings to non-contract providers (vs. full service) across the board. In the US, seven brands scored higher than any of the four full service providers, led by Consumer Cellular. Non-contract providers are disrupting full service providers—as evidenced by T-Mobile’s dramatic changes to no longer require contracts.
  2. Dropped calls and poor connection quality. In the US, 12% of consumers (17% in the UK) planned to switch providers in the next 12 months—with value being the top driver. And what do consumers say is a source of poor value? Dropped calls, poor quality connections, and slow data transfer rates—all related to connectivity. 
What We Love:
  1. Great sales associates. Great sales associates create great customer experiences. They ask about what we really need and make pertinent recommendations. In the US, 40% of consumers (33% in the UK) buy what the sales associate recommends.
  2. Self service. We need and want a good website with the right information and content. It’s much better to do it yourself online than haggle with reaching the contact center, online chat, or going to the store. In the UK, a great website predicted both customer satisfaction and value ratings.  

With the big four carriers there are limited options for consumers. Many of us are opting for non-contract providers who focus on network quality, great sales associates, and a self-service model. Find out more about what makes us choose one carrier over another by scheduling a briefing. We’d be glad to walk you through the research.

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As Chief Strategy Officer, Cheryl aligns Market Force's strategic direction with our clients' strategic objectives. She oversees the North American client base, Analytics and Insights, Winnipeg Operations and Marketing. She has a Ph.D. in social psychology and broad business experience in both private and public companies.

Use Cameras and Beacons to Understand Customer Experience

Multi-unit businesses strive to gain a better understanding of what truly happens across their expansive network of locations. Being in-tune with the nuances at the location level can be the difference between the success or failure of a brand.  Each location and each shift will either help or hurt in your quest for market dominance. To intimately understand performance we need answers to important questions. Questions like: Are staff interacting with customers? Are we managing queue times effectively? Are we seeing more or fewer customers walk through our doors? Are sales staff interacting with customers? 

Market Force is working with more and more clients who are investing in digital stores as a part of their customer experience management strategy. They are using camera and beacon technology to collect information on customer counts, dwell time, number of customers in line, and time for sales associates to approach customers. In turn, this objective data is combined with customer experience data to get the subjective perspectives on the experience itself, for example, how effective the sales associate was in ascertaining needs and making good recommendations.

The plethora of data can be overwhelming. How can you find the ROI in your camera, beacon, and customer experience data assets? Try these three tips to get started:

  1. In the retail space, cameras count the number of customers who enter the store and the POS system shows the number of transactions. That conversion rate is a key metric—and will vary across locations. Use your customer experience survey and mystery shopping data to explain the difference in conversion rates between your locations. Then set goals to drive improvements on what matters most.
  2. In the restaurant industry, focus on dwell line queues and how well staff greet and connect with customers. Focus on how to better engage staff and whether you have the right labor model to handle the queue and optimize transactions.
  3. Embed a customer experience survey in your app. Ask customers about their experience while they are in the store, and marry those perceptions with your beacon technology tracking in-store movements. Market Force now provides a software development kit for our survey technology to embed surveys in your app—and report on KnowledgeForce.

In a past post our CTO Ben Dards wrote about the importance of looking at customer behaviors not just opinions. Specifically he cited the following; “Cameras, beacons, and app integrations give you extremely insightful information into some operational measures, for example: dwell times, queue abandonment, and conversion rate. When you couple this behavioral data with customer perceptions, you will have powerful new insights into the customer experience and how you can take action.”

Technology is empowering us in new ways to get an affordable and continuous view of reality. We can now monitor behaviors and trigger instant alerts when necessary, while in the background we amass huge amounts of data. By combining a series of behavioral data with subjective measures, and tying it back to specific and quantifiable business outcomes, you can get to a clear ROI and create a plan of action that quickly improves your revenue and reduces your costs.

To learn more about how to create a Location Based Service strategy that leverages your camera or beacon technology, contact Market Force. Our senior strategists have the expertise to blend the right processes and technologies to create cost effective solutions for leveraging your data assets. We look forward to an exciting discussion!

 

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Scott Griffith is Vice President, Executive Business Strategist at Market Force Information. Scott consults with client executives to design strategies that foster growth for companies in early stage ventures through IPO and beyond.

Feedback is a Gift: Managing Customer Complaints

Consumers expect us to be united and omni-present in understanding their experiences. That’s a tall order when feedback can come from so many different touchpoints. How can you listen and respond effectively to consumer feedback, especially to those negative comments that can hurt your brand or lose loyal customers? Here are a few tips to get you started:

  1. Make sure you listen across a wide variety of touch points, such as your inbound phone calls (into head office or call center), emails, social posts, online chat, customer satisfaction surveys, in store quick-feedback pods, comment cards, etc.
     
  2. Incorporate new technology touchpoints that look at customer behaviors—not just opinions. Cameras, beacons, and app integrations give you extremely insightful information into some operational measures, for example: dwell times, queue abandonment, and conversion rate. When you couple this behavioral data with customer perceptions, you will have powerful new insights into the customer experience and how you can take action.
     
  3. Manage the complaint process consistently across all touchpoints. Ensure that each item—no matter whether it is a call, an email, or a social post—is appropriately handled with a closed loop system. Communications, escalations, fulfillment—all need to be handled in a single case management solution.
     
