ICEW 2013 Reshmi Maharaj - Putting SAs competitive customer satisfaction market on the global scorecard
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ICEW 2013 Reshmi Maharaj - Putting SAs competitive customer satisfaction market on the global scorecard

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The rapidly developing economy of South Africa has many lessons to offer the rest of the world, especially in the field of customer experience. Now, with the establishment of the South African ...

The rapidly developing economy of South Africa has many lessons to offer the rest of the world, especially in the field of customer experience. Now, with the establishment of the South African Customer Satisfaction Index (SAcsi), South African companies are able to showcase their customer satisfaction abilities to the world.

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  • What is the Csat world now?
  • Long-term customer relationships are characterized by efficiency, low risk and predictable income. Sellers compete for buyers’ preference and satisfaction. Winners are rewarded by lower cost and lower risk by returning customers
  • Satisfaction has a STRONGER effect on financial performance than Loyalty. Reason: the increased revenue generated by improved loyalty is not offset by the higher costs of the Loyalty programs (unless generated by customer satisfaction) – e.g. Frequent flyers being members at all frequent flyer loyalty programsP(Repeat business by Satisfied customer) > P(Repeat business by Dissatisfied customer)Loyalty is different – it is a behaviour and thus a consequence of satisfactionSellers can manage causes NOT consequencesLoyalty is a consequence of:Customer SatisfactionSwitching barriers from one supplier to anotherPrice
  • The realities of our current economy present challenges forpolicymakers, businesses, and consumers alike, as markets reachbeyond borders and across cultures. The South African CustomerSatisfaction Index (SAcsi) has emerged in response to the need for aNational Customer Satisfaction Index in the South African economy.
  • SAcsiistheonlyorganisationinSouthAfricawhichholdsalicencefromAmericanCustomerSatisfactionIndex(ACSI).SAcsisupplementstraditionalmeasuresofeconomicoutputwithadefinitiveandscientificallyprovenmeasureofcustomersatisfaction.
  • Satisfaction has a STRONGER effect on financial performance than Loyalty. Reason: the increased revenue generated by improved loyalty is not offset by the higher costs of the Loyalty programs (unless generated by customer satisfaction) – e.g. Frequent flyers being members at all frequent flyer loyalty programsP(Repeat business by Satisfied customer) > P(Repeat business by Dissatisfied customer)Loyalty is different – it is a behaviour and thus a consequence of satisfactionSellers can manage causes NOT consequencesLoyalty is a consequence of:Customer SatisfactionSwitching barriers from one supplier to anotherPrice
  • Economic returns: Possible to link customer satisfaction to economic returns via correlation with financial performance indices.Economic stability: Help determine what percentage of price increases represent quality improvement and what are caused by inflation.Economic link: Link between the quality of economic output and productivity measuresEconomic welfare: An indication of economic well being.Economic output: Quantifies the value that customers place on products and services & driving quality improvement.
  • Satisfaction has a STRONGER effect on financial performance than Loyalty. Reason: the increased revenue generated by improved loyalty is not offset by the higher costs of the Loyalty programs (unless generated by customer satisfaction) – e.g. Frequent flyers being members at all frequent flyer loyalty programsP(Repeat business by Satisfied customer) > P(Repeat business by Dissatisfied customer)Loyalty is different – it is a behaviour and thus a consequence of satisfactionSellers can manage causes NOT consequencesLoyalty is a consequence of:Customer SatisfactionSwitching barriers from one supplier to anotherPrice
  • Centre fro Communication and Reputation Management

ICEW 2013 Reshmi Maharaj - Putting SAs competitive customer satisfaction market on the global scorecard ICEW 2013 Reshmi Maharaj - Putting SAs competitive customer satisfaction market on the global scorecard Presentation Transcript

