Report: Economics of Net Promoter, 2015

1506_Economics of Net Promoter_COVERWe just published a Temkin Group report, Economics of Net Promoter, 2015. Here’s the executive summary:

Net Promoter® Score (NPS®) is a popular metric that companies use to analyze their customer experience efforts, but how does it actually relate to loyalty? We asked thousands of consumers to give an NPS to 293 companies across 20 industries, and then we examined the connection between NPS and four key areas of loyalty. We found that compared to detractors, promoters are more than five times as likely to repurchase from a company, more than five times as likely to forgive a company if it makes a mistake, more than seven times as likely to try a new offering shortly after its introduction, and that they recommend the company to about four times as many people. This analysis examines the loyalty behaviors of promoters, passives, and detractors across 20 industries: airlines, appliance makers, auto dealers, banks, rental car agencies, computer and tablet makers, credit card issuers, fast food chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, parcel delivery services, retailers, software firms, supermarkets, TV service providers, utilities, and wireless carriers. The percentage of promoters who are likely to repurchase ranges from 96% for retailers, fast food chains, and supermarkets down to 77% for airlines, while the percentage of those who are likely to forgive ranges from 72% for computers & tablets, utilities, and supermarkets down to 51% for airlines. Meanwhile, the percentage of those who are likely to try new offerings ranges from 70% for major appliances and software firms down to 52% for banks. Ultimately, if a company wants to benefit from using NPS as a key metric, it must focus on improving customer experience, not obsessing over the metric itself.

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Here’s an excerpt from one of the 12 graphics, which shows the loyalty differences for promoters, passives, and detractors across all industries:

1506_ValueOfPromotersDetractors

The report provides loyalty data for promoters, passives, and detractors across 20 industries: airlines, auto dealers, banks, computer and tablet makers, credit card issuers, fast food chains, health plans, hotel chains, insurance carriers, Internet service providers, investment firms, major appliance makers, parcel delivery services, rental car agencies, retailers, software firms, supermarket chains, TV service providers, utilities, and wireless carriers.

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See our VoC/NPS resource page, which includes great resources for creating a successful NPS program. You mat also want to see our latest NPS Benchmark Report with NPS data on 283 companies.

The bottom line: Promoters are much more valuable than detractors.

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

Report: Activating Middle Managers to Drive CX Change

1505_ActivatingMiddleManagers_COVERWe just published a Temkin Group report, Activating Middle Managers to Drive CX Change. Here’s the executive summary:

It’s hard to get any group of employees to change their behavior when their managers are still reinforcing old processes, measurements, and beliefs. Middle managers show up in organizations under a variety of titles, but regardless of the descriptor, they are the ones who execute plans, lead teams, and direct collective efforts to produce results. Because of the importance of these responsibilities, Temkin Group made “Activating Middle Managers” a key strategy in its change model, Employee-Engaging Transformation. In this report, we examine five categories of best practices for successfully activating middle managers in organizational change efforts: Involve Middle Managers in Shaping the Change, Engage Middle Managers in Goal Setting, Train Middle Managers on Key Skills, Provide Middle Managers Tools to Engage their Teams, and Connect Middle Managers with Customers. In this report, we also describe the critical role that senior leaders must play across all of these strategies.

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The report contains details on 21 best practices across five categories:

1506_ActivatingMiddleManagers21BPs

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The bottom line: You can’t drive change without activating middle managers.

Report: The State of the CX Management, 2015

1505_StateOfCXMgt15_COVER_Page_01We just published a Temkin Group report, The State of the CX Management, 2015. This is the sixth annual benchmark of CX activities, competencies, and maturity levels.  Here’s the executive summary:

For the sixth straight year, Temkin Group surveyed nearly 200 large companies to evaluate the state of their Customer Experience (CX) management. This year we found an abundance of CX ambition and activity. Most companies have a CX executive leading the charge, a central team coordinating significant CX activities, and a staff of six to 10 full-time CX professionals. Using Temkin Group’s CX competency and maturity assessment, we found that 32% of companies have reached the highest three levels of customer experience, and while this isn’t very high, it’s still a significant increase from last year. Companies have also achieved the best scores we’ve seen for two of our four core competencies, Employee Engagement and Customer Connectedness. We additionally compared CX laggards with CX leaders and discovered that the leaders have stronger financial results, have more customer-centric cultures, focus more on internal communications, are stronger at customer insights and change management, and are better at digital interactions. Executives in companies with stronger CX competencies also tend to focus more on building a customer-centric culture and less on cutting costs. This report also includes an assessment that companies can use to benchmark their CX efforts and capabilities.

