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European Conference Blog 2008

31 Posts tagged with the b2c tag

Holcim may not be a well known company on first pass, but after hearing the facts, you will wonder why you never heard of them.  A couple of interesting things:  They've grown in the last 4 years from having 44,000 to over 100,000 employees.  Their strong growth, just like Symantec's, was fueled through acquisitions plus organic growth.

 

 

Holcim's rapid growth pushed the organization to get more systematic processes and metrics in place.  As an Engineering company, Christian Birck, Head of Branding for the company, said "everything was a measurement" and that management was used to numbers.  However, they had no metrics on people or customers.

 

 

The company had another challenge in that they had a mixed model.  In some markets they were B2B; they sold to construction companies.  In others they were B2C and sometimes B2B2C.  Christian showed a great slide that said this industry was "not the sexiest, but real."  As such, one of their challenges was in recruitment.  As well, they knew they needed to keep the good talent they had, but focus on getting more.

 

 

So, according to Christian some of the key business challenges were:

 

 

  • Organic growth and threat of commoditization
  • Getting right talent and enough of them
  • Building and protecting their reputation — this is particularly important in their business

 

Because Holcim does not enter different new markets lightly, they are extremely focused on the long term.  They believe one of their key differentiators is their people — how their employees fit and exemplify the values of the company.  The list of things they wanted to accomplish included:

 

  • Making their people ambassadors for the company
  • Focusing all employees on delivering on company promises
  • Fostering a culture of customer orientation
  • Facilitating knowledge-sharing
  • Facilitating integration of new acquisitions

 

 

I thought Christian did an excellent job of explaining that "Brand does not equal logo, or advertising."  He believes that the brand promise has to be communicated in products, communications, behavior, and channel experience.  This means you really have to deliver to this.

 

 

In addition, through their complex business, it wasn't just their employees who had to live their brand promise, but their partners as well.  This was a challenging aspect for them, to make sure channel partners also were also ambassadors of the brand.

 

 

One of the programs that the company put in place was something they called "Living our Values."  This included: vision, mission, and values with some support systems.  For their industry, Holcim felt that trust was low, so the ability to differentiate on values was critical.  Christian wisely pointed out that anyone can put values in words, but it was how you get the organization to understand and live the values that was the challenge.

 

 

Holcim put in some change management processes to reinforce their message.  One of their principles was:  Enough of us for long enough.  This message went back to the earlier point about retention and recruitment.  Another key differentiator in terms of Holcim's messaging around this was "it is not just another program".  For them, the word "program" meant it was fleeting, not permanent, and they wanted everyone to take this seriously.  They focused on leadership as well, having them engage, communicate, and reinforce aligned behaviors.

 

 

One of the other enlightening statements from Christian was that you "Don't have to have a big brand for employees to believe in you."  In my experience, this is very true.  It is the extent to which you live the values as a company, and the extent to which these values also align with employees' own personal values.

 

 

From a measurement perspective, Holcim collected two types of NPS: (1) measuring recommendation of products and services, and (2) measuring whether employees recommend Holcim as an employer.  What they found was that the recommend score for products and services was very high, but scores for recommending Holcim as an employer varied dramatically.

 

 

So, this measurement of employee promoters told Holcim the extent to which they were making progress.  For their large complex business, they realized that some actions took a long period of time, and that too frequent reporting of the metric could be counter productive, in that management had to see progress.

 

 

They also found that it was difficult to sometimes prioritize empowerment drivers, as well as what things the company could actually influence.

 

 

Finally, one of the other things they realized in trying to develop trackable metrics was that there seemed to be a strong cultural bias in answering questions.  There were dramatic country-level differences.  This did not surprise me however, as we have seen this as well at Satmetrix.  Christian wisely pointed out that they don't compare scores between countries, nor did they consider normalization as this would be hard to communicate and take away the very thing they like:  the simplicity of the measurement.

 

What did I learn from Christian's presentation? Holcim's story is similar to Symantec's -- large complex organizations take time to change, but both have implemented many successful mechanisms and practices to try to help them get there.  Holcim is also somewhat similar to Travel Counsellors in that they recognized that the individual employee was critical to representing their brand.  The added twist with Holcim was trying to also reinforce their "promise" through their partner channel.  Perhaps at next year's Net Promoter Conference we will see more about this last dimension; one that I'm sure many companies are trying to get right as well.

 

Click here to download the presentation.

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Travel Counsellors is a company comprised of 900 travel counsellors in 7 countries with 20 years of experience.  They have experienced rapid growth in a very interesting marketplace; counsellors providing travel guidance out of their home offices.  Most of the motivation in being a travel counsellor is a) being well paid, but more importantly, b) getting recognition for helping and giving their customers successful, enjoyable trips.

 

 

Malcolm Hingley, Sales Director at the company, stated that "our success is our relationship with our customers, and that's what sets us apart from the rest."

 

 

The travel business has changed dramatically.  There are two components to it -- a relationship aspect as well as a transactional aspect.  Many travel businesses have traditionally focused on the transactional nature of travel, but it is a critical differentiator to also focus on the relationship (partnership) aspect as well.

 

 

It seems the travel industry in general has not established itself as a shining example of customer loyalty.  One statistic Malcolm reported was that 2 out of 3 customers would not return to their travel agency.  The reason, he said, is that many customers felt that these travel agencies were primarily out "take my money."  There was no interaction, they were only interested in the next customer.  He said other agencies' customers felt that there was no caring and that this was a very short term perspective.

 

Amidst this backdrop, Travel Counsellors was interested in engineering the experience quite differently.  Malcolm discussed the 12 golden habits.  Some of their findings were these gold habits had nothing to do with the sale, but about the unexpected moments that motivate customers to refer.

 

 

Of the 12 golden habits; it is really interesting that none of these are sales oriented.  As Malcolm put it, it was all about making the customer feel special.  Some of these include:

 

 

  1. Give the customers great reason to talk about you
  2. Have an emotional connection in everything we do; it is not enough to know about the transaction but to truly understand our customers' lives.
  3. OK sales people have customers, great sales people have friends.

 

 

I really liked this list, and especially its non-sales approach.  It focuses on the right thing -- the customer -- and not the transaction or sales event.  As well, it must make Travel Counsellors feel good that they are working toward this greater goal.

 

 

One of the things that Travel Counsellors also validated in the UK, was that NPS that was more relationship-oriented tended to produce higher scores, while convenience-based bookings through the Internet have the lowest recommendation rates.  These seemed to substantiate their 12 golden habits.  Travel Counsellors had on average a score of 82% while their competitors had much lower scores.

 

Travel Counsellor also introduced TCS (Travel Counsellor Score). They wanted to also validate the external study internally. They asked how likely is it that you would recommend your travel counsellor?  Notice that they altered the wording to be person specific, not about the company.  This was critical, because it was in fact that very personal relationship with the counsellor that they felt made the difference.

