Listening to Customers

• Show results and data in ways people enjoy and understand.
  
  
• Develop strategies for customers in both developed and developing areas of the world (although these are becoming increasingly more similar).
  
  
• Consistently think of future trends when developing customer strategies.

• My child isn’t doing well in school, but that’s because his teacher isn’t spending enough time with him.
• We would have won the game if the referee didn’t practically give it to the other team.
• Our business didn’t do well this quarter, but that’s because the economy is down.
• We didn’t reach our goal of bringing in new customers, but that’s because the market just doesn’t understand our value.

In my last blog post, I talked about the "Before, During, and After" of good communication planning for Voice of the Customer programs. Digging into the Before.... Before you launch a customer program, it is important to consider the internal and external (customer) communications that need to happen.

One great opportunity is to craft, post and distribute a solid one-pager about each major VOC program.  The document should overview the program purpose, scope, timeline, and business impact.  Here is a good example I’ve been involved with:

I recently heard about a concept called decision making fatigue from a friend of mine. It basically means that throughout the day the more that is thrown our way, the less capable of making solid decisions you become. Seems logical, but the statistics on this topic that have been documented are pretty staggering.

John Tierney from New York Magazine explained this phenomenon by using an example of how 1,100 parole board decisions revealed the following: Prisoners who appeared in the morning received parole 70% of the time, but those who came later in the day only received parole less than 10% of the time.   The reason? Decision making fatigue. Parole officers are seemingly unable to make decisions later in the day, so they avoid it by not granting parole and pushing it off to a later time.

Thinking about how this impacts our world as customer advocates, it basically boils down to this: all decisions are hard to make, but the more that is thrown our way, the less capable we become of making the right decision for our customers or our companies. At least later in the day, it seems.

Tierney suggests in his article that making big decisions should wait until the next day if you have reached a decision making fatigue point. So, in other words, he suggests not restructuring or reorganizing your company at 4:00pm! Here are some ideas that can help us eliminate the impact of decision-making fatigue, even if you are short on time:

·         Get Some Sleep. If a big decision is hanging over your head late in the day, sleep on it. Come back and think it through first thing in the morning.

·         Stagger Team Schedules. If it works within your company environment, have team members stagger their hours so there are “fresher” minds available for longer periods in the day.

·         Be Choosy. Choose where you spend your time wisely. Tackle your biggest and most strategic items early in the day. 

The bottom line is that it takes time to think through the implications our ‘fatigued’ decisions can have on customers every day. Just don’t wait too long or your customers will get fatigued from your company’s lack of decision making ability! 

Katie Kiernan

Vice President, Consulting Services

Most customer listening programs suffer from a lack of really good communication planning. Communication will be the focus of my next blog series.  We'll look at the before, during, and after of Communication in the following areas...

Before...

• How should I communicate with customers before launching a customer listening initiative?
  
• What do I need to communicate internally before launching a customer listening initiative?

• What do I need to build into my internal and external communication plan during the course of a customer listening survey?

• How and what should I communicate with my customers after a major customer listening initiative?
• How do I close the loop internally and build up momentum for real action planning to take place?

At home this morning, I was reading Indianapolis Monthly magazine and ran across an article about a new Google tool, the Ngram Viewer.  (Fair Warning: if you decide to go try it, plan on losing the next 20 minutes of your day!)

When you enter words or phrases into the Google Books Ngram Viewer, it displays a graph showing the incidence of those words in a corpus of books over the selected years.  Published late last year, this cool new “Culturomics” tool mines the text of 5.2 million books and spans the time frame of 1800 to 2008.

As an example, here are the results for the words “customer” and “employee” over the last century. 



Books mentioning employees seem to have been a hot trend in the 40s and 50s, and are again on the rise.  The customer line has been on a steep climb since 1980.  In the mid 90s, the customer line crosses the employee line indicating that there were more written mentions about the customer heading into the new millennium than the employee.   Are we living in the Customer Era?   Is this a time frame that will be marked in history for enlightenment around customer centricity?   But look at the end of the trend line.  The Ngram Viewer stops plotting at 2008, and the customer curve is in a decline since around 2002.  Maybe its happenstance, but that coincides with some tough market declines.   It's counter-intuitive to those of us in the the business of listening to the voice of the customer, but have recent market conditions caused some to take the focus off the customer?  

