Resources for Net Promoter Score (NPS) Programs

Temkin Group works with many companies on their Net Promoter® Score (NPS®) programs and has researched 100s of other organizations. Take a look at our services on the Temkin Group website. I’ve assembled some research and blog posts to help you make the most out of these efforts:

NPS Research Reports:

NPS Blog Posts:

View all of our NPS content

Relevant VoC Resources:

NPS programs are really just one type of a Voice of the Customer (VoC) program. Here is a selection of related VoC resources:

VoC Program Assessment:

Download our free VoC program assessment tool and you can identify the maturity level of your VoC program and identify strengths and weaknesses of the program across our Six Ds of a closed-loop VoC program. If you want to compare your results against the VoC programs at 192 large companies, then download the Temkin Group report Prepare for Next Generation VoC Programs which includes detailed benchmarking data.

VoC Research and Posts:

View all of our VoC content

Additional content that you may find valuable:

Sign up for our monthly CX Matters Journal

Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

Report: Tech Vendor NPS Benchmark, 2013

1306_IT_NPSBenchmark_COVERWe just published a Temkin Group report, Tech Vendor NPS Benchmark, 2013, The research examines Net Promoter Scores and the link to loyalty for 54 tech vendors based on feedback from IT decision makers. We also compared results to the NPS data we published last year. Here’s the executive summary:

We surveyed IT decision makers from more than 800 large North American firms to understand how they view their tech vendors. One of the questions we asked provides Net Promoter Scores® (NPS®) for 54 of those companies. VMWare and SAP analytics earned the highest NPS while CSC IT services and Infosys IT services earned the lowest. The overall industry average NPS dropped nine points from last year. Our analysis also examined the link between NPS and loyalty, finding that compared with detractors, promoters are more than six times as likely to forgive a tech vendor if they deliver a bad experience, almost six times as likely to try a new offering from the vendor, and more than three times as likely to purchase more from them this year. When examining the loyalty levels for each vendor, we found that Oracle consulting and VMWare clients have the strongest purchase intentions, SAP analytics and Sybase have earned the most forgiveness, and VMWare and SAP analytics have the most innovation equity.

Download report for $495 (includes Excel spreadsheet with data)
BuyDownload3

Here are some of the findings from the research:

  • With an NPS of 47, VMware came out on top followed closely by SAP analytics with 45. At the other end of the spectrum, four tech vendors have negative NPS: CSC IT services, Infosys IT services, Alcatel-Lucent, and Deloitte consulting.
  • The average NPS in the tech industry went from 33.6 in 2012 to 24.7 in 2013. The percentage of promoters dropped seven points.
  • Compared with detractors, we found that promoters are more than six times likely to forgive a tech vendor if they deliver a bad experience, almost six times as likely to try a new offering from the company, and more than three times as likely to purchase more from them in 2013.
  • Forgiveness and willingness to try increase steadily starting at 3 while increased purchases begins steady growth at 5.
  • Promoters most frequently wanted lower prices and better support, while passives and detractors were looking for better support.
  • Oracle outsourcing has the strongest purchase intentions while Trend Micro has the weakest.
  • SAP analytics and Sybase have earned the most forgiveness while Trend Micro has earned the least.
  • VMware has the most innovation equity while Accenture consulting and Intuit have the least.

1306_ITNPS2

1305_ITNPS_Economics

Download report for $495 (includes Excel spreadsheet with data)
BuyDownload3

The bottom line: When it comes to NPS, large tech vendors are heading in the wrong directions

Note: See our 2012 NPS ratings for tech vendors and the post 9 Recommendations For Net Promoter Score along with all of my other posts about NPS.

P.S. Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

What Drives Net Promoter Scores (NPS) in IT?

A previous post examined Net Promoter Scores (NPS) for tech vendors and the relationship between NPS and market share based on feedback from IT decision makers within large firms. Since I’ve had questions about that post, I decided to examine a common question: What’s driving those NPS scores? It turns out that the answer (no surprise) is customer experience.

We examined a number of metrics and their relationship with NPS in two areas:

  • Correlation (R). This looks at how connected one metric is to another, ranging from -1.0 to 1.0. A correlation above 0.5 is strongly positive and above 0.7 is very strongly positive.
  • Slope. This looks at the change in NPS that relates to a one-point change in the metric. A higher slope means a change in the metric has a higher change in NPS.

Our first analysis examined NPS scores versus the Temkin Experience Ratings for Tech Vendors. It turns out that there was a very strong correlation (R= 0.77) and the slope is 1.13.

We then examined the correlation and slope between NPS and components of the Temkin Experience Ratings as well as with product and relationship satisfaction scores.

Here are some observations from the analysis:

  • Customer experience is critical. Temkin Experience Ratings has the highest impact on NPS, with the highest overall correlation and slope.
  • You have to be easy to do business with. The highest individual correlation (.75) and slope (1.11) is with the accessible element of the Temkin Experience Ratings, which looks at how easy the company is to work with.
  • Relationship trumps product. It turns out that the correlations are about the same for relationship satisfaction and product satisfaction, but the slope is much higher for relationship satisfaction.
  • Cost of ownership stands out. When it comes to the slopes, cost of ownership (.99) stands out amongst the satisfaction items. Support of account team (.86) is also relatively high.