 

 

On this method they scored  94% on over 30,000 customers. To explain, Malcolm said that part of this score is based on their belief that there are no limits for what you could do for your customers.  He gave the example of one woman who owned a horse, and that she would personally ride out to each of her customers to deliver their tickets personally.

 

 

So what were some of the key messages from this presentation?  I'll summarize Malcolm's list:

 

  • Don't transact, relate.
  • Keep investing in the relationship.
  • Communication is key to keeping your customers engaged.
  • Make it personal. (This is a large part of the company's plan going forward.  One of the things that Travel Counsellors is doing is rebranding their marketing material around the name of the counsellor, so it is now person-specific.)
  • Don't oversell.
  • The power of 'thank you' is huge.

 

 

Toward the end of his presentation, Malcolm showed some great short videos in which customers gave feedback about their positive experiences with their counsellor. These customers were extremely real and enthusiastic in their praise. One thing (albeit many) that I took away from this presentation was the "make it personal" message. Travel Counsellors realized that their brand was really represented by their ambassadors; their counsellors. They were very savvy in recognizing that it was the individual personal relationships that mattered, even in terms of how they asked the recommend question. Thanks for an eye-opening presentation, Malcolm.

 

Click here to download the presentation.

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Alexsandra Alfonso, Senior Global Manager of Customer Experience Programs at Symantec, began her session by discussing the past 3 years of tracking Net Promoter at Symantec.  What was particularly interesting was the significant amount of change and transition that has happened in Symantec as a result of merger acquisitions, the largest of which was Veritas.  Alex compared and contrasted the before and after view of what this meant by revenue, acquisitions, employee portfolio, customer locations, and values.  Throughout these major transitions, Symantec was able to keep their core company values -- innovation, action, trust, and a customer driven philosophy -- intact.

 

 

Alex articulated Symantec's mission, which was to enable and empower individuals to create change in the business, to improve customer experience. I like this mission as it really brings together two key components in one mission statement, the employee and the customer.

 

 

Alex outlined the history of NPS at Symantec. She indicated that the primary concern early in 2005 was to establish a sound baseline, and from there, to look at key drivers and what impact these were having on the customer.

 

 

There were several program elements that Symantec focused on initially. One of these was a customer loyalty champion program. Employees from various business units who were passionate about customers were selected to participate. Their role evolved over time, but initially they focused on aligning products and process (not surprising given the amount of change through the merger process). Also, they focused on creating quarterly executive summaries of the results (these also transformed over time).  Finally, they realized that all employees needed to be aware of the individual role they played in customer loyalty.  Throughout this time, Alex mentioned that Symantec was more focused on operational issues and less focused on loyalty (meaning there were many competing priorities). They tended to operate from an internal point of view and perhaps lower executive involvement than they would have liked.

 

 

Today this has changed; Symantec has launched efforts around the "power of one, the power of the individual."

 

 

One of their biggest learnings from their early program was the importance of making individual business units accountable for the results.  Alex showed how their process has changed in terms of key improvement steps, which include insight, inform, action, and measure model. This happens in all areas of their complex key stakeholder relationships -- B2B, employee, B2C, and partner.

 

 

Symantec also realized that the customer loyalty champion was critical to making NPS success real.  The role has changed, though -- they are putting more structure, framework, and definition around the role, for ultimate success.  They've also reframed the executive summary process -- these now take place at the highest level and issues are really owned by the business.

 

 

Finally, employee awareness education has gone though huge change, by communicating through multiple mechanisms, including webcasts and online training, giving employees the power to make change and take action locally.  These awareness enhancements have enabled employees to participate in generating creative ideas to improve how Symantec operates.

 

 

Alex noted that now Symantec is focused more on business change and less on operational actions.  They rely on root cause analysis to really understand business change.

 

 

Their latest stage of improvement is now focused on named account surveys. This requires a very mature sales organization that has really bought in to the program. Symantec is using this feedback as part of an integrated account review process. Although there were some associated changes that had to be made, she said the benefits were huge.

 

 

Symantec has also implemented the Customer First Award. Employees are nominated quarterly, which helps drive attention around customer loyalty. I believe it is these grass root efforts that really motivate employees to focus on the customer.

 

 

NPS is now included as part of the executive compensation package at Symantec. Alex said that this action really helped solidify the belief that this was "serious." It made executives think that perhaps their staff was out of alignment with their goals, potentially pushing ownership of NPS downwards in the organization.

 

 

I thought one thing that was interesting was the clarity the company Chairman has on communicating what's important. There are 3 metrics -- NPS, market share, and ENPS (Employee Net Promoter Score).  The Chairman and COO recently delivered this message to all 5000 sales and marketing employees.

 

 

Some critical learnings from Alex:

 

 

  1. It is vital that employees understand the impact they have on the customer. To do so, you must connect individual behavior to the impact on the customer.
  2. The program must be owned by and driven from the top.
  3. Make it actionable and make it positive; both of which are critical to NPS
  4. Accountability and Reward; Compensation, if used appropriately, can help steer people in the right direction.
  5. Communicate -- This is perhaps the most critical. Communication cannot just be internal, customers need to understand this as well.

 

 

I thought this was a great presentation that connected the dots between customer and employee behavior.  As well, it was an honest look at a very complex organization that has gone through dramatic changes and has managed to keep the focus. I'm looking forward to seeing Symantec's future progression on this journey.

 

Click here to download the presentation.

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Fred Reichheld has been thinking about the link between customer loyalty and a company's financial performance for 30 years. Somehow recently Fred has sparked a negative response from the market research community. So there you have it, a picture of Fred as the devil. Fred makes the point that Net Promoter is not intended to be the world's best predictor of future performance. Perhaps the best predictor of future performance is superior management based on intense focus on the customer. NPS is a tool for managers to drive a customer-centered strategy. That indeed is likely to lead to improved performance in the future.

 

 

NPS is different because it is motivational, it encourages people to want to invest in a relationship. The real goal is to turn everyone into a 10. Wouldn't we rather do business with someone whose customers are likely to strongly recommend them? Wouldn't you rather work for a company who delivers such value that customers strongly recommend? It is rather simple. More fundamentally, it strikes at the universal basis of good relationships -- the Golden Rule. Southwest Airlines, Four Seasons, and eBay, as examples, all practice the Golden Rule. Look at the eBay feedback system. eBay sellers need to maintain a good reputation by treating people right, otherwise their trust score dives.

 

 

How many people have gone to jail for fudging financial numbers? I think we read about it weekly. How many people have gone to jail for fudging loyalty scores? That would be zero! Fred's point is that our value system is controlled by the profit motive, without attention to long term value. Companies get away with bad profits all the time. Yet all of the companies who practice bad profits measure some form of customer satisfaction. Fred's slide pictured this as a gorilla (financial accounting) against a puppy dog (loyalty measures).