Krista Roseberry
Vice President, Consulting Services

• The pace of innovation will only increase as Generation C pushes for an even broader digital world.
• Co-creation and collaboration (more C’s!) will be an absolute requirement for customers to realize the value companies provide by 2020.
• Customer feedback will flow into companies in a much more rapid fashion, including both structured and unstructured data. Successful companies will be ones who can balance being proactive in gathering structured data, and reactive to the unstructured customer information surrounding them.
• A continued focus on connectivity will advance developing markets, offering a new set of potential customers for many industries.

I recently saw the following quotation in the footer of an email from one of my client contacts at a leading IT company:  “The memory of bad quality lasts longer than the shock of high prices.”  

How true that is.  On a personal note, have you ever opted for the cheap seats at a show or concert, only to wish you had paid 20% more to be able to actually see and hear the performance?   Or, ever made a snap decision to buy a new piece of furniture that was on a too-good-to-miss sale, only to realize when it arrives that it really isn’t that comfortable or doesn’t fit in like it should?   As customers, we make purchase decisions based on the value we expect to receive, and we all try to optimize the value equation in our favor.  But, sometimes we get it wrong and tip the balance too far toward price, only to later regret the quality component.

In Voice of the Customer relationship studies, it’s pretty common to include several metrics on quality and also a metric on price.  Most of the clients Walker works with are industry-leaders that are bringing to market leading innovations and new trends, and that calls for a premium on price.  In these cases, it’s critical to measure VALUE, including a competitive view on Value, so that we have a gauge on customers’ perceptions of ‘what they get, for what they paid’.  Analytically, we look at what drives value, and often find that quality components (Hardware and Software quality, the quality of the People that customers interact with, quality of Support) are bigger factors in customers’ assessment of the ultimate value they receive. 

The same thinking should apply when we scope out customer measurement programs – both in terms of vendor costs and the allotment of time for internal team members to manage the program.  We recommend that you, as VOC program leaders, are careful, even territorial, about not cutting out the 20% of scope and time that will provide 80% of the value – the extra analytics, communication planning, collaboration, action planning, change management and deployment type activities that are going to make the biggest difference on how your internal customers assess the quality – and the ultimate ROI! – of your efforts.


Krista Roseberry
Vice President, Consulting Services

I have a new baby boy at home, and after a pretty sleepless night, this morning’s HBR “daily stat” about caffeine consumption caught my eye.  A group in the UK studied the effects of caffeine on collaboration, and found some key differences between men and women.  When it comes to collaboration on stressful tasks, they found that caffeine tends to impair men's performance but actually boosts women's ability to work under pressure. 

This is a light-hearted topic, but it does speak to the power of segmentation.  In our daily lives as Voice of the Customer advocates, we can find some interesting and useful applications of the data we work with when we break it apart and look for different behaviors, needs and tendencies across our customer segments.  Last year, my team worked with a client to develop a set of common customer ‘personas’ using segmentation analysis.  In VOC work for large B2B companies, we often only focus on 'A Priori' segments – those that we already know and use in daily business operation, such as region, channel, etc.  In this case, the objective was to take a more empirical approach and let the data tell us how customers tended to group together based on their profiles and their needs.  Many different demographic, firmographic, preference-based, and performance-based metrics were fed into the analysis. 

The outcome was the identification of 4 unique 'customer personas' that were common in this customer base.  We were able to understand the variables that characterized each ‘persona’, the relative size of each within the population, differences in their loyalty, differences in their needs and interests related to training, and how best to communicate with each customer group. 

Great outcomes for the client and their customer strategies... and a little good news about my daily caffeine habit, too.

Krista Roseberry
Vice President, Consulting Services
Walker

• Why do customers complain online in the first place?
• How long will online complainers hold a grudge against the company?
• How should a company respond after the online complaint? 
• How can a company prevent online complaining?

