Posts Tagged ‘loyalty’

Would your employees recommend your company as a place to work? Would they recommend you as a person to work for?

Net Promoter Score® is an effective and efficient method to use to check the health of the customer relationship. But, don’t forget the health of the employee relationship. Employee loyalty is just as critical as customer loyalty.

At the recent Net Promoter conference, Fred Reichheld, the creator of the Net Promoter Score® practice reminded us how important it is to include employees in the feedback process and not to separate employee engagement from customer engagement. To read a summary of Reichheld’s thoughts, as presented by Destination CRM, click here.

Reichheld makes that point that engaged, loyal customers create engaged and loyal customers. We have all had the experience of being served by a miserable customer service agent and how that can ruin your day. On the other hand, being served by someone who is happy in their job and committed to providing excellent customer service makes all the difference in the world. Guess which one is going to create a loyal customer?

So, why don’t companies make more use of NPS® to measure employee loyalty and engagement? Perhaps they don’t feel the need, or they may not want to know the answers.  But, according the Reichheld, it is as easy as asking just two questions:  “How likely are you to recommend this company as a place to work?” and “How likely are you to recommend your team leader as a person to work for?”

Measure the health of your employee relationship and you’ll have an insight into the health of your customer relationship.

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@promotersrecommend.com

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.

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If you’re like me, your wallet (or purse) is crammed with so-called loyalty cards. They come from grocery stores, pharmacies, gas stations and even credit card companies themselves. But, are they really loyalty cards or are they just rewarding frequent purchases? Are they effective?

Do these cards increase purchase frequency? In my case they do. I will buy my gas at the same station every week because it offers Air Miles.

Do these cards drive product preference? Yes, because I try to use only my MasterCard credit card because, again, I can accumulate more Air Miles.

Do these cards result in brand switching? Yes, because I will select a brand (within my substitutable set of brands or commodity products) if there are reward points associated with the purchase.

So, the cards can influence purchase behaviors, which is good for marketers, but do they drive loyalty? Do the cards create Promoters. My response is emphatically NO!

Loyalty is based on an emotional attachment for a product or brand. To paraphrase Fred Reichheld, author of The Ultimate Question, “Have I been treated in a way that is worthy of my loyalty?”. If I have been treated well, received good value, had my expectations exceeded and developed an emotional attachment to the product or service, then I have become a loyal customer and will  recommend a product or service.

Plastic cards are no guarantee that I will be treated well or fairly. They do not create those intangible “warm and fuzzy” feelings that signify loyalty. My use of these cards is a very rational decision, and nothing to do with loyalty. For example, I shopped at a local grocery store for years to amass more Air Miles. On the surface, the retailer would see me as a loyal customer who shopped there on a regular basis and spent lots of money. In fact, I hated the store and shopped there only because it was conveniently located, open 24 hours and offered Air Miles. As soon as a better store open closer to my home, I was gone even though the new store did not offer reward points. I became a former customer overnight because I had a better option. Had I been a loyal customer, they would still have my business.

On the other hand, I have owned 12 Toyotas since 1976. They don’t offer reward points but I have developed a deep emotional attachment with the brand and that has overcome all the disappointments that the brand has experienced in the past year or so. I don’t need a plastic card to give them my business provided they continue to treat me fairly, offer good value and exceed my expectations. I just feel good about the brand.

Those little plastic cards can influence purchase decisions. They can provide incentives to change behaviors. But call them what they really are – reward cards not loyalty cards.

My loyalty is not for sale.

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@promotersrecommend.com

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.

The smallest things can drive customer loyalty. And, the smallest things can drive loyal customers away. It doesn’t take much to make a customer feel valued and appreciated and it takes even less to make them feel abused, cheated and disappointed. Years of effort to build  solid customer relationships can come crashing down over something as insignificant as a pickle.

One way to create loyal customer is to meet or exceed their expectations. Meeting expectations will make customers happy, while exceeding expectations will make customers feel elated. Fail to meet their expectations and they quickly change from Promoters to Detractors and they could be gone forever.

