Customer Satisfaction

April 11, 2019

#93 – Complaints management, ‘NPS is dead’ blog, Amsterdam video

Maurice FitzGerald / Customer Satisfaction, Newsletter, NPS, Strategy, Video / customer complaints, Customer Experience, Customer Satisfaction, Net Promoter System, research, Speaking, strategy /

Make it easy for customers to complain. Reactions to my ‘NPS is dead’ blog post. Welcome to the 93rd edition of my customer strategy newsletter. The five topics this week are:

A complaints team is one of the first things you should implement
Reactions to my ‘Is NPS Dead?’ blog post last week
Latest blog posts
Notable items from other sites – My Amsterdam video, Ian Golding
Looking forward

A complaints team is one of the first things you should implement

One of the challenges faced by new customer experience leaders is how to establish short-term credibility. You may have been placed in your new job because of your compelling mid-term vision, or the vision of your senior leadership.

None of that will count for anything if you are not seen to me making progress during your first few months. One of the easier things to implement quickly, if you do not already have it, is a customer complaints process and potentially a customer complaints team.

It is a good idea to have a single customer complaints team for your entire organization. The phone and email contact details for complaints should be visible at the top level of your company website. “Log a complaint” is a reasonably clear heading. If this sounds too scary, consider putting that link on various intranet pages so that your own people can log customer complaints that they are not able to deal with on their own.

The person or people handling complaints should accept complaints from both internal and external sources. It is difficult for complaints team members to be effective if they are new to the company. The ideal profile is a relatively experienced company veteran who understands the organization and can get things done quickly. A single person could do this on a part-time basis in a small company. A team is needed for a large organization. When I managed this for HP, covering consumer and enterprise business, there were over 100 people in the complaints team in Europe alone. We had 350,000 employees in the whole company at the time. The range of work was quite extreme, even including representing the company in small claims courts when people went there to get satisfaction on a printer or PC problem.

The complaints team, and perhaps your full organization, should have the authority to spend a certain amount of money to resolve complaints immediately, without further approval. That amount should be something between $1,000 and $10,000. In HP, the Swiss complaints team could leave the office, go to a local electronics store, buy a product and drive it to the customer’s home near Zurich, if that was appropriate. Flowers and other small gifts are a good way of apologizing when you make mistakes or a product is defective. Think about this when you are trying to turn around detractors. Note in passing that most countries have rules prohibiting gifts to government employees, so your processes need to take this into account.

Complaints. A great way of engaging the whole organization. And a great way to get and publicize compelling customer stories that will motivate the entire company.

I would love to hear about your own experience in this area.

Reactions to my ‘Is NPS Dead?’ blog post last week

I sent the blog post to subscribers to this newsletter last week as I thought it might gain some attention. It certainly did. I posted it on our own site, on LinkedIn, on Medium and in the private forum of the Customer Experience Professionals Association. It is the second-most-read article I have ever posted on LinkedIn. I received a lot of private and public messages of support for what I wrote. The nature of these messages made me do multiple edits and additions to the article on all four sites. Newsletter subscribers will not have seen the updates unless you have visited one of the four sites.

I also received a small number of quite emotional messages suggesting that I have been brainwashed by Bain and others into accepting a totally useless concept unsupported by science. I did my best to respond politely to all such messages. The surprise to me was that most of the points made in these messages were the same as the ones I addressed in the article. I found that somewhat hard to deal with without getting angry. Yes, I realize that ‘communication is something that happens at the receiving end’ and the repetition of the same points may just mean that I did not express myself clearly enough the first time.

The two main points that came back in the negative messages were:

‘My favorite compound metric predicts revenue or market share better than NPS.’ Once again, nobody denies that many compound metrics are better predictors than NPS. They are all simply harder than NPS to communicate and implement.
‘NPS has not been backed up by any academic research published in peer-reviewed journals.’ As that is not true, I added a paragraph and link to such research in the article and reinforced my messaging that contrarian positions published in peer-reviewed journals did not have science behind them and should not have been published. To say the least, I got additional emotional reactions to those statements.

Once again, I want to state that no metric tells you what you need to do. You have to ask customers why they gave you the score and what you should improve. The answers to these questions will often tell you things you cannot see in your operational metrics. This in turn gives you a basis for your improvement projects.

