The New Game Of Telephone!

It has never been more important than now to have a very well planned and executed Customer Loyalty Program. Customer Loyalty has always been important because we naturally want to share our stories and experiences with one another… it goes back to that fundamental desire for us to be known by others.

We have more and more ways to communicate and share our stories with others. It is no longer a select few people who have a voice beyond just their family and friends… now the whole world has access to our stories in many cases.

I am “relatively new” to the social media space over the last five years and I personally have:

  • 565 friends on Facebook
  • 600+ Connections on LinkedIn
  • 184 followers on Twitter
  • … and a couple of hundred subscribers on each of my two blogs

That is nearly 1800 “quantifiable” people who I have access to hear my stories about the good and bad experiences I am having with products, services, and companies… but anyone can read my tweets and read my blogs so it is actually much larger than that!

So, in a world that is more and more interconnected we never know who we are making loyal or disloyal. The lowly system administrator (so says the former technical geek) may also be a very successful social media guru and have over a million people they can reach with their stories. If you are not creating a place for EVERYONE to share broadly about why they are loyal or disloyal to your company…you are running a high risk of missing a vital opportunity to turn around those disloyal customers.

Loyalty study objectives should be:

  • Give every single customer a voice
  • Measure loyalty (statistical and anecdotal)
  • Find out what things to improve/change to increase customer loyalty (continuous improvement)
  • Leverage extremely loyal customers (references, etc)
  • Turn experiences around for disloyal customers

Customer Loyalty… It’s More Than Statistics!

I was recently having a conversation with some of my industry friends about Customer Loyalty and a growing trend of compromise we are seeing in the industry. Customer Loyalty Programs are still “fairly new” in the marketplace and therefore the adoption rates continue to increase rapidly, however the early adopter stage has long passed and now we are starting to see some compromises being introduced into some of these programs.

The trend we have been noticing and others have seen as well Is what I like to call “Statistical Sanitization”. This is where for various reasons programs start to be slanted in a way that the statistics tell the story that you want them to tell, rather than analyzing the statistics and then developing the story… the truth! When you start to segment, departmentalize, and distribute only the data you are most interested in… it can become borderline gaming the system.

Customer Loyalty Program are only holistic if they have the following characteristics:
1) The invitation to participate is 100% inclusive of your entire customer base
2) The survey is detailed and tells you what your customers REALLY think
3) It allows you enough deep dive information to drive continuous improvements in your business
4) It acts like an early warning system and allows you to identify brush fires before they become forest fires
5) It includes closed loop follow-up conversations directly with your customers
6) Although It is very important to be able to segment, departmentalize, and distribute the data… you need to start with the entire sample first.

A few goals I always have in Customer Loyalty Programs:
1) You need a single customer loyalty metric. (NPS, OSAT, Index, etc)
2) You need to understand how each product and functional area effects your Company Loyalty
a. You need actionable feedback/data that correlates to loyalty for each product you have and each functional areas of your business
3) The goal is to drive continuous improvement actions at all levels of your business
4) Continuous Improvements should be tracked and positively influence the Company Loyalty over time

The “Magic Bullet” Survey Methodology…

I was recently talking to some of my loyalty industry colleagues about different methodologies and metrics that we use to quantify customer loyalty. There were many different approaches, opinions, and thoughts on the matter of course, but there were 2 universal beliefs among all of us:

1) There is NO “Magic Bullet Survey Methodology”
2) Taking “real” actions based upon the data is most important

Let me expound a bit…

Yes there are some methodologies that are better than others because they are more statistically accurate and/or they are easy to communicate with those who are going to consume and put into action the data… but in the end there is no magic bullet methodology.

Let’s take the Net Promoter Score(NPS) methodology for instance. I “like” NPS because it is easy to understand, measure, and communicate to a broad audience.. people easily get and understand what it is.. but NPS is not “the way, the truth, and the life” either. The score is like a fuel gauge… it is something you should obviously reference to see what the gauge says, but don’t fixate on it either… because you will lose track of the road and crash!

The most important function of a loyalty survey is your ability to take strategic and tactical actions based upon the data and drive real change in your organization. If you are not able to take real actions and deliver real change… why even bother doing a survey… just do a marketing campaign instead!

