Sunday, January 26, 2014
Research Suggests Word Of Mouth Declining - We Need To Act
10:37 pm est
you believe that advocacy is important to your business, then several research studies released recently suggest you have
your work cut out for you.
First, Mindshare World has reported
on response to the statement, “When I see or hear something interesting about a brand, I like to pass it on”.
The percentage of positive responses shows a continually declining trend:
In 2010, 66% agreed
In 2011 62%
In 2012 53%
In 2013 only 47% agreed
Let’s be careful with the takeaway.
The study shouldn’t be interpreted as suggesting that 66% or even 47% are advocates, but only that if a
brand managed to get something before them that the individual considered “interesting”, then
they “like to” pass it on. Knowing how many messages are thrown at each one of us every day, that’s
a big “if” to be overcome.
Secondly, we note that EngageSciences reports
that only 4.7% of a brand’s fans generate all of the social media referrals for the brand.
When those two studies are considered together, it‘s clear
that it’s going to take special effort to produce the frequency, volume, and positive tone of word of mouth that most
brands would like to be receiving. Delivering good value for the money and a positive overall customer experience are
essential, but even that won’t be enough.
Success will be dependent upon:
Identifying the best potential advocates (those current
customers who have proven behavioral commitment to the brand, plus an emotional connection, who possess the “communicator
Providing each of them with the necessary Motivation, Content,
and Opportunities that will prepare those potential advocates to tell the own view of the brand’s story, both
online and offline, to friends, neighbors, co-workers, relatives, and even strangers.
Monday, January 20, 2014
What Does Your Loyalty Program Accomplish?
12:37 pm est
hard to tell what some marketers think they are accomplishing with their loyalty programs. Some clearly are me too
efforts with no strategic direction and others cost more to operate than they can hope to generate in increased profits. In
reality the objectives with existing customers should come down to: 1) Retention (persistence of store visits, resistance
to competitor enticements, etc.), 2) Increase category share of wallet spending with the store, and 3) Generate positive word
According to a recent report on RetailWire.com,
Loblaw’s a Canadian supermarket has their act together, understands that those are the possible objectives, and recognizes
where their greatest opportunity lies.
Though we’ve never been in one of their stores, apparently
Loblaw’s already provides quality and good customer service and as a result has been able to retain a loyal customer
base. Theve gone to the next step, done their homework, quantified spending, and made the strategic
decision to focus on increasing share of wallet spending of those customers they have worked so hard to win and keep. Using
direct communication to those valuable customers and personalizing offers is allowing them to gain share of wallet thereby
gaining a competitive advantage. It allows them to provide individuals with totally customized offers
and services that can increase purchases without discounting items that those individuals have already proven that they will
buy at full price. It sounds like a cost-efficient approach that hopefully will deliver added bottom-line
Thursday, January 9, 2014
Fixing the Store, Or Just Fixing the Score?
12:35 pm est
I went to the bank
the other day (yes, even with online banking you can still physically go into a branch office). As the
teller was completing the simple transaction she said to me, “How is my service?” She totally
caught us off guard and I guess I mumbled something about it being fine. She then told me that I would
receive a call and would I please give her a ‘5’ on everything they ask about. She continued
to say that “even a single ‘4’ would be viewed as failure”.
encounter reminded me of other similar ‘abuses’ to the CSM process:
The sign posted in the hospital elevator reminding riders (have to wonder how much time patients actually spend in
the elevators) how important it was to give the hospital top scores on any follow-up surveys.
The note attached to my bill at a car dealer’s service center
telling us that if we didn’t feel that we could recommend them to a friend that we should contact the service manager
to discuss our visit.
inquiry call to the cable company - which doubled in length because the rep needed to be assured that he had absolutely, completely
addressed my issue on this call and that I was totally satisfied with his performance.
With 95% of companies (according to Gartner) reporting that they are collecting
feedback from customers, there is a lot of customer satisfaction and NPS surveying going on out there. That
in itself could be great. In the big picture listening to customers is important, and certainly much of
it is well-intentioned.
The problem arises in the use of the
data and the communication to staff. In their efforts to achieve improvement in the customer experience,
management often creates a competition between units or uses the results to reward some employees and punish others.
But employees aren’t stupid. It takes little time for them to get the message.
So if management demands good scores, then good scores they shall have.
Unfortunately rather than giving focus to ways to
improve the customer experience, some district managers and staff short-cut the process
and slump to the level of begging customers for good top ratings. Worse, others spend their time finding
ways for gaming the system to simply get better scores. We have interviewed customers who report that the
demands for top scores has only resulted in destroying what otherwise was a great customer experience. We
have even witnessed illegal actions to eliminate the records of customers who have suffered poor service that might result
in low scores. It’s sad, and damaging to long term profitability to see more effort going into fixing the score rather
than fixing the store (in terms of process, policies, training and attitude).
There is a better way. Ask us about it.