Temkin Group’s Q1 Survey

We’ve launched Temkin Group’s Q1 survey on customer experience management practices. Complete the survey and receive a free copy of the research report

Report: 2012 Temkin Experience Ratings

The report can be downloaded for free

We just published a new Temkin Group report, 2012 Temkin Experience Ratings. The report analyzes feedback from 10,000 U.S. consumers to rate 206 organizations across 18 industries. Congratulations to the top firms in this year’s ratings: Sam’s Club, Publix, Starbucks, Subway, Chick-fil-A, Aldi, Winn-Dixie, H.E.B, and credit unions.

We added six industries (fast food chains, grocery chains, major appliances, car rental agencies, auto dealers, and parcel delivery services) and 63 companies compared with the 2011 Temkin Experience Ratings.

Here is the executive summary from the report:

Sam’s Club and Publix earned the top two spots in the 2012 Temkin Experience Rankings, with three fast food chains rounding out the top five. We asked 10,000 U.S. consumers to rate their recent interactions with companies across three dimensions of their experience: functional, accessible, and emotional. Their responses allowed us to rate 206 companies across 18 industries. Only 28% of those companies received at least a “good” rating. Grocery chains earned the highest average scores and health plans dominated the bottom of the ratings. Kaiser Permanente and credit unions most outperformed their industries while DHL and RadioShack fell the farthest behind their peers. None of the companies earned an “excellent” rating for the emotional component, while Charter Communications and Earthlink lead 10 companies falling below the “very poor” threshold in that area. Compared with last year’s ratings, most industries improved, led by a 5.3 point average increase by insurance carriers. When it comes to changes over the past year by individual firms, PNC and Lenovo improved the most while Regions Bank had the sharpest decline.

The Temkin Experience Ratings are based on evaluating three elements of experience:

1. Functional: How well do experiences meet customers’ needs?
2. Accessible: How easy is it for customers to do what they want to do?
3. Emotional: How do customers feel about the experiences?

Here are the ratings for all 206 companies:

Here’s how the industries compare with each other:

Here are the companies that are leaders across the 18 industries:

Download report for free

Do you want to see the data? Go to the Temkin Ratings website where you can sort through all of the results for free. You can even purchase the underlying data if you want to get more access.

The bottom line: Customer experience is improving, but there’s a long way to go

Timeless Advice About Chief Customer Officers

It seems like there’s been a pickup of interest in the title of “Chief Customer Officer.” I’ve “studied” this role for a while and have worked with dozens of these execs (they often have a different “title”). Here’s my advice for companies that are considering this role that I published in 2007 in the post: Chief Customer Officer: To Do, Or Not To Do?

There’s a question that I’ve heard a lot that seems to stir up some debate: Do firms need a Chief Customer Officer? Well, I’ve run into zealots on both sides of the argument.

Those that say “absolutely yes” are convinced that companies can’t change without a senior executive who “owns” customer relationships; someone who can bring senior executive visibility to all of a company’s  customer-facing efforts. The argument is compelling — customers are certainly important enough to deserve a dedicated executive.

Those that say “absolutely not” are convinced that companies can’t just fix the problem by creating a new executive position.  They believe that this ends up being a superficial move — like putting lipstick on a pig. The argument is compelling — people often call for a new executive whenever they don’t know what else to do.

It’s an interesting dilemna when both sides of an argument are compelling. My position on this question is equally dogmatic: Absolutely yes and absolutely no.

To understand my position, let’s start by shifting the questin a bit. Instead of asking whether or not you need a person with the specific title of “Chief Customer Officer” let’s ask whether or not you need an executive in charge of a concerted effort to improve customer experience across the enterprise. If a company is truly committed on improving their customer experience, then an executive in charge of that change process will be very important. That person (who may or may not be called “Chief Customer Officer”) can lead a host of efforts like the establishing customer experience metrics and developing of a voice of the customer program.

But this type of position only makes sense if the CEO is truly committed to a significant change and will hold the entire executive team (not just the new executive) accountable for results. If the plan is to make the new executive responsible for “owning” the customer experience, then don’t create this position — it will only provide a handy scapegoat for executives that don’t make the required changes in their organizations.

