Category Archives: Customer Advocacy

Get more customer insights with these 5 questions

Questions to uncover customer insights

If you want really insightful information from your customers, try asking these 5 open-ended questions:

What is the one thing you think we do really well?

This question will help you identify what customers really like about doing business with you. You may have your own opinions on this, however more than likely you will be surprised by customers’ opinions on what they consider as your biggest differentiator.

What is the one thing we do that you think needs improvement?

This enables you to get real feedback on areas of your business that need improvement from a customer perspective. Some of the customer responses might be unexpected, but this is truly valuable insight for improving your business relative to actual customer experiences.

What is the one thing we do that we should stop doing?

Companies rarely ask their customers this question. The problem is that many businesses do things because they think that’s what customers want or because they’ve always done it. This could be something that a company spends resources on but has no or even worse negative value for customers.

What is the one thing we don’t do that we should start doing?

Your customers have done business with many other related and unrelated companies and have seen good and bad business practices for how businesses deal with customers. These answers can provide great ideas for improving the experience for your customers and developing stronger competitive differentiation.

Would you recommend us to others?

This question will tell you whether or not your customer is someone that will help drive positive word of mouth.

Is the Bell Canada Transformation Enough for a Competitive Future?

transformational_customer_centric_cultureLike most telecommunications companies in North America, Bell Canada has undergone a major transformation over the last four years since 2008.

In a 2009 article titled “How Bell Canada remade itself from the top down’, Ed Gubbins explained how the company changed its culture, operations and cost structure. George Cope, appointed President and CEO in 2008, led this transformation.

Along with reducing its headcount, reducing management layers, overhauling its field operations reducing its broadband repair response time from 8 days to 1, eliminating some brands, it implemented a “pay-for-performance” pay structure. A number of services were introduced to provide better and quicker service for customers. During 2011 and 2012 Bell made joint investments with Telus in wireless networks. It also attempted to acquire media company, Astra Media, but was thwarted by the CRTC regulatory body.

In 2013 Cope is continuing to lead this transformation of Canada’s largest communications company into an efficient customer-focused competitor, based on a strategy of enhanced service capability, significant broadband network investments and a high-performance team culture.

But is enough being done to create an enduring customer-focused culture to ensure Bell Canada’s competitiveness and profitability in the future? Bell operates in a marketplace being disrupted by technology. Transforming a large incumbent communications company from a technical engineering focus to a customer-centered organization is difficult and takes time. Cutting costs and building networks is the easy part.

Building the business on a customer culture foundation will be the one thing that Bell Canada must do to ensure its competitive future.

Do your customers inspire you? How Virgin Rail was saved by its customers

inspired by customers

Sometimes our customers inspire us to great heights. 

Recently Richard Branson’s Virgin Trains created a major bureaucratic turnaround by sheer force of will and the inspiration of their customers.

On September 10th 2012, Richard Branson and his CEO of Virgin Rail, Tony Collins, were answering questions at a Parliamentary Enquiry in London initiated by Branson. This was about the awarding of the West Coast train franchise (London to Glasgow) to a competitor, FirstGroup – a franchise that had been held by Virgin Trains for the previous fifteen years.

Branson said: “We submitted a strong and deliverable bid based on improving the customers’ experience through increased investment and innovation.”

He added: “Our team has transformed the West Coast line over the last 15 years from a heavily loss-making operation to one that will return the taxpayer billions in years to come.”

Branson, who had considered abandoning the rail industry in Britain after this 4th unsuccessful bid (second each time), decided to put up a fight this time. It was not because of the money – he has plenty of that – it was because of the customers and the staff of Virgin Rail.

Buoyed by 170,000 passenger signatories to an e-petition supporting the company, rallying support from unions and staff, he decided to press the government for an investigation into the transport franchise tendering process and how decisions were made.

When asked on 10th September by a member of the Parliamentary Inquiry why he was objecting, he said: “The customer is the heart of our business”. He went on to say that customers and staff had given overwhelming support to him and the CEO, Tony Collins, and he did not want to let them down. The growth of over 10% per annum in passenger numbers over the previous 10 years was testimony to the customer appeal and quality of the service provided.