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The research revealed significant ambitions for improvement. While only 7% of companies believe that their organization currently delivers industry-leading customer experience, 55% have a goal to be an industry-leader within three years.

The research also shows that customer experience maturity correlates to financial results. Seventy-seven percent of companies with above average customer experience maturity levels reported that their financial results in 2014 were better than their competitors, compared with only 55% of those with below average customer experience maturity.

Temkin Group’s Customer Experience Maturity Model uses six stages of CX maturity based on the four customer experience core competencies. Here’s what we found when 199 companies completed the assessment:

1505_CXMgtCompetencyMaturity

Here are some additional findings:

  • Senior executives in companies with higher customer experience maturity levels are more likely to focus on the company’s culture and less likely to focus on cutting costs.
  • Sixty-three percent of large organizations have a senior executive in charge of their customer experience efforts.
  • Thirty-seven percent of large organizations have more than 10 full-time customer experience professionals
  • Only 7% of large companies rate their mobile phone experiences as being very good and only 3% of those firms feel that way about experiences that cut across multiple channels.
  • Companies identified “other competing priorities” as the top obstacle to improving customer experience.

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Data Snapshot: Social Media Benchmark, 2015

1505_DS_SocialMediaBenchmark2015_COVERWe just published a Temkin Group data snapshot, Social Media Benchmark, 2015. This is our annual analysis of how consumers use different social media sites on computers as well as on mobile phones (see last year’s data snapshot).

Here’s the data snapshot description:

In January 2015, we surveyed 10,000 U.S. consumers about how frequently they use social media on their computers and mobile phones, and we then compared these usage rates to analogous data we collected in January 2012, January 2013, and January 2014. This analysis looks at the frequency with which consumers in different age groups use computers and mobile phones to access Facebook, LinkedIn, Twitter, Google+, Pinterest, Tumblr, and third-party rating sites. We also examine how usage rates vary by mobile phone type.

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This research has 14 data-rich graphics. Here’s a portion of one showing the daily social media activity via both computers and mobile devices for U.S. consumers:

1505_SocialMediaCOmputerMobile

Some of the findings form the research include:

  • Consumers increased their daily computer usage across all nine social media sites we examined. While daily Facebook access showed the smallest increase, from 46.5% in 2014 to 47.1% in 2015, Twitter jumped the most as daily computer users increased from 13.4% to 16.1% over the past year.
  • Social media activity grew even faster on mobile devices. Daily mobile usage of Facebook increased the most, from 29.3% in 2014 to 36.1% in 2015. Pinterest showed the most momentum, growing its audience of daily mobile users from 8.0% to 11.4% over the last year.
  • The youngest group of consumers we studied, those between the ages of 18 and 24, lowered their daily computer usage of Facebook, LinkedIn, Twitter, Google+, as well as with ratings and review sites like Yelp and TripAdvisor. Those young adults also lowered their daily mobile use of LinkedIn and Google+.
  • These young adults are very mobile-centric, as they are more likely to use Facebook, LinkedIn, Twitter, and Pinterest daily on their mobile devices than on their computers.
  • Consumers between the ages of 25 and 34 are the most active on Facebook, Twitter, Google+, Pinterest, and ratings sites.
  • Across both computers and mobile devices, consumers between 35- and 44-years-old showed the most increase in daily social media activity between 2014 and 2015.
  • iPhone users are the most active on Facebook, Twitter, and Pinterest, while Blackberry users are the most active on LinkedIn, Tumblr, and ratings sites.