The bottom line: To improve NPS, improve customer experience.

You can purchase this data for $295. The Excel spreadsheet contains NPS, Temkin Experience Ratings, relationship satisfaction, and product satisfaction data for 60 tech vendors in the analysis as well as for 28 others with sample sizes of less than 60 respondents.

9 Recommendations For Net Promoter Score (NPS)

This week is the Net Promoter Conference in London. Since these events often spur a ton of questions about Net Promoter Score (NPS), I put together one of my periodic posts about NPS. If you’re not familiar with NPS, it’s based on asking customers a question like this:

How likely are you to recommend <COMPANY> to a friend or colleague?

Respondents are categorized as “Promoters,” “Detractors,” or “Passives” based on their answers. The Net Promoter Score (NPS) is calculated by subtracting the percentage of Detractors from the percentage of Promoters (Passives are ignored).

My take: Let me start looking at NPS with some data points from the report, The State Of Customer Experience Management, 2011:

  • 48% of large companies (more than $500M in revenues) are using NPS
  • 67% of those using NPS report positive results (15% say it’s too early to tell)
  • 84% of large firms with voice of the customer programs (including those that use NPS), report success from those efforts

NPS can be a valuable metric, but only when incorporated within a strong voice of the customer (VoC) program. Here are a handful of overall recommendations about NPS:

  1. Stop dreaming about an “ultimate question.” Having worked with dozens of organizations on their NPS efforts, I can tell you that the NPS question is not nirvana. Even the most successful users of NPS ask customers a series of questions and get feedback through a portfolio of mechanisms.
  2. Look for magic in the “why.” To some degree, it’s useless to know if someone is likely or unlikely to recommend you if you don’t also understand why they feel that way. So you need to make sure customer feedback helps you understand why customers feel the way that they do. Which leads to my next recommendation…
  3. Focus on improvements, not questions. Feedback is cheap, but customer-insightful actions are precious. The goal for any feedback mechanism (like NPS) is to drive improvements in your business. Successful NPS programs have strong closed-loop VoC programs that go from detection of customer perceptions to deployment of improvements (see my post about the 6 Ds of a voice of the customer program).
  4. Don’t lose sight of segments. An overall NPS score across your customers may be a good metric for aligning focus across the company, but it’s not very diagnostic. A good VoC program needs to track this type of data across key customer segments and understand which interactions (“moments of truth”) are driving those scores.
  5. Understand the elements of experience. When it comes to making improvements, you need to understand the three core elements of any experience: Functional, Accessible, and Emotional. A good program needs to provides insights into how customers perceive each of these elements.
  6. De-emphasize the “N” in NPS. NPS improves by eliminating Detractors or by increasing Promoters. but those changes can also offset each other. So the “netting” of the scores removes important clarity. Companies need to look at the rise and fall of Promoters and Detractors independently, since the changes needed to affect these areas are often quite different.
  7. Tap into the power of the language. There’s a lot of data to suggest that other measures such as the ACSI’s satisfaction index are as good as NPS (many people argue that it’s better, but I don’t want to enter that debate). What sets NPS apart is the wonderfully clear language around “Promoters” and “Detractors.” Make sure that the education across the company focuses heavily on those terms.
  8. Build a strong VoC program, with or without NPS. The overall program is more important than the choice of a metric like NPS. So make sure you focus on building a strong VoC program whether or not you use NPS (check out our VoC resource page).
  9. Remember, this is a long-term journey. Companies can make short-term improvements with superficial changes, but long-term success requires institutional capabilities. Start by understanding the 6 laws of customer experience and create a roadmap for building four customer experience core competencies: Purposeful Leadership, Compelling Brand Values, Employee Engagement, and Customer Connectedness.

The bottom line: Successful NPS implementations require strong VoC programs

2014 Temkin Group CX Vendor Excellence Award Winners

CEVendorAward_logoToday we announced the results of the 2014 Temkin Group CX Vendor Excellence Awards. Once again we had a great group of nominees, making the scoring difficult for the judges. Congratulations to this year’s winners:

Allegiance

Clarabridge

Verint

Also, congratulations to the finalists: Confirmit, Enghouse Interactive, Mindshare Technologies, Qualtrics, and Walker.

In its second year, these awards recognize companies that provide products and services that help companies improve the customer experience they deliver. Nominees are rated based on their capabilities, results, and client feedback.

The CxVE Awards were judged by five noted customer experience experts: Mila D’Antonio (Editor-in-Chief at 1to1 Media), Denise Bahil (CX Transformist at Temkin Group), Desirree Madison-Biggs (Director of Customer Experience Insights & Advocacy at Symantec), Rick Meyreles (VP – Global Voice of Customer, World Service at American Express), and Bruce Temkin (Managing Partner & CX Transformist at Temkin Group).

I’ve included the first two section of the nomination forms submitted by the eight winners and finalists. Read more of this post

Why Net Promoter Score May Not Align With Business Results

I just received a great question: “Why do companies have a very healthy growth although their NPS is low and vice versa why can growth be decreasing although the NPS is very high?” I get asked versions of this question all the time, so I decided to capture my typical answers in this blog post (check out our Net Promoter Score (NPS) Resource Page).