Thank you for your feedback on this so far.

Our latest blog posts

Older posts are still available on the blog page.

Is the Net Promoter Score (NPS) dead?

The Net Promoter Score is dead! Or are the reports on NPS simply fake news? Well, the image at the top of the article shows what I found with a simple Google search. This article explores the main negative points made about the Net Promoter Score and suggests which ones are correct and which are misleading…

Here is why the European Commission fined Google $2.7B and $1.7B, and how it could all have been avoided

Quite a lot has been written about the $2.7 billion fine levied on Google in the case about comparison shopping sites and on the new find related to AdSense. Much of what has been written is simply wrong.…

Answers to two questions from new Customer Experience leaders: Where do I start, and to whom should I report?

I attended and spoke at the CustomerGauge Monetize! event in central Amsterdam last week. It was fabulous event, held in a theatre that has been created in an old church. Here are the answers to the two most common questions I was asked during breaks…

Notable customer experience items from other sites

My presentation from Monetize! Amsterdam

As regular readers know, I was on stage in Amsterdam a few weeks ago and was voted top presenter overall at the event. The organizers filmed all presentations and a link to mine is below. I hope you find it entertaining. And of course, if you want me to do something like this for your team or event, please reach out.

My performance is here.

An interview with Ian Golding: The Strategy of CX

Why have just one video this week. Here is a second one. Ian is considered one of the top global CX gurus. From their site: “In this interview, Ian – who also leads the CX Professional Masterclass and CCXP Exam Workshop – outlines the work of CX professionals, how companies test their CX offering, how organizations can change and improve to become more customer-centric, and more.”

Watch the 11-minute video here.

Looking forward

I will cover the second anniversary of the publication of our books next time.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only. And as of two weeks ago, you can find the books, or at least order them in many bookstores. If you have already read any of our books, please write reviews on Amazon.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

Please share this newsletter with your friends and colleagues and encourage them to sign up for it here. I have put links to past newsletters on the subscription page. Finally, please feel free to change or cancel your subscription using the link below.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

March 28, 2019

#91 – Critical difference in B2B vs. B2C feedback, Speaking experience in Amsterdam

Maurice FitzGerald / Behavioral economics, Customer Satisfaction, Employee Satisfaction, Newsletter, NPS, Strategy / ACSI, Customer Experience, Customer Satisfaction, employee satisfaction, Net Promoter System, research, Speaking, strategy /

Differences in the way B2B and B2C customers answer open questions. Speaking experience at CustomerGauge event in Amsterdam. Welcome to the 91st edition of my customer strategy newsletter. The five topics this week are:

Unexpected (to me) difference between B2B and B2C customer feedback
My recent speaking experience in Amsterdam
Latest blog posts – Answers to CX leadership questions, employee/customer happiness
Notable items from other sites – Annette Franz and Rosaria Cirillo Louwman
Looking forward

Unexpected (to me) difference between B2B and B2C feedback

While working at HP my experience was that NPS Promoters write the longest answers to open questions. My operating assumption is that such customers like you and want you to continue to improve, so they do their best to help. Rob Markey confirms that this is what they see with Bain clients too. However, all of this is for business-to-business customers.

Since retiring from HP, I have been exposed to the situation at a number of B2C companies. I have seen data that shows the opposite pattern. Detractors write the most. In one large data set, Promoters used about 8 words to answer the ‘Why?’ question after the NPS rating, while Detractors used twice that, with Passives half way between. It may interest you to know that it made less than half a word difference for Promoters when people answered on their phones. Single-word responses from Promoters were quite common in all cases. “Great!”, for example. It would have been nice to know what exactly was great.

Since the data sets I have looked at are for companies without annual contracts I suspect this may just be true for companies that have a purely transactional relationship with their customers. Unfortunately, none of these data sets came from research that included the standard ‘What could we do better?’ question, so I don’t know whether the same would be true there.

Your views would be most welcome.

My recent speaking experience in Amsterdam

I spoke at the CustomerGauge Monetize! event in Amsterdam two weeks ago. What a great experience! The event was held in a theatre that has been created inside an old church. The lighting was great, and the general atmosphere was wonderful. Customer Experience work has advanced quite a lot in the last few years. It was great to see leaders from DHL, Electrolux, Salesforce and other companies present their achievements and concerns.