While we’re on the topic of leading customer experience change, I’ll also point to a post from 2008: Corporate Customer Experience Groups; To Do Or Not To Do? Here’s what I discussed in that post:

Transformation isn’t easy. There’s a very strong need for a centralized group when companies are in a transformational mode, making changes that cut across the entire organization. This type of effort can’t be done without centralized support and facilitation. But companies that invest in centralized groups before the organization is committed to the journey are likely to either 1) completely offload responsibility for customer experience to these groups; or 2) stifle these groups through internal politics. In either case, they are likely to fail.

While these groups are important in some phases, they should never “take over” customer experience activities. Instead, they should facilitate and support transformational activities across the organization. In my research, I defined the following 8 categories of activities that these centralized customer experience organizations work on:

• Customer insight management. Develop and support a voice of the customer program.
• Customer experience measurement. Create and track key customer experience metrics and related management dashboards.
• Employee communications. Make sure that employees are informed and engaged in the efforts.
• Process improvement. Help the organization map interactions from the customer’s point of view and then redesign broken processes.
• Customer advocacy. Make sure that customers’ needs are taken into account in all key decisions.
• Culture and training. Actively work on cultural change and identify training required along the way.
• Issue resolution management. Establish and support the process for solving customer issues that get escalated.
• Cross-organizational coordination. Support the cross-functional teams and processes that govern the customer experience efforts.

The bottom line: Chief Customer Officers can be valuable in the right enviornments

Report: The State of the CX Profession

The report can be downloaded for $195

We just published a new Temkin Group report, The State of the Customer Experience Profession, 2012. Here’s the executive summary:

We surveyed 327 customer experience (CX) professionals and compared their responses to a survey from last year. It turns out that CX professionals are happy with their profession and remain satisfied with their jobs. A larger percentage of CX professionals think that their management team is committed to CX. The largest area of focus for these professionals is customer service and voice of the customer programs. Eighty percent of respondents think that CX will be even more important for their firm this year, although that’s slightly down from last year. We also compared responses between CX executives and other CX professionals. The executives feel more appreciated, are less likely to look for a new job, and see more changes coming in the future.

Here are some highlights of the research:

• 99% think that customer experience is a great profession to be in
• 89% are satisfied with their current position, but only 63% are happy with their opportunities for advancement
• 48% are likely to look for a new job outside their company
• 68% want to attend CX conferences for their professional development, up from 60% last year
• 54% think their company is good at providing executive support, but 36% think they are good with executive dashboards and scorecards
• 53% think their company had moderate or significant results from their CX efforts last year and 80% think that CX will be more important in 2012 than it was in 2011
• 40% expect to see an increase in CX employees while 5% expect a decrease
• 74% see customer feedback having a significant impact in the future of CX, while only 45% feel that way about social media
• 92% of CX execs think that their company appreciates them compared with 72% of other CX professionals
• 33% of CX execs are likely to look for a new job inside their company compared with 51% of other CX professionals

Purchase  and download report for $195

The bottom line: Customer experience is a thriving profession.

Off Topic: Who’s Watching Football Today?

It’s the most important day in U.S. sports, Superbowl Sunday. As you can see from my choice of graphics, I’m rooting for the Patriots. So let me say up front: Go Pats!

Given the importance of this day, I decided to do a bit of analysis on who actually watches football. In a recent Temkin Group survey, we asked 10,000 U.S. consumers about their sports preferences. It turns out that football is the favorite sport by a wide margin. Fifty-seven percent of Americans like to watch football, which outpaces second place baseball by more than 20 percentage points.

I dug a bit deeper into the consumers that enjoy watching football. It’s not much of a surprise, but men are much more avid fans of football than females across all age groups. The largest gender gap is with males and females between 65 and 74 years old. It also turns out that older consumers are the most interested in football.

I also took a look at the customer bases of 249 large companies to see how many of them enjoy watching football. Led by Sheraton, Residence Inn, Holiday Inn Express, Infiniti, and Avis, 16 companies have at least 20% more than the national average of football enthusiasts. These companies should would probably do well taking out a Superbowl ad.

The bottom line: There will be a lot of people watching the Superbowl (and, go Pats!)

John Lewis, Amazon, and Waitrose Lead 2012 UK Loyalty Ratings

We are happy to announce the 2012 Temkin Loyalty Ratings UK, which examines how loyal UK consumers are to 66 large brands. Only 28% of the companies  received “good” or “excellent” loyalty ratings while 39% had “very poor” ratings:

As you can see from the distribution across industries below, groceries and retailers are well ahead of other industries in loyalty of their customers while insurers and credit cards are well behind.

