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Linking customer experience to operational and business performance

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  • Showrooming—customers view product in store and buy online, not necessarily at retailer’s siteNetflix price hike led to a social media bloodbath, stock dropped 50%
  • Consider an auto manufacturer. One of the critical aspects of a customer’s journey is maintenance service (oil changes, tire rotations etc). Many consumers do not go to the dealer for this service, or forge to do it at all which can affect their perceptions of the vehicle and affect future purchasing behavior. However, some manufacturers have started to influence this by offering maintenance plans for first few years bundled along with the MSRP of the vehicle. This way the consumer is not only forced to come back to the dealer for service (and thereby receive a consistent hi quality experience) but also influenced to get regular maintenance done since they have already paid for it.
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    • 1. 1 Linking Customer Experience to Operational and Business Performance Presented by: Niren Sirohi, Ph.D.
    • 2. 2 Niren Sirohi, Ph.D. VP, Predictive Analytics iKnowtion Niren leads iKnowtion’s Predictive Analytics practice Speaker IntroductionToday’s Presenter
    • 3. 3 Apply Analytic and Consultative Best Practices to:  Identify customer-level opportunities  Inform customer-centric strategies  Maximize customer- focused programs  Measure customer-driven impacts iKnowtioniKnowtion Leaders in Customer and Marketing Analytics
    • 4. 4  Commoditization pressure  Explosion in channels with the digital revolution  Shift in balance of power to customers  Amplified Word of Mouth  High customer expectations Today’s World Reality For Marketers
    • 5. 5 Competitive Advantages Are Changing Competing On Product And Price Are Over Differentiate on price How low can you go? Differentiate on product Today’s innovation is tomorrow’s knock off The new differentiator Differentiate on customer experience
    • 6. 6 Customer Experience Becoming Top Priority 63% see Customer Loyalty as the primary focus of the contact center in five years International Customer Management Institute (ICMI) 93% customer experience is a strategic priority Forrester’s 2012 Global Customer Experience Peer Research Panel Survey 49% companies are focusing their efforts on customer insights, segmentation, and targeting to improve overall performance Minding Your Digital Business, McKinsey Global Survey, 2012
    • 7. 7 Transforming the Customer Experience Build Foundation Build Foundation AnalyzeAct Customer
    • 8. 8 Customer Journey Mapping Customer Feedback Operational and Business Performance Build Foundation Build Foundation Laying the Groundwork Transformational Customer Experience  Customer Segmentation  Map customer activities and influencers  Identify touch-points  Customer perceptions  Measure across touch-points  Customer behavioral intentions  Operational metrics across touch-points  Customer transactional behavior  Overall business performance AnalyzeAct Customer
    • 9. 9 Touch-points: Opportunities to Influence Experience Examine the Customer’s Entire Journey, NOT Just Activities Which You are Involved in Today
    • 10. 10 Customer Feedback Is A Rich Source It’s Varied and Comes in Many Forms Structured (Quantitative) Unstructured (Qualitative) Company-Initiated Customer-Initiated Illustrative for a Wireless Provider
    • 11. 11 Measure Behavioral Intentions Net Promoter Score Tracks Sentiment Likelihood to Recommend
    • 12. 12 Customer Feedback In isolation is NOT Enough Customer Feedback Operational Metrics Customer Transactions
    • 13. 13 Analyze Analyze Build Foundation Touch-point Importance Operational Linkages VOC Signal Detection Actionable Insights Transform Customer Experience  Determine critical touch-points  Quantify business value of touch-points  Build business case  Link internal data to customer perceptions  Impact of internal improvements  Build business case  Real-time monitoring  Pattern analysis and signal detection  Insight and business implications Act Customer
    • 14. 14 Key Questions of Analytics What is the expected business impact of improving customer perceptions by X%? What operational and process changes will be needed to improve customer perceptions by X%? How do we generate continuous insights from real-time customer feedback across touch-points and channels?
    • 15. 15 In Order To Be Actionable Focus Analytics on Linkages Operational Performance VOC (Customer perceptions, feedback, intentions) Customer Behavior (Transactions, Engagement) Business Performance
    • 16. 16 Structural Equation Models Used to Estimate Linkages Customer Perceptions Information Ticketing Rides Lines Food Grounds Entertainment Operational Metrics Information Ticketing Rides Lines Food Grounds Entertainment Return Theme Park Experience Share of Wallet Incremental people; sooner (ticket revenue) Incremental spending on food, merchandise (revenue) Improve wait time 5 minutes Total cost to improve experience NPV Total incremental revenue Behavior Outcome Financial Outcomes 5% 2% 10% 15%
    • 17. 17 Touch-point Analytics Identify Experience Improvement Initiatives Loan Officer interaction and process improvement initiatives drive $146M in incremental annual revenue for mortgage refinancer Improvements in customer perceptions of Advocacy drives 15% incremental market share for ISP Improvements in service delivery drive $75M in incremental annual revenue for mutual fund manufacturer 26 customer experience improvement initiatives drive incremental $741M in revenue for an airline
    • 18. 18 Analyzing and Taking Action on Real-Time VOC Will Drive Positive Customer Experience Aggregate Insights  Identify unmet product and service needs  Identify experience pain points  Proactively identify potential PR issues Targeted Actions  Send product offer to specific individuals  Inform specific customer about fix of pain point  Execute proactive save for dissatisfied high-value customers Real-Time Big Data Analytics Stack Speech Text Machine Learning Pattern Recognition Trend Spotting Log Analysis + CRM Nick, 25 year old gamer
    • 19. 19 Ideation Test and Learn VOC Programs Act ActAnalyze Sustained Value Generation From Transformational Customer Experience  Generate activation ideas  Customer experience initiatives  Experience process design  Pilot initiatives in market  Develop measurement plan  Make go / no-go decisions  Develop VOC strategy  Develop VOC infrastructure  Continuous learning process Customer Build Foundation
    • 20. Focus on customer experience as the differentiator Outside-in thinking necessary to identify and fix key pain points Commit to listening and analyzing the Voice of your Customer (VOC) Summary Leverage Big Data analytics to detect meaningful signals in VOC
    • 21. Thank You For questions, contact: Niren Sirohi, Ph.D. VP, Predictive Analytics nsirohi@iKnowtion.com 781-494-9989 x201