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

What Motivates Employees: Required Training for Business Leaders

“Engage Employees to Engage Customers to Engage Customer Loyalty!” ~Chris Antonelli

I have had a long standing belief that “engaged” employees are one of the main keys to customer loyalty. When we are truly and fully engaged in something we tend to apply all of our cognitive skills to it… rather than just going through the motions and doing the bare minimum to complete the task.

We have all been “served” by someone who is not engaged and not really there to serve us… they are there to make their money and apply the least amount of effort in doing so… but we have probably all experienced the inverse of that too where the person serving us is really engaged and seems to be “on their game” going above and beyond… so what is the difference and how do we “Engage Employees to Engage Customers to Engage Customer Loyalty!”

“Freedom from Command and Control” is a great book and business philosophy going around right now… this concept basically boils down to empowering your employees to do the right thing and encouraging them to utilize their cognitive skills to do their day to day work. One great example of this business philosophy in action is Zappos:

  • In 2001, Zappos more than quadrupled their yearly sales, bringing in $8.6 million
  • In 2003, Zappos reached $70 million in growth sales
  • Over the next three years, Zappos doubled their annual revenues, hitting $840 million in gross sales by 2007
  • In 2008, Zappos hit $1 billion in annual sales, two years earlier than expected (one year later, they fulfilled their other long-term goal, debuting at #23 on Fortune’s Top 100 Companies to Work For

Why has Zappos be so successful? Most would agree it is because their Customer Loyalty is second to none. CEO Tony Hsieh of Zappos believes “Empower and trust your employees. When you take care of your employees they take pride in the work they do, which helps to provide the ultimate customer service.”

So, What Motivates Employees to perform at these levels? Well, here is a video that I believe best articulates this business philosophy and should be Required Training for Business Leaders

The surprising truth about what motivates us:

References:
http://comment.rsablogs.org.uk/
http://en.wikipedia.org/wiki/Zappos.com
http://econsultancy.com/us/blog/4912-q-a-zappos-jane-judd-on-customer-loyalty

Teton Mountain Lodge & Spa… so much potential, but ends up disappointing!

This summer I decided it was time to take my family on a memorable summer vacation. It had been nearly 3 years since we had been on a true vacation due to my work commitments after the company I work for was acquired. Don’t get me wrong, I still spent lots of time with the family, did some weekend getaways, and even had multiple “workations” where the family traveled with me and they played while I worked… but we hadn’t had a true “bona fide” vacation for way too long.

After looking at our options my wife and I agreed it would be great to visit Yellowstone National Park and Grand Teton National Park. We figured this would be the perfect mix of driving distance from Seattle (14 hours), outdoor adventures, and great selection of hotels. I started mapping our journey and decided we would stop at Missoula Montana for one night, then head onto West Yellowstone Montana for two nights, and then Jackson Hole Wyoming for 4 nights and then map a new route home while in Jackson Hole. I don’t know about you, but we are pretty frugal with our money. When we go on vacation however we try to have a portion of the trip where we get to live it up for a few days too. We mostly stay at reasonable hotels under $150 a night and then we always pick one really nice resort type hotel in the $300 range that we stay at for a few days too.

Ok, so now that you know the back story and how amazing our trip was, let me focus on one part of our journey that had so much potential, but ended up disappointing…

When I was searching for hotels near Jackson Hole I found a lot of potential hotels that looked good, but decided to use Trip Advisor to find the “cream of the crop” for the price range I was looking for. I heard really good things about the Teton Village which is outside of Jackson and ended up looking for hotels in that area. I came across “Teton Mountain Lodge”. The reviews were amazing, it had 192 reviews and was rated 4.5 out of 5 stars by those reviews… I thought to myself…. Jackpot! I went on their website and found a really good rate, plus I found a coupon to reduce the rate and give us a daily breakfast credit. I booked my reservation and was all set to go. I decided to call them the next day to inform them this was a special family vacation and we would appreciate a great room assignment. The person on the phone was VERY helpful and said I was booked on the 5th floor (top level) and facing the Teton Mountain range… perfect!