My take: We’ve found a high correlation between NPS and customer loyalty across a large number of industries. But that does not mean that NPS will provide a clear understanding of a company’s business results. There are many reasons why a company’s business might perform differently than its NPS might suggest. Here are some of the common reasons that I’ve seen:

  • NPS is not the ultimate question. In many situations, the amounts of promoters and detractors are roughly correlated with customer loyalty and business success, but that’s not always the case. It’s not a universally good metric as it’s not correlated to business success in all situations. For example, NPS may not be at all indicative of business success if customers are trapped because of a high switching cost, limited competition or monopolistic power of the company, unique product or service offerings, etc.
  • Comparison NPS trumps absolute NPS. In general, health plans have low NPS scores yet many of them do well financially. Customers may not be likely to recommend their health plan, but if they don’t believe that there are any better options then it will not affect their loyalty.
  • B2B roles are under-appreciated. There are different dynamics in B2B situations. If we ask treasury assistants in large companies to provide an NPS for commercial banks, we might believe that it should represent the health of a bank’s business. But what happens if CFOs, who control the banking decisions, give banks  a completely different NPS?
  • Non-customers are often overlooked. A retailer may have a high NPS, but still lose share if its products and services start appealing to a narrower audience. This type of situation is often missed, because companies tend to get considerably more feedback from existing customers than from prospective non-customers.
  • Segmentation can alter the analysis. When an organization looks at its overall NPS, it might miss important trends in different customer groups. What happens if NPS is getting lower for high value customers and getting higher for low value customers? The overall NPS could stay the same or even improve while the company’s results decline.
  • Survey design affects results. Many companies have a mismatch between the way they deploy NPS surveys and the insights they attempt to glean from the data. Companies ask the NPS questions at different times and frequencies, which can affect the overall results. If we ask NPS after a customer service event, then the results will likely be different then if we ask it periodically to a random sampling of customers.

The bottom line: NPS can be an effective metric in many situations, but only if used correctly

Customer Experience in Review, 50+ CX Data Bits from 2013

CXDataBits100hWe had a busy research year in 2013, publishing 22 research reports in addition to a large number of datasets and research-based blog posts. That’s a lot of data!

We looked through all of our published analyses and pulled out some interesting data points from last year (and mixed in a few from 2012) . So here’s a data retrospective on CX in 2013 across a number of categories (including our four CX core competencies):

CX Industry:

ROI of Customer Experience:

Temkin Group Ratings:

  • Only 37% of companies earned “good” or “excellent” scores in the 2013 Temkin Experience Ratings, while 28% received “poor” or “very poor” scores. However, companies with at least a “good” rating increased from 28% in 2012 and 16% in 2011 (2013 Temkin Experience Ratings Report).
  • 57% firms included in both the 2012 and 2013 Temkin Experience Ratings increased their scores (2013 Temkin Experience Ratings Report).
  • Grocery chains, retailers, and fast food chains earned the highest average Temkin Customer Service Ratings, while TV service providers, Internet service providers, wireless carriers and health plans earned the lowest ratings (2013 Temkin Customer Service Ratings).
  • Only 6% of companies earned “strong” or “very strong” ratings in Temkin Group’s Web Experience Ratings, while 63% earned “weak” or “very weak” ratings (2013 Temkin Web Experience Ratings).
  • Banks earned the highest average Temkin Web Experience Ratings, followed by investment firms, retailers, credit card issuers, and hotel chains (2013 Temkin Web Experience Ratings).
  • Grocery chains earned the most trust in Temkin Group’s Trust Ratings, while TV service providers earned the least trust (2013 Temkin Trust Ratings).
  • Grocery chains are the most forgivable companies according to Temkin Group’s Forgiveness Ratings with an average rating of 39%, while TV service providers are the least forgivable with a rating of 12% (2013 Temkin Forgiveness Ratings).
  • The average Temkin Experience Rating for Tech Vendors dropped from 58% in 2013 to 52% in 2013 (2013 Temkin Experience Ratings For Tech Vendors Report).

CX Organizations:

Employee Engagement (CX Core Competency): 

Purposeful Leadership (CX Core Competency):

Compelling Brand Values  (CX Core Competency): 

Customer Connectedness (CX Core Competency):

The bottom line: 2013 was a busy year for customer experience, bring on 2014!

Report: Lessons in CX Excellence, 2014

1401_LessonsCX Excellence_COVERWe just published a Temkin Group report, Lessons in CX Excellence, 2014. The report provides insights from 11 finalists in the Temkin Group’s 2013 CX Excellence Awards. The report, which is 144 pages long, includes an appendix with the finalists’ nomination forms. Here’s the executive summary:

The following 11 organizations are finalists in Temkin Group’s 2013 Customer Experience Excellence Awards: Adobe, AIG Asia Pacific, Cisco, Cox Communications, EMC, Findel Education Resources, Fiserv, Intuit ProTax Group, Oracle, Rackspace, and UMB Bank. This report highlights their customer experience efforts and describes their best practices across the four customer experience competencies: purposeful leadership, compelling brand values, employee engagement, and customer connectedness. Additionally, this report includes an appendix with the finalists’ detailed nomination forms to help you gather ideas and examples to improve your own CX efforts.

