Here is the article to go with the last comment

5 steps to effective Customer Loyalty Programs

By Adam Ramshaw (Director)

Increasingly organizations are becoming dissatisfied with their customer satisfaction surveys and turning instead to designing and implementing customer loyalty programs. The reason is simple, after 10 years of running national customer satisfaction surveys the American Customer Satisfaction Index has, basically, not moved at all. This is despite industry reportedly investing USD800,000,000 each year on improving customer satisfaction.

So what to do? Organizations are beginning to understand that itÂ’s not just about satisfaction. In order to improve their businesses they have to implement customer loyalty programs. Customer loyalty programs are different to normal customer satisfaction surveys because the later use outcome as an indicator of past success. The real goal is to understand and improve the areas of the business that drive customer loyalty.

In my experience there are five key steps to implementing good customer loyalty programs.
Step 1: Link customer loyalty to business outcomes

Before you make any investment you need to understand what the potential returns are going to be. The heart of Step 1 is linking your business goals (revenue, profit, market share, growth, whatever) to changes in customer loyalty.

That way you demonstrate the benefits as well as the costs of your customer loyalty programs when you present them to your management.

Start by taking your key business measurements and link them to changes in customer loyalty. If customer loyalty were to increase by 10% how much would profit rise?
Step 2 Find a loyalty indicator

While customer satisfaction surveys are measuring satisfaction at finer and finer levels it is becoming clear that, as a metric, customer satisfaction is not a very reliable measure of loyalty. Customer satisfaction surveys were always intended to be customer loyalty marketing surveys but they are in fact no such thing.

Research is now showing that, depending on your industry, unless your customer scores you in the "top box" in your customer satisfaction surveys, i.e. 5 out of 5 they have little real loyalty to your organization. Lets face it good customer satisfaction is now table stakes -–you have to do better to keep them loyal.

However, recent research (1) has shown that there is one question, the answer to which is a good indicator of customer loyalty. That question is "How likely would you be to recommend us to a friend or colleague".

ItÂ’s simple, straight forward and easy for your customers to understand. But most importantly the answer is closely correlated to customer loyalty and business profits. This question should be in all of your customer loyalty marketing surveys as a key outcome indicator.
Step 3: Identify the drivers of customer loyalty

Every business has a range of attributes that might impact on customer loyalty. If youÂ’re in financial services it could be areas like service fees, line lengths in branches, product features, etc. If your business is a physical product they might be delivery times, stock holdings, and order quantities.

Starting with the one question above, add questions about these different potential drivers of customer loyalty to your customer loyalty marketing surveys. DonÂ’t add too many. Maybe 10 or 15 and make sure that you use a rating scale to collect the customer perception of your performance.

Now comes the most important part: find someone to do some reasonably straightforward statistical analysis on your results to determine which of the drivers are most significant in terms of customer loyalty. There are a few different techniques but correlation and regression analysis are the most common.
Step 4: Implement your customer loyalty programs

Now you have the vital information that you need: you understand the state of customer loyalty and you understand which of your business attributes are most important to that loyalty.

Start by focusing on just a few of the most important drivers that you also believe that you can change. Then simply start making changes in your business.

Perhaps you have found that line lengths in your branches are a key driver of customer loyalty. Work with your staff to identify ways to change you business processes and reduce line lengths. Make sure that you align staff compensation plans and bonuses so that the changes you make will be permanent.

Once youÂ’ve improved the most important areas move on to those that are less important.
Step 5: Re-survey your customers

Remember that the goal is to improve customer loyalty. Marketing surveys repeated at regular intervals will let you know how youÂ’re customer loyalty programs are doing on both customer loyalty and the important drivers of customer loyalty that you have identified.



(1) "The one number you need to grow", Frederick Reicheld, Harvard Business Review December 2004.

Loyalty versus Satisfaction. There is an even better way.

This is an interesting article that lays out some very useful information about about customer loyalty versus customer satisfaction.



The reason I posted it is that I was recently briefed by a business that has 92% satisfaction. Now that is extremely high.



