Category Archives: Customer Insight

How to be insanely service centric – Lessons from Zappos

Posted on November 13, 2012 by | Leave a comment

Customer Culture Car from Zappos

Zappos is renowned globally as a legend in customer service, partially for the e-retailer’s unique approach to customer interaction management. Zappos invests in the call center not as a cost, but as a marketing opportunity

Recently, Software Advice  Analyst Ashley Furness sat down with the company’s Customer Loyalty Operations Manager Derek Carder. He said the company’s whole strategy is to create loyalty through incentivizing ‘wow’ moments and emotional connections. Here are the four KPIs they use to monitor, track and improve performance:

  • Measure Total Call Time, Not Time Per Call

Instead of valuing quick time to resolution or processing high call volumes, Zappos looks at the percentage of a time an agent spends on the phone. Agents are expected to spend at least 80% of their time in customer-facing communications. This measure – called personal service level – is a way to empower the team to utilize their time how they see best promotes customer loyalty.

Reps who achieve this target get receive rewards, while those who fall below the 80 percent line are coached.

  • Quantify and Reward Wow Moments

Zappos measures calls against a 100-point scale called the “Happiness Experience Form.” This is based on answers to the following questions:

  1. Did the agent try twice to make a personal emotional connection (PEC)?
  2. Did they keep the rapport going after the customer responded to their attempt?
  3. Did they address unstated needs?
  4. Did they provide a “wow experience?”

Agents are expected to achieve a 50-point average or higher. Again, agents earn incentives for meeting their goals, while under performers are required to take extra training.

  • Mine for Idle Chats

Zappos monitors “abandonment time,” or periods when an agent has a session open even though the customer already disconnected from the chat.  Carder said sometimes agents do this purposely to avoid responding.

This strategy of looking for idle chats zeroes in on the cause of unproductivity. When agents aren’t productive, customers wait longer. And the longer they wait, the more apt they are to abandon the session.

  • Reward Perfect Attendance and Punctuality

Zappos uses a program called Panda to combat absenteeism. Employees receive a point for every day they miss work or come in late. Staff with zero points in a given period receive a varying number of paid hours off. These hours can be accrued and stacked for an entire paid day off, Carder explains.

The primary take away is that Zappos created metrics that emphasize creating a relationship with the customer rather than rushing them through the call. At the same time, these KPIs still successfully improve performance and make employees feel appreciated and rewarded.

This is what call center metrics look like when they are designed to maximize value for customers, rather than minimize costs for the company…..

Thanks to Ashley Furness for providing great inputs for the content of this post, for more on this story visit her here

Leave a comment

Posted in Customer Centric Culture, Customer Centric Values, Customer Experience, customer focus, Customer Insight, Customer Metrics, Customer Satisfaction, Customer Service, Customer Value, Customer-Centricity, Empathy, Employee Engagement, Freedom, Market Culture in Action, Trust, Voice of the Customer

Tagged

How Amazon’s customer centric culture breeds innovation

Posted on November 12, 2012 by | 1 comment

Amazon Customer Innovations

Amazon’s vision is to be the world’s most customer centric company and what this means in practice is they are always looking for ways to add value to customers. This year that has meant innovating in the physical world rather than just the online world.

One of the problems all online shoppers face is what happens when I get something delivered and I am not home? Missed deliveries……..

To address this need Amazon has begun expanding its physical footprint in the US by providing the Amazon Locker. This push first started with the 24 hour convenience chain, 7-11.

It recently announced a partnership with Staples to extend its locker footprint to their stores. Customers can opt to have packages sent to their nearest staples store, they are then emailed a code and have 3 days to pick up their package.

Given Amazon’s mission to save customers money, it is a great strategy designed to expand its options available to customers without increasing its costs substantially.

It is potentially an interesting win-win partnership with Staples who competes with Amazon in the online environment. Staples will get a fee and more foot traffic and Amazon a physical footprint to provide more convenience for customers.

From a competitive standpoint this development also makes sense as the major physical retailers get better and blending online and offline purchasing options. For instance more than half of the sales from Walmart.com are picked up at Walmart stores so customers clearly like this option.

The only way to compete in this environment is to innovate around the ever evolving customer needs, does your company have a customer centric culture?

1 Comment

Posted in Competitor Insight, Customer Centric Culture, Customer Experience, Customer Insight, innovation, Innovative Thought

Tagged

Reinventing your small business with a deeper understanding of customers

Posted on November 9, 2012 by | Leave a comment

If you can develop an ongoing unique understanding of your customer’s needs through discussion and observation you will have a competitive advantage.

A great small business example comes from Lex Dwyer, a Melbourne based fitness instructor who repositioned his services as a result of observing customers for hours at a time.