As is often the case, half of what I learned came from discussions during breaks and during the evening between the two days. Fascinating stuff. One of the blog posts in the list below covers my answers to the two most common questions I was asked during these informal interactions.

My main stage presentation was based on two different blogs that you may remember. The first is my ‘Valentine’s Day’ blog about the similarities in the relationships couples and companies have. The second is my recent work on using stories and emotions to communicate effectively. And I just received the preliminary results of the feedback request sent to all participants. My session was the top rated one on the first day. I have not seen the results for the second day, and don’t expect an overall ranking to be published. Anyway… Yay me! (And thank you to all the attendees.)

Congratulations to Camilla Scholten, Adam Dorrell, Sarah Frazier, Katerina Sinitskaia, Cvetilena Gocheva and the rest of the CustomerGauge team on a great event.

Our latest blog posts

Older posts are still available on the blog page.

Answers to two questions from new Customer Experience leaders: Where do I start, and to whom should I report?

The best and worst of customer and employee satisfaction (Part two in a two-part series)

And here is today’s Fake News (though the quotes are real): “Our core values: … Put the customer first…” – Frontier Communications website… In reality there are many companies that customers hate though employees love them, and vice-versa. Here are the results of my research on the topic…

Do happy employees bring you happy customers? (Answer: In general – No!)

“Everybody knows that happy employees make happy customers.” “Satisfied employees are the single most important driver of customer satisfaction.” In reality, I don’t believe employee satisfaction even makes the top three for most companies. There are exceptions. I recently completed my third annual study on the (non-) relationship between employee and customer satisfaction…

Notable customer experience items from other sites

Annette Franz – Putting the customer at the center of every conversation

While this memorable article just came up in my LinkedIn feed yesterday Annette actually wrote it on her ‘CX Journey’ site back in 2002. It includes a mention of my ‘favorite hate’ in customer experience work. As she puts it, “I think hearing requires a subsequent action or reaction. And in the customer conversation, that part is often missing.” Annette goes on to suggest that only 5% of companies tell customers what they have learned from their research and what they are going to improve.

I think Annette is an optimist. In my own experiments in which I provided a total of 150 B2C companies with feedback, just a single one wrote back to tell me what they had learned and what they were going to improve. (Just FYI, that company was British Airways, which may surprise you. It surprised me as I have probably sent them about 20 survey responses over the years. At least they closed the loop that one time.)

Read this classic blog post here.

Rosaria Cirillo Louwman / Wow Now

I was able to meet Rosaria for the second time on the afternoon before the CustomerGauge event in Amsterdam. I first met her a few years ago when I spoke at a Satmetrix event in London. It was great to catch up, especially to discuss Yellow Goldfish, the recently-published book she has written together with Stan Phelps.

Rosaria founded Wow Now back in 2013. Her focus is not customer satisfaction or customer experience. I think it would be safe to describe it as happiness, meaning happiness of everyone involved in customer interactions, especially the customers, of course. Her framework builds a new layer on top of the well-known Maslow motivation pyramid: Happiness. She describes her focus as ‘happiness driven growth’ and has invented the Happiness Contribution™ Factor.

Read more about Rosaria’s book, training courses and Wow Now here. And you should be able to find the link to download her Happiness-Driven Growth booklet quite easily.

Looking forward

April will bring the second birthday of our first three books. My co-author/brother’s son is preparing a special birthday animation that you will see a few weeks from now. Thank you for your support during these two years. We are happy with the way the book has been selling, and especially the way they continue to sell well, even two years later. The CX strategy and NPS books occasionally make it up into the top 2% of all Amazon book sales. The cost-reduction book does not do quite as well. I suspect we need another economic downturn to make it more relevant.