And their problem is that they are going broke!



I fully support the move to loyalty, and it's not enough. The critical move is to create advocates for your business. People who will brag about what you do. That is a combination of a number of things.



Designing customer experiences that engender loyalty and then as well as measuring loyalty, also measuring advocacy.



After all that here is the article.

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The top priorities of a CEO

This information came from a US business that works with CEO's.





Life in Business » Blog Archive » CEO’s Top Priorities

CEO’s Top Priorities







1. Speed, flexibility, adaptability to change


2. Sustained and steady top-line growth


3. Customer loyalty/retention
4. Stimulating innovation/creativity/enabling entrepreneurship


5. Tight cost control


6. Availability of talented managers/executives


7. Cost/ability to innovate


8. Employee loyalty/commitment/job satisfaction


9. Transferring knowledge/ideas practices within the company


10. Succession planning


11. Making investment/capital allocation decisions


12. Aligning IT with business goals


13. Regulatory compliance


14. Making best/highest use of available data


15. Management/board succession


16. Sarbanes-Oxley compliance





Original writing date: June 21, 2005

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The top priorities of a CEO

This information came from a US business that works with CEO's.





Life in Business » Blog Archive » CEO’s Top Priorities

CEO’s Top Priorities







1. Speed, flexibility, adaptability to change


2. Sustained and steady top-line growth


3. Customer loyalty/retention
4. Stimulating innovation/creativity/enabling entrepreneurship


5. Tight cost control


6. Availability of talented managers/executives


7. Cost/ability to innovate


8. Employee loyalty/commitment/job satisfaction


9. Transferring knowledge/ideas practices within the company


10. Succession planning


11. Making investment/capital allocation decisions


12. Aligning IT with business goals


13. Regulatory compliance


14. Making best/highest use of available data


15. Management/board succession


16. Sarbanes-Oxley compliance





Original writing date: June 21, 2005

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Stamford Hotels get saucy!

Stamford Hotels in Australia have started to use viralmarketing by creating cameo videos that peole will pass around. My wife sent me this link. There are a couple of different videos on the website. they are fun and fall into the category of infectious from a viral standpoint.

Here is the link to the page with two clips.

http://www.stamford.com.au/page.asp?3653=406115&e_page=406005

Let me know if there are any other examples of hotels seeking to differentiate themselves.

Iven

Back on and active

For some time this blog has been inactive. My apologies if you have been visiting in search of the latest information. As usual the technical problem was really simple and basically more about me than the machine.

So now it's on with the show.

Thanks for your patience or welcome if it's your first time.

Iven

Bezos does an about turn

2300% growth can’t be ignored. That’s what Jeff Bezos decided when he started looking at the opportunities available on the web. He analysed all the possible products that could be marketed and decided that the one that had the greatest need for upgrading was books. It was a head not a heart decision. Clearly calculated and thought out.

“This was my criteria: picking a category where you could substantially improve the customer experience along a dimension that could only be done on the web.” said Bezos.

To read more about how he built Amazon and why he is going in a completely different direction here is the link.

http://www.alwayson-network.com/comments.php?id=10754_0_3_1_C

Bezos also sets out what’s next and how the business he built with Amazon will not be the one he builds next.

As always let me know your thoughts and give me any feedback you have on this customer experience example.

Iven

68% of Customer Feel Ignored - A great opportunity

That's what a study quoted by the Dean of the Kellogg School of Management, Dipak Jain stated about how American customers feel. I'm sure the numbers in other markets would be similiar.

He talked about how people are feeling like commodities when purchasing and what you can do about it. Here is a link to the full article. He has other interesting points.

http://www.agencyfaqs.com/news/stories/2005/07/06/11951.html

What a great opportunity. It means that at least 68% of the market are available to you and your business if you create an outstanding and memorable customer experience.

Let me know if you agree or disagree with what he has to say.

More soon.

Iven
CEO. Cheif Experience Officer

Over 50% of CRM fails. Want to know why.

You are being judged. By everyone who interacts with your business. Everytime they do.