When we arrived at the Teton Mountain Lodge it was right at the foot of the Teton Mountain range and the scenery and hotel were both beautiful. I went inside to check-in and the front desk staff was again VERY helpful and welcoming, a bellhop was immediately there to help me and he was one of the best bellhops I have ever had. The bellhop gathered our luggage and room keys and we took the elevator to the second floor?? .. ok I wasn’t going to say anything even though I was a little surprised… we got off the elevator and walked down a long hall and took a left… but wait… the mountain was to the right… hmmm…. when he opened the room it was really VERY nice accommodations and had a balcony… so again I didn’t say anything. Once the bellhop left I decided to go out onto the balcony and check out the view… I still hadn’t decided if I was going to say anything to the front desk. When I opened the sliding glass door I immediately heard this really loud wind sound… it actually sounded like a hurricane! I looked down and there was a large metal grate on the ground floor the size of two large SUV’s…I think it might have been a really large air conditioning unit… whatever it was.. it was VERY loud! Plus the view although decent was of the valley NOT a view of the mountain!

I went inside and my wife asked me what was wrong… because I don’t have a great poker face. I told her I was pretty disappointed with the room because I had gone through so much trouble to make sure it was going to be that “cream of the crop” part of the trip. Yes the room amenities and decorations were great, but the valley view and the fact that I had a constant mechanical hurricane out my balcony really diminished my “value for price” assessment of the room. At that point I decided to approach the front desk with the issue and explain gracefully the whole situation.

The front desk supervisor was again VERY pleasant, but she was unable to find another room that night and said she might be able to move us up one floor and on the mountain side the next day… but we would need to be out of our room early in the morning and would not have access to our new room until late in the day. It sounded less than ideal because we have 2 young kids that sometimes need to take naps, but I told her I would talk it over with my wife and let her know. We decided it would be too difficult to repack everything and not have access to the room all day, so I called her and told her that wasn’t an option for us and we ended up staying in the mechanical hurricane room. When I asked her why we lost our assigned room she was not able to give me a straight answer. I found out from another staff person that the Teton Mountain Lodge is run like a hotel, but each room is independently owned and if one of the owners decides to come… even last minute… they get priority. That makes sense for the owners, but can leave guests like us out on a limb.

I bounced back and enjoyed our stay. The hotel staff was great, the food was good, the location was great, the room setup and décor was great… and overall it was a good stay, but on the day of check-out I decided to give them one more chance to recover my business and told the front desk manager what had happened. She was VERY polite, apologized, and even offered us one free night stay during our next visit. I know this was a nice gesture, but it just didn’t sit well with me or recover my loyalty. I would have much rather had a credit for one night rather than a hook to get me back for another visit. I thanked her and left still feeling disloyal to the Teton Mountain lodge.

After getting resettled at home and work for a few days I started reflecting on our trip… and then I received a email survey from the Teton Mountain Lodge. I took the survey to see what would happen… my whole blog is about “Fantastic Failures” and I wondered if I filled out the survey would I receive a follow-up and would they recover my business and loyalty. A few days letter I received a personal email from the front desk manager and she said she remembered talking to me at check-out and re-iterated her offer for a free one night stay in the future… I was really happy they followed up on the survey to “close the loop”, but if the offer didn’t sway me the first time it wasn’t going to work the 2nd either.

Yes the trip was fantastic, but as a Loyalty professional I like discussing my real life experiences here on my blog and what I find that make people loyal or disloyal… this is a perfect example. Since I run a Net Promoter Program, I asked myself:

On a scale of 0-10, How likely is it that I would recommend Teton Mountain Lodge to a friend or colleague?
My Answer when I checked out: 0
My Answer after the follow-up Survey and email: 2
My Answer if they would have given me a partial refund: Probably a 9

At this point I would NOT recommend Teton Mountain Lodge to anyone and even if I use that one night stay voucher, we’ll probably only stay there one night. This got me thinking about what was missing and how they could have better handled the situation… and it boils down to one thing… an open conversation on what it would take to recover my loyalty. If they simply ASKED “what” they could do… I probably wouild have asked for a one night credit… which would be the same cost as what they offered me without the “hook”. Yes, sometimes you get people who ask for the moon, but an open discussion leads to better outcomes and would have turned this failure into a Fantastic Failure!