Here are links to all of our books on Amazon.com. Kindle versions are available in all stores. Print versions are available from the major stores only. If you have already read any of our books, please write reviews on Amazon.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

Customer-centric Cost Reduction

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Color edition)

“So Happy Here”: The Absurdist but Essential Guide to Better Business (Black & White edition)

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

March 8, 2019

#90 – The relationship (or not) between employee and customer satisfaction

Maurice FitzGerald / Customer Satisfaction, Employee Satisfaction, Newsletter / ACSI, Customer Satisfaction, employee satisfaction, Glassdoor /

A different sort of newsletter this week. I have combined two blog posts on my annual study on the relationship between employee and customer satisfaction to make this special edition. Just like the last two years, I found that the relationship between the two factors is far weaker than most of us would like to believe. This year’s study is a bit larger and now covers 398 businesses that sell to US consumers. I hope you enjoy it. Please forward it to your colleagues and friends as you see fit.

“Everybody knows that happy employees make happy customers.”

“Satisfied employees are the single most important driver of customer satisfaction.”

In reality, I don’t believe employee satisfaction even makes the top three for most businesses. And I think I can prove it.

This is the third year in a row that I have studied the relationship between customer and employee satisfaction for large companies that sell to US consumers. The results have been consistent: There is almost no relationship between employee and customer satisfaction across the 398 business covered this year. Employee satisfaction explains just 6% of the variation in customer satisfaction across these companies. Mind you, “Almost no relationship” is better than my findings in 2017, which were simply that there was, on average, no relationship.

Within the overall results there are exceptions and surprises. There are industries and entire sectors where employee satisfaction matters a lot more. There are also striking examples of companies whose employees hate them while their customers love them. The opposite is also true. And these are big names.

Let’s begin

Back in 2017 I asked myself whether there was any actual evidence for the many statements that I could find that were similar to those at the top of this article. What I found was highly disappointing, to say the least. I found low-volume studies. I found attractive anecdotal studies based on single companies. I found low-volume and single-company studies about employee engagement, which is a different subject. More on employee engagement later. In short, the whole subject had not been studied scientifically. Repeating my searches before writing this article gave the same result. Nothing useful.

It is not surprising that the subject is tricky to study. Companies do not disclose the results of their own internal employee surveys. High-volume public benchmark data about customer satisfaction is also rare. However, it does exist, as does a single high-volume source of employee satisfaction data. I use Glassdoor data for employee satisfaction and the American Customer Satisfaction Index data for customer satisfaction. This year I was able to match the two for 398 businesses. Here are the highlights:

Overall results

ACSI Glassdoor

At the top level and across all businesses, variations in employee satisfaction explain 6.2% of the variations in customer satisfaction. However, I somewhat arbitrarily decided that 129 of these businesses, such as hotels, retail stores and airlines, are ‘high-touch’. By this I mean that employees have regular face-to-face contact with customers, where their smiles and empathy may make a difference. The remaining 269 are ‘low-touch’. I have used quadratic regression for the graphs below and think they are interesting.

High-touch businesses

ACSI Glassdoor High-touch

For the high-touch businesses, variations in employee satisfaction explain 16.8% of the variations in customer satisfaction. Among well-represented industries, the nine hotel chains top the list at 61.8%, followed by 17 supermarket chains at 49.1%.

Low-touch businesses

ACSI Glassdoor Low-touch

At the other end of the scale, low-touch industries have an average of 8% interdependency between employee and customer satisfaction. The energy utilities industry is represented by 23 companies and shows no relationship at all. I don’t find this surprising. When was the last time you spoke face-to-face with an energy company employee? In my own case, they don’t even need to come out to read our meters anymore.

Performance by industry sector

ACSI data is provided by company and by industry, and the industries are grouped into sectors. Some sectors do better than others as you can see in this table:

ACSI-GD by sector

Retail does rather worse than last year. While it might be tempting to say that this is because Internet Retail is now included in Retail, that’s not the problem. Health and Personal Care stores now have no relationship between employee and customer satisfaction.

Performance by Industry

I removed all industries represented by less than five businesses from the table below. This may not be entirely fair. After all, if there are only three large businesses in a particular industry in the USA, the ‘Normal distribution’ rules of statistics don’t apply. If there are only three and you cover them all, you have a good sample. Similarly, there simply aren’t 30 major hotel businesses in the USA, so any preconception you may have that you need a minimum of 30 for a valid sample is simply wrong. In any case, you will be able to make your own judgments when you download the data.