Download report for $195
BuyDownload3

Here are some highlights from the finalists:

  • When Adobe began its transition from a products-based company to a services company, it recognized the increased importance of providing excellent customer experience and established a central Customer Advocacy team in January 2013. One of this team’s main objectives is to make measurable improvements to top customer issues. Adobe identifies these top issues using numerous VoC listening channels and then, with full transparency, communicates these issues across the entire company. Every leader and employee can access root cause analysis, direct customer comments and feedback, action plans, and more.
  • AIG Asia Pacific uses its FEEL GOOD message to engage customers, employees, and leaders in the company’s service culture transformation efforts. AIG uses a comprehensive Voice of the Customer program—which includes a closed-loop NPS process—to keep the company focused on its customers and agents and implement meaningful changes based on their feedback. In each country, cross-functional teams concentrate on improving responsiveness to customer feedback. Teams create plans for their alert management processes and use a real-time online dashboard to quickly resolve customer issues.
  • Cisco has made Ease of Doing Business (EoDB) a corporate priority; it drives relevant and meaningful solutions that simplify complex issues for its customers. To support its EoDB focus, Cisco analyzes customer feedback and identifies trends in experience pain points, and then delivers tailored reports and suggestions to the appropriate business teams. Cisco reinforces the importance of EoDB by equipping leaders with regular program updates, factoring the success of EoDB targets into the bonus calculations of every employee, and prominently displaying an EoDB dashboard that provides real-time data feed from customer surveys.
  • In an industry notorious for poor customer service, Cox Communications stands out for its dedication to improving its customer experience. Its closed-loop feedback program has been particularly successful at repairing damaged relationships and reducing customer churn. Cox Communications established a centralized Closed-Loop Feedback (CLF) team, which is made up of agents from different functional areas who are tasked with taking ownership of customers’ issues from beginning to end.
  • The dedicated Total Customer Experience (TCE) team at EMC recently enhanced its TCE program by fine-tuning their data-driven approach to improving the company’s customer and partner experience. EMC obtains a complete view of its customers’ perceptions and behaviors by collecting data using customer journey maps and an extensive Voice of Experience (VoX) program. To augment these insights, EMC also evaluates the quality of its products and the TCE team assesses customer and partner infrastructures to ensure that EMC products suit their clients’ needs.
  • Findel Education Resources recently revamped its entire outlook on customer experience and placed the customer at the center of its business. The company started its journey towards customer-centricity by outlining the objectives it sought to achieve and the questions it wanted to ask to ensure that leaders and employees remained customer-focused. Findel instituted Employee Voice and Customer Voice programs to diagnose customer issues and benchmark the company’s progress.
  • Two years ago Fiserv established a new Customer Experience Department tasked with improving customer service and associate engagement. This department began by changing the company’s vision and mission to incorporate its new focus on customers, creating a multi-faceted customer experience roadmap, and outlining a hierarchy of needs. Since the department’s inception, CX has become the highest weighted metric on the balanced scorecards for leaders and employees, and the company has invested a great deal in internal assessment and coaching.
  • Intuit’s ProTax Group (PTG) uses customer feedback to drive changes in the business. Intuit PTG gathers customer feedback through a robust customer listening program, an extensive closed-loop program, and engaged social media communities. After collecting customer insights, the Customer Experience and Customer Market Insights team within Intuit PTG sends weekly, quarterly, and annual reports to the entire company, which broadens awareness of customer issues.
  • At Oracle, customer experience initiatives begin with a 360-degree view of customers. Oracle maintains a Customer Experience Database (CxD), which details the interactions and experiences of every customer based on their behavior on oracle.com and their interactions on social media. Oracle also utilizes its business intelligence product to add survey results to this customer profile, further expanding the company’s attitudinal and behavioral data on each customer.
  • At Rackspace, Fanatical Support forms the backbone of their customer experience efforts. Rackspace combines its customer data into a single listening and analysis hub, and undesirable scores and trends act as a catalyst for the company’s business decisions. For example, after examining this data, the company decided to merge the sales and support teams together to provide a constant customer experience.
  • UMB Bank recently established a Voice of the Customer Steering Team to support their customer-centric focus. This Steering Team uses VoC feedback to assign priority to CX issues and oversees improvements to the customer experience. The team is made up of leaders from all different business areas, such as product and sales, which ensures that all departments are fully engaged in the company’s efforts to improve customer experience.

Download report for $195
BuyDownload3

If you enjoyed this report, check out last year’s report, Lessons in CX Excellence.

The bottom line: There’s a lot to learn from these CX Excellence Finalists.

