Measuring the customer experienceand increasing customer loyalty, customer retention

and customer acquisition in the process

Fredrik Abildtrup

CEO @ TeleFaction A/S

The Return on Behavior® Company

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About TeleFaction - What do we do?

• TeleFaction is a “Voice of Customer” Company.

• We offer companies with knowledge and tools to increase customer satisfaction, customer loyalty and additional sales.

• We do this through real-time customized closed loop feedback methodologies where we listen to the customers.

Today’s topics

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Agenda

• Why manage experiences?

• Customer Experience Management (CEM) vs Customer Relationship Management (CRM)

• How to be successful

• Case Study – Danske Bank

• How to do it

Poll

Why manage experiences?

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It is though out there!

58% say it is harder to make a reasonable profit, compared to 5 years ago

add the Financial crises to that!

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How to remain successful

• Staying on top is not easy– I.e. Mercedes, General Motors

• Difficult to hide– I.e. Twitter, Facebook, Blogs, websites

• Shopper help each other– I.e. consumerist.com, word of mouth, Google groups

• That also count for small businesses– I.e. reviews by amateurs, ratings etc.

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Your customers behaviour today ...

What has changed over the past 5 years?

• Customer’s behaviors!– Are spreading good experiences, rewarding good service;– Bad news are discussed more frequently due to easy access to

new channels of communication;– Short-term relationship with brands with no bad conscience; – No immediate emotional attachment;– Difficulty to forgive

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The voice of the customer – why is this important?

A big survey, In Customers Are People, shows, that 70 procent of the customers buying decision are based on how they feel they are being treated.

Another survey shows, that 69% of the customers say, that emotions count for more than half of the total buying experience

A survey conducted in Denmark, where the customers were asked if they would change supplier if they had a bad customer experience, showed, that • 32% would change immidiately, • 67% would change if it happened again, and only • 1% would not change

• A good customer experience are told to 8 others• A bad customer experience are told to 22 others• It takes 10 good experiences to make up for one bad

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On which channels?

• 92% of all customer interactions happen via the phone (Gartner)– 80 -90% transactions completed– 84% view Speech as equal to, or better than Web

• 85% of consumers are dissatisfied with their phone experience (Gartner)

• Around 90% of unhappy customers will not buy again from a company that disappointed them

• 68% of customers will switch brands based on a poor service experience (Gartner)

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Be distinct or be extinct

Idea sourced from Tom Peters

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Interactions drives loyalty

High-quality interactionswith people and systems

Lowest price or cost of ownership

Superior products orservices

Percent High Importance

Poll

Customer Experience vs. Management

Customer RelationshipManagement

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CRM to CEM

• The right brained approach to Customer Management

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Build or destroy profits!!!

• Memorable experiences can lead to customer actions that build—or destroy—profits

PleasedComfortableAppreciated

ImportantSpecial

FrustratedLet Down

AngryIgnored

Confused

Recommended to a friend or colleague

Praised a company representative

Purchased more products/services

Continued relationship about the same

Complained to a friend or colleague

Complained to a company representative

Switched to new supplier/provider

Purchased less products/services

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Customer Experience Management…

…is or should be the execution of a customer centric business strategy

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Enterprise managers wear rose-colored glasses

• Survey:– Companies Provide an Excellent Customer experience?

Net Agreement: Customer +4, Enterprises +34

How to be successful

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To get success – be SMART

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Customer Value…

• Companies see customer relationship value this way

Sales

Lifetime valueStrategic fit

Profit

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Customer Value…

• Customers see the value differently

High-QualityEmpowered Employees

Rewards for loyaltyHonest communication

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Metrics – The steering wheel

• Customer focus are visulized through the results of the measurements– The customer says that...– The customer experienced that...

• Translate what you mean with customer satisfaction

• Operationalize your vision through measurements – And rememeber you get what you measure!!!

• Primary areas to create instant results– Customer Satisfaction– Cross sales/Up sales– Operationalization of strategies and values– Retention of customers

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People are the drivers

• The Top 5 attributes of companies that deliver ”Constantly Excellent Customer Experiences”

The key ingredient: People!

1. Well-trained and Helpful Employees

2. Excellent Customer Service

3. High-Quality Goods and Services

4. Friendly and Caring Employees

5. Personal Attention, Reward for Loyalty

Source: Bob Thompson, CustomerThink Corp.

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Redesign Experience

• Customer experiences as parameter for success

– Every contact with the company gives the customer a chance to evaluate if the experience have been bad / neutral / good

– Over time these customer experiences will make a lasting impression of the company’s values or the company as a brand

– Act on the feedback of your customers experiences and reap the benefits of satiesfied customers

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Use technology to optimize experiences

• Assess the quality of customer experiences with telephone, online and contact center monitoring and measurement systems

• Optimize marketing with analysis and campaign management systems to deliver relevant offers

• Treat customers as individuals and reward their loyalty

• Provide tools to help employees be helpful and responsive, including sales coaching and support knowledge bases

Case study – Danske Bank Group

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About Danske Bank

• The Danske Bank Group is the largest financial enterprise in Denmark and one of the largest in the Nordic region.

• The Group serves personal and business customers through banks with nationwide branch networks in

oDenmark

oSweden

oNorway

oNorthern Ireland

oThe Republic of Ireland

oFinland

oThe Baltic states.

• In total, the Group serves 5 million retail customers and a significant number of public sector and institutional organizations. Some 2 million customers use the Bank's online services.

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Why Danske Bank focus on CEM?

• The culture of a company are very difficult to copy, because it is embedded in the people. It also makes it very difficult to change!

– Internet and legislation generates more transparency in all markets. Products, prices, processes etc. can ‘easily’ be compared by customers and/or copied by competitors.

