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Tuesday, June 16, 2009

How much should you spend on Customer Experience?
The Strativity Group surveyed more than 850 executives globally this year and is now publicizing the findings in what they call their 2009 Customer Experience Benchmark Study.  Lior Arussy, president of the firm, states that "The economics of customer experience is critical. Companies must develop the financial understanding that drives customer experience investment and return".   

I couldn’t agree more with that premise, but clearly see things differently when it comes how one acheives a healthy ROI.  Mr. Arussy is concerned about the need to spend a significant percentage of revenue “in customer experience”.  His study commends companies that invest 10 percent or more of their overall revenues in customer experience and claims that they see myriad benefits including lower attrition rates and higher referral rates.
 Customer Experience Partners has difficulty in understanding even what is meant by spending “in customer experience”. 

We believe that the TOTAL customer experience includes every touchpoint in which the brand interacts with their customer (whether intended our accidental).  Yes the customer service center is part of the experience, but so also is the brand’s advertising presence, their packaging, their trucks, service personnel, billing appearance, website, etc.  As such we just  can’t imagine how some part of the budget can be earmarked as being spent “on customer experience”. 

From our point of view virtually everything that touches the customer is part of the customer experience. 
 Our belief is that management’s role should be one of identifying the areas in which changes would be most valued by customers. There are just too many things that could be done and too much money that could be spent to improve the customer experience (without a justifiable ROI).  Management should not be aiming to maximize the customer experience, but rather should be seeking to focus efforts on the key issues that will optimize their investment by adding the greatest value for customers. 

Which direction is your company taking?

1:52 pm edt          Comments

Friday, June 5, 2009

Satisfaction scores deciding fate of auto dealrships?

Earlier this week a Senate Committee was grilling the heads of Chrysler and General Motors about how they selected which dealerships they had decided to close, and how they were treating those dealers. 
 Congress has become involved in such issues of course because the government now owns a large part of both Chrysler and GM, and because many of those influential dealers are highly visible employers in their communities. 

We could argue about the value of having a Senate Committee attempting to micro-manage such major corporations, but what caught my attention most was the criteria that the auto makers claimed to have used in their decision-making process.  Unless I heard them wrong, the biggest issues considered were: 1) whether the dealers were capturing what the manufacturer considered an appropriate share of total auto sales in their territory, and 2) how positively the dealer was representing the brand as measured by their customer satisfaction scores.  
 

The Senators apparently haven’t spent a lot of time buying or servicing there own cars over the years, because not one of them even raised a question about the legitimacy of those satisfaction scores.  As most consumers know from their personal experience with dealerships, and as I know as someone who has seen from the inside how a number of automotive CSM programs operate, what Detroit has done is now in some cases rewarded the dealerships that cheat.  From the hand on the shoulder request from the salesman to give them only “excellent” scores on the satisfaction questionnaire (or as some dishonestly claimed “Or I won’t get any commission for this sale”), to the instruction sheets distributed on service visits showing how to fill-out the survey form (with all “10s” of course), to the all out bribes (we’ve honestly seen everything from a free tank of gas, to free floor mats, to $100 cash) to bring the survey package into the dealership so they can “help you fill it out” (or even do it for you), to filing of fraudulent addresses so the customer never even gets a chance to complete the questionnaire - some dealerships have done it all – while others have played entirely fair and by the rules.  
 

I have no way of knowing how many of those who systematically cheated the system over the years have now been saved.  I don’t know how many of those dealerships who played fairly and believed that the satisfaction surveys were meant to capture honest feedback are now been shut down. 
 If that’s what the satisfaction scores were going to be used for, someone should have advised the dealers years ago.  

If they knew that the very existence of their dealership was on the line, do you think some of those honest dealers who took the high ground would have been more tempted to play the Customer Sat Survey game differently?
 
12:37 pm edt          Comments

Thursday, June 4, 2009

Finding the tasks that customers value

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.

11:04 am edt          Comments


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Customer Experience Partners, LLC
Measurement, Management, Optimization
Contact us at: 203-655-0090 or
pruden@customerexperiencepartners.com

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