  4. Analyze your complaint data to find specific locations that generate most of the complaints—and link complaints to financial results. Allow data analysis to open your eyes. At Market Force, we have analyzed complaint data and consistently find two very important outcomes:
    -  The number of complaints per thousand transactions can vary widely, with some locations generating 3x to 4x the number of complaints averaged by other locations in the system.
    -  The number of complaints about a specific location is negatively correlated with financial metrics like same store sales growth.
     
  5. Act. We often find that clients can make it to Step 4 and then get stuck. It’s very difficult to actually act on this data. It requires consistent messaging and expectations to all locations, clear action plans, and then will to follow through and hold managers accountable for results. That takes time, and your closed loop reporting system can open your eyes to the behaviors of A, B, and C managers.

Feedback is a gift. Listen to what your customers say, respond consistently and effectively, and use the insights to hold your teams accountable to delivering exceptional service. 

Ben Dards is the Chief Technology Officer at Market Force Information and has been developing technology in the rapidly expanding customer experience management space for over 15 years. His experience working with over 250 clients in the space has informed development of reporting and visualisation platforms, an online app for collecting data, and unique tools empowering operators take action on data. 

Create a Restaurant Measurement System That Produces Real Results

Measurements are the key enablers to drive accountability and effective business and consumer analytics, as well as to help companies grow and strengthen their business performance. When I led a team at McDonald's that was charged with developing and implementing a world-class measurement system that centered on the critical drivers of restaurant performance and customer satisfaction, there were specific key elements/enablers that made it so effective. Let’s take a look at them.

1. Management buy-in before all else

The first and foremost step in creating a measurement system for your restaurant brand is to obtain support from senior management. Like any major initiative a company undertakes, it requires funding, people resources and management support to address any pushback within the organization regarding the need or direction of the project.

After the business case has been made and approved by senior management, you then need to create a cross-functional team that represents all of the critical segments of the business that will either be impacted or able to add value to the process design. This is critical to ensure you receive the best input on the design and structure of the measurement tools and processes. Plus, it lends credibility to the process, and helps turn those involved in the project design into advocates and supporters of the end product.

 

2. Set achievable and actionable metrics

The next step is to sit down with your team and ensure that the metrics or targets for the components you’re planning to evaluate possess the following characteristics:

  • Actionable – Are they in the control of the people who are being measured?
  • Realistic – Are they achievable or too far fetched?
  • Targeted – Make sure the targets are designed around the critical drivers for your business and customers’ expectations
  • Data-friendly – Data must be captured at the unit level to help determine root-causes and assist in developing effective action plans
3. Outsource the feedback gathering

Enlist quality third-party partners to help you capture and evaluate customer feedback on your brand and service, to assess in-store performance relative to your standards, and to gather employee input on their day-to-day experiences (e.g. customer satisfaction surveys, mystery shopping audits and employee commitment surveys). This is typically a more cost-effective way to capture the data versus trying to do it internally, and these are professionals who do this all day every day.

4. Tap technology – don’t undertake it all yourself

Leverage technology wherever possible to capture, input and report data performance at all levels of the organization. Spend the time upfront to perfect this process because, in the long run, it will guarantee the data is captured efficiently and reported back to the appropriate people in a friendly, summarized format. Technology will also assure the reports and analytics (e.g. unit rankings, top and bottom performers, trending, etc.) are performed in a cost-efficient manner, as they can easily start eating up lots of man-hours. The other benefit is that your performance data will be available any time and any place your staff wants to access it.

 

5. Don’t skip the training

Once the reporting is finalized – or even alongside it – you should be developing a comprehensive training program to educate all of the people in the system on all the tools, processes and reporting and, even more importantly, making it clear how they can tap them to drive increases in performance. The key here is to communicate early and often to all of the impacted people, so they have a thorough understanding of what, why and how the new performance improvement system operates.

6. Review and review again

Lastly, it's critical that you periodically review the measurement system and processes that you decide upon to make sure they’re still current and relative. Don’t go too long without taking stock because you’ll quickly fall behind in a fast-moving industry. Any significant enhancements or changes should be implemented ASAP.

Keep in mind that developing an effective measurement system will take time and dedicated resources. It's a journey and customers may not notice the performance improvements over night, but rest assured that they will eventually take note. When approached correctly, it will be a valuable tool to help drive performance improvements at both the unit and system level.

Any organization with numerous locations spread out geographically, such as multi-location restaurant brands, needs a quality measurement system to help them measure and assess performance consistently and timely. These tools are also the key enablers that will help you react to problems quickly, determine if action plans are working and begin building an accountability culture throughout the organization.

 

Jerry Calabrese was responsible for a global restaurant measurement system that evaluated and helped to significantly improve the performance of 32,000 restaurants in 100+ countries in the period from 2002 to 2008. As VP of Restaurant Measurement at McDonald’s Corporation, his leadership and implementation of tools and processes were a key enabler and significant factor in the financial and operational turnaround of the company during his tenure that helped McDonald’s improve its performance and brand image during that time period.

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To discuss your needs for improving performance for your multi-location brand, give us a call. We’d be happy to discuss best practices for measuring the customer experience and compliance to brand standards, using analytics to understand what matters most and the ROI for change, and technology solutions that integrate large quantities of data on one single platform. We look forward to a great discussion!

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