The parliamentary Enquiry overturned the decision to award the franchise to the competitor, citing irregularities and lack of transparency in the bid decision.

Here is a man who believes that the most important thing in business is to have satisfied customers and fully engaged, happy staff around a customer culture that delivers increasing value to all stakeholders – and he has proved it in Virgin Rail and other Virgin businesses.

This only happens when your customer culture is so strong that your customers not only like your products and services, but they love you and your organization. When the going gets tough, your customers will “go in to bat for you”.

Would your customers help save your business?

Customer Metrics: Measure what matters most to customers

Key Customer Metrics

As business leaders we tend to pay a lot of attention to the metrics important to the business, that is, revenue, cash flow, profitability, growth and so on… but the real drivers of these business outcomes are customers.

So the obvious question becomes what customer metrics should I be tracking to make sure my business metrics continue to head in the right direction?

Well there are a number of key customer metrics that must be considered for every business:

1. Customer Satisfaction

As a first step it is important to track customer satisfaction, this will provide some inputs as to how well the business is performing on delivering what it promises. But remember customers have already paid for satisfaction, they expect to get what they paid for. So high levels of dissatisfaction are an obvious and immediate cause for concern.

Satisfaction is not enough, even highly satisfied customers can and do switch to alternatives so it is important to also look at Loyalty and Advocacy. That brings me to the next question (Fred Reinhold calls the “Ultimate Question“) How likely are you to recommend us? Loyal customers not only bring you repeat business, they also expand your customer base through positive word-of-mouth.

2.Net Promoter Score

The net promoter score is a simple tool designed to identify 3 types of customers, promoters (advocates with strong positive word of mouth),  detractors (negative word of mouth) and those in the middle. The goal is to drive up the number of promoters as a way of driving business growth.

Many of the most customer focused businesses in the world use NPS, see below a list of the current top 10 Netpromoter scores in the US:

USAA – Banking = 87%
Trader Joe’s = 82%
Wegman’s = 78%
USAA – Homeowners Insurance = 78%
Costco = 77%
USAA – Auto Insurance = 73%
Apple = 72%
Publix = 72%
Amazon.com = 70%
Kohl’s = 70%

Source: Satmatrix

3. Customer Value Analysis

This is a more advanced metric specifically looking at the value a customer places on what you offer. Value consists of an equation that includes CUSTOMER PERCEPTIONS  of price,  service and product quality. Customer value analysis looks directly at how customers view your business vs. your competition and provides you with valuable information on what you might need to adjust in terms of both product and service quality, as well as price, to increase market share and revenue. For a free example and a spreadsheet tool on Customer Value Analysis you can visit our easyLearn site here.

4. Life Time Value of Customers

I talk about this in some more detail in these two posts:

Part 1: Understanding Lifetime Value of Customers

Part 2: Calculating Lifetime Value of Customers – a simple example

Something not covered however were some of the inputs to Customer Lifetime Value which in themselves are useful metrics:

Customer Acquisition metrics include customer awareness levels, the information sources customer use to make purchase decisions, and cost of acquiring a customer.

Churn (%)  measures how many customers are leaving, that is, customer attrition.  Churn is a commonly used metric related to customer retention. Specifically this is about knowing how many customer are defecting and why.

Customer Complaints are usually an early warning signal that something is wrong. Most customers will not complain they will just take their business elsewhere. Complaints although often difficult to hear are a gift that can help course correct.

What Criteria should I use when deciding on Customer Metrics?

  1. The metric drives business results
  2. The metric correlates strongly with business results
  3. The metric is something you can influence
  4. The metric can be measured accurately
  5. The metric can be measured consistently
  6. The metric can be measured cost effectively
  7. All the stakeholders agree the metrics meet these criteria

Ultimately you want to choose the right metrics for your specific business, they should be tailored to the unique business drivers and business strategy.

Why implement customer metrics?

Tracking customer metrics is important for many reasons, but the most important reason is cultural. It gets everyone on the same page, aligns people across the different parts of the business, and leads to a customer focused culture of success. You should celebrate wins when a key customer metric reaches a new and important milestone. Choosing the right metrics and celebrating progress against them are incredibly important to building a strong customer culture that can work together and grow rapidly.