14 Customer Experience Trends for 2014 (The Year of Empathy)

It’s time to identify key customer experience trends for next year. We did a pretty good job of identifying 13 CX trends for 2013 and many of those trends will continue on into 2014, so they remain on this year’s list. We expect CX to gain even more momentum next year as 2014 brings us deeper into what Temkin Group has labeled the Era of CX Professionalism. Based on what we see emerging in CX, we believe that 2014 will be The Year of Empathy, which is the 14th trend. Here are 14 CX trends to watch for in 2014, followed by some advice for each item:

  1. 2014CXTrends2Renovation of VoC Programs. Large organizations spend millions of Dollars/Euros/etc. per year on collecting customer feedback. Yet, all too few of them gain the value they could—or should—from those investments. Only one out of five organizations has reached Temkin Group’s two highest levels of voice of the customer (VoC) maturity. In 2014, we expect many companies to scrap their overly burdensome customer surveys in favor of more targeted feedback. They’ll rely less on multiple-choice surveys and more on topic-specific surveys and text analytics of unstructured content like comments on surveys, calls into the contact center, social media conversations, and chat sessions with agents.
    ADVICE: Don’t worry too much about trending historical data. A feedback system that helps you make improvements now and into the future is far more valuable than one that only enables you to compare yourself with the past.
  2. Lots of Customer Journey Mapping. One of the most effective tools for customer experience professionals is Customer Journey Mapping (CJM), which is why so many people read our CJM posts in 2013. These tools identify key areas of improvement and opportunities for innovation and can help build organizational empathy. In 2014, organizations with customer experience ambition will most likely develop their own CJMs. However, despite all this activity, many companies will still misuse CJMs by mistaking touchpoint analysis with CJMs and forgetting that a CJM is merely a means to an end—not the ultimate goal.
    ADVICE: Think of CJMs as a learning experience, not as an output. Be clear about how you want to use them before you start and focus on a few targeted areas. And make sure CJMs are created from your customer’s perspective.
  3. Integration of Customer Behavioral Data. While feedback is a form of customer insight, it is by no means the only form—or even the best form. Companies can glean a lot of insight through an understanding of what customers have done, what channels they’ve used, what products they’ve purchased, and what service interactions they’ve had. These data sources provide the rich content required to fuel predictive models. In 2014, we’ll see the continued trend from 2013 with more companies blending together customer feedback data with troves of other data they have in CRM and other systems about customer transactions and value. This will enable companies to accurately target experiences to reduce churn, improve metrics (e.g., satisfaction, NPS), and increase customer lifetime value. Consequently, data scientists—especially those who can speak with business people—will continue to be in high demand.
    ADVICE: It’s easy to get overwhelmed when you start integrating multiple data sources, and it can quickly devolve into a pure “big data” project. Don’t let that happen. To stay on track, focus on the analysis you want to do and start by integrating only the data required for that analysis.
  4. More Anticipatory Service. As companies gain a deeper understanding of customers through research and analytics, they will use that information to develop more individualized customer experiences. Look for companies to route callers to the phone agents who are most likely to help them based on the anticipated reason for the call. Companies will also train front-line employees with different scripts based on anticipating a customer’s needs/interests/emotional style, and will even teach them to proactively recover from service issues before customers can even complain about them by detecting potential changes in customer loyalty.
    ADVICE: Get into the habit of asking, “what’s next?” When you’re working on anything related to customer experience design, think about what the customer is likely to do after they finish the experience you’re examining and find a way to make those next steps easier.  CJMs can be a great resource for this type of thinking.
  5. Experience Infused into Product Development. We’ll see more companies create products with customer experience embedded throughout the entire development process. What will this look like? Product teams will define usability requirements, set minimum experience thresholds for product launch, and design the entire service lifecycle. Fidelity Investments evaluates all new product and experience efforts using a CX scorecard that determines the level of customer experience risk involved in a proposed project. Its “Customer Lens” process delivers more customer-centric experiences by incorporating standards and checkpoints into business cases and new product development methodologies.
    ADVICE: Most new products and services overly focus on functional requirements. To break this pattern, create ease-of-use requirements, defining things like how quickly a customer can set up and start using the product/service or how long it will take for customers to realize the value proposition defined by the product.
  6. Consolidation of CX Process Methodologies. Large companies often have several efforts focused on creating customer-centric processes. As customer experience efforts highlight the need to redesign more operational processes, companies will combine customer experience efforts with other process improvement efforts such as lean sigma and design thinking. These combinations“–like GM’s effort to bring together customer experience and product quality–will merge process-centric tools with the power of deep customer empathy. We’ll also see more companies following firms such as Intuit that are embedding design thinking across their organizations (check out the Stanford d.school).
    ADVICE: If your organization has a LEAN or SIGMA effort underway, then embrace it — but make it more customer-centric. Combine some of the deep empathy pieces of design thinking with the more efficiency-focused other process methodologies.
  7. Contact Centers Morph into Relationship Hubs. For years, companies have relied on their contact centers to deal with customer interactions—from technical support to requesting medical coverage—but contact centers are on the verge of a major change. Driven by a shift in technology capabilities and consumer behavior, leading companies are refocusing the primary purpose of contact centers from handling individual calls to building customer loyalty. These changes will morph contact centers into what I’ve called Relationship Hubs. In 2014, Relationship Hubs will establish success metrics tied to long-term customer loyalty. Belgacom, a Belgium telecom provider, changed its key call center metric from average handle time to a combination of two metrics—first call resolution and likelihood of customers to recommend the company.
    ADVICE: Identify what your customers really want when they contact you. If it’s a service interaction, then they are likely looking for a speedy and complete resolution to their issue. Shift your measurements that drive rep quality ratings from efficiency to fulfilling these customers’ needs.
  8. Deeper Appreciation of Employee Assets. Companies are beginning to see the deep connection between employee engagement and customer experience. Engaged employees are more than twice as likely to stay late at work if something needs to be done, help someone at work even if they’re not asked, and do something that is good for the company even if it’s not expected of them. In 2014, we’ll see more employee surveys, executives developing employee engagement goals and objectives, and managerial training focused on employee engagement.
    ADVICE: Our research shows that employee engagement is not a matter of compensation. Leaders across the organization have the ability to provide what’s really important to people, intrinsic rewards. Start training your managers on what truly matters to their employees and measure their ability to engage employees.
  9. Mobile, Mobile, Mobile: Personal Health Monitoring Takes Off. This isn’t about mobile phones: it’s about digital experiences integrated into everyday life. More consumers will have smart phones and tablets, and these devices will have more apps and more sensors that enable consumers to do more things wherever they go. We’ll see a surge of personal health monitors, such as Nike’s FuelBand and Sleep Cycle Alarm Clock. In 2014, health plans and health care providers will begin integrating these remote monitors into their offerings.
    ADVICE: To make these programs work, health care companies (plans and providers) will need to consider the end-to-end experience from initiation through ongoing use. These firms don’t typically have the expertise of designing into everyday life, so they should hire outside firms such as IDEO and Continuum to help shape these offerings.
  10. Mobile, Mobile, Mobile: Retail-Digital Integration. Mobile is such an important area that it generates two of the trends. Companies will increasingly integrate mobile into their product offerings and service experiences. They will integrate mobile with other channels, particularly focusing on combining desktop applications with mobile apps being used in physical stores. In 2014, every major retailer will need to have a strategy for putting customers’ mobile phones to use when they are in their stores.
    ADVICE: Retailers need to stop thinking about digital channels as an alternative to retail channels, and instead, embrace experiences across them. Create a cross-functional retail-digital task force to identify the best way to capitalize on the mobile habits of their shoppers.
  11. Software As an Experience Continues. The initial rise of cloud-based software (a.k.a. SaaS, or software-as-a-service) focused on renting access to software instead of the historical approach of selling licenses. That makes sense, considering that Net Promoter Scores for tech vendors are more correlated to customer experience than product performance. As cloud-based software expands, we’ll see these offerings cater more explicitly to the needs of customers. How? More simple, highly focused, specialized applications (like smart phone apps), more focus on quick initial usability, more sharing of best practices (usage, not technical), and customization based on behavioral analysis of users.
    ADVICE: Start measuring how your customers use the software and use these measures to identify what drives happy and renewing customers (as well as unhappy customers). Use what you learn to help customers gain more value from their software. This effort will require a shift in the focus of account management from sales and enrichment to success and renewal.
  12. Resurgence of Purpose. As more companies push forward on their CX journeys, they’ll find that there’s nothing holding their efforts together. The desire to improve customer experience will fall victim to other priorities if the effort is not tied to the core values of the company. But many organizations focus intently on their operations that they’ve lost sight of their raisons d’être. I expect more companies to articulate and recommit to a core set of values like those of Zappos and Whole Foods, customer promises like that of TNT Express, and mission statements like that of the Dallas Cowboys.
    ADVICE: Check out one of the principles of People-Centric Experience Design, Align Through Purpose.
  13. CX Certification Accelerates CX Education. The Customer Experience Professionals Association will be launching its Certified Customer Experience Professional (CCXP) certification in 2014. This industry-wide certification will help solidify the role of a customer experience professional and create demand for more CX training. In 2014, look for a surge in companies offering CX training aligned with the categories in the CCXP test.
    ADVICE: If you’re a CX professional with at least three years of experience, consider going for your CCXP certification.
  14. The Rise of “Empathy.” As companies increasingly focus on customer experience in 2014, they will recognize that their organizations lack a deep understanding and appreciation for their customers. It’s not a flaw in the people, just a natural result of an internal focus on day-to-day operations. In 2014, we’ll hear more executives talking about the need to build “empathy” for customers, making “empathy” THE CX word for 2014.
    ADVICE: Check out one of the principles of People-Centric Experience Design, Guide With Empathy.