• Double deviation refers to the fact that customers have been victims of not only a product or service failure, but also a series of failed resolution attempts. In my experience, customers will tolerate and even expect some issues. It’s how the resolution is handled that makes or breaks the situation. Continued failure to resolve a customer’s issue not only causes them to lose loyalty, but in time they will almost certainly look for an alternative.
  
  
• Betrayal is a primary driver of what causes customers to complain in an online environment. Not all customers who have issues are going to complain online.  The ones that do feel as though they have so much invested in the relationship that the issues that they are facing with the company are in fact the ultimate betrayal of trust and partnership. It’s basically the “I’ll show you” type of reaction.

Many companies are focused on growing through acquisition, and those with a lot of experience are starting to get good at it. However, companies still want to know whether or not a strategy of mergers and acquisitions is a smart approach in today’s economy. Do acquiring companies outperform those who are continuing to focus on organic growth? When is the right time to acquire? Will my company get a better deal today than I will in 2011?

Some experts say that “deal-making” companies are in fact outperforming others today, particularly when it comes to cross-border deals. Others stand firm on the belief that making acquisitions in today’s economy is still too risky.  Recently, Forbes released a list of the “Top 10 Deal Makers in 2010”, adding to the commentary of whether or not making acquisitions is a smart decision now and in the near future.

Those who believe that now is the time to “make a deal” should keep these success factors close at hand:

Know the risk of the customer base you are buying. It is extremely critical to take the due diligence process seriously, investing appropriately in order to make a sound decision. This includes predicting the future loyalty and growth of the customer base, in addition to understanding historical trends.

Find the hot-spots. An acquirer doesn’t have to know every single area that needs improvement within a company they are hoping to purchase, but having indicators of weak areas or hot-spots will give a clear indication of whether or not that company is a good fit. If customer support has always been a weakness for the acquirer, adding more customer support problems will only create more headaches (not to mention risking greater financial losses).

Gather customer comments. Simply gathering comments from the customer base that an organization would like to acquire can provide clarity to any current feelings. Tone comes through clearly in comments customers provide, and typically can shed a lot of light on areas that could have already been a concern.

Gathering insights from a customer base that an acquirer can analyze during the due diligence process should be done by a third party to keep neutrality. It is something that can be done fairly quickly and is an absolutely critical component prior to making an acquisition.

Are you thinking about making a deal? Do you have all of the information you need to make a good decision?

Katie Kiernan
Vice President, Consulting Services

I’ve recently become a Groupon user. For those of you that aren’t aware of this craze, the Chicago-based company is essentially a “deal of the day” website that is customized to the city you live in (currently offered in almost 150 cities around the world). The daily deal could consist of things to do, see, buy, or eat. To sign up, you simply go to the site to confirm your city, enter your email, and BAM! – you are all set. It’s that easy. After you are signed up, you get an email each day with an extremely discounted product or service that is within close proximity of the city you live in.

As a “deal-oriented” consumer, this is the best case scenario. If something of interest comes along, I snag it. Otherwise, there is no harm in ignoring them for days or weeks at a time. However, what about the businesses utilizing Groupon to sell their products and services? Is this really a good idea? What kind of revenue does it generate?

Many of you may have heard about Groupon’s $11 million day thanks to the daily deal that was produced for the Gap. It was a great – you got a $25 discount if you spent over $50 at the store. It was a no-brainer to buy it. So, was this really worth it for the Gap? Or, due to the overwhelming response, did they ultimately lose with the deep discount?

Contrary to popular belief, I say “no” to the fact that the Gap made a mistake. True, they didn’t expect to sell over 400,000 Groupons that day. Also true, they only received 50% of the revenue they could have had on the purchases that were made (not counting the cut that Groupon takes). This assumes, however, that everyone who purchased the Groupon that day was going to make a purchase at the Gap anyhow. Of course, there is no way this was the case and I’m certain the data would show that nearly all redemptions were well over the $50 amount for that sale. The publicity also came at a time when sales have been somewhat lackluster over the past two years.