 

 

NPS is radical because it forces bad profits out of the system. NPS, if applied correctly, will come into conflict with short term gain. The Golden Rule does not come for free.

 

 

The business inspiration for NPS was Andy Taylor, CEO of Enterprise Rent-A-Car, who commented that the real way to know if your business is going to grow, is if your customers will come back and bring their friends. Enterprise took the customer satisfaction survey out of market research and put it in the hands of operations. To keep it simple he reduced the survey to two questions: "Would you recommend?" and "Why?" The field was made responsible. Promotions were tied to the results.

 

At Enterprise, cheating on or fudging the numbers will cost you your job. So the core learning here on NPS is primarily front-line, bottom-up oriented. Fred made the point that many people believe in NPS, but then turn it into a survey administered top-down and tied to bonus. NPS is intended to drive fast front-line changes that will improve customer experience; a measure that drives fast change.

 

 

Fred then presented the case for segmenting your business to focus on the strategic drivers of growth; accounts he calls "angels". Angels are accounts that are profitable and are promoters. Fred asked who in the audience knew their angels? I didn't see any hands.

 

 

Fred went on to talk about the Charles Schwab story of taking a -35 NPS in 2004 to a +23 in 2007. Success was a combination of a localized effort, training, and root cause analysis, etc.

 

 

Fred closed with a reiteration of linking the Golden Rule to NPS. It is simple in concept but there is a test to make sure you are applying NPS:

 

  • Are you categorizing promoters?
  • Is there a systematic process in place for reducing number of detractors?
  • Is there a process in place to identify and grow profitable promoters?
  • Is there leadership commitment?

 

 

Fred was asked what to do if you don't have close contact with your customers. He mentioned in response, that one way to remedy this is to build an online community for customers. He referenced his work with Intuit's Inner Circle customer community and Informative, which is now part of Satmetrix. He suggested this is a good way to get close to customers and to engage them in conversations that will drive improvements.

 

 

Fred reiterated this in a second question suggesting that a community is a good way to get customers talking, learn ways to make improvement even before rolling out a full-blown program.

 

 

Fred then responded to a question on NPS and employees (B2E). He believes we now need to look at how we can use NPS to transform employee management. He talked about how Bain ranked managers based on their NPS scores from their team members. The scores were published and the bottom half do not get promoted.

 

 

Throughout the session, Fred spoke to the battle between the Gorilla (financial accounting) and the Big Dog (loyalty scores with teeth). The issue is how to give power to the Golden Rule.  Enterprise is a pioneer.  All impactful implementations of NPS will drive cultural change that focuses on customer loyalty; The Big Dog.

 

Click here to download the presentation.

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Kip Knight, Vice President of Marketing at eBay, spoke about Investing in Community and NPS to Drive Customer Loyalty. 248 million people are registered on eBay creating a worldwide online marketplace.

 

Over 1.3 million people make all or part of their living on eBay. eBay defines community as everyone who has a relationship with eBay including buyers, sellers, employees, and users of Skype to select a few examples. eBay sees community as a strategic differentiator. Members actively engaged with eBay have a higher NPS, sell more, buy more and in general are more valuable customers.

 

 

The eBay community as defined has both online and off-line components. eBay Live events are a significant part of the eBay community initiative. Online, eBay has a number of channels including The Chatter which is a blog that keeps eBay community members aware of what is going on. Also, the Voices Program is an ongoing group of 300 active members that are invited in four  to six times a year to function as an advisory group to eBay management.

 

 

The first loyalty tool at eBay was the Feedback System which was a way for the community to monitor itself. While the system is widely used, eBay still felt NPS was needed and has made it part of eBay's DNA. In fact, NPS is the only forward looking metric eBay uses. NPS is measured top down via an ongoing sampling of buyers and sellers. Bottom up NPS is measured at the transactional level. eBay is able to tie NPS to other online behaviors. NPS is used as a "Red Alert" to reach out to at risk, high value buyers.

 

 

The NPS program was not launched until this year, 2008. Counted as an early win is the fact that senior executives are now reading customer verbatim statements. And internal NPS workshops are driving action. A key early learning from implementing the program is knowing what to centralize and what to delegate; centralize data gathering, delegate insights and evangelism. The learning process is ongoing.

 

eBay's online community is the company's biggest asset. NPS is a primary used vehicle for staying in touch with Community members. While there were challenges in implementing NPS at eBay, it was considered well worth the effort.

 

 

One question from the audience was: Have you been able to track the value of an eBay community member? Kip responded that eBay is putting measures in place to link NPS with behavior. From this they hope to build a Net Promoter economics model.

 

 

A second question was "Why did he recommend a company take its time implementing NPS?" Kip made the analogy to "test markets." It is important to learn first since it is hard to recover from a false start.

 

Click here to download the presentation.

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Virgin Media launched their Net Promoter Program in 2007. Sean Risebrow, Director of Customer Experience at Virgin Media, is at the helm of the program, and he was at the conference to share their experiences and how they operationalised NPS the Virgin way. To date, they have collected 250,000 responses and are still actively collecting and taking actions driven by their customers' insights.

 

 

Who Is Virgin Media?
Virgin Media came into existence in 2007 as a result of a merger between Virgin Mobile, NTL and Telewest. Quadplay is the name of their game. To provide the context of the scale and complexity the program needed to achieve their goals and objectives, Sean asked the audience to think about the number of Virgin broadband customers that go through the sales process, installation, billing and how the cycle repeats when they move. Then think about the number of times these customers would call Virgin to talk about the problems that they are facing and finally think about the number of times customers would access their services throughout their relationship with Virgin. These figures rise at an exponential rate resulting in billions of customer interactions for the 14,000-strong organisation who is by far, the largest Virgin organisation in the world.

 

 

What Did They Measure and How?
Their goal was to develop a program that could continuously tune into the voice of the customer at an individual employee/customer level across the whole range of experiences. In-depth research has gone into helping Virgin Media identify the following significant customer journeys:

 

  • Join
  • Help
  • Change
  • Pay
  • Use

 

 

To address the different nature of these journeys, Virgin decided to run both operational and relationship surveys. There are 26 versions of the operational survey alone to measure the "Join", "Help" and "Change" journeys. The core essence of the survey was maintained throughout the versions with variations to capture the different types of events and the different lengths of the survey. These were the 3 core questions they asked in the short version of the operational survey:

 

  1. Would you recommend us?
  2. Why have you given us the score?
  3. Are you willing to provide us with more information?

 

 

Logic was built by Satmetrix into the survey to allow the answers to the third question to trigger the closure of the survey or the extension of the survey to capture further information unique to each journey. The quantitative nature of the additional insights helped to provide robust statistical measures of the relationship between each journey's touchpoints and the recommend score. Together with customers' verbatims from the second core question, Virgin was able to identify the key drivers of recommend and was able to diagnose areas that needed further improvements.