ACSI Glassdoor by Industry

It should not surprise you to see hotels, supermarkets and restaurants at the top of this list. For hotels, employee satisfaction variation explains 61.8% of the variation in customer satisfaction. Employees are an integral part of the experience in these industries. For many of the industries close to the bottom, we never come into face-to-face contact with the employees, so the lack of a relationship between employee and customer satisfaction should not be a surprise either.

And here is today’s Fake News (though the quotes are real):

“Our core values: … Put the customer first…” – Frontier Communications website

“We take pride in knowing how to take care of you.” – Message to potential employees on the State Farm website

“Our team members are the key to our success. Whether they work behind the scenes or are out there delivering great service to our guests.” – Frontier Airlines website

This is the second article about the results of my third annual study of the relationship between employee and customer satisfaction. The first article is here. This time I will cover love and hate, stars and goats. (What a program!)

Love-hate relationships

Here are the companies whose employees love them while their customers hate them. From a data perspective, this means they are in the top 10% of the Glassdoor scores while being in the bottom 10% of the 398 ACSI scores. There are just four companies in this category:

ACSI Glassdoor love hate

Should we be surprised by the positions of the three social media businesses here? Great employment conditions and the fact that the customers seem to hate them is not really a major source of concern. We could debate whether the US consumers answering the ACSI feedback requests are actually the customers. After all, the companies’ main source of income is from advertisers, who were not asked. As for United Airlines, I think the few high-profile nasty incidents they had with passengers last year and in 2017 made a difference to perceptions. They had the biggest drop of any airline. My prediction is that it will all be forgotten in 2019 and they will have the biggest improvement.

And there is just a single company in the opposite category. Kraft Heinz employees give them an appalling Glassdoor score of 2.9, while customers give them an ACSI score of 82. I think it is safe to say that Kraft Heinz employees have a lot to deal with these days and never come into contact with end consumers.

Companies that seem to get everything right – The heroes

Yes, they exist. Here are the companies that are in the top 10% on both the ASCI and Glassdoor lists:

ASCI Glassdoor best performers

Note that the list is in the order of the Glassdoor rankings. Hilton topped the ACSI list for hotels for the fourth year in a row, and their employees love them too. Do you see anything surprising here? I don’t.

Companies that seem to get everything wrong – The goats

Personally, I think goats are cute and I am not sure why various BCG-style business models cast them as the villains. Anyway, here are the companies that managed the difficult task of being in the bottom ten percent for both their customers and their employees:

Should we be surprised to see the lower table almost exclusively populated by ISPs and TV service providers? I think not. Telecommunications companies have a reputation for disdain of both customers and employees.

Are these comparisons fair?

No, the comparisons are not fair, at least as far as customer satisfaction is concerned.

Customer satisfaction varies strongly by industry. There are industries, such as telcos, cable TV companies, and Internet Service Providers, that have little or no opportunities to ‘delight’ us. If they do their jobs perfectly, we simply don’t notice them. We only notice them when things go wrong. So it is to be expected that they would do relatively poorly in customer satisfaction comparisons that cross industry lines. However, that is no reason for them to treat their employees badly.

Conclusion

We should not find the lack of a strong relationship between employee and customer happiness very surprising, for two main reasons. First, a company’s products and services are generally far more important to customers than the employees. The main exception to this rule is where the employees are the product. Second, employee happiness and employee engagement are two quite different concepts. Employees can be happy with their pay, the food in the company restaurant, and their commute to work. None of these do anything for customers.

Employee engagement is a more sophisticated concept that lacks a standard definition. When I worked at HP the Employee Engagement Index was an aggregate of nine questions. Other companies use different standards, as does every study I have read on the subject. (For the experimental scientists among you, this smells of ‘p-hacking’. Ask a lot of questions in your employee survey. Determine after the fact which set of ten have the best correlation with revenue growth. Combine them in some way and call that your ’employee engagement index’. That’s cheating!)

Data

I have put an Excel sheet with the data here. There are four tabs. It is not very pretty. I have inspected it in various ways but may still have made some sort of error. If you find one, please let me know.

Lots more writing like this in our books. All of our books are available in paperback and Kindle formats from Amazon stores worldwide.