You can't avoid it. You can't stop it. You can't fight it. But you can manage it!

Every customer or prospective customer gets an experience of your business and how it operates every time they 'touch' it anwhere on your touch map.

The main touch points are: face to face, email, web, phone, fax and mail.

At each point they get an experience. The simple question is this."Is it the experience you want them to have?"

Rik and Janel Villegas in the Saipan tribune put it this way "The experience that customers have with your organization should be a central consideration in the short-term growth and long-term health of your business. The simple fact is that your customers cannot not have an experience. The question, then, is how do you manage that take-away impression formed by their encounters with your products, services, and overall operations; and do it so that your customers have an experience that is consistent with the experience you would like them to have?"

OK so manage the experience. But manage what exactly?

There are three factors that go to making up the customer experience. Your customers could experience them individually or together.

People, Operations and Technology.

Change one and you impact them all! That's why over 50% of CRM installations fail. In most cases the technology is upgraded - a major CRM vendor is usually pushing this - and it's expected that by osmosis the operations and people will adapt as well.

Managing the Customer Experience is about managing all the touch points and their relationship with the people , processes and technology so that they are coreographed to achieve the same outcome.

The keys for 100% success?

Prepare the people for the changes. Train, explian and refrain - refrain from cristisism when it's all new.
Design the operational systems for the new environment so they don't sabotage the new iniatives and ...
Impliment the technology upgrades as the first two are done.

That's it for now. Feel free to comment or ask for topics you want answers on.

Iven

Can't get no respect! 65% fail the test.

The late comedian Rodney Dangerfield had as his catch phrase "I can't get no respect".

The survey says..

According to the latest survey of the top 100 US firms when it comes to online experience neither can they. The Customer Respect Group - yes that really is their name - condcuted their 4th annual Customer Respect Study and found when it comes to respect only 6% rate Excellent; 29% Get a Good Rating and, in these days of privacy paranoia 30% Continue to Share User Information Without Permission.

An the winners are... HP, Medco Health Solutions, Sprint, Intel, American Express and UPS.

How did they arrive at this conclusion? Here is an excerpt from the article.

"By interviewing a representative sample of the adult Internet population, and by analyzing and categorizing more than 2000 corporate Web sites across a spectrum of industries in detail over the past four years, The Customer Respect Group has determined the attributes that combine to create the entire online customer experience. These attributes have been grouped together and measured as indicators of Simplicity (ease of navigation), Responsiveness (quick and helpful responses to inquiries), Privacy (respect for the privacy of the customer), Attitude (customer-focus of site), Transparency (open and honest policies) and Principles (values and respects customer data). Combined they measure a company's overall Customer Respect."

So there you have it. The attributes for your own online experience evaluation. I like this list because it goes to the heart of Experience Management. Anyhing is managable if it's measurable.

Simplicity
Responsivness
Privacy
Attitude
Transparency
Principles

If you need help to evaluate your online experience give me a call. At 'The Experience Managers' we have the expetise you halp you evaluate your situation and more importantly help you create an excellent online experience for your clients.

You can read the whole article by clicking on this link.

http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20050627005850&newsLang=en

Good Experience Engineering

Iven

The start of managing the Customer Experience

The idea of this blog is simple - to bring you the latest and most interesting ideas and information about how to create consistent, stable and strong experiences for your customers. That's it!

The philosophy is simple and its the phrase that drives what I do. "If you give people an experience they can't get anywhere else - they wont go anywhere else"

So stay tuned for information, insights and advice on how to create Incredible Customer Experiences.

Be part of creating an experience!

Makers and Breakers

An Experience is either Made or Broken by what happens to us when we interact with a business. Tell me about what a business you have shopped in, bought from or have a long term relationship does that makes it or breaks it for you.

Every month the best Maker or Breaker story will win a prize from our gift shop. (There has to be an old birthday present I can recycle somewhere here)

Keep coming back to check on what's going on in the Customer Experience world. I promise to keep it interesting, informative and fun. In short a great experience.

Iven