The Temkin Loyalty Ratings are based on three underlying areas of loyalty:

• Willingness to purchase more products or services
• Likelihood to recommend the company to a friend or colleague
• Reluctance to switch business away from the company

We ask consumers to rate their loyalty in these areas on a seven-point scale. The “net” scores for each of these areas is calculated by taking the percentage of consumers that select the top two boxes and subtract the percentage of consumers that select the bottom three boxes. The overall loyalty rating is an average of these three scores. Here’s the loyalty for each of those components:

Here are the top and bottom 10 companies in each of the loyalty components:

To access the full ratings and all of the data associated with this study, visit the Temkin Ratings UK website

The bottom line: Most UK companies have a lot of loyalty to build

Small Companies Have More Engaged Employees

The Temkin Group report Employee Engagement Benchmark Study highlighted the connection between employee engagement and both employee productivity and customer experience. But how does the level of employee engagement change by the size of company? We used the Temkin Employee Engagement Index (TEEI) to analyze employee engagement based on the number of employees within companies. Here’s what we found:

Nearly six out of 10 of employees at small companies (those with 10 or less employees) are highly or moderately engaged, well above the level for all other size companies. This engagement level decreases significantly to 45% for companies with 10 to 100 employees and then continues to drop, albeit at at a lesser clip, for larger companies.

The bottom line: Small companies should exploit their higher employee engagement

Report: 2012 Temkin Experience Ratings of Tech Vendors

We are excited to be publishing this first report from our large-scale research on customer experience in the IT sector.

The report can be downloaded for $295

We just published a new Temkin Group report, 2012 Temkin Experience Ratings of Tech Vendors. The report analyzes feedback from 800 IT professionals to rate 60 tech suppliers. Congratulations to the top firms:

1) Microsoft (business applications)
1) Cisco
3) IBM SPSS
3) Microsoft (servers)
5) Microsoft (desktop software)
5) IBM software (other than SPSS)
5) Intel

Here is the executive summary from the report:

To understand the customer experience delivered by IT vendors, we surveyed 800 IT professionals from large companies. Using their feedback on the functional, accessible, and emotional components of experiences with vendors, we created the 2012 Temkin Experience Ratings for Tech Vendors which rates 60 large IT suppliers by their customers. Microsoft business applications, Cisco, IBM SPSS, and Microsoft servers were at the top of the list with “excellent” ratings. At the other end of the spectrum, Compuware, Capgemini, and Fujitsu were at the bottom of nine companies with “very poor” ratings. Our research also looked at the 2012 purchase plans for these IT buyers. When we chart the Temkin Experience Ratings for Tech Vendors with the purchase momentum for these 60 firms, it shows the clear connection between customer experience and revenues.

The Temkin Experience Ratings for Tech Vendors are based on evaluating three elements of experience:

1. Functional: How well do experiences meet customers’ needs?
2. Accessible: How easy is it for customers to do what they want to do?
3. Emotional: How do customers feel about the experiences?

Here are the ratings for all 60 tech vendors that had feedback from at least 60 IT professionals:

The report also examined IT purchasing plans. We created a purchasing momentum index, equal to the percentage of companies planning to increase spending in 2012 minus the percentage that were planning to decrease spending. The report contains the purchasing momentum for all 60 tech vendors in the study. It turns out that the Temkin Experience Ratings are highly connected with purchase momentum:

Purchase  report for $295

You can also purchase the data from this report for $295. The Excel spreadsheet contains inputs to the Temkin Experience Ratings and purchase momentum for all 60 companies in the report as well as for 28 other tech vendors which had sample sizes of less than 60 respondents.

The bottom line: Customer experience and loyalty go hand in hand in the tech sector.