You can also email me, Maurice FitzGerald, at mfg@customerstrategy.net.

To change your subscription, click here.

March 7, 2019

The best and worst of customer and employee satisfaction (Part two in a two-part series)

Maurice FitzGerald / Blog, Customer Satisfaction, Employee Satisfaction / ACSI, Customer Satisfaction, employee satisfaction, Glassdoor /

And here is today’s Fake News (though the quotes are real):

“Our core values: … Put the customer first…” – Frontier Communications website

“We take pride in knowing how to take care of you.” – Message to potential employees on the State Farm website

“Our team members are the key to our success. Whether they work behind the scenes or are out there delivering great service to our guests.” – Frontier Airlines website

Love-hate relationships

Companies that seem to get everything right – The heroes

Yes, they exist. Here are the companies that are in the top 10% on both the ASCI and Glassdoor lists:

Companies that seem to get everything wrong – The goats

Are these comparisons fair?

No, the comparisons are not fair, at least as far as customer satisfaction is concerned.

Conclusion

Data

If you enjoy this sort of thing, there is lots more on this topic and many others in our book Customer Experience Strategy – Design and Implementation. All of our books are available in paperback and Kindle formats from Amazon stores worldwide.

March 6, 2019

Do happy employees bring you happy customers? (Answer: In general – No!)

Maurice FitzGerald / Blog, Customer Satisfaction, Employee Satisfaction / ACSI, Customer Satisfaction, employee satisfaction, Glassdoor /

“Everybody knows that happy employees make happy customers.”

“Satisfied employees are the single most important driver of customer satisfaction.”

In reality, I don’t believe employee satisfaction even makes the top three for most businesses. And I think I can prove it.

Let’s begin

Overall results

High-touch businesses

Low-touch businesses

Performance by industry sector

ACSI data is provided by company and by industry, and the industries are grouped into sectors. Some sectors do better than others as you can see in this table:

Performance by Industry

This is part one. What’s next?

This is the first instalment. Here is a link to the data so you can download it and do your own analysis. Note that the Excel sheet has four tabs. In the next article I will cover the companies that employees love while customers hate them, and vice-versa. I believe these lists will be quite enlightening and will make it seem more logical that employee and customer satisfaction do not necessarily go together. I will also provide details of the companies that are at the top of both lists, and of course the opposite. I also go on to suggest why these results should not be a surprise.

February 28, 2019

#89 – Employee and customer sat, Consumer subscription service feedback

Maurice FitzGerald / Behavioral economics, Newsletter, NPS, Strategy / ACSI, Avis, Bain, Compaq, Customer Experience, Customer Satisfaction, employee satisfaction, Hertz, HP, Net Promoter System, research, strategy, Willie Pietersen /

Welcome to the 89th edition of my customer strategy newsletter. The five topics this week are:

Relationship between employee and customer satisfaction
The right time to ask for feedback on a consumer subscription service
Latest blog posts
Notable items from other sites – Willie Pietersen, Eric Smuda ex-Compaq, HP, Avis, Hertz
Looking forward

Relationship between employee and customer satisfaction

The American Customer Satisfaction Index people released the final part of their 2018 customer satisfaction data earlier this week. I have been able to match the scores against Glassdoor employee satisfaction data for 398 large businesses that sell to US consumers. This is up from 345 last year and hopefully makes the data more reliable.

There are a few surprises, though the overall message has not changed: there is not much of a relationship between employee and customer satisfaction. Variations in employee satisfaction across the 398 businesses explain just 6.2% of the variations in customer satisfaction. This is up from last year’s number of 4.4%. There are industries and indeed a whole sector where there seems to be no relationship at all between the two. The big surprise is that the relationship for the retail trade has dropped significantly. This turns out to be an artefact of the ACSI including eCommerce sites in retail this year while they were separate last year.

At the moment I am doing extensive data validation. This is the third time I have carried out the study. I made minor mistakes each of the first two times and am in the process of ensuring I have at least not made the same mistakes again. I will then write a series of blog posts. The ones you should expect are:

Overall results, including an analysis of ‘high-touch’ and ‘low-touch’ businesses.
Lists of companies that employees hate but customers love, and vice-versa.
Lists of companies that both the employees and customers love, and of course the opposite view.

