the first 10 metrics - part iii

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The First 10 Metrics – Part IIWhere Intelligent Marketing Begins


In the last lecture, we started looking at the metrics that drive our marketing successes…


We learned about the modern purchasing funnel and why it fits today’s marketing scenario better than the original


Then we started talking about the first three metrics – brand awareness, brand equity and the “test drive” – and how each effects our marketing


If you weren’t missed the previous lecture, please download and review it


Metric 4 – Customer SatisfactionCustomer Satisfaction Measured by Asking


CSAT is not the same as awareness and is more closely related to loyalty – loyalty feeds awareness in the behavioral impact model


Brands have established customer bases and these customers have experiences with the product/service that defines their perception of the brand


For example, a major automaker measured CSAT and brand purchase intent finding a one-to-one connection between CSAT and repurchase intention


They found that customers who had problems with their car was more satisfied and had a higher repurchase intent than those who did not have any problems at all.


Why?


Excellent customer service if there was a problem with the new car measurably changed perception positively toward the brand


Therefore, CSAT is the “golden” marketing metric that bridges both loyalty and brand awareness – and can be used as a leading indicator of future sales


So how do we measure it?


On a scale of 1 to 10, would you recommend this product/service to a friend or colleague?


In a CSAT environment, only the people who answer 9 or 10 matter, everyone doesn’t


So here is my question to you –

What product or service would you recommend to a friend?


“Would you recommend to a friend?” is the essential question to define satisfied customers


But does that matter to us – how many people would recommend us?


Fred Reichheld used this question to define another essential marketing metric known as – The Net Promoter Score


The Net Promoter Score is a better metric than the CSAT because it is more accurate


To get the Net Promoter Score – we subtract the average number of detractors (score 0 – 6) from the number of promoters (9 – 10).


The difference is one word in the question – recommend becomes satisfied


Why is this a better metric?


For actionable metrics, it is better to ask a few simple questions that focus the consumer’s attention


Let me give you acouple of examples


A major waste management company in the United States used to call up customers and ask a series of survey questions


These questions started with discussions about customer garbage, pickups, cleanliness of the garbage trucks, friendliness of the workers and ended with a question about satisfaction


Not surprisingly, the detailed discussions made the customers neutral (5 – 7) in terms of satisfaction


Had they started with the question – “How satisfied are you with your waste management?” – the satisfaction numbers would be much higher


DSW is a $1.4 billion discounted brand-name footwear retailer that focuses primarily on women, but also sells men’s shows


DSW offers more than 2,000 styles of dress, casual, and athletic shoes, and in addition sell handbags, hosiery, and accessories. DSW operates 300 stores in more than 35 states and also sells online


They are opening stores at a pace of 10 per year through 2010, and also operates more than 375 leased departments inside stores operated by other retailers


When DSW decided to measure their CSAT, they asked some interesting survey questions


How likely would you be to recommend..

All things considered, how satisfied..


Then they checked future spending


Thinking about the past 4 months, approximately how much have you spent on shoes for yourself at DSW and other stores?


Now, thinking about the next 4 months, approximately how much do you plan to spend on shoes for yourself at DSW and other stores?


To the first question – 37% of DWS customers said they would highly recommend, while 45% said that they would recommend


Why such high levelsof satisfaction?


DSW has an award—winning rewards program which is offered free to all store and online shoppers. Customers build up points to get reward certificates giving them discounts on purchases.


The DSW award program has a 68% satisfaction rate


More importantly, when customers were asked about future shopping, these same shoppers anticipated increasing their spending at DSW over the next 4 months


The ultimate for a marketer is when your customers are so excited about your products/services that they recommend to friends or colleagues


Customer evangelists and fans demonstrate their emotional connection to your brand, so they become the marketing department – everywhere! Their passion adds authenticity!


A customer’s recommendation is the best compliment your customer can ever give your brand


But customer satisfaction is a double-edged sword – ask this question instead


What product/service wouldyou not recommend to a friend?


This question can elicit a strong response – simple maintenance issues, incorrect billing, and terrible customer service


When people talk more about bad experiences – customer satisfaction declines decreasing future sales and damaging the brand


We call this metric the golden marketing metric because it links brand and loyalty in the behavioral impact model


What do we learn?


CSAT is a leading indicator of future sales and is measured through a simple question. By adding related questions, we can also judge future purchasing intent


You have to manage CSAT as actively as you do sales revenue to have a successful brand and company

the first 10 metrics - part iii

Business

brand focused

brand equity

enabled csat

enabled metric

enabled brands

metrics brand awareness

brand purchase intent

enabled fred reichheld