So, all publicity and marketing aside, the real benefit that Gap created for themselves is an opportunity to not only gain new business and customers with a one-time transaction, but also to build greater loyalty for the existing customers who may not have purchased recently. So, the verdict is still out on whether or not this was a good strategy for the Gap or not – we’ll see in the long-term if sales grow and are sustained beyond the “pre-Groupon” day. Due to their size, this investment is likely one they would have made in some fashion anyhow. This type of reaction could have been devastating to a small business, however.

Have you had any positive or negative experiences with Groupon?

Katie Kiernan
Vice President, Consulting Services

A few months back, I read a Yahoo! Finance article about the key quality that executives are looking for in their leaders. 

Many would have guessed operational excellence, an extraordinary ability to influence, or superior selling skills. However, somewhat surprisingly, “creativity” is cited in this article as the key factor that executives are looking for in their future leaders.

Similar to successful leaders, customer feedback programs too can stand out from the rest if creativity is a part of the plan. Below are the critical elements of a creative leader, and my thoughts on how these same principles can apply to customer feedback strategies.

Disrupt the status quo:

Even if you already have an established, successful customer feedback program in place, take the time to step back and evaluate with a fresh perspective how to more actively engage your customers and your internal stakeholders. If you do not have an existing program or it is not getting the traction it deserves, look for ways to break through the clutter and engage your audiences with new, innovative methods of reaching out and reacting to the information.

Disrupt existing business models:

Many customer feedback programs traditionally reach out to customers one time a year (or every other year) to understand their feelings about the relationship with the company. Then comes the laborious process of filtering through a large quantity of data to identify the key priority areas that will ultimately impact your customer relationships. Why not think of your program as an opportunity to engage your customers year-round to gain real-time insights to allow you to react quickly and effectively, and course correct before it’s too late? Sometimes comfort with existing processes and the fear of the unknown keeps us from making a positive, and sometimes necessary, change.

Disrupt organization paralysis:

Back to the large quantity of data I mentioned above: while it is natural to want to wait until all of the feedback is gathered, analyzed, and wrapped up in a nice package, sometimes there are warning signs that cannot, and should not be ignored. To reap the most reward from the feedback you gather, take steps to initiate action within your organization as quickly as possible. Think of the information as an opportunity to justify positive changes within your organization to enhance customer relationships. 

Could your customer feedback strategy benefit from some disruption and creativity?

I recently moved to a new state, and during a week of the house hunting extravaganza, I stayed at a local hotel. Browsing my favorite travel Web site that rewards me for frequent bookings, I chose this hotel because it was convenient to the freeway, within my budget, and the pictures looked promising. 

The hotel met my expectations. My only complaint was a slight mildew odor in the room because the exhaust fan wasn't working properly. After mentioning this to the staff, they were happy to move me to a new room.

After my stay, I received an invitation to take one of those surveys measuring customer satisfaction. I noted the smell in the room, but I also made sure to note the excellent service I received from the staff. A month later, I received an email thanking me for participating and acknowledging my comments:

Ms. Loyd,

I wanted to take a minute and thank you very much for filling out our online survey following your stay with us.  We appreciate your comments regarding the smell of your room and sincerely apologize for the inconvenience that was caused to you.  It is only by hearing feedback from our guests that I can work to improve service at our property. We hope that you enjoyed your stay with us here and hope to welcome you back in the near future.

This hotel understood the importance of listening to the voice of the customer and closing the loop on the feedback they receive - a quick email from the manager acknowledging my survey was unexpected and appreciated. 



Amanda Loyd
Customer Experience Analyst

 

“Kudos” to all companies out there that have a customer listening program!  While it seems like a general thing that nearly all companies do, in my experience I’ve found that many do not put enough focused energy into really listening to customers. It goes without saying that customers are the heart of any business, and a huge factor in how and if companies will be able to achieve growth. That said, even companies that have made customer listening a priority need to revitalize their efforts every few years.  Here are a few keys to success for revitalizing your program.

1.      Make it a priority to measure success of current initiatives every few years. A full assessment of any customer initiative every few years can be eye opening. Measure success and confirm areas for improvement with regards to how information is gathered, how relevant it is to users, how it is communicated and validated, and ultimately if the right resources are in place to take action.

