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Why Surveys Do Not have Impact: Creating a Voice of the Customer that Drives Customer ExperienceMarch 24, 2015 Clicktools and Survey Magazine John Goodman, Vice ChairmanCustomer Care Measurement & Consulting

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Agenda

• Customers Experience, Voice of the Customer, Customer Insights and Enterprise Feedback are hot topics.

• Why VOC and surveys often lack impact • Prerequisites for an actionable VOC • Tilting VOC toward proactive, preventive findings • Creating an economic imperative for action


Context For Proactivity: Customer Experience

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Driving the Customer Experience

1. Staff isn’t to blame 2. Sensibly create remarkable delight 3. Revenue payoff of great CE is 10-20 X cost 4. VOC is more than surveys and complaints 5. Technology is the key to VOC and CE

From “Customer Experience 3.0” Published by American Management Assoc.- on Amazon <$20


Why Surveys Are Not Effective

• Not relevant – too general • Not reliable – do not tie to other data sources • Do not create an economic imperative for action • Are not packaged to be easily used • Do not provide recommendations

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Understand the Causes of Customer Dissatisfaction

- Fails to follow policy

The majority of customer dissatisfaction is NOT caused by employee error or attitude but by products that cause disappointment and broken processes*

Customer20%-30%

Employee 20%

- Wrong expectations - Customer error

- Fails to follow policy

- Attitude

Company 40%-60%- Products and services

don’t meet expectations - Marketing miscommunication

- Broken processes

Poorly designed products, processes, and marketing

create most unmet expectations.

Customer expectations must be set to avoid problems

and surprises.

At least 30% of contacts

are preventable


Basic Tip of the Iceberg Behavior

• Multiplier is ratio of complaints received to problems in market • Ratio can vary from 1:10 to 1:200 • Causes

− Effort − Hopelessness − Retribution − Where

• Applies to B2B

1-2% Complain To HQ/Executive

5-35% Complain to Front Line or Provider

75% Do Not Complain

Customers Who Experience a

Problem…

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Make Findings Relevant to Functions

• General satisfaction and loyalty indices do not create accountability

• Most issues are cross functional • Problems and events are more tangible than

feeling – show how events impact feelings • Everyone is too busy and overwhelmed • Question is - “Where can I get a quick hit in the

next month?”


Make Findings Reliable

• Bad news from customers is always skewed • Operational data • Complaint data • Employee input • Understand skews of sample and proactively

highlight


• CFO support increases the impact of the Voice of the Customer − by two the impact on satisfaction and − by five times in terms of getting issues fixed

• Focus on revenue and word of mouth • Must have agreed-upon value of customer

Create an Economic Imperative

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I Question/problem

experience

II Contact behavior

III Contact handling

Customers

No Question/ problem

experience 80%

Question/ problem

experience 20%

IV Market impact

Non-contactors 75%

Satisfied1 50%

Mollified2 30%

% Definitely Will

Recommend

69%

39%

74%

42%

32%Dissatisfied3 20%

Word of

Mouth**

---

2.9

1.7

4.4

5.5

% Definitely Will Keep

Purchasing

82%

75%

90%

80%

70%

% Very Satisfied with

ABC

81%

40%

82%

52%

35%

Contactors 25%

Get CFO Support For Action On Results

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=

=

=

=

x xx

=

2,500

3,000

3,000

37,500

46,000Total Customers At Risk

200,000

Customers

with

Problems

20%

Dissatisfied70%

Repurchasing

75%

Repurchasing

50%

Satisfied90%

Repurchasing

75% Do Not

Complain

25%

Complain30%

Mollified80%

Repurchasing

Three strategies: Prevention, Solicitation of Complaints and Improved Response

At $1,000 per customer, $46,000,000 at risk

Quantify Revenue Damage of Status Quo

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=

=

=

=

x xx

=

1,875

2,250

2,250

28,125

34,500Total Customers At Risk

150,000

Customers

with

Problems

20%

Dissatisfied70%

Repurchasing

75%

Repurchasing

50%

Satisfied90%

Repurchasing

75% Do Not

Complain

25%

Complain30%

Mollified80%

Repurchasing

@ Gross margin of 25%, $1MM spent on prevention = ROI of 187%!

At $1000 per customer, $34,500,000 at risk or retention of $11,500,000 plus reduction of 12,500 calls

Quantify the Payoff of Prevention of 25% of Problems

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Quantify Word of Mouth Impact of CE

10%

delighted

80%

satisfied

Tell two

Tell one

=

=

2,000

8,000

4,000

10,000

customers

10%

dissatisfiedTell six

= -6,000

10,000 Referrals X 1 Action 30 Referrals

= 333 New Customers


Package Findings For Easy Use1. Tailor to each audience 2. Use multiple credible data sources 3. Humanize data 4. Do not criticize – highlight opportunities 5. Exception reporting - No more than two pages

and three issues 6. If nothing has changed, don’t report i 7. Follow up with face to face meeting 8. Report on progress with previous issues


Provide Actionable Recommendations

• Two or three quick actions • Suggest accountability for actions • Stress cost of inaction • Develop proposed recommendations in concert

with internal clients • Get meeting with as many participants and

possible • Include action-planning process at end of

presentation


Why Be Proactive?

• Definition of Proactive– Control situation by causing action rather than waiting to respond to an event

• Approaches to proactivity − Know what will happen – operational data − Predict what will happen – previous customer experience

• Why do it? – it is cheaper and creates delight


Examples Based on Knowing What Will Happen

• Prevent uncertainty – email or text confirmation of appointment

• Warn about unpleasant surprises – SoCalEd • Provide information on opportunities – earlier

appointment at MRI clinic • Proactive education on potentially troubling

facets of transaction – auto repair labor rate


Proactive Education


Prerequisites for Proactivity and Great CE1. Agreed upon value of the customer 2. CE strategy and map across customer journey 3. Website oriented to both marketing and service 4. Marketing and sales willing to warn customers in

advance 5. Accountability for CE across the organization

including closed loop for all individuals and issues 6. Customer ID across all major data bases which

drive proactive CRM contacts 7. Integrated VOC process focused on top line


Effective Voice of the Customer Process

1. Well-defined ownership of process and

issues

2. Unified data collection

across whole lifecycle

3. Integration of multiple data

sources

4. Visible, granular,

actionable reporting

5. Clear revenue

and profit implications

6. Formal processes for

translating data into actions and

targets

7. Formal systems for

tracking impact

8. Process supported by

company-wide incentives


• Understand your audience • Proactively establish reliability • Create the economic imperative for action • Package for easy understanding • Provide recommendations that support proactivity !

• Details in Customer Experience 3.0 & Strategic Customer Service Papers on VOC & Applying Technology to CE: – [email protected]

• Follow me on Twitter – Jgoodman888

Summary

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