Overall our trip was amazing and one of the best vacations I have been on in my life. We got a lot of quality time together as a family and saw lots of breathtaking nature scenery. Here is a small sample of some of the photos we took on this trip:

If you want more info on *Net promoter, please visit the Net Promoter Website

Other External Links:
Teton Mountain Lodge
Trip Advisor for Jackson Hole
Jackson Hole
Yellowstone National Park
Grand Teton National Park
Bain & Company
Satmetrix

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

Executive Sponsorship… is the Golden Ticket!

A couple of weeks ago I spent a few days in a conference room with the top Executives of my division. Our discussions where wholly focused on our loyalty programs, the data, action items, and how we can leverage our data to further improve our customer’s experiences and therefore increase our loyalty. I had a light bulb moment realizing that I am particularly fortunate to have the ears of these key leaders and that they are fully engaged in the loyalty program. They view the loyalty info as fundamental, rather than an afterthought or a bright shinny object that they can point to.

These meetings got me thinking about how many loyalty programs are destined for failure… or at least they’ll be marginalized in their success because of their lack of top Executive Sponsorship. Having the top Executive sponsorship allows countless synergies that cannot be listed here, but here are a few top benefits:

1) The Executives set the standard for the focus of the company. If they are really focused on customer loyalty and are using the data… ultimately so will everyone in the organization.

2) The Executives have the larger broader view of the business economics and can bring a valuable perspective to the loyalty data. In the end this will make the program much more successful with increasing loyalty.

3) The foundation of a great loyalty program is not collection and dissemination of the data, but rather the operational and strategic changes we make in our business based upon what the data is telling us… you NEED Executives to drive these changes!

4) When customers know that a loyalty program is being utilized by the Executive Team to drive operational and strategic changes, they are more likely to:
a. Take the survey and therefore increase sample response rates
b. Provide in-depth verbatim responses that help make the statistical information more actionable.
c. Respond when asked for more in-depth interviewing of their experiences.

Over the years that I have been running loyalty programs, I have had a mix of whether the programs were appropriately sponsored at the Executive level, but now that I have had exceptional Executive sponsorship over the last 2 years… it has convinced me of 2 things:

1) Having Top Executive Sponsorship…. is the Golden Ticket!
2) I really don’t want to run another loyalty program… unless I have the golden ticket!

Sincerely,
Chris Antonelli
FantasticFailures.com

There are three kinds of lies…

The phrase “There are three kinds of lies: lies, damned lies, and statistics” was popularized in the United States by Mark Twain (among others), who attributed it to the 19th-century British Prime Minister Benjamin Disraeli… I actually heard it from one of my lifetime buddies Ben Hamilton who is probably one of the biggest geeks I know :)

Regardless of who the original author was of this quote, it is 100% true! I run multiple Satisfaction and Loyalty/Relationship Surveys for my corporation and we are always looking for new ways to slice and dice the data in-order to get to the most meaningful and actionable data. Don’t get me wrong, this is a great practice for sure, but I do find myself searching sometimes for what the REAL answer is in all of the data… if there were just ONE lever I could pull in our business to increase our loyalty… what would it be? Yes we can do multiple regression analysis, trends charting, correlation analysis, etc… but what does it all mean as a bottom line?

The data is really good, but I find the most powerful and meaningful data we get from our surveys is in the comments analysis and categorizations, closed loop calls, & customer interviews. These interactions provide us the raw, uncensored words of one of our customers. If we read and/or listen to the comments… and then look at the scores… it makes the entire survey come alive with so much more foundation/context because it adds a “human connection” aspect that is otherwise sanitized by data.

Yes, let’s keep surveying our customers and looking at the data in great detail, but let’s make sure we “listen to our customers and make sure we are connected with their voice… after all… it is called “Voice of the Customer”!

Quote Source: (http://en.wikipedia.org/wiki/Lies,_damned_lies,_and_statistics)