  • Putting South Africa’s competitive customer satisfaction market on the global map through SAcsi Reshmi Maharaj
  • Global Customer Satisfaction
  • Online survey with random sample of consumers aged 18+ USA Canada Mexico France Germany Italy UK Netherlands Australia India 1018 1060 1002 1001 1000 1000 1016 1007 1021 1002 2011 Global Customer Service Barometer - Amex
  • Evolution… TQM SERVQU AL CEMCR M1950s 1984 1995 2003 Customer Satisfaction
  • Is Customer Experience the new Customer Satisfaction? Q:
  • “The literature in marketing, retailing and service management historically has NOT considered customer experience as a separate construct. Instead researchers have focused on measuring customer satisfaction and service quality.” Source: Verhoef, Peter C., Katherine N. Lemon, A. Parasuraman, Anne Roggeveen, Michael Tsiros and Leonard A. Schlesinger (2009), “Customer Experience Creation: Determinants, Dynamics and Management Strategies,” Journal of Retailing, 85 (1), 31–41 A:
  • Where Brand gives the promise, CEM is the physical delivery of that promise and is vital in an economy where a brand is increasingly built on value delivered rather than product features Customer Experience in Perspective
  • Customer Experience in Perspective Brand Customer Experience Management Making Promises Enabling Promises Keeping Promises
  • The Myth of Customer Loyalty Customer Satisfaction is “worthless”, but Loyalty is “priceless”
  • Customer Loyalty without Satisfaction is a contradiction of the basic mechanics of the free market system, and violates the cause- and-effect relationship between satisfaction and loyalty The Myth of Customer Loyalty
  • Satisfaction vs. Loyalty
  • The South African Reality
  • The South African Customer Satisfaction Index is a national economic indicator of customer evaluations of the quality of products and services available to household consumers in South Africa
  • Source: FCI Group., 2007b. The American Customer Satisfaction Index (ACSI) Technology: A Methodological Primer. pp.1–37. Perceived Overall Quality Customer Expectations Perceived Value Customer Satisfaction (ACSI) Customer Complaints Customer Loyalty Created the National Index with the Global Leader
  • Some ACSI findings over the past 16 years CS is a leading indicator of financial performance Changes in CS affect the general willingness to buy Changes in CS correlate with changes in GDP growth Quality plays a more important role than price
  • Satisfaction drives Value Average Market Value Added (MVA): High and Low ACSI Frims Source: FCI Group., 2007b. The American Customer Satisfaction Index (ACSI) Technology: A Methodological Primer. pp.1–37.
  • Creating a National Index with the Global Leader Mexico Columbia United Kingdom Sweden Turkey Korea Malaysia Singapore Dominican Republic
  • What will SAcsi do for YOU? Economic Returns Economic Stability Economic Link Economic Welfare Economic Output
  • SAcsi Model – a trusted science • Satisfaction • Comparison w/ Ideal • Confirm/Disconfirm Expectations • Repurchase Likelihood • Price Tolerance (Reservation Price) • Overall • Customization • Reliability • Overall • Customization • Reliability • Price Given Quality • Quality Given Price • Complaint Behavior Perceived Overall Quality Customer Expectations Perceived Value Customer Satisfaction (SAcsi) Customer Complaints Customer Loyalty
  • SAcsi Governance Founding Sponsors Board of Advisors Academic Support Data collection Global Partnership License CCRM Prof. Y Jordaan Prof. A. Schreuder Subscribers Non-subscribers
  • SAcsi has taken off… 2014 The entire South African economy with all its 48 Industries The Future Q1 2013 Petroleum Service Stations Airlines Fast Food Outlets Health Insurance Mobile Handsets Supermarkets In Process Q4 2012 Mobile Telecoms Networks Mobile Telecoms Stores Banking Gaming Life Insurance Short-term insurance Done
  • A snapshot of some results
  • Net Promoter Score
  • Industry Growth Inclination 4% 2% 2% 2% 3% 8% 5% 7% 12% 10% 45% -10% 0% 10% 20% 30% 40% 50% 0 1 2 3 4 5 6 7 8 9 10 Likelihood to purchase additional products and/or services Growth inclination is an indictor of customers’ apatite for more products and/or services from the specific company under evaluation. The measure is based on the following question, and rated on a 0 – 10 point scale: “How likely is it that you would use / purchase additional products and services from (brand/company)?” From the figures, we can surmise that there is a relatively large apatite for more offerings.
  • Satisfaction relative to growth 0% 10% 20% 30% 40% 50% 0 1 2 3 4 5 6 7 8 9 10 Score Given on a 0 - 10 Point Scale Likelihood to purchase additional products and/or services Overall Satisfaction Score Whilst there is little differentiation on a SAcsi level (Satisfaction Index) between the 3 companies measured, the above trend clearly illustrates the importance of keeping one's customers satisfied. The trend illustrates that the more satisfied a customer is, the greater their apatite for additional products and services. Furthermore, the overall industry trend shown above is in line with the individual company trends.
  • CENTIMent index Great Good OK Fair Bad The CENTIMent index is based on an open ended verbatim question, simply asking respondents to relay the experiences that they have had with a company. The question is kept as open and non-specific as possible in order to solicit a wide variety of responses The index is powered by the Clarabridge Sentiment Scoring engine, which automatically understands negation, conditional sentiment, and other linguistic nuances to provide an accurate context. It uses advanced linguistic algorithms to determine and index evidence of sentiment and tone in customer comments. The sentiment score is indexed on a normalized minus five (-5) to plus five (+5) scale. The higher the score, the greater positive sentiment.
  • Contextualising CENTIMent Index -1.35 -1.51 -1.3 -0.27 -0.11 0.27 0.5 1.02 1.89 1.9 2.12 -2 -1.5 -1 -0.5 0 0.5 1 1.5 2 2.5 0% 10% 20% 30% 40% 0 1 2 3 4 5 6 7 8 9 10 Overall Satisfaction Score Given Overall Satisfaction Score Sentiment Score Poly. (Overall Satisfaction Score) *A similar trend is observed across all the companies measured
  • “MTN, FNB claim top spots in customer satisfaction index” “Making the world a less irritable and more profitable place, the SAcsi has arrived with key insights into our mobile and banking industries”
  • We’re now on the map!