I listened in on a webinar yesterday because its title spoke of issues near and dear to me: “Better Customer Insights Equal Better Interactions”.  Three speakers used all the right terms and buzzwords like retention, lifetime customer value, word of mouth, ROI and so on.  I was about to fall in love with one speaker when she pointed out that the real benefit of providing better insight was in helping clients focus their attention on the higher value tasks.

 I say about to fall in love because she then finished her thought with the word “online”. (The area of expertise of her company).  Another speaker talked of providing a great customer experience.  He explained that this of course would be accomplished by giving customer contact agents the right information about their customers, the right training to answer their questions, and the right guidance to offer additional products and services best suited to individual customer needs.  (All of course that could coincidently be delivered through the software solution his firm sold.)

There is a lot of talk about the voice of the customer, and better managing the customer experience.  But very few of the experts and their firms seem to be beginning by actually listening to the customer.  Before acting clients really need to understand the TOTAL customer experience – that is all the rational and emotional reactions to each and every interaction the customer has with their brand – and that is a complex challenge to deal with. You might wonder who is willing to pursue such a thankless task.  For most of those who sell their services as experts in customer retention or customer experience management, it’s not where they want a client to wander.  If in reality the consulting firm makes their money selling CRM software, or training, or web applications, or store design, or other upgrades to the customer experience, but those changes are not in fact what the true voice of the customer reveals as the most valuable, then that’s certainly not the kind of objective insight that they want to be helping develop.

Management of the Customer Experience without real financial success until clients get that true voice of the customer.  They need a trained and objective resource to help them learn what their customers would value most BEFORE they hire the firm specializing in that area and move to action.

A former colleague opened a conversation the other day by asking why I had turned my back on customer satisfaction measurement (CSM) after my years of helping run some of the premier engagements in the country.   He made his assumptions based upon my present focus on CEM Optimization and work in the measurement and management of customer word of mouth.

I explained that I still think that CSM could be a great way to compare the ratings of various stores, braches or call centers, and to identify the internal best of class.  Unless it’s being gamed, I think it points out the individuals within each of those units who are probably making the greatest effort to serve customers.  Typically it helps measure, focus and reward employees for behaving in a manner that management feels is most beneficial to the company.  

But I do see some significant limitations.

To accomplish those deliverables and to conform to the structure of most corporations, CSM projects are built upon tracking performance in comparison to a set of internal operational standards. We talk about CSM as though it’s going to lead us to strategies that will improve customer retention, allow us to capture greater share of category spending, and to generate more positive word of mouth.  In reality CSM can’t do a great job at addressing any of those objectives.  It’s all about how the customer rates the company in regard to a number of attributes that are important to the company – it’s not a conversation driven by the customer.  Whether the customer gives the company a high rating or a low rating we really have little idea of what has earned the praise or caused the pain.  We also don’t know how that rating compares to customer expectations.  Even after deriving importance we don’t really know which negatives are most critical to neutralize nor which positives can be best leveraged.  As a result the right priorities cannot be established and we are only guessing at which strategies to set and which tactics to implement.

CSM works well when limited to what it does best.  But in reality the Customer Experience with many products and virtually all services is too complex to be comprehended based on a forty question survey (let’s not even think about those “surveys” that include one simple question or even a handful of questions).  We don’t know which messages customers are communicating to one another, or which experiential components of the check-in process the customer was thinking of when they scored us that “4”.  Marketers that attempt to develop strategies and tactics based upon CSM alone are really only fooling themselves. And that’s why we’ve had to create new processes to help clients move forward.

Just saw another example of the potential power of word of mouth – and the fear it can generate among say medical doctors.  The May 2009 AARP Bulletin informs us of a new trend. Apparently some 1,000 physicians in the US have been asking their patients to sign legal forms promising not to “publish or air” unfavorable information about the doctor’s “care, manner or office staff”.  (A firm called Medical Justice Services of Greensboro, NC apparently developed the waiver language and has been licensing it for a fee to physicians for about two years.)

Similarly attorneys in California have been seeking formal written protection from their clients as well after seeing a few too many complaints on yelp.com.

In a project we recently executed for a Connecticut orthodontist we found that 40%-50% of his new teenage patients were coming to his practice as the result of word of mouth from current patient’s parents.  Further we found that 77% of the parents claimed that they were in fact talking to on average to 4.1 other parents about the orthodontists.

But do all B-to-B or even B-to-C industries really need to be concerned? I have no doubt that customers will talk to one another about a movie or restaurant, and their experience with doctors, orthodontists, diapers, or even golf clubs, I question whether most of us will be interested or emotionally involved enough to really write or speak to others about our bank, laptop computer, airline, hotel, phone company, or most other businesses (except of course when they really treat us poorly). 

Any thoughts about additional categories in which you would go out of your way to tell others about a positive experience?  Please let me know.