 

 

The other type of survey developed was a Relationship survey to capture their customers "Pay" and "Use" journeys and these followed the same design principle as the Operational survey.

 

 

What Have They Learned about Measuring and Rolling Out NPS?

 

 

  • Tracking one meaningful number was the vehicle they used to focus the entire business around what matters most to their customers. NPS provides a single, simple measurement across the business that everybody understood, from the front lines to the CEO. Is it cost-effective? Yes it is. They spent 50% less to collect feedback but are getting more actionable insights for the investments made.
  • "You cannot mobilize the whole organization unless you create a company-wide view". He believed that this was best achieved using a big bang approach, rolling it out across the business versus a phased approach. In total, they took only 19 weeks to launch the project across the whole of Virgin Media.
  • Understand the significance of survey timings. Conscious of accurately capturing the true customer perception of the complete journey, Virgin looked at all their customer journeys and identified the appropriate events to trigger the survey to capture customers' perceptions of how well they kept their promises rather than the customers' perceptions of their initial promise. For example, if they asked the customer immediately after they have contacted Virgin to arrange for a "Move", they may not be accurately measuring the whole customer experience of moving house until the move has been completed.
  • There is zero value in just the score alone. In the first 12 weeks they refused to release their NPS to the business, as they wanted their employees to focus on engaging with the customers and not just following the score. "The competitive advantage comes from what you do with the data".

 

"It's the promises we keep and not the ones we make that drive customer advocacy."

 

 

Let Customers Tell You in Their Own Words What Matters to Them
There will always be a small number of key drivers. People can become so focused on data that they stop hearing the real voice of the customer. This goes to the very heart of what Net Promoter is all about.

 

  • Get the right things right
  • Customers' expectations are reasonable
  • Customer-facing groups and not central teams are the primary stakeholders of the Net Promoter data.
  • There are 1-3 things that customer truly value

 

"The key is not to feel overwhelmed by customer data and think of them not from your perspective but from a front-line perspective". They went to each touch point owner and selected 10 comments from detractors to get them to focus on customer feedback. All their action plans were focused on reducing detractors. When they first started the program, they had the same number of customers who gave them a score of 0 as customers who gave them scores of 10. Today they have reduced the number of customers who gave them 0s by 30% but have grown significantly the number of promoters.

 

 

Everyone needed to see the impact of his or her interactions and decisions on the customer experience. They recognised that every single transaction was important to their customers and it needed to be equally important to them. Driving the voice of the customer to the frontlines meant that results were disseminated across the organisation and even managers took to working frontline jobs some part of the time. "If they are not working for the customers, they better be working for someone else who is."

 

 

Unleashing the Power of their People

Focusing thousands of employees on what mattered most to their customers meant shifting the focus from the mechanics of measure, publish and pay, to focusing on winning hearts and minds. They now have a "10" wall where they post comments from customers who gave them a Recommend score of "10," to share their strengths across the organisation.

 

 

For Virgin Media, it was all about the right data in the right hands in the right way at the right time. Everyone needed to know what they were accountable for and they provided dashboards that were relevant to each individual to drive actions. They were fortunate that the Virgin staff wanted to proactively do the right things. For example, a team leader from Manchester who shared with her colleagues in other regions the actions she took based on the insights.

 

 

"It is impossible to win the loyalty of customers without first winning the loyalty of our people."

 

 

Success Takes Time
Without action, any loyalty program is a waste of time. Virgin made a conscious decision to avoid focusing purely on the ultimate value of their data. Instead they recognised that the true value of the program came from the improvements they made across the business.

 

Their customers judge them from end to end, so it was important for them to keep a clear focus on the single most important thing for the customer, and get that right. This is about deciding how they allocate their investments to tackle the number one issue that the customer raised. Their definition of a successful team isn't the team who addressed the broad customer issue and not raise the score, but the team who was focused on improving their key drivers' performances.

 

"Fixing broken processes and fixing customer issues build the platform for winning customer advocacy."

 

 

Improving Advocacy Is Not a Spectator Sport
All parts of the organisation needed to act and move in the same direction to improve their Net Promoter performance. For example, their Managing Director asked 25 directors to name 12 issues raised by customers. The first time they were asked, it took them 13 tries. The second time they tried the exercise, they were able to correctly identify the issues the first time. Key success factors were:

 

  • Keep it simple and easily understood by everyone.
  • Constantly reinforce the importance of staying close to the customers.
  • Create a cross-divisional group empowered to make the big decisions.
  • Let customers drive the focus of improvement efforts.
  • Embed into the organisation - successful customer experience management programs aim to embed skills and knowledge in their operations and not the centre.

 

When they started the program, they did not have a central division empowered to drive the vision. At the start, there were a lot of conflicts in how they measured customer loyalty. They were measuring it from their business process view but not the customer view. Now in Virgin, customer perception is all that matters and customer perception has become the driving force behind improvements to their operational processes.

 

 

Key Learnings

 

 

  • Develop early proof points. Their focus on first contact resolution resulted in less cancellations.
  • Create an early snapshot of the cost to the business and value to their customers by touch points.
  • Stop spending money on the things that customers do not value.
  • Market level scores are more interesting than they are actionable.
  • Connecting dots between operations, financial and loyalty data takes time.

 

 

 

No Excuses, the Secret of Success Is Not That Secret
So far, the Virgin Net Promoter program has been successful in being a catalyst for cultural change. It was a simple concept to understand and rally around, a continuous feedback mechanism where everyone from the front line to senior management could clearly see the impact of their interactions.

 

"We did this to benchmark ourselves against other organizations. We wanted to execute the program better than anyone else. This was our operational model:

 

  1. Collect and distribute customer feedback.
  2. Interpret the data.
  3. Mobilize the organisation around what the customers told us in their own words.
  4. Operational delivery: it was about consistently being the best at each touch-point that mattered.

 

Right data, right hands, right way and right time"

 

Click here to download the presentation.

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Laura Brooks from Satmetrix discussed the importance of building trusted relationships with customers and employees and how that results in the economics of word of mouth. She started with recent research in high tech, financial services and telecommunication industries that showed trusted relationships had a stronger correlation to recommend scores then product or service performance. This was true of vendors with both one-off point solutions as well as broader solutions. Product innovation is not sufficient, buyers want a trusted partnership.

 

Critical to building trusted partnerships with customers is having trusted partnerships with employees.  She referenced other conference speakers that shared the importance of engaging employees in improving NPS scores. More mature Net Promoter programs go beyond engaging employees to evaluating the Employee Net Promoter Score (EPS). Without loyal employees you cannot create loyal customers and achieve results. Employees want to be valued and know their values are in alignment with the organization. Drivers of employee loyalty include being consulted, collecting their feedback, and rewarding for results.