The bottom line: I hope that 2014 is a great year for CX within your organization!

20 Most Popular CX Matters Posts in 2013

As 2013 comes to a close, I looked at the readership stats for the previous year. Here are the 20 most-read posts from 2013:

  1. Free eBook: The 6 Laws Of Customer Experience
  2. Seven Steps for Developing Customer Journey Maps
  3. 13 Customer Experience Trends to Watch in 2013
  4. Report: 2013 Temkin Experience Ratings
  5. LEGO’s Building Block For Good Experiences
  6. Report: Net Promoter Score Benchmark Study, 2012
  7. 50 CX Tips: Simple Ideas, Powerful Results
  8. The Ultimate Customer Experience Infographic
  9. USAA and State Farm Lead Insurance Industry in 2013 Temkin Experience Ratings
  10. 9 Recommendations For Net Promoter Score (NPS)
  11. Report: 2012 Temkin Experience Ratings
  12. Net Promoter Score and Market Share For 60 Tech Vendors
  13. Don’t Confuse Customer Service With Customer Experience
  14. Report: The Four Customer Experience Core Competencies
  15. Report: Best Practices in B2B Customer Experience
  16. Report: The Economics of Net Promoter
  17. Customer Experience Reading List for Execs
  18. Employee Engagement Lessons From Southwest Airlines
  19. Report: The Five I’s of Employee Engagement
  20. USAA On Top (Again) in 2013 Temkin Trust Ratings