Based on the feedback I receive each year I suspect most of you believe my study is wrong. Indeed, I submitted it to one academic publication and one business publication the first year and it was rejected by both as not being credible. Nobody, and I mean absolutely nobody, has been able to present a scientific analysis that proves anything different. I look forward to the feedback this year.

The right time to ask for feedback on a consumer subscription service

I just answered a question about when you should ask customers for feedback about a ‘box subscription’ service. This is the type of service where you receive something different every month. Kiwico is an example, with their scientific toy kit subscription service, and I have seen subscriptions that give you a new book every month. Here is how I answered the question:

If you have no people or budget to work on improvements that customers may suggest… well… you are better off not asking them for feedback at all. So, if you have no resources, the right time is never.
You want to be able to work on improvements and tell the customers about them before their subscription deadline comes up. If all customers do not have the same renewal date, this really means working on a single improvement every quarter, then telling the customers when you have completed it. Once again, if you don’t have the resources needed, then please don’t ask for feedback.

Your input welcome.

Our latest blog posts

Nothing new this week as I have had my head down working on the employee-customer satisfaction research. Older posts are still available on the blog page.

Valentine’s Day classic blog – How to stay married – to your customers of course!

It was Valentine’s Day a few years ago, and I was puzzled by the results of some HP customer experience research. The data source and volume were impeccable. However, the results were surprising. Then I remembered what day it was, and everything became clear…

What skills do you and your customer experience team need to be successful? (5-minute read)

While pure luck was a major factor, my use of Microsoft Project version 1.0 on my personal Mac certainly had a major positive influence on my promotion to the European HQ of Digital Equipment Corporation…

The nature of customer-centric strategy and why your team needs one (Intense 3-minute read)

I have been broadening my writing horizons somewhat over the last few weeks. Among others, I have contributed thoughts on customer strategy to discussion on LinkedIn, Quora and the members-only Customer Experience Professionals Association forum. Some clarity seems to be needed…

Notable customer experience items from other sites

Willie Pietersen – Five time-tested ideas for success

Many of you know that I consider Willie Pietersen to be the greatest strategy teacher on the planet. As a former CEO of some major companies, his advice is intensely practical. His latest blog post is no exception. The five concepts covered are easy to understand. They are:

Our only sustainable competitive advantage is our ability to learn faster than our competitors
Success means putting the customer at the center of business decisions
Strategy is about achieving differentiation by making choices
Leaders must be able to simplify a complex world
To move people at the deepest level, you need compelling stories

Willie’s first strategy book is the only book I have ever read a second time immediately after finishing my first read. I did the same with this blog post. Read it here.

Bain NPS podcast – Interview with Eric Smuda, former CX leader at Compaq, HP, Avis, Hertz

A fascinating and insightful interview with Eric Smuda. My time in CX at HP started after Eric left and I never heard of him at Compaq. I wish I had. He is clear and insightful about what it takes to develop and implement a customer experience strategy. I learned a lot about the car rental business and found some of the stories fascinating. Like the one about the need to reposition cars around New York. Hertz uses a single car fleet. The weekday demand is at the airports. The largest single weekend demand is from people who live in Manhattan and want to get away for the weekend, starting on Friday evening. So Hertz drives huge numbers of cars from the airports into town. It is a constant stream as there is not much space for them in Manhattan. That’s just one story and there are many others. Listen to them here.

Looking forward

I will be speaking at the CustomerGauge Monetize! event in Amsterdam on March 13th and will stay over to enjoy the other speakers on the 14th. I look forward to meeting any readers who will be there. And of course I want to complete my blog posts on the relationship between customer and employee experience. I am sure you will find them interesting.

