an ebook byCopyright © PeopleMetrics, Inc.R

From Measurement to Transformation:Improving Your Customer Feedback Program

From Measurement to Transformation: Improving Your Customer Feedback Program

Contents

What is customer feedback doing for you?

Measuring the Customer Experience

Managing the Customer Experience

How Voice of the Customer Works

What to Look for in a Voice of the Customer Solution

Which companies will benefit from Voice of the Customer?

Further Information

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a PeopleMetrics ebook | 3

From Measurement to Transformation: Improving Your Customer Feedback Program

What is customer feedback doing for you?Customer satisfaction measurement has been around in one form or

another for close to half a century. So if you work for a customer-centric

organization, you are probably measuring how satisfied (or loyal) your

customers are with your company, products, and services.

Customer feedback should be an essential element of every organization’s

strategy. Without customer feedback, we’d likely base decisions on gut

instinct, personal beliefs, and experiences — subjective reference points

that may not align to the customers’ needs.

The Value of Customer Satisfaction ResearchDespite the importance of collecting customer data, marketing managers

often find their customer surveying efforts on the budgetary chopping

block. Capturing customer feedback on an ongoing basis can require a

significant investment of time, funds and resources. If leadership sees

consistently high satisfaction scores, but flat-lining business growth, they

might question the ROI of the spend.

Voice of the Customer is an approach to measuring and managing customer experience at the individual level.

Some of their questions might include:

• How are these satisfaction scores and quarterly trend lines helping us

keep our current customers and grow our customer base?

• Why do we see satisfaction scores in the 80s and 90s, yet we don’t see

significant business growth or an increase in market share?

• What are we really doing with this information?

Benefits of a Voice of the Customer SolutionDo any of those questions sound familiar? If so, you may want to consider

a Voice of the Customer (VOC) solution. VOC helps organizations measure

and manage the customer experience at the individual level.

VOC has grown in popularity because it goes a step further than looking

at aggregate customer satisfaction scores and wondering why they’re not

changing. VOC is about taking action on individual customer feedback —

actions like recovering lost customers, recognizing employees who went

above and beyond, identifying customer growth opportunities, gathering

positive customer testimonials for marketing purposes, and much more.

From Measurement to Transformation: Improving Your Customer Feedback Program

a PeopleMetrics ebook | 4

Metric Typical Question Score/Index Calculation Advantages Disadvantages

Cust

omer

Sa

tisfa

ctio

n

“Overall, how satisfied are you with the company’s products and services?”

Typically asked on a 5-point agree/disagree scale

Scores are presented as “top box” (5’s) or “top two box” (4’s and 5’s).

Easily understood by internal and external customers

Most common / traditional metric

Less precise and variable data, which often results in consistently high scores

No clear correlation between high levels of satisfaction, resulting behavior, and business results

Net

Pro

mot

er

Scor

e (N

PS)

“How likely would you be to recommend the company to a friend or family member?”

Typically asked on a 0-10 scale: “Not at all likely” to “Extremely likely”

Percent of Promoters (9’s or 10’s) minus the percent of Detractors (0’s to 6’s) is the NPS.

Simple and easy to assimilate at all levels in the organization

Often the industry-standard calculation

Single-item outcome score has been shown to be less reliable than a composite measure

NPS measures just one element of customer engagement: Advocacy

Cust

omer

Effo

rt

Scor

e (C

ES)

“How much effort did you have to put forth to handle your request?”

Typically asked on a 5-point scale from very low effort to very high effort

Good way to assess how hard it is to do business with you.

Ease is a known dimension of a good customer experience, so removing barriers to ease is a good starting point

High-effort actions (e.g., mortgage applications) require the scale to be adjusted to expectations.

Covers one aspect of experience, and unrelated to emotional outcomes from human interaction

Cust

omer

Loy

alty

In

dex

(CLI

) or

Cus

tom

erEn

gage

men

t (CE

)

Varied questions, based on four measurements:

1. Retention2. Effort3. Advocacy4. Passion

Typically asked on a 5-point agree/disagree scale

CLI usually covers Satisfaction, Retention and Advocacy; CE aims for more emotional elements that indicate stickier relationships (like Effort and Passion).

Measures emotional and behavioral outcomes as a composite score

Shown to be correlated with business performance across industries and companies

Not always the industry standard

Takes some explanation for users to understand the score and how it is calculated

Improving your customer experience requires a commitment to improving every customer interaction. It’s important to choose a metric that works for

your company — one that every level of business can understand and can readily work to improve. Here are options:

Measuring the Customer Experience