2.     Systematically ask internal users if the right information is being gathered from customers in order to take action. Ensure that lines of communication are always open between users of information and the central customer listening group.

3.      Assess KPIs and metrics annually to ensure that customer measurements are in alignment with company strategies. Strategies evolve over time, as should key performance indicators. At a minimum, make sure that what metrics are being tracked internally can be aligned and linked to customer feedback.

4.       Break through the clutter. This is easier said than done, but ensuring that information is relevant to a particular user or group will make all the difference. Providing internal stakeholders with information that can help them succeed in their positions will certainly get their attention. For executives, make sure that customer feedback is ultimately linked to how it can help the company succeed financially, particularly as it relates growth.

As with any change or revitalization effort, communication is the key. Get buy-in from all critical people within your organization to ensure a smooth transition as changes are made.

Katie Kiernan
Vice President, Consulting Services

It’s time! Every four years fans gather to watch the best soccer, ah-hem, football teams in the world battle it out for the most globally coveted prize in all of sports – the World Cup. The passion felt by these fans for their country will be clear as you watch the excitement, the support, and all-out general mayhem of the Cup games as they progress over the next several weeks. 

The one thing that always strikes me the most about the players is how they have such a clear and evident loyalty to their country and team during the World Cup. However, after the games have come and gone, that same loyalty and relationship does not exist to their club teams where they play professionally.  The loyalty that once existed has been replaced by greed. Even the great Pele agrees that loyalty, love, and magic have gone. It’s no longer about loving the game and just playing, it’s about the money.

There is a clear difference in what is motivating the players’ loyalty in these cases. In the case of the World Cup, the player’s loyalty is driven by achievement, their commitment to playing for their country, and just the general love of the game. Professionally, many are motivated by money, the brand perception and prestige of the team they play for, or where they just “feel the most love.” It causes their loyalty to constantly change. Same game. Same player. Very different drivers of loyalty.

It’s important for us as customer strategists to always consider what is driving our customer’s loyalty, but know that it can and will change. Just because a customer tells you they are loyal today and will continue to be with you for the next few years does not mean the work is done. They must constantly be reminded through actions of why you are the best choice for them. Otherwise, their motivators will change and they will be on to the next “team.” 

So, let’s enjoy watching what I believe to be the purest form of the player’s loyalty as they commence in the World Cup games later today. It should be an exciting month!

Katie Kiernan
Senior Analyst

I’ve seen several examples over the past six months of companies trying to define what the concept of “innovation” means. It’s a fair point of discussion, and one that gets a lot of air time with many of today’s top global organizations. The debate usually starts with someone asking about how the company even defines innovation. A quick online search led me to some interesting definitions. 

The Wikipedia definition of innovation is “new stuff that is made useful.” Could it really be that simple? Even if defining it is easy, the challenge is obviously then in finding the “new stuff.” So, no matter how companies decide to define it, eventually the hunt for the magic bullet of innovation begins. Increasingly high competition, mature markets, the desire for corporations to develop market adjacencies, and the inevitable increase of the impact of globalization on companies are all factors driving the focus on innovation today. 

A recent article by Michael S. Hopkins in the MIT Sloan Management Review draws on some very unique concepts of The four ways IT is revolutionizing innovation. There are a few ideas in this article that I think all companies can learn from in his message about the success of IT companies:

·         There is a lot of data out there that IT companies just know how to tap into more effectively.  They are also structured to be able to replicate and scale up innovations.

 

·         There are numerous data points out there that can be analyzed today – ultimately measuring the customer experience on how innovations are performing is critical.

 

·         Many IT companies have a culture of innovation, which is a critical component for success.

 

·         There is a shift in focus from as much long-range planning to more short-term experimenting to uncover customer needs.

Innovation can naturally just be something some companies do best, while others continue to struggle to define what innovation means to them.   I believe that even if you are not a naturally innovative company you can develop this culture – particularly with the help of customers to help you drive your most innovative strategies.   Use customer insights to uncover how to innovate with new services, create new products, or how to improve operations. After all, each of these can be considered “new stuff”.

Katie Kiernan
Senior Analyst