Customer Experience Strategy – Design & Implementation

Net Promoter – Implement the System

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December 6, 2017

The main customer experience measurement and improvement systems – Part 2 – CSAT / Customer Satisfaction

Maurice FitzGerald / Blog / CSAT, Customer Experience, Customer Satisfaction, Surveys /

When you are asked to rate your ‘overall satisfaction’ with something, you have entered the Customer Satisfaction rating system. The most common way of doing this is to ask you to rate satisfaction on a scale from 1 to 5, where 5 means ‘extremely satisfied’. There is a minor challenge in the rating scale, as with all scales that do not contain a zero. A small proportion of the respondents will believe that 1 is the best rating, rather than 5. After all, you want to be number one, don’t you? At the level of your overall brand, the satisfaction metric does not predict revenue as well as the ‘willingness to recommend’ metric used in the Net Promoter System. At least, that is the case for most, but not all industries. In that context, it is worth noting that Enterprise Rent-A-Car is used as an example in The Ultimate Question 2.0, and they discovered that overall satisfaction was a better predictor than willingness to recommend. In general, for surveys about telephone, web and chat support, the Customer Effort Score (to be covered soon in another article) is a better revenue predictor.

“Top box” satisfaction

A common method of communicating results is to talk in terms of ‘top box’ satisfaction or “top-three box”, for example. This means arbitrarily deciding that people who give you the top score, or the top two or three scores on a five-point scale are ’satisfied’. I have not been able to find studies of differences in customer behavior between the different categories or groupings. However, based on Net Promoter System studies, it seems unrealistic that someone who gives you a 3 is actually satisfied. The NPS research would suggest that someone who gives you a 5 is likely to recommend your product or service, and someone who gives you a four does not care much either way. A three would already be a sign of negative views. Note that some companies use seven-point scales.

The principal communication challenge

The lack of a single standard customer satisfaction scale and definition causes communication issues. It is quite easy to find companies that say “92% of our customers are satisfied.” What does that mean? On a five-point scale, which of the five are they counting to get to 92%. Since there is no single definition, anyone explaining the metric has to explain where it comes from, and risks losing time in an argument with someone in the audience who measures it a different way.

CSAT is a metric, not a system

While CSAT is probably the most common satisfaction metric, it is not a system. It is entirely up to you to work out what the number means, what customers actually want you to improve, and how you should go about it.

Composite satisfaction metrics

Some companies use the term ‘customer satisfaction score’ or CSAT, and actually use a different method of calculating it. Predicting customer loyalty, meaning the desire of customers to keep on buying from you, can of course different forms. The more sophisticated satisfaction surveys also include several questions that are not about satisfaction. The most common questions ask customer to use the same type of rating scale to answer questions such as “This company has earned my loyalty”, “How likely are you to repurchase?”, “This company is a leader in its field”, “How likely are you to recommend this company or product to a colleague?” and so on. Several metrics can then be aggregated to form a satisfaction index. Where this is done well and with representative customer samples, it can be an excellent revenue predictor. I will cover some composite metrics in an article proprietary measurement systems.

Lists of things to rate

Satisfaction surveys usually ask you to rate a list of things. The list can be very long. For years, I participated in a survey panel that covers the travel industry. I have received surveys that only have satisfaction rating scales and took more than half an hour to complete. The main problems with lists of things to rate are:

It is your list, not the customers’ list. Most commonly, these lists are set up by the way your organization is structured. You want to get some sort of feedback for everyone. This may not correspond to what the customer wants to tell you about. Notably, if a competitor does something that you do not, only asking about what you currently do will prevent the customer giving you that feedback.
It creates the illusion that each of the factors you ask about is equally important. It is particularly difficult to undo this subliminal message. Imagine you have 50 things that you ask customers to rate. Imagine further that seven of them have the worst rating possible. Once these ‘red’ items are visible, you will be forced to turn them around, even if they have no importance whatsoever.

Conclusion

The lack of a standard definition of what we mean by ‘Customer Satisfaction’ causes major communication challenges and is the principal argument against using CSAT. However, no matter how you define the metric, its trends relative to the trends of your competitors are still meaningful. If you can find a reliable way of finding out why such trends are happening, you may well have something useful.

As always, I have opinions, usually based on fact. That does not make me correct. Please feel free to comment below. And this article is a slightly edited part of a chapter of one of our four books, in this case Customer Experience – Design & Implementation. Our fourth book So Happy Here came out recently and is available on Amazon. It is a heavily-annotated book of my brother’s business cartoons. Most have appeared in our first three books, in my blog posts or Tweets. This and all of our books make great end of year presents for your colleagues and teams.

Next time: Customer Effort Score

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