 

Employee Promoters are more likely to be customer facing. People feel they are valued in these roles and they feel their contribution is important in the context of the company's strategic direction. The Allianz presentation yesterday discussed how they connect the front office to the back office. Laura suggested that getting both the front office and back office people following up with customers helps the back office employees better connect to the customer.

 

Now that we have discussed trusted relationships with both customers and employees, let's connect that to word of mouth. Most of us know that the old advertising model of broadcast communication is broken: 76% of people don't trust advertising. Today's marketing is about word of mouth. According to Forrester Research, 80% trust word of mouth more than any other source.

 

Word of mouth is no longer constrained to the water cooler. Research shows that word of mouth is on the rise. The Net Promoter research data shows referrals increased 8% over the last year across all industries and in some industries as much as 18%. This is largely driven by consumer generated media and online social networking.  It is estimated that the top dozen social networking sites have over 30 million users. In this connected world, people desire dialogue with brands and with each other.

 

Next, Laura introduced the concept of NetWorked Promoters, those that are more connected and tend to have a bigger impact on word of mouth. NetWorked promoters are a special subset of your promoters.  They refer more, are more socially connected and credible and tend to be more charismatic.  When studying online communities she found that 80% of the ideas voted as most popular in the community typically come from this group.  Focusing efforts on the few NetWorked Promoters can extend reach and influence over a large number of people.

 

Let's now look at the economics of word of mouth. Customer value is made up of both referral economics and buyer economics. Net Promoter measures both loyalty and total customer worth that lead to organic growth.

 

Laura shared research from 2007 for the B2C computer hardware industry and mentioned two other studies coming out, one on the credit card industry and the other on the wireless industry. In this model Satmetrix found that the B2C hardware industry has a NPS of 27%. By contrast, Apple has a NPS of 78%. She then shared how that impacts the bottom line.

 

  • Promoters spend more. The research showed Apple customers spend 1.5 times more than the industry average and promoters spend 1.3 times more. Apple Promoters refer positively on average 90% of the time vs. 75% for the industry average.
  • Referrals. The research showed that in the B2C hardware industry, average promoters refer 78% of the time and detractors have negative referrals 29% of the time.  But detractors have 4 times the impact than promoters.

This research has been put into an economic model that would be difficult to describe on this blog.  CLICK HERE to download the white paper, titled Net Promoter Economics: The Impact of Word of Mouth.

 

The key takeaways from Laura's presentation

 

  • Today's buyers want trustworthy relationships with your organization.
  • Strategies for building trust based relationships include Employee Promoter Score (EPS) and NPS
  • Word of mouth economics are driven by buying and referral behaviors
  • Promoters spend more and refer more
  • NetWorked promoters have higher referral rates through connected word of mouth
  • The key to Net Promoter economics is TRUST.

 

Click here to download the presentation.

 

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I really enjoyed hearing Jana Eggers, the CEO for Spreadshirt, share her thoughts and "lessons learned" about NPS. A lot of what she shared can be applied directly to other businesses considering NPS as a key part of how they listen and respond to their customers.

 

 

One of the first things I learned during Jana's presentation was about Spreadshirt, the company she's managing as CEO. Spreadshirt is an internet enabled company that's a worldwide leader for creative, personalized apparel. It was started by a grad student in 2002 in Germany and has since grown to over 250 employees.

 

 

Spreadshirt has a direct-to-consumer business (with 700,000 customers) as well as 500,000 "shop partners" who design and sell customized T-shirts online via using Spreadshirt's platform and production capabilities. They've also got some large corporate clients such as CNN (where you can order a current headline on a T-shirt or jersey...how cool is that?).

 

 

Spreadshirt's key users are consumers who simply want to express themselves in a wide variety of creative ways through words and graphs on various types of apparel. Unlike a lot of their competitors, there's no minimum order quantity and they're proud of the "value for money" they offer their customers.  Another key selling feature is most Spreadshirt orders are shipped within 48 hours of being submitted.

 

Before coming to Spreadshirt as their CEO, Jana spent some time with Intuit where she became a big fan of NPS. Intuit was one of the "early adopters" of Net Promoter and continues to be one of its biggest advocates. Jana successfully used verbatims from NPS surveys when she was in charge of QuickBase at Intuit to help identify and implement quick wins in the business.

 

 

When she arrived at Spreadshirt last year, the good news was the company was already a consumer-centric culture. The challenge was it didn't have an overall guiding customer metric for the customer voice to be heard. They needed a way to talk and think about their customers and needed to break away from the tendency to say "if customer service hasn't heard about an issue, it's not an issue we care about".

 

Jana has used NPS to make sure Spreadshirt has an aligned way of listening and responding to their customers from all over the world. She implemented NPS across all the business units in 2007 and made sure NPS data was an integral part of everyone's SMART goals (i.e. specific, measurable, actionable, realistic and time bound).

 

 

Jana initially rolled out the NPS program in her core markets in three languages (German, English, French) with an email survey sent out to customers once a month. They have now included all their markets and do automatic email mailing after an order is placed or set-up.

 

 

They've also learned the wording of the invitation e-mail (such as subject heading) has a significant impact on the response rate to their NPS surveys. Based on this insight, they are continually experimenting with different e-mail subject headings and wording to improve their response rates.

 

Spreadshirt has developed some key early insights due to NPS which has led to a better understanding of their customers. For example, they've confirmed that Promoter re-order rates are 60% higher than that of Detractors. Additionally, customers who don't respond to their NPS surveys tend to have a similar NPS score as Detractors.

 

 

Having worked with NPS before at Intuit, Jana also appreciates that while the overall concept of NPS is simple to explain, it can be quite challenging to implement effectively across different markets. Another key lesson in implementing NPS she's applied at Spreadshirt is the critical need to balance short term vs. longer term issues.

 

 

For example, if you focus solely on long term issues, there's a danger of the organization giving up when they don't see progress in a relatively short time frame. If you focus solely on short term issues, you ignore the bigger strategic issues that are going to cause major problems in the future. The art and science of NPS is how to find the right mix of addressing both types of issues at the right time with the right team and resources.

 

 

Now that NPS data is coming in continuously from the various Spreadshirt markets, they've created an NPS dashboard that has all country data available for easy access. There's a "general assembly" for all employees held every month to review current business performance with only two PowerPoint slides (which should be a "gold standard" for any management meeting!). The first slide shows the number of shirts shipped the previous month and the second slide is an update on NPS data.

 

 

That's it...two slides....talk about focus!  And it highlights the importance that NPS has at Spreadshirt to all employees on a regular basis.

 

 

A major point Jana made throughout her presentation is teaching all employees, especially new leaders, about the importance of NPS. Everyone in the organization should be familiar with your NPS scores and key drivers behind the scores.

 

 

It's important everyone in the organization understands you will get different NPS results due to cultural differences. For example, the US and UK scores tend to be higher than those from France and Germany.  Additionally, smaller countries tend to have greater flux in their scores than larger countries.

