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Sunday, January 26, 2014

Research Suggests Word Of Mouth Declining - We Need To Act

If 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:

  1. Identifying the best potential advocates (those current customers who have proven behavioral commitment to the brand, plus an emotional connection, who possess the “communicator gene"), and

  2. 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. 

10:37 pm est          Comments

Monday, January 20, 2014

What Does Your Loyalty Program Accomplish?

It’s often 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 of mouth.

According to a recent report on, 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 results. 



12:37 pm est          Comments

Thursday, January 9, 2014

Fixing the Store, Or Just Fixing the Score?

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”.


This 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.

  • A quick 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.





12:35 pm est          Comments

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Measurement, Management, Optimization
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