Customer Experience Reading List For Senior Execs

Our research shows that an increasing number of companies will focus on customer experience in 2012. So there will be a new cadre of senior executives beginning to learn about customer experience. As they gain interest, they’ll look for materials for getting up to speed. Here’s a short list of posts that I’d recommend sharing with these CX newcomers:

1. The 6 Laws Of Customer Experience. Every executive should understand these fundamental drivers of how organizations deliver customer experience.
2. The Four Customer Experience Core Competencies. The path to customer-centricity requires mastering these four competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness. The report also has a self-assessment tool that execs can use to gauge their organization.
3. My Customer Experience Manifesto Continues. Provides a perspective of how to think about customer experience management.
4. Customer Experience-Loyalty Connection. This report uses large-scale consumer research to show the link between customer experience and customer loyalty, good for understanding ROI.
5. What If Customer Experience Has No ROI?. This is a three-part post that explains the connection between customer experience and business results.
6. Customer Experience Affects Attitudes And Behaviors. Shows how customer experience links to business and brand strategy.
7. Three Characteristics Of Transformational Leaders identifies what leaders need to do if they want to drive change in their organizations.
8. Improve “Purposeful Leadership” In 2011. Gain a deeper understanding of the role that leadership plays in transforming customer experience.
9. The 8 Signs Of Executive Commitment. Gauge the commitment level of the executive team with this simple diagnostic.
10. The Customer Experience Checklist Manifesto. Use this checklist of eight items to make sure that investments will improve customer experience.
11. 8 Customer Experience Trends For 2011. These trends give a good sense of where things are heading, but keep an eye out for an updated list of megatrends.

If you can get your senior executives to spend 60 minutes reading through this material, then they should have a much better understanding about what it takes to build a more customer-centric organization. If they show some interest, then sign them up for the monthly CX Journal so they can continue on their learning journey.

The bottom line: An informed senior executive is a critical CX asset.

Tim Cook: It’s Time To Secure Apple’s Future

Apple just announced terrific results for Q4, but I’m not sure it’s set up for long-term success. Apple hasn’t explicitly defined customer loyalty as an asset, at least not when it comes to a key structure like its board of directors. So, in light of Apple’s wonderful success, I penned this note to Tim Cook (which I am not sending, but feel free to pass it along to him):

Obviously Apple is not the only large organization that isn’t setup to improve or sustain its relationships with customers; it’s true of most companies. So this letter could have been addressed to just about any CEO, but I knew that a note to Apple would get more people’s attention.

The bottom line: Customer loyalty is a sustainable asset

Data Snapshot: Social Media And Mobile Adoption

Purchase data snapshot for $195

We just published a new Temkin Group Data Snapshot: Social Media and Mobile Adoption that provides details of how often U.S. consumers do a number of social media and mobile activities. Here’s the description of the research:

As part of Temkin Group’s Q4 2011 Consumer Benchmark Survey, we asked 5,000 U.S. consumers about their social media and mobile activities. This data snapshot looks at how many consumers perform activities such as update their status on Facebook, send a tweet, read an online product review, or invite someone to join their LinkedIn network. The data also shows how frequently they do these activities and the differences across seven age groups of consumers.

The data snapshot if full of facts and figures. Here are a handful of factoids that I pulled together from the report:

The data snapshot has 13 data-rich graphics. Here’s a partial view from two of the figures:

Purchase data snapshot for $195

The bottom line: Social medial and mobile adoption differs widely across age.

Report: 2012 Temkin Experience Ratings UK

I’m excited to announce the launch of Temkin Group’s newest offering….

We introduced the Temkin Ratings site in the US last year. The site provides free access to all of our ratings, making it easy to see how consumers rate large companies across a number of dimensions. We decided to extend the Temkin Ratings into the UK with four of our ratings: Experience, Loyalty, Trust, and Forgiveness. You can review all of those ratings from the Temkin Ratings UK site.

As you can see below, we’re also providing the Temkin Experience Ratings report free of charge. We will providing some details around the other ratings in future posts. And, of course, we will be releasing the 2012 ratings in the US later this year — with even more industries.

The report can be downloaded for free

We just published a new Temkin Group report, 2012 Temkin Experience Ratings UK. Congratulations to the top six companies (out of 66 in the ratings):

1) John Lewis
1) Waitrose
3) Amazon.co.uk
4) Farmfoods
4) Iceland
4) Morrisons

Here is the executive summary from the report:

John Lewis and Waitrose tied for first in the 2012 Temkin Experience Rankings UK, with several other grocery stores and Amazon.com rounding out the top ten. We asked 3,000 British consumers to rate their recent interactions with companies across three dimensions of their experience: functional, accessible, and emotional. These data allowed us to rate 66 companies across seven industries. Only two of those companies received an “excellent” rating, while 26% fell in the “good” category. The results show that retailers and grocery stores deliver the best experience while personal computer manufacturers and insurance companies provide the worst.