 

That means there's a real risk of managers turning NPS scores to a contest to see "who's #1 and who's not". This belief would be a major detriment in making NPS a core part of how they manage the Spreadsheet business.  To make sure this doesn't happen, Jana emphasizes that while everyone naturally likes to be #1, the important thing to remember is it's all about improvement in their NPS scores, not the absolute number.

 

 

So what's next for Spreadshirt and NPS? Jana outlined three key areas, including:

 

 

  • Understanding success factors that drive strong NPS scores
  • Continue to study country specifics (and what's needed to improve)
  • Benchmarking against other companies

 

 

That's it for this blog...now I'm going to think of a snappy NPS quote that I can put on a shirt and order on the Spreadshirt website!

 

Click here to download the presentation.

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Glenn Rogers, Director, Customer Experience, at Logitech presented a compelling business case based on his experience at Logitech on how NPS data can be used to prioritize and guide new product development as well as help transform a product focused culture into a consumer oriented one.

 

 

As background, Logitech is one of the leading providers of computer accessories (such as keyboards, mice, webcams, etc) in addition to a growing array of other popular consumer electronic products (such as Harmony, a no-brainer remote control that works with a wide variety of DVD players, TV's, etc).

 

I was surprised to learn just how complicated Logitech's business is, with 6 business units and over 100 new product launches every year. With such as large number of new product launches, quality isn't always consistent and there's the risk of alienating early adopters of a new product when quality isn't where it should be.

 

 

An additional challenge Logitech faces on a going basis (a challenge other consumer electronic companies face as well) is the relatively short "shelf life" of the product lines; the average Logitech product life cycle is only about 18 months! This requires constant innovation, which they've been quite successful in achieving over the past 25 years with an impressive 25% CAGR revenue growth.

 

As with many engineering driven companies, there is a strong focus on developing the next great product rather than starting with understanding what consumers really want (which is probably why none of us non-engineer types can ever figure out how to program our VCR's). Engineers intuitively want to know how to identify and fix "the bad stuff" (which is what Detractors are great at pointing out). Getting engineers to understand and appreciate what Promoters love about a product is a much harder concept to get across.

 

 

As a result of this challenge, Logitech has wisely chosen to go through a culture change while the business is good which will be heavily dependent on NPS as a "true North" guide to focusing on both Promoters and Detractors (and understanding what they both need).

 

 

Concurrent with this culture change initiative, Logitech re-organized the business in April 2007 with an EVP of Product as well as a CMO/SVP of Customer Experience (which includes marketing, customer support, customer experience and quality). The driving force behind these changes was a belief in "The Boomerang Principle"; i.e. the primary role of the business should be to focus on persuading current customers to return (i.e. creating promoters). This is a key principle many different types of businesses have confirmed is true; for example, 80% of Starbucks revenue comes from customers that come 18 times or more a month.

 

 

The re-org included the creation of a Customer Experience vision for Logitech, which is "a collective attitude that delivers on our Brand Promise by creating customer loyalty that leads to enthusiastic lifetime promoters who love and share Logitech experiences."

 

This long-term vision highlighted the need for two key priorities for the newly created Customer Experience team Glenn is creating:

 

  • Incorporating the "voice of the customer" into new product development
  • Integration of the customer experience into new product development process

 

 

Given these priorities, Glenn has been able to generate NPS scores for all of their product lines (which is very impressive given the large number of products) and is using this data to help improve product quality and processes. NPS is the key metric used to determine if Logitech is improving over time (and is a key input to the "Voice of the Customer" dashboard, which also includes returns to retail, customer support data and internet forum highlights).

 

 

Logitech's NPS journey started 18 months ago with few thousand responses using 5 point scale. This shifted in Q3 to an 11 point scale as well as the validation of NPS scores by product category and by product.

 

 

NPS data is collected via email and they are now generating 40,000 responses per quarter. Consumers are encouraged to go to www.logitech.com/ithink two weeks after a product is purchased. The NPS data is summarized on dashboards which are available to the business units and updated on a continuous basis.

 

 

Categorized verbatims were collected centrally last year (which took 5 full time people) but Glenn decided to get rid of this given the complexity of understanding verbatims from so many different product lines. The responsibility of analyzing verbatims is now with the respective business units who are expected to do regular "deep dives" on what's driving promoter and detractors. Glenn knows they still have lots of verbatims they're not doing enough with but is working on ways to gain additional insights from it in the future.

 

 

Understanding the economic value of NPS is also underway. Glenn is looking into ways to balance the short-term with long-term at Logitech. He's already determined the worst case with a Detractor is -$40 (product return plus negative WOM) using 20 year NPV plus negative WOM. He's still working on learning more about the upside potential that a Promoter has for the business.

 

 

He's also determined Promoters are almost twice as valuable as Passives in terms of long-term value and plans to use this knowledge to evaluate if additional investment in product is going to pay out (which would be a first for Logitech and a huge benefit to the consumer).

 

 

In 2009, Logitech will be expanding NPS to other regions and working to increase NPS response rates from non-software products (such as gaming, audio, keyboards), closing the loop via callback from customer service team and conducting quarterly "Voice of the Customer" workshops with each business unit to review the data and get the resources allocated accordingly.

 

 

In summary, Glenn outlined some key lessons Logitech has learned so far on its NPS journey:

 

  • You need a catalyst to get going (in this case, they decided to make this culture transformation while the business was still strong)
  • Top down support for NPS implementation  is absolutely critical
  • It's a long term journey (i.e. minimum 5 year game plan)
  • NPS is a philosophy that involves significant culture change
  • You need a small group to "own" NPS
  • Data collection is much more complex than anticipated
  • Your customers will thank you for doing NPS since it will improve their experience with products they buy and use on a daily basis

 

 

I've heard a number of other companies that have implemented NPS echo these same valuable lessons.  So for those of you considering NPS for your business, consider these principles to be key to your planning and strategy assumptions (or ignore them at your own peril).

 

Click here to download the presentation.

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Having completed the first day of the conference, it certainly feels that the subject of communities is a growing concept for developing deeper relationships with customers; and a customer community perspective is a perfect partner to a more established loyalty program. Communities and the relationship with NPS were also the focus of the start to Day 2, articulated by a great speaker and veteran of the community concept, Kip Knight from eBay.

 

Now, you would be forgiven for thinking that eBay see their community solely in terms of their online existence but it was great to hear from Kip that their concept of community goes much deeper and wider. Before looking at this further, let's just refresh on the background of the company.

  • Started in 1995, after a year of operations there were 41,000 users on eBay. Today there are over 248 million people active on eBay.
  • The vision of the company is to make it possible for practically anyone to sell practically anything in a worldwide marketplace.
  • At any one time, there will be 103 million items for sale on the site.
  • Over 1.3 million people make a large part or all of their living trading on eBay.