• Danske Bank Group has developed and implemented one integrated analytical set-up for measuring customer satisfaction and attraction in the market.

– Customer Experience in the Moment Of Truth has a key role in this set-up. Other analysis covers other needs.

– An important role for the Moment Of truth measurements are, that they function as a mirror, when reported back to each team on a quarterly basis.

– The discussion is ‘no longer’ a conflict between headquarter opinions, branch managers former experience and the advisors first hand experience about a specific meeting. Now the bank looks forward based on the customers view, and on how to improve the next experiences.

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Where is Danske Bank measuring?

• Danske Bank is a multi channel bank. The customers interact with Danske Bank Group via various channels, medias and forums.

• Danske Bank started implemented the Moment Of Truth measurements – In the channel with the most contacts (contact centers)– And in the channel that created the biggest change

(branches)– Other channels will follow

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How Danske Bank is measuring?

• “Moment of Truth” - measurements on specific interactions with customers– Ask as quickly as possible after the interaction – to have as

‘unpolluted’ answers as possible. – Use the data methodology that are most suitable for that

specific area – to make it easy for the customers to answer, improve answering rate and keep it cost efficient.

– Ask only questions related to the specific interaction, and only questions that can and will be acted upon – to make it relevant.

– Reported back to the people in the organization that can change the next Moment Of Truth - to make it make a difference.

– Targets, benchmarks, change management tools etc. have been developed - to assist the right amount of focus.

– Learn from the best, and follow up where needed – to secure the success.

What kind of results has been achieved?

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Results: Actions can be targeted

Did you get a better advice in the meeting than expected?S

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est

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It is the individual team that can make a difference

Better service

Development over time: Resume on all questions

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Analyses to find drivers

Ser

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Average amount of products offered

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One important finding

• It is not the surveys alone that makes results

– The great leap forward comes when you measure AND work systematically with the results

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Where Danske Bank is using TeleFaction

• Danske Bank Group use TeleFaction in the whole process from data gathering, data structuring, analyzing, reporting, presenting and follow up.

• Next steps in corporation with TeleFaction– Share leanings with other clients– From data to knowledge– Prove Return on Behavior– Develop feedback management system for actions

• More information– Andreas Wessel Knaack– akn@danskebank.dk

Some words on how to do that!

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Obtaining info on customer needs

• Surveys – Automated Telephone surveys– Mail – E-mail– Live Interview

• Focus Groups• Customer Observation• Market Research• Customer Complaints• Call Monitoring The KEY?

It is never ending

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Taking Quality to the Next Level

• You need to have customers evaluate the service delivery immediately after the interaction

• ...the best solution is real-time customer feedback.– Eliminate the gap between service and evaluation– Too late to recover poor interactions – Enhances believability of results

• 50 to 75% less expensive than follow up telephone interviews allowing for continual measurement

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Taking Quality to the Next Level

• Respond to questions using telephone keypad or voice

• Verbatims: capture caller suggestions for improvement– Verbatim comments– In the customer’s own words (capture the emotion)

• Identify and highlight employees that delight customers

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Taking Quality to the Next Level

• Receive alert of a dissatisfied caller!– Pro-actively prevent market damage– Service Recovery Opportunities– Detect Process and Procedure that are flawed

• Frequent reporting of customer feedback– Daily, Monthly or quarterly, Fact analysis– Annual summary presentation– Benchmark scores with others– Frequency to meet management’s needs

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Return on Behavior

• Service quality is not about internal compliance – It is about satisfying your customer

• It is the change in behavior that gives pay-off in terms of customer experiences

High Monitoring scores≠

Customer Satisfaction

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TeleFaction

• Fredrik Abildtrup• fab@telefaction.com• +45 5057 5070

• www.telefaction.com• www.returnonbehaviormagazine.com

• Twitter: http://twitter.com/TeleFaction• Linkedin: http://www.linkedin.com/in/fredrikabildtrup

Backup slides

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Polls

• How frequent are you measuring your customer experience?– We are not

– Daily

– Quarterly

– Bi-annual

– Annually

• Is any portion of your pay or incentive based on the customer experience?– Yes

– No

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Polls

• Do you have a feed-back management process in place for Customer Satisfaction?– We are discussing it

– Yes we have

– Yes we have – it is IT supported

– No

• Are you measuring your customer satisfaction today?– Yes, on postal surveys

– Yes, on postal, web, email surveys

– Yes, on all channels including telephone

– Yes, through other channels like panels, store interviews etc.

– No, we are not

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Developments in customer approach

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Create a customer vision/strategy

Customer ExperienceHow do we ensure that customers get the same experience across all touch points?On which level must the experience be consistent across all channels?

IntegrationHow do we share knowledge of our customers?How do we plan and implement customer activities across the company?How close do we want to integrate ourselves with customers and partners?

Balanced effortHow do we balance our efforts in relation to the customers value?What effect does that have in our activities? How far will we go?How do we focus on loyalty, retention, additional and cross sales?

Customer ExpectationsWhen are the customer in touch with us and why?Which expectations do they have and how do we live up to them?How do we communicate with the customers?What impact does customer satisfaction have on revenue and profit?

Customer ValueWhich customers have which value?How do we measure it?Which customers will we attract, retain or develop?Which service will we provide the defined segments?

Knowledge of CustomersHow do we collect knowledge of our customersIn which touch points?How do we use this knowledge?How can we enrich and increase our own knowledge

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About TeleFaction - What do we do?

• TeleFaction is a global “Voice of the Customer” Company offering real-time customized closed loop feedback methodologies.

• Our core service is Return on Behavior®, a results-driven solution which translates objective customer data into actionable insights.

• These insights provide specific action points for management and individuals to secure revenue, retain customers and increase loyalty.

Measuring the customer experienceand increasing customer loyalty, customer retention

and customer acquisition in the process