Here is a fun and insightful video from Bob Farrell. It’s about pickles, loyalty and life.

What’s the lesson here? Don’t underestimate the power of the small things that have a large impact on the customer relationship. Don’t underestimate the Power of the Pickle.

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@sympatico.ca.

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.

If you read my earlier blogs, you’ll know that I have been a devoted and loyal Toyota owner since 1976. In the past, I’ve recommended Toyotas to anyone within hearing distance. The cars have been dependable, reliable and, in spite of ongoing price creep, a good value in cars.

But now what do I do? With all the recalls for Toyota products, do I continue to recommend freely, or do I qualify my recommendation? Would anybody even believe my recommendation? Have I suddenly become a Passive?

To make matters worse, the lease on my 2006 Camry ends in April 2010. I’ve been shopping the Toyota dealerships looking for a replacement, but every model I considered has been recalled. I even test drove the Prius hybrid and was seriously considering leasing the new 2010 model. Then, surprise surprise, the Prius seemed to develop software issues with the brakes. How discouraging!

This is really testing the limits of my Net Promoter instincts. Promoters, by definition, are tolerant of missteps by manufacturers to whom they are loyal. They give manufactures a lot of latitude and expect (or pray) that defects are anomalies that will be resolved and fixed. As a long time Toyota owner, that’s what I’m doing.

A report by Reuters indicates that Toyota Canada has ramped up its advertising spending, but the ads are aimed at its existing customers, rather than at new ones. A company spokesperson says that the future is in the hands of customers driving the cars today, not some potential customers. Toyota seems to understand the importance of their Promoters and wants to keep them that way. OK, Mr. Toyoda, I’m waiting to be convinced that all is good in Toyota Land. I’ve got to get a new car and soon. As a Promoter, I’ll give you my business, but you’ve got to give me back my peace of mind.

In the meantime, I’m going to check out the new Hyundai Tucson. Maybe even take it for a test drive. I don’t think I’m going to like this one bit!

 

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@promotersrecommend.com

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.

I recently read on one of the Net Promoter® forums a posting that asked the question “Is my company big enough for an NPS® program?”. The Poster felt that his/her company was too small to benefit from implementing a Net Promoter program.

Although Satmetrix, in their Net Promoter ® Associate training (which I attended in May ’09) claims that nearly 700 of the Top 1000 Companies uses Net Promoter, this does not mean that smaller enterprises cannot benefit from the NPS process and discipline. In fact, NPS could be even more valuable to the smaller company.

In my previous posts, I discussed how NPS identifies the Promoters who become free extensions of a company’s marketing department, not to mention that they are the most profitable customers. So, why should this benefit be limited to only the large organizations like Apple, eBay and Harley Davidson? Small to Medium Enterprises (SMEs) all the way down to the individual Entrepreneur can implement and benefit from NPS. Every company, regardless of size, can use more profitable customers and no-cost marketers to promote their business. And all companies, regardless of size, need to understand the factors that create Detractors.

NPS is very scalable and affordable for the smaller organization. I’ve seen an NPS program implemented for a large North American financial institution as well as a program for a local independent financial advisor with only 300 clients. The basic tenets of NPS apply to both businesses. In other instances, I’ve seen an NPS program put in place for a small entrepreneurial heating and air conditioning service supplier as well as an independent construction crane contractor. Neither company had a large staff nor a long client list, but both CEOs took away some key insights that helped drive their business growth.

The two key issues that seem to be of concern for smaller companies are the costs associated with an NPS program and the internal resources required to manage the program and to analyze the results.

With smaller companies and shorter customer lists, costs are generally contained since the sample size is smaller. In the case of the financial advisor, 100 completed NPS questionnaires were gathered from a base of 300 clients. And since the NPS questionnaire is very short, the telephone data collection (used because of the sensitive nature of the client relationship) proved to be very affordable for the financial advisor. Costs would be even lower for an online survey using a qualified, client identified list. Yes, a larger sample size would improve the statistical significance of the data, but 100 completed interviews from a base of 300 will yield usable data.