The Temkin Experience Ratings UK are based on evaluating three elements of experience:

1. Functional: How well do experiences meet consumers’ needs?
2. Accessible: How easy is it for consumers to do what they want to do?
3. Emotional: How do consumers feel about the experiences?

Here are the ratings for all 66 companies:

The report can be downloaded for FREE

Are you interested in getting a deeper look at the data? Or do you want to see the differences in industries across age? Then you should visit Temkin Ratings at www.temkinratings.co.uk.

The bottom line: Customer experience excellence is in short supply.

How Companies Use Customer Experience Metrics

In a recent report, State of Customer Experience Metrics, 2012, we examined how large companies use CX metrics. To get a better sense of what’s going on, we segmented the companies in our study along two dimensions:  frequency of metrics usage by executives and integration of CX metrics into key decisions. The results defined four segments of companies:

• CX Metrics Ignorers (45%): These companies don’t use CX metrics in any substantial way.
• CX Metrics Reviewers (16%): These companies review metrics but don’t do too much with the information.
• CX Metrics Toe Dippers (14%): These companies make some decisions using CX metrics, but the metrics aren’t part of the ongoing operations.
• CX Metrics Decision Makers (25%): These companies use CX metrics to guide how they run their business.

The bottom line: How do YOU use CX metrics?

Discussing 13 Customer Experience Megatrends

In 2010, I wrote a report called 8 Customer Experience Megatrends and it’s now time to update the list of megatrends. I’m planning to publish a report in early 2012 with a new set of CX megatrends. As part of the process, I’m sharing a draft of the megatrends in order to get feedback. So please leave comments with your thoughts!

To prepare the updated list of megatrends, we’ve been doing a bunch of research which includes reading through responses from more than 300 CX professionals who recently answered our survey question: What trends do you think will have a significant effect on customer experience over the next few years? 

Here’s the initial draft of 13 CX Megatrends. As you’ll see, there are a few carryovers from the previous list. I’ve also taken some creative license to introduce new words.

Is there something missing? Do these make sense? How do you think the future of CX will play out?

The bottom line: We want to hear from you

Data Snapshot: Who Prefers Service Over Price?

The report is available for FREE

We just published a new piece of research, Who Prefers Service Over Price?

This report uses a new format for Temkin Group that we call a “Data Snapshot.” While many of our reports have a lot of data, these reports will be even more data intense and can serve as reference materials for looking up data points. Since this is the first report in the new format, we decided to make it available for free.

Here’s the executive summary:

We asked 5,000 U.S. consumers whether they would prefer low prices or good service when doing business with 14 types of companies. It turns out that consumers prefer low prices in every industry except for banks and computers. Our analysis looked at differences across age, income, ethnic, and educational levels of consumers. Some of our findings: life insurance is the most age-dependent, low income leads to price preference, blacks have the most preference for good service, and higher education leads to a preference for service.

This Data Snapshot has five graphics that look at the following data (which is the first figure in the snapshot) across age, income, ethnic, and educational demographics.

The report is available for FREE

The bottom line: Low prices are important, but many people prefer good service

CX Metrics Don’t Stack Up To Financial Metrics

In the recent Temkin Group report State of CX Metrics, 2011, we examined many aspects of CX metrics programs. As part of that research, we asked respondents from large companies to rate their effectiveness at certain aspects of a CX metrics program. Here’s a summarized version of their responses.

My take: As you can see, only about half of respondents think they’re doing a good job collecting and communicating CX metrics — and that’s the most effective thing that they’re doing. Less than one out of five think they’re good at making trade-offs between financial and CX metrics.

What does that mean? Even companies that are measuring their customer experience aren’t able to use this information effectively to sway decisions. So short-term financial metrics continue to set the course for most companies.

It doesn’t make sense to ignore financial metrics, but companies need to do a better job of balancing them with CX metrics. While financial metrics often look at historical performance, CX metrics can give a better sense of the future. So companies should build up their confidence in CX metrics so that decisions are made based on an explicit analysis of short-term and long-term goals.

The bottom line: CX metrics need to guide business decisions