If you want to dive in a little deeper on reliability and validity of these measures here is a great post from Bob Hayes on some of the technical considerations of customer metrics 

What customer metrics are you using?

A new way to innovate and get funded

Customer Focused Innovation

One of the biggest challenges in businesses is determining whether your new product or service actually fills a need. It maybe a cool product, you may like it yourself but if no one will pay money for it, its just a hobby.

There are some really interesting emerging online businesses designed to help entrepreneurs with just this problem.

Kickstarter is one site that has received significant exposure thanks to the incredible success of the Pebble Watch project. Essentially a smart watch that connects to your iPhone apps so you can control music, view text message, get news feeds right on your wrist.

The project raised almost $3 million in 3 days from its “backers”, essentially its future customers and supporters. When the project finally closed it had over $10 million in pledges that was used to get the business off the ground and get production going. In return for the pledges the backers will receive the first editions of the final product.

What’s great about this approach is how it leverages social media and the online world to get projects in front of supporters and early adopters and asks them to commit funds upfront.

We know from working in market research that a lot of potential customers say they like a new product idea but when it comes to actually purchasing they don’t follow through. This is a great way to get commitments to a project before invest time and money.

Another cool success story comes from Scott Wilson a designer of the Apple Nano wrist band. Experts told him it would never work, no one would pay a high price for a premium wrist band for the Nano.

The Nano Wrist Bands

Within a month Scott raised more than $1 million dollars to fund production and a large number of the wristbands sold at twice the price predicted by experts, $79. In fact 76% of customers said they purchased the Nano because of the wrist band, now that got Apple’s attention!

Kickstarter is only available to entrepreneurs in the US at this stage so some other alternatives are listed here ( I found this list on Quora):

FundedByMe.com is a successful Nordic platform for crowdfunding that will soon add the element of equity crowdfunding
StartSomeGood.com – a kickstarter-like platform for social good initiatives globally.
PleaseFund.Us – pretty similar to Kickstarter but in the UK, using paypal
IgnitionDeck.com – A crowdfunding plugin for WordPress.
Indiegogo.com – Just like Kickstarter, but with more options.
Crowdfunding-Website-Reviews.com – A site devoted to reviewing kickstarter alternatives
http://haricot.ca (English and French, open to all)
Fundly.com – “Crowdfunding Platform for Social Good” ”

Source: Quora

Are you focused on your customer’s profit producing behaviors?

Show me the money!Do you know which of your customers are profit producers?

It’s a great way to think about that core group of customers that really drive your business forward. These are typically what we think of as our most loyal customers, our advocates and what they do can be more powerful that the best sales team in the world.

For starters they buy your products more frequently and at higher values that other customers.

Secondly they recommend you, provide feedback, support new products and typically ignore competitive messages.

As a leader in your organization what are you doing to enhance these behaviors? Do you make it easy for your customers to share their stories?

Do you recognize these customers and create unique experiences that provide extra value for them?

Some companies with traditionally poor records on this front are starting to step up in this area namely United Airlines.

United is now delivering more than just frequent flyer points but differentiated experiences for frequent flyers such as more room leg and priority boarding. They are also targeting customers with relevant and timely upgrade options as well a a broader range of flexible options for using points for travel and shopping.

What can you do differently for your best customers?

The 5 Crucial Questions you must answer about your customers

There are 5 crucial questions every leader must answer about their customer base:

1. Which customers are your most valuable and why?

2. Which customers are costing you more time energy and stress than they are worth?

3. Who are your advocates? Customers that are driving new business by referring you to others?

4. Who are your ideal prospects?

5. Which prospects are most likely to become customers and why?

Why are the answers to these questions important? Understanding who your best existing and potential customers are is essential to growth and to the allocation of resources.

By spending more time with your best customers and less time with those that drain your resources you can free up the time necessary to attract new customers.

The answers to these questions should drive your marketing strategy, implementation tactics and ultimately improved return on investment (ROI) from all of these activities.

Do you know the answers?