Few small companies have a dedicated research department so they should lean on their Net Promoter® Loyalty Partner for the project management as well as the research analysis and reporting. This might cost a bit more, but could pay off in some very valuable insights. In the case of the large financial institution I mentioned, their large research department handled everything but data collection and data tables, while the financial advisor depended on the Net Promoter Partner for the project management, questionnaire construction, list management, data collection, data tables, analysis and final report. One such Net Promoter® Loyalty Partner that provides this type of comprehensive service is Consumer Contact Loyalty Monitor (www.loyaltymonitor.ca)

The frequency of data collection might need adjusting for a smaller company with a smaller client list. The NPS survey might be conducted quarterly instead of monthly, with the data aggregated into a rolling average. Less frequent surveying will also reduce the cost and the risk of over-researching a relatively small client base.

There is one advantage that SMEs have over the large companies when it comes to taking action based on NPS data. The agility of smaller companies allows them to identify the critical issues and swing into action mode very quickly and make any adjustments to the operations or organizational structure. Large organizations, in spite of their best intentions, still take a lot of effort to enact the changes indicated by the NPS data.

A Net Promoter Score™ program does require an effort and investment, but for the smaller enterprise it could prove to be one the best investments they could make to drive business growth and profit. You don’t have to be one of the Big Guys to benefit from NPS.

 

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@promotersrecommend.com

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.

 

Net Promoter™ is the internationally recognized tool that measures the dimensions of loyalty. By asking the simple question, “How likely are you to recommend my company (product, service or brand)?” customer loyalty can be effectively measured and tracked. But loyalty is not a simple concept. Loyalty has many dimensions that involve both the rational (the head) and the emotional (the heart).

The rational dimension of loyalty uses the head in a very logical evaluation of the product or service. Did it have the features I wanted? Did I get the best service? Was it the best price? If all this results in positive answers, then you were probably satisfied with the product or service. It met your expectations and maybe even exceeded them. You were satisfied, but were you loyal?

Satisfaction has a lot to do with initial expectations. I like to use the example of the new owner of a Kia 4 door sedan and the proud new owner of the BMW 335i sedan. After six months a headlight fails and forces both owners back to the dealership for servicing. The Kia owner may be happy that nothing else has gone wrong with this low-cost, entry-level car. However, the BMW is furious that his $60,000 pride and joy is in the shop for something as simple as a headlight. The Kia owner is still very satisfied with the purchase, mainly because expectations were low to begin with. The BMW owner was expecting perfection and is less than pleased that the headlight failed. The Kia owner has a higher level of satisfaction than the BMW owner, based on initial expectations. Who is likely to be more loyal, the owner whose low expectations were exceeded, or the owner whose high expectations were unmet?

The emotional dimension of loyalty engages the heart. Loyalty will be earned when a personal relationship develops between the product or service and the customer. The heart asks the questions: Do they know me? Do they value me as a client? Do they listen to me? Do they share my values? Only when the emotional combines with the rational does true loyalty happen.

Think about the last time you recommended a product or service. How did you feel when asked to make a recommendation? How did you feel when your recommendation was followed? Did you feel good when everything worked out? When you are loyal and recommend a product, you’re really sticking your neck out so you better totally engaged before you do it.

I am a long time Toyota owner and promoter (I’ve owned eleven Toyotas over the years) and I never hesitate to recommend the brand. It feels great when someone follows my recommendation and they become a happy Toyota owner. Needless to say, there are a lot of Toyotas in my neighbors’ driveways. I am very emotionally engaged with the brand.

Promoters, by definition, are emotionally engaged with the product or service they recommend. Passives, however, are not emotionally engaged. Their rational, logical mind may tell them that they are somewhat satisfied, but their heart has not yet created an emotional bond. Passives may not recommend nor stay with the brand. Detractors, on the other hand, may use rationality and emotion for NOT recommending (did not meet my expectations and I do not feel good about recommending).

If you are a quantitative researcher who lives for the numbers, you might be uncomfortable with the simplicity of Net Promoter Score and the short questionnaire used to collect the data. If you are the accountant- type manager who needs massive amounts of data to make business decisions, you may question the wisdom of using a single number to enable organizational change. However, if you are the researcher or manager who understands the complex interactions of the head and heart, you will see Net Promoter Score® as an effective tool to create a customer-centric focus within the organization.

The head and heart work in mysterious ways.

 

 

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@promotersrecommend.com

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.

Anyone can ask the question “What is the likelihood that you will recommend”, but who will trust the answers? Choosing to measure and track customer loyalty is a critical decision for your business. Equally important is the company you choose as a partner for your loyalty data collection, tracking and reporting. As a certified Net Promoter Partner®, Consumer Contact is uniquely positioned as the North American leader in data collection quality with specific experience and expertise in tracking customer loyalty.

When Net Promoter Score® is used as a key performance metric, it is imperative that a qualified, unbiased third party be used for the data collection and reporting. The data must be seen as being trustworthy and collected in an accurate and reliable manner. The data should be an honest, unfiltered representation of customer perceptions and behaviours. The results and methodology must withstand rigorous internal and external scrutiny. If you’re going to trust your customer loyalty data, you need to trust your data collection partner.

When selecting a data collection partner for your NPS® program, consider the following:

1. Do they have the expertise?

• As a Certified Net Promoter Partner®, Consumer Contact has demonstrated that we have met the demanding standards of Net Promoter® and SatMetrix. • Question Based Digital Voice Recording provides 100% verifiable data

• Consumer Contact has over 50 uniquely trained, full-time B2B Executive Research Interviewers who specialize in engaging in conversations with senior executives.

• We are one of the largest independent data collection companies in North America with 5 call centers and over 450 stations supporting 7 languages and all time zones.

2. Do they have the experience?

• We have over 38 years of data collection and reporting experience and are recognized as leaders in data quality and integrity.

• Consumer Contact has been implementing customer loyalty tracking programs leveraging the principle of NPS since 1997, starting with the original Enterprise Rent-a-Car customer loyalty project described in Fred Reichheld’s The Ultimate Question.

3. Are they committed to their clients?

• Our infrastructure and process has been audited by financial clients that require the highest level of security and reliability.

• Each Consumer Contact client is assigned to a dedicated project team of research professionals who are responsible for all aspects of the loyalty tracking project.

• We have our own highly experienced programmers on site to program all questionnaires. We do not outsource our work to off-shore contractors.

• Consumer Contact provides complete data management services to handle client contact files, source third-party respondent lists, tabulate results and create custom reporting.

4. Do they offer the solutions you need to get started immediately?

• We can track and measure Net Promoter Score® data using telephone, online or a combination of both for those hard-to-reach respondents. We are the only company to use patent-pending Quality Triggers™ to validate the quality of online data.

Consumer Contact Loyalty Monitor (CCLM) is a turnkey solution that measures and tracks customer loyalty with less cost and effort. CCLM is especially effective for small to medium size businesses.

• CCLM “Quick Start” surveys provide first-time clients with an easy to use questionnaire template to quickly begin a loyalty tracking program.

• CCLM has a unique “Hot Alert” process that automatically identifies those respondents identified as Detractors who want to be contacted about their experience.

• CCLM provides custom reports by segment, customer type or line of business. The custom reports can be updated automatically and delivered digitally as a PDF file.

Consumer Contact truly understands the importance of Net Promoter Score®. As your partner in loyalty data collection we have the tools, experience and people to make your NPS® program a resounding success.

 

Keith Chapin is a Certified Net Promoter® Associate and Consultant with over 35 years of experience in research, marketing and customer insights. He can be reached at kchapin@promotersrecommend.com

Net Promoter, NPS, and Net Promoter Score are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc., and Fred Reichheld.