Report: The State of CX Metrics, 2013

1312_StateOfCXMetrics2013_COVER_Page_01We just published a Temkin Group report, The State of CX Metrics, 2013. The research shows how large organizations are using CX metrics. Here’s the executive summary:

Companies with stronger CX metrics programs are more likely to be customer experience leaders. We asked over 170 large companies about their use of customer experience (CX) metrics and compared their answers with similar studies from 2011 and 2012. We found that although companies view CX metrics as important, only 12% of respondents received at least “good” ratings in Temkin Group’s assessment. Our self-test examines four areas: consistency (does the company use common CX metrics across the organization?), impact (do the CX metrics inform important decisions?), integration (are trade-offs made between CX and financial metrics?), and continuity (do leaders regularly examine the CX metrics?). The analysis shows that while interaction-satisfaction and likelihood-to-recommend metrics are on the rise, companies do a particularly poor job of measuring non-customers (non-buyers and defectors), the emotional response of customers, and mobile and cross-channel interactions. Customer service remains the best-measured portion of the lifecycle, and it has consistently improved over all three years. Companies rate themselves the lowest in making trade-offs between CX and financial metrics, but this area has still improved since last year. Our research also uncovered that more than eight out of ten NPS users report positive results. Ultimately, to fully measure customer experience, companies need to develop measurements that link behaviors, attitudes, perceptions, and interactions.

Download report for $195
BuyDownload3

We’ve done similar studies in 2011 and 2012. Here are the results from our CX Metrics Assessment over the previous three years:

figure14

Here are some additional findings from the research:

  • Seventy-three percent of CX metrics leaders have above average customer experience compared with only 45% of CX metrics laggards.
  • The two most widely used CX metrics are interaction satisfaction and likelihood to recommend. More than 80% of respondents use each of these metrics.
  • Customer service is the highest rated area of measurement across the customer lifecycle, an area that companies have steadily improved on since 2011.
  • More than 60% of companies think they do a good job collecting CX metrics on phone calls, but less than 30% feel that way about wireless devices and cross-channel interactions.
  • Only 30% of respondents think they do a good job measuring customer’s emotional response after an interaction, but that’s an increase from 25% in 2011.
  • Less than 30% of respondents think they are good at tying compensation to CX metrics and making trade-offs between financial and CX metrics.
  • Forty percent of companies review CX metrics more frequently than quarterly.

Download report for $195
BuyDownload3

The bottom line: CX metrics are being used, but not very effectively

Temkin Group December 2013 Workshop

Hi Everyone:

We really enjoyed having you join us in South Beach. Hopefully you had an enjoyable stay and identified many opportunities to drive change within your organizations. Here are some follow-up items we discussed during the workshop:

We will also send along a link to our Webinar landing page, with links to previous recordings, when we set it up (in the next couple of weeks).

To help keep the “memories” fresh from our South Beach experience, here is an updated workshop video, attendee contact information (from registration form), and some select pictures from the event.


First Name Last Name Email Address Company Title
Emma Smith eps@usp.org U. S. Pharmacopeia Administrative Services Manager
Stacia Tyner stacia.tyner@genworth.com Genworth Financial
Daniel Henderson daniel.henderson@genworth.com Genworth Financial CX Leader
Erika Stinson erika.stinson@genworth.com Genworth Financial Digital Channel Product Manager
Carolyn Muise carolyn.muise@emc.com EMC Corporation Vice President, Total Customer Experience
Coda Bruce brucec8@nationwide.com Nationwide Insurance Sr. Consultant, Process Management
David Polet david.polet@cunamutual.com Cuna Mutual Director-Voice of Customer
Jennifer Slagle slaglejenniferk@johndeere.com John Deere Financial Manager, Customer Experience
Kayla Negrete negretekaylar@johndeere.com John Deere Financial Customer Experience
Ryan Haug ryan.haug@rackspace.com Rackspace Senior Manager- Customer Experience Design
Aleana Reeves aleana_reeves@esource.com E Source Senior Product Manager
Katie Ruiz katie_ruiz@esource.com E Source Senior Research Associate
Lykins Lesley llykins@cxpa.org CXPA Director of Member Engagement

IMG_2709IMG_2689ImageSlide14Image 3IMG_2687IMG_2683IMG_2696IMG_2693IMG_2699

Warm regards,

Aimee, Karen & Bruce
Temkin Logo.VeryVerySmall


Temkin Experience Ratings Correlate to Loyalty

I’ll start with the takeaway: Better customer experience leads to more forgiving customers, more trusting customers, and higher Net Promoter Scores (and a myriad of other good things that we did not include in this post).

The 2013 Temkin Experience Ratings benchmarked the customer experience of 246 companies across 19 industries based on a survey of 10,000 U.S. consumers. But how does a good score relate to other measures of loyalty? I took a look at that question by examining how companies fared compared with their peers in other Temkin Ratings.