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The bottom line: Mobile use continues to rise

Data Snapshot: Media Use Benchmark, 2015

1504_DS_MediaBenchmark2015_COVERWe just published a Temkin Group data snapshot, Media Use Benchmark, 2015. This is our annual analysis of how much time consumers spend using different media channels (see last year’s data snapshot).

Here’s the data snapshot description:

In January 2015, we surveyed 10,000 U.S. consumers about their media usage patterns and compared the results to similar data we collected in January 2014, January 2013, and January 2012. Our analysis examines the amount of time consumers spend every day watching television, browsing the Internet (for both work and leisure), reading books (both print and electronic), reading newspapers (both print and electronic), listening to the radio, reading a print magazine, and using a mobile phone. This data snapshot breaks down the results by income level, education level, and, most expansively, by age.

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Use of mobile phones for internet or app-related consumption increased an average of 0.4 hours per day over the past year. This is the largest jump in average usage time over all 11 areas we examined in both 2014 and 2015. Respondents under the age of 35 dedicate the most amount of time to all of these activities, with the exception of TV watching, which is most heavily consumed by 65- to 74-year-olds.

Here’s a portion of the first figure from the data snapshot that contains 12 data-rich charts:

1504_MediaUseHours

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The bottom line: Mobile use continues to rise

Report: State of the CX Profession, 2015

1503_StateOfCX Profession2015_COverWe just published a Temkin Group report, State of the CX Profession, 2015. This is the fifth year that we’ve examined the roles of CX professionals and the second year that we’ve done a compensation study. Here’s the executive summary:

To better understand the mindset and roles of CX professionals today, we surveyed 270 CX professionals and then compared their responses to similar studies we conducted over the previous four years. Although 98% of respondents believe that customer experience is a great profession to work in, these professionals feel less appreciated than they did last year. Web interactions and voice of the customer programs continue to be key areas of responsibility for these professionals, and respondents expect spending on and hiring for CX activities to grow in 2015, with voice of the customer software vendors enjoying the most positive momentum. On this year’s survey we included our second annual compensation study. We examined 126 CX professionals from large organizations and found that their average compensation (salary plus bonus) ranged from $92,000 for mid-level individual contributors to $344,000 for CX executives.

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CX continues to be a great profession….

1503_CXGreatProfession

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The bottom line: The CX profession is thriving.

Data Snapshot: Customer Experience Expectations and Plans for 2015

1503_DS_CXPlansFor2015_COVERWe just published a Temkin Group data snapshot, Customer Experience Expectations and Plans for 2015. This is our annual analysis of CX priorities and spending within large organizations (see last year’s data snapshot).

Here’s the data snapshot description:

In the first quarter of 2015, Temkin Group surveyed 207 respondents, each from a company with $500 million or more in annual revenues, about their customer experience efforts over the past year and their plans for 2015 and beyond. We compared the results of this survey to the results of similar surveys that we completed in Q4 of 2010, Q4 of 2011, Q4 of 2012, and Q4 of 2013. This year’s results show that companies are planning on dedicating more money and effort to improving a variety of customer experience activities in 2015.

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Here are some highlights from the data snapshot that contains 13 data-rich charts:

  • 42% of respondents think their CX efforts had a moderately or significantly positive impact on the business in 2014 and 78% expect to have a positive impact in 2015.
  • 82% of respondents think that CX will be more important to their organization this year than it was last year.
  • 66% of respondents expect that their company will spend more on CX this year than it did last year.
  • 40% of respondents have more than five people in their centralized CX team and 42% expect those numbers to rise (none are expecting a decline).
  • 31% of respondents expect to spend more on voice of the customer software vendors in 2015 than they did in 2014 and only 2% expect to spend less.
  • 88% of respondents expect to put more focus on Web experiences in 2015, a jump from 79% that expected to do the same last year. Social media and phone self-service interactions were the only areas that did not gain momentum.
  • 81% of respondents expect to put more focus on customer insights and analytics. The largest jump from last year is employee communications and engagement.
  • Building a customer-centric culture and predictive analytics are the areas that jumped the most this year when respondents identified the things that would have a significant impact on their organization’s CX in three years.

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The bottom line: Companies will be spending more time and money on CX this year

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