The eBay community itself is defined in terms of including everyone who has a relationship with the company. That really does include everyone --  from buyers and sellers to partners, vendors and associate organisations. This is known as eBay's eco-system and through the online platform and wider community, eBay have developed their strategic differentiation through a unique asset and developed a real tool to promote and develop loyalty and retention.

Perhaps the key driver of the success enjoyed by eBay is the early focus that was placed on a set of values underpinning the business. Those values were outlined as:

 

  • People are basically good.
  • Recognise and respect each person as unique individuals.
  • Everyone has something to contribute.
  • Treat others as you would want to be treated.
  • An honest, open environment will bring out the best in people.

 

As well as developing the online feedback tool, offline eBay has continued to develop the honest, open environment through live discussion events, "Bay In Person" visits, open dialogue and the member advisory group, Voices, who assist with ongoing developments. What eBay has found is that the more a member of the community is involved, the stronger their promoter status. And that involvement should not be limited to the online interaction.

 

So how does NPS fit into all of this? Well, first of all Fred Reichheld's Golden Rule is articulated as one of the core values. Secondly, eBay felt that the discipline would be core to developing best practice improvements, increasing competitive awareness, focusing on incremental investments and really enabling a deep-dive understanding of their members loyalty behaviour. The NPS discipline also appealed because it was based on a simple concept metric, it was easy to articulate and it provided a forward looking metric for the business.

 

Interestingly enough, as with some of my customers, it was not specifically the "Recommend" question that eBay used. After researching and analysing the data, it was found that "Intend to Buy" was a better-correlating metric for their business. They are now moving to "Recommend" as it certainly is relevant to their business and it does allow for more benchmarking comparisons across a wider range of organisations as so many comapnies are using it as a key metric today.

eBay have melded their community and NPS program into a coherent approach to loyalty. It didn't happen overnight and Kip and the team spent time in defining and planning the program (you only get the one opportunity to implement this!), building the foundation and they are now moving into further evaluation and expansion.

 

Kip's key learnings from the implementation are:

 

  • Know when to centralise and when to delegate
  • Never stop learning
  • Process is king
  • One size does not fit all

 

And yes, it's not simple in any organisation to implement a loyalty program -- it comes with its own set of unique challenges; but as Kip ably demonstrated -- it's worth it!

 

Click here to download the presentation.

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Conny Kalcher from LEGO Company addressed the topic of growing brand ambassadors.  The name LEGO comes from Danish words that mean "play well," and most agree that LEGO makes that a driving passion for the company as well as for the customer/consumer. Did you know that there are 52 LEGO bricks for every person on earth? In many cultures, when the idea of creative play is discussed, LEGO enters the conversation.

So how is it that a company with such focus on play could hit hard times, even face the possibility of bankruptcy?  Conny suggested that perhaps it was the loss of a keen focus on the customer. She shared how the grandson of the company founder reentered the picture and restored focus on the essence of the LEGO brand - the customer experience.

 

The more connected a customer is to LEGO the more they spend to get the LEGO experience. The company's strategy, then, is to leverage various customer touch points to get to know their consumers and create a special connection with them.

 

One way LEGO builds that connection is through the Kids Inner Circle. Members get the opportunity to talk about their experience and, as a reward they get an inside track to LEGO news. The kids participate in blogs and adaptive conversations (a unique way to get collaboration on ideas). They get to see how their ideas are being accepted by others and used by LEGO.

Net Promoter is a key metric to track connection with the customer. Conny pointed out actions the company has taken to improve their Net Promoter Score (NPS), such as changing packing materials and working to improve fulfillment. Monthly reports provide Net Promoter Scores and action plans, and all parts of the company share NPS KPIs, driving a focus on the customer experience.

There are over 70,000 YouTube movies on LEGO, over 200,000 LEGO pictures on Flickr and a LEGO search on Google returns over 50 million hits.  LEGO is taking an organized approach to this popularity, with Promoter programs such as LEGO Club, AFOL (Adult Friends of LEGO), LUGs (LEGO User Groups), Brickfests, LEGO Professionals and others. (I have personally attended a Brickfest in Washington D.C. and the LEGO section of last year's Maker Faire in the San Franciso Bay Aarea. If you want to see examples of truly engaged customers, I recommend you attend!)

 

What LEGO has found is that openness and dialogue with customers pay off. LEGO has, in essence, extended the boundaries of the company to include its advocates. Lead user involvement and co-creation are a growing part of LEGO's business and they are implementing business strategies that put the customer in the center of their business. While NPS plays a central role in driving customer-centric behaviour, it needs to be implemented alongside a customer-centric culture and engagement programs such as LEGO's Club and the Kids Inner Circle, to deliver the desired results.

 

Click here to download the presentation.

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From the presentation delivered by Conny Kalcher from LEGO Company, there were a number of points made from which you could choose a key takeaway such as...working for LEGO is so cool! to the importance of understanding your customer affinity groups and how to segment them.

However, for me there was one comment that stood out from all the others Conny made: "Listening to the customer is a commitment to taking action."

 

I'd be surprised if there are more than a few people out there unaware of LEGO as a company. Some fantastic facts about them include:

  • There are 52 LEGO bricks in existence per person on the planet
  • LEGO is the largest manufacturer of tyres in the world - albeit very small ones
  • There are over 71,000 LEGO films on YouTube
  • If you search for LEGO on Google you'll get over 53 million hits
  • The 4,400 customers in their top customer segment have a Net Promoter score of 90%
  • The average promoter spends around 50% more than the average detractor

 

With a brand like LEGO, with the passion that generates from both children and adults for their products, are we surprised that their results are so good? Isn't this a case of playing with a stacked deck?

No, that would be a somewhat unfair assessment. LEGO have had their fair share of problems, especially over the last 6-7 years; but their focus on the customer has helped them to keep their heads above water and get back on track once again. A revealing communication from a key UK customer -- a member of AFOL (Adult Fans of LEGO) -- helped to highlight the fact that LEGO were not spending the time listening to customers. That communication went straight to CEO level and the net result was LEGO started to listen actively and translated that customer insight into action.

 

Led by the CED team (Community, Education and Direct), LEGO have re-evaluated their customer affinity groups, changed their action focus accordingly and really reached out to the customers in terms of developing their community of enthusiasts. Tracking key drivers alongside the Net Promoter Score (NPS) has enabled the team to understand the impacts of process or packaging changes, for example, on customer satisfaction. Where action is then taken on that insight, the impact is visible in improvements to their NPS.

 

Conny admits that there are areas where they could still do better. For example, the closing of the communication loop with customers could be more robust. Recent customer feedback from the 9V protest group, however, would indicate that this is improving.

We all need to take action from our customers' feedback. LEGO are, and look at their results!

 

Click here to download the presentation.