I separated the companies into five groups based on how far above or below they scored on the Temkin Experience Ratings compared with their industry averages. Using these clusters of companies, I examined their Net Promoter Scores, Temkin Forgiveness Ratings, and Temkin Trust Ratings compared to their industry averages. As you can see in the graphic below, companies with the highest performing Temkin Experience Ratings outperformed those in the bottom group by:

  • 25.7 points in NPS
  • 16.1 points in Temkin Forgiveness Ratings
  • 20.9 points in Temkin Trust Ratings

1311_TERvsLoyaltyThe bottom line: If you want more loyal customers, improve your customer experience

Tech Vendors Earn Loyalty By Being Easy to Work With

We’ve done a number of studies of the IT industry, including Tech Vendors: Benchmarking Product and Relationship Satisfaction of IT Clients, 20132013 Temkin Experience Ratings of Tech Vendors, and Tech Vendor NPS Benchmark, 2013. I examined data across these studies to analyze how being easy to work with affects loyalty.

I analyzed feedback from more than 800 IT professionals who collectively provided more than 9,000 pieces of feedback on tech vendors. As you can see in the figure below, IT buyers are more loyal when tech vendors are easy to work with.

1311_ITEasyLoyaltyI examined three measures of loyalty of IT decision makers to different tech vendors based on how the IT pros rated the tech vendor’s easiness to work with (on a seven point scale). Here’s some of what we found:

  • Across all three measures, there’s a clear uptick in loyalty between a “4″ and “5″ on the easiness scale and loyalty continues to increase with every increased level of easiness.
  • The percent of IT buyers who plan to spend more with tech vendors ranges from 4% for the vendors that are most difficult to work with to 55% of tech vendors that are easiest to work with (almost 14x).
  • The percent of IT buyers who are willing to try a new product or service from a tech vendors ranges from 7% for the vendors that are most difficult to work with to 70% of tech vendors that are easiest to work with (10x).
  • Net Promoter Scores from IT decision makers range from -72 for the vendors that are most difficult to work with to +79 of tech vendors that are easiest to work with (NPS gap of 151).

The bottom line: IT professionals prefer tech vendors that are easier to work with

Report: Net Promoter Score Benchmark Study, 2013

1311_NPSBenchmarkStudy_COVERWe just published a Temkin Group report Net Promoter Score Benchmark Study, 2013. This study of 10,000 U.S. consumers benchmarks Net Promoter® Score (NPS®) for 269 companies across 19 industries. Click to download list of companies (.pdf).

Here’s the executive summary: We measured the Net Promoter Score for 269 companies across 19 industries. USAA took the top three spots with NPS of 60 or more for its credit card, banking, and insurance businesses. At the other end of the list, HSBC earned the two lowest scores, with NPS below -20 for its banking and credit card units. Auto dealers (38) and groceries (30) have the highest average NPS, while TV service providers, Internet service providers, and health plans are below 10. In 18 of the 19 industries, consumers who are under 25 represent the lowest (or tied for lowest) NPS scores. Compared with detractors, promoters are more likely to want lower prices and less likely to want customer service improvements. To help you implement a successful NPS program, we’ve included eight tips, such as don’t believe in an “ultimate question” and use control charts, not pinpointed goals. The industries included in this report are airlines, auto dealers, banks, computer makers, credit card issuers, fast food chains, grocery chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, major appliance makers, parcel delivery services, rental car agencies, retailers, software firms, TV service providers, and wireless carriers.

This is our second annual NPS benchmark. Check out last year’s results.

Download report and data for $395
BuyDownload3

Here are the overall results for the 19 industries:

2013NPSResults_TemkinGroup

Here are some other highlights:

  • USAA earned the highest NPS scores on the list for three of its business—66 for insurance and credit cards and 65 for banking. Other companies with NPS above 50 are Amazon.com, H.E.B., Chick-fil-A, Apple, Audi, credit unions, and Nordstrom.
  • HSBC earned the lowest two NPS scores across all companies with a -42 for banking and -24 for credit cards. Other companies with NPS of -10 or below are Time Warner Cable, Citibank, Super 8, Charter Communications, and Motel 6.
  • Auto dealers earned the highest average NPS (38) followed by grocery chains (30), hotel chains (29), and software firms (29).
  • TV service providers (2), Internet service providers (5), and health plans (9) are the only industries with averages below 10.
  • USAA’s three businesses earned NPS levels that are 40 or more points above their industry averages. Three other firms are 30 or more points above their peers: A credit union (banking), Amazon.com (retail), and H.E.B. (groceries).
  • HSBC’s NPS is 55 points below the industry average for banks and Super 8 is 42 points below the hotel industry. Four other firms are 30 or more points below their industry averages: Motel 6 (hotels), HSBC (credit cards), US Airways (airlines), and 7-Eleven (retail).

Download report and data for $395
BuyDownload3

The bottom line: Find out why customers do and don’t recommend you.

*Net Promoter Score, Net Promoter, and NPS are registered trademarks of Bain & Company, Satmetrix Systems, and Fred Reichheld.

Follow

Get every new post delivered to your Inbox.

Join 2,620 other followers

%d bloggers like this: