Managing Exceptional Customer Service and Customer Experience with Relevant Measures

Professor Jukka Laitamaki, PhDjl142@nyu.edu

New York University School of Professional Studies

Jonathan M. Tisch Center of Hospitality

“If You Can’t Measure It, You Can’t Manage It”

Peter Drucker

Exceptional Customer Service Measures1. Customer Satisfaction Score (CSAT)

2. Customer Retention Score (CRS)3. Net Promoter Score (NPS)

1. Customer Satisfaction Score (CSAT)

From 1 * to 5 ***** Stars

2. Customer Retention Score (CRS)Acquiring a new customer is 5 to 25 times

more expensive than retaining one

CRS = ((CE-CN)/CS)) x 100CE = Number of customers at the end of the period

CN = Number of NEW customers at the end of the periodCS = Number of customers at the start of the period

3. Net Promoter Score (NPS)How likely are you to recommend us?

Exceptional Customer Experience Measures:

1. Customer Journey Mapping and Key Touch Point Analysis

2. Exceptional Customer Service Measures 1, 2 & 3

3. Employee Satisfaction, Engagement, Retention and Turnover

4. Social Media Monitoring: Online Analytics, Buzz Analysis and Social Media Intelligence

Exceptional Customer Experience Measures:

1. Customer Journey Mapping and

Key Touch Point Analysis

4. Social Media Monitoring: A. Online Analytics: Data from Facebook, Twitter, Blogs,

Comment Pages, News Feeds, etc.B. Buzz Analysis: Monitoring and analyzing online consumer

responses and sentimentsC. Social Media Intelligence (SMI): Intrusive and non-intrusive

intelligence from open and closed social networks

Exceptional Customer Experience Business Measures:

1. First Choice for Customers and Potential Employees2. Customer Lifetime Value

3. Share of Customer Wallet4. Revenue Growth

5. Cost Savings6. Profitability

“It ain’t what you don’t know that gets you into

trouble.It’s what you know for sure that just ain’t so”

Mark Twain

Ronni SchorrGlobal Vice President of Marketing

Circles, Sodexo Group

A CEO was flying to London for a Black-tie event. When he landed at Heathrow he realized he forgot his tux shirt. Having to go straight to a meeting with no time to go buy one, he remembered he had Concierge service through his company. The concierge quickly went out and purchased a tux shirt, brought it to his hotel and had it brought up to his room which was waiting for him when he returned to the hotel to get ready for the event.

The customer experience is paramount and a key differentiator-Epicenter of the brands DNA

Voice of the Customers

3 Key Experience Indicator

KEIs provide information to decision makers

KEIs precede or predict business outcomes.

KEIs gives insight intoqualitative findings and customer anecdotes

Key Experience Indicators (KEIs) provide a quantitative score of a specific, important, and actionable phenomenon related to using a product or service. Measuring KEIs has the following benefits:

Who are the Consumers in 2020?

What’s the best way to communicate with this population?

Random Active Passive Persistent Targeted Engagement

Random Customers representing a sample population

Comment Cards used for remediation Survey invite-targeted audience

All can be delivered via mobile

• Gives provider a clear view of how to attract and retain the most profitable customers

• Provides insight into how invest in relationship development

Customer Acquisition Cost

• Provider can intervene and change a negative perception into a positive

• Auto alerts allow for follow-up tasks to be determined for detractors

Closing the Loop

• Motivational tool for a more focused organization to improve products, services and the overall customer experience

Motivation

• Comment sections allow the company to get direct feedback from the customer and ensure they are working to meet expectations

Voice of Customer

Why are these

Important?

MethodsNPS and CSAT

Understanding your customer segment with NPS.

One simple question:

How likely are you to recommend to a friend or colleague?

What does satisfaction depends on?• The product or service• The date of their first interaction• Number of interactions• Geographic locations

*Source: Bain & Company

Using NPSCompetitive Benchmark

Customer Relationship

Touchpoint

Objective

• Competitive comparison• Strategy decisions• Goal setting

• Frontline learning• Organizational learning• Customer relationship enhancement

Who

• Customers• Competitor’s customers

(double-blind research)

• Existing customers(representative sample of census)

• Customers with recent touchpoint experience

Closed-loop

• No • Yes • Yes

Other follow-up

• Data analysis• Cross-functional projects• Major initiatives

• Account planning• Product, policy or

other enhancements

• Touchpoint experienceimprovement/redesign

• Customer call-backs• Coaching for employees

Select NPS Score Examples by Industry

76%

70%

65%

54%

27%

27%

26%

26%

2%

0% 20% 40% 60% 80%

Apple (laptops)

Apple (smartphones)

Apple (tablets)

TurboTax

Acer

Blackberry (smartphones)

Blackberry (tablets)

Microsoft (tablets)

McAfee

Select Technology NPS

69%

50%

21%

2%

0% 20% 40% 60% 80%

Amazon

Netflix

Google Shopping

Blockbuster On Demand

Select Online Service NPS

78%

56%

36%

28%

6%

-13%

-20% 0% 20% 40% 60% 80% 100%

Select Financial Service NPS

HSCA Bank

Citigroup

Morgan Stanley

American Express

Vanguard

USAA (banking)

Source: Satmetrix, Researchscape.com

Devon is the epitome of customer service. She goes above and beyond to help. Great services

provided. Thank you!

Customer SAT Drivers

WE WANTTO BE

THE BEST

Everything we do pivots around the consumers

experience. Every touch point and interaction is an

opportunity to provide exceptional service experience

CUSTOMER SERVICECONNECTION TO WORK & HOME

DIGITAL EXPERIENCEVENDOR NETWORK OMNI-CHANNEL ACCESS

DISCOUNTS & PERKSQUICK & VAUABLE RESULTS

PERSONALIZED EXPERIENCE

ENGAGING EVENTS

Case StudiesCircles and Apple

• Improve internal communication• Ensures that everyone feels at best in their

professional environment

verage NPS2017-722018-63

Timeliness Results Usefulness Results Overall Results

96% 92.8%+80 95.3%

NPS

From traditional reception to the visitor experience of the future

Community Manager• Creates a vibrant atmosphere in the lobby• Helps enhance tenant´s day to day QoL• Offers concierge services

• Organizes events that strengthen the community• Real estate owner´s/clients ambassador• Actively searches for improvements

Average NPS2017-722018-63

Timeliness Results Usefulness Results Overall Results

96% 92.8%+80

“I really liked how detailed my experience

was. I was not expecting such a

service. I am WOW'd. Thank you.”

“Jason was friendly, knowledgeable, and knew exactly what I

needed. Thanks man!”

95.3%

“Love this service so much! Will use them for

many other things coming up”

“Devon went beyond my expectations. This was my first time using the

Concierge Program and with her and James the professionalism was

outstanding. Devon delivered the flowers I purchased to my wife's work after her shift was over, took a photo to confirm delivery and she was very surprise and impressed as well. I will be using the

service more often now.”

NPS

Case Study-APPLE

❑ Start with the Customer❑ Listen to Customers

Apple’s NPS team uses customer feedback to better understand the reason that turnsCustomers into promotors or detractors

❑ Quickly Close the Loop❑ Engage all employees with NPS

A-Approach customers with a personalized, warm welcomeP-Probe politely to understand the customer’s needsP-Present a solution for the customer to take home todayL-Listen for and resolve issues or concernsE-End with a fond farewell and an invitation to return

You've got to start with the customer experience and work back towardsThe technology-not the other way around-Steve Jobs

Average NPS2017-722018-63

Average NPS2017-722018-63

Ken Fordyce, Ph.D. Director Advanced Analytics

Arkieva

View from the Trenches

Ken Fordyce

Summary of Jukka M. Laitamaki, Ph.D. & Ronni Schorr

Analyze the data for the following “uses” from passive to pro-active

• Summarize current status

• Generate alerts

• Determine actions to take

• Estimate impact of actives (DSIM – decision simulation)

What to measure and why

Establish Metrics **

Collect and Store

Data

Analyze data

Responsiveness: capture, identify, and respond

Responsiveness is universal theme

1. Medical treatment, government, factories

2. Supply chains

1. Mattress

2. Cosmetics3. The ability to simultaneously respond to customers’ needs and

emerging business opportunities in an intelligent, orderly manner is a survival requirement for today’s marketplace. Our customers continue to tell us that the quality of our responsiveness is as important to them a the quality of our products.” - Nick Donofrio, IBM SR VP, Technology & Manufacturing,2001,Interfaces, 31:1:123

A Few Basic Analytics Observations

1. Analytics – statistics, data manipulation, machine

learning, knowledge of the application area

2. The bridge from collecting the data to benefits (actions)

3. Analytics methods – evolving over time

4. Clean your data

5. Understand the limits of your metrics

6. All models are wrong, some are useful

Personal Experiences from the Trenches

Avoid over reacting to “random” fluctuations – easier said than done

There is no substitute for “domain” knowledge – knowing the area

being measured

• Example the missing importance of reliability

Personal Experiences from the Trenches

Most of the data collected is categorical (satisfied, neutral, not satisfied), not

numeric (blood pressure). However many firms convert the categories to

numbers to create a single score, beware of scores – they can be misleading

• In this example customers are asked if they are satisfied, neutral, or

dissatisfied.

• To create an index satisfied are assigned a 1, neutral a 2, and dissatisfied

a 3. An average score is calculated as an index of satisfaction.

• Observe Group 1 and Group 2 have time same index of satisfaction (2),

but a very different satisfaction profile.

• Group 1 all neutrals – your customers are neither excited or unhappy,

just ok

• Group 2 has a split personality – half love your product, half hate it

Same satisfaction score, different response

Same satisfaction score, different response

The goal of the analytics

is an action plan, it is

likely the action plans for

group 1 and group 2 will

be different

Q & A