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The second presentation of the day was delivered by Dominique Soudais who is responsible for customer experience at Orange. Orange is an international company providing fixed line, mobile and Internet services. They have 170 million customers on 5 continents.

 

Orange uses Net Promoter as a lever for organisational change, referring to it as the "magic KPI."  Their goal is to help customers be more empowered and achieve more where they live, work and play.  Their strategy for growth includes investing in new technologies, such as fiber, that deliver incremental value for customers.  This strategy requires increased focus on customer experience and word of mouth.

 

Why did Orange use NPS as driver for change?

 

  • Customer demands continue to rise and points of interaction expand across mobile, land and internet connectivity.
  • Purchases are more complex, typically multi-step and multi-channel.
  • Consumers have strong expectations for advice and help.
  • Consumers often seek word of mouth when considering a purchase.

 

While Orange has always had a strong customer satisfaction culture, practices were heterogeneous and limited to satisfaction measures. In February 2007 they began measuring NPS. Initially they focused on improving the critical steps of the customer journey and motivating teams to encourage cross-organisational actions. They found that calling back customers was very effective at helping to build a customer-driven culture.

The results are impressive, with an increase of 6 points in 8 months. They have set a target to increase by an additional 10 points in 2008.

Dominique highlighted one of NPS's greatest benefits -- understanding by everyone in the organization.  He went on to discuss the personal element of Orange employees and their willingness to promote the brand and collect feedback in personal settings. This personal association with Promoters and Detractors made them an ambassador for the brand with a personal responsibility to create Promoters.

 

Some of their lessons learned include:

  • NPS is a reliable and meaningful KPI.
  • Create value across the customer journey.
  • Identify where it hurts.
  • Benchmark performance across operational units.

 

 

He shared data that proved a direct correlation between churn rates and NPS, once again demonstrating the financial benefits of NPS.  They also found that Promoters bought 2.5X Detractors.  This is a critical factor in their growth given the cross-sell opportunities their product extentions offer.

 

Among the factors of recommendation, customer experience is the most important, making up 40% of their overall NPS.  Measuring NPS after interactions allows them to continuously improve the customer experience and improve NPS.  He shared two stories of monitoring NPS at key touch points and how the front line was able to deliver measurement improvements in NPS through verbatim analysis and management incentives.

At the end Dominique shared their plans for 2008:

 

  • Gain a better understanding of what creates Promoters.
  • Simplify the customer journey.
  • Investigate a speech recognition tool to collect feedback.
  • Use NPS as a KPI for the general management community throughout Europe.
  • Continue to increase NPS in consumers' minds.

 

Another story of an organisation using NPS to drive cultural change to focus on the customer and achieving measureable results!

 

Click here to download the presentation.

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Delegates are returning from a short coffee break — room is packed again.

Peggy Conley introduces her session by explaining LEGO adopted NPS two years ago as part of a turnaround strategy for company.

NPS has permeated LEGO company culture - focusing the business on customer experience (the key driver of NPS).  Example of CEO receiving letter from customer asking for Space LEGO instructions - and replying personally.

Peggy is talking about critical success factors for NPS deployment:

1) Employees know the score

2) Employees are rewarded for improvements to score (10% of bonus on NPS improvement )

3) Employees feel they can personally have an impact on NPS

First step in building a Net Promoter Program for LEGO involved tracking NPS in surveys (which LEGO had been doing for several years - so they already had basic) benchmark data.

Measuring NPS is involves researching right consumers (core target groups), at the right time  (after brand interactions), and right experiences (experiences over which business has some control)

LEGO measure user NPS as a customer experience metric across 5 key areas

Product Experience (immediate post purchase), Online Experience, Store Experience, Customer Services experience

The LEGO NPS surveys are kept deliberately short - four questions - to get impressive response levels.

Peggy is explaining how all monthly NPS data and actions are summarized on a single sheet that is distributed to the business

NPS data is also used to feed into an affinity segmentation model to allow LEGO to build segment specific initiatives for improving NPS/experience.

 

Different methodology for different experiences - but goal of NPS research is to measure quality of experience and opportunities for improving it.  Key is to turn data/info into actionable insights

Peggy is wrapping up by giving examples of how NPS research is driving business improvement initiatives.

i) how mood of customer services influences experience (NPS) - when engaging an fun experience quality (NPS) increases

ii) how ease of finding instructions on the website influences experience - a site redesign increases NPS significantly

iii) how search and navigation on online store influences experience - usability tests and "deep dives into open comments" identified how to improve experience

iv) how packaging quality influences experience - improved packaging improved NPS

v) how delivery times for online sales influences experience - improving delivery times improved NPS

 

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The room's full overflowing - standing room only to hear Gavin Sugden, Market Intelligence Manager for mobile operator T-Mobile, talk about the T-Mobile experience of deploying Net Promoter.

Gavin's talking about T-Mobile deployment of Net Promoter Score in the UK. At the heart of the initiative is a competitive NPS tracker conducted with a random sample of 3000 consumers by phone every month.

Interestingly, the T-Mobile tracker measures the NPS of T-Mobile and key competitors, reporting scores relative to category average to provide a competitive benchmarking. Smart.

bT-Mobile has implemented a 3 step NPS strategy - Communicate - Understand - Act

1. Communicate - first communicate adoption of NPS internally across the business simply and clearly, emphasizing that the initiative has senior level buy-in, and that improvement to NPS should be a key goal of all T-Mobile initiatives

2. Understand - identify key drivers of NPS with diagnostic research - interviews with detractors and promoters, and correlation of NPS with satisfaction and brand research.

Gavin presents key advocacy (NPS) drivers for T-Mobile

a) Brand Relationship (innovative and forward looking, involvement and knowledge, perception as a big confident brand, customer service and value for money)

b) Customer satisfaction (service, network coverage, value for money)

c) Tariff Popularity (popular tariffs)

Based on understanding of NPS drivers, Gavin explains how to T-Mobile put together a 2 step action plan

Step One of T-Mobile's Net Promoter action plan is to deliver on expectation priorities with a set of improvement initiatives that focus on getting the basics right.  The KPI here is a reduction in proportion of customers who are detractors - who can have disproportionate negative influence on growth.

Step Two of NPS strategy is surprise and delight customers with initiatives that deliver on the key drivers of recommendation. The KPI here is an increase in proportion of customers who are promoters - who will drive organic growth through loyalty and referrals.

3) Act - implement action plan.  Gavin is not giving away any company secrets here about the specifics of the action plan ;-( but he emphasizes the importance of ongoing monitoring of the action plan on the NPS.  Gavin is warning of the ‘hockey stick effect' that can occur when new initiatives are rolled out - a short term dip in NPS reflecting teething problems in delivery - and an expectation/experience disconnect.

Gavin is wrapping up with a summary - is talking about the importance of setting up NPS forum to share learning across the business and to continuously evolve T-Mobile's NPS strategy and action plans.

 

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