At first he was providing “light relief” at corporate planning workshops by giving executives tips on how to look after their health. He then added to this, physical challenges for managers working in teams, to achieve a specific goal like building a bicycle without assembly instructions. Each team would have an incorrect collection of parts, which needed to be traded with other teams to complete the task. These “games” added value to the planning sessions by incorporating leadership, collaboration and teamwork principles.

Understanding Customer's Fitness Needs

However, as Lex attended his clients’ working sessions he was able to design physical challenges as games that reinforced their business goals. He did this by listening to their discussions, observing their frustrations and disagreements and understanding their business challenges.

This insight enabled him to design exercises as a real-time responses to their observed needs and tie their thinking together in a more holistic approach. Lex found he had a particular talent for seeing the “big” picture and tying together his games with the client’s strategy. As a result he repositioned himself as a provider of leadership services and now works with corporate clients and with business schools’ executive education programs.

Net result – delighted clients and consumers, higher revenue and making a difference to people’s lives. Lex’s personal vision of “making a difference” is a reality.

To gain deep customer insights, you have to ask questions and observe customers in multiple ways with disciplined processes. Insight comes from integrating different pieces of information and gaining a multi-faceted knowledge of your customers. It is gained from knowledge of how they think and act before, during and after their purchase. It requires knowledge of the entire customer experience.

Leave a comment

Posted in Customer Centric Culture, Customer Insight, innovation, Innovative Thought

Tagged

How you can create killer customer insights

Posted on November 8, 2012 by | Leave a comment

Customer Insights

Customer insight comes from a deep understanding of customers’ needs and drivers of customer behavior at a level well beyond what customers themselves can explain. These needs are understood from what customers tell us, but more deeply from what we observe customers doing and the frustrations they have in using particular products, services and companies.

Richard Branson, when trying to identify industries to enter a new Virgin service, asks the brainstorming question – “What are 10 things that nobody would say about this industry?” He and his team then prioritize those ideas that would create value for customers and profits for virgin. The next step is decide if a Virgin service can be designed to deliver some of these unspoken values in that industry. It is a great example of outside in thinking, starting with the customer’s pain points or needs and working backwards.

At Mercedes-Benz, rather than asking customers “What do you think of Mercedes-Benz?” a standard question that gets the standard answers about high quality, luxury and so on, they reverse the question –

“What do you think Mercedes-Benz thinks of you?”

This unique twist on a common question results in much deeper insights. Many customers responded initially by saying thing like “ you think we are made of money … that we have all the time in the world”. These responses  led the company to find ways of making its car servicing much more convenient for customers and to build in servicing costs to the initial purchase or lease arrangement.

In both cases these are questions designed to get customer insight that goes beyond what customers will normally tell us.

Are you asking the right questions?

Leave a comment

Posted in Customer Centric Culture, Customer Experience, customer focus, Customer Insight, Customer Value, Customer-Centricity, innovation, Innovative Thought, Outside In

Tagged

What’s the difference between customer focus and customer culture?

Posted on October 31, 2012 by | Leave a comment

aligned customer culture

Ask any business leader if they and their business is customer focused and you will invariably get the answer – “of course”! But, you’ll find, as I have, that the term ‘customer focus’ means different things to different people.

It ranges in its meaning from ‘good customer service’ to ‘identifying the needs of customers and delivering products and services that meet those needs’ to ‘ensuring that the whole organization, and not just frontline service staff, puts its customers first’. In this last meaning, every department and every employee should share the same customer-focused vision. For this to occur, an organization must have a culture based on the belief that what’s best for the customer is best for the business. It is this meaning of customer focus I call customer culture.

A customer culture is embraced by every individual, team and business unit. It is embedded in people through induction, leadership, processes, rewards, key performance measures, a common language, and an expected way of doing things. What’s more, customer culture is a discipline – a shared set of behaviors and skills that can be developed, refined and practiced to become habits that lead to better personal and business results.

A strong customer culture delivers a customer experience that is consistently excellent along the whole service chain. The ultimate aim is to have the customer make your business the center for everything they do for your particular offering. You can’t get to the ultimate unless you start with the right culture – a customer culture.

Does a customer culture matter?

It may sound like a simple question with an obvious answer. For most of us the answer to this question is intuitive: yes, customer culture matters! We are all customers and when we reflect on our most fulfilling business relationships we sense these companies are focused on our needs and helping us be satisfied and successful.

But, does customer culture really matter to business performance? Our answer is a resounding Yes! After spending 3 years researching this question we have scientific evidence to show that it does matter. It has a deep impact on an organization’s business performance and sustainability. In fact, you only have a sustainable business if it is driven by a customer culture.

How do you get it?

Although companies like Amazon and Zappos provide great inspiration, they are examples of companies that were born with a unique deeply innovative leader who embedded a customer culture from the start. But, what about companies that must transform from an inward looking culture to one that is externally focused and embraces the customer like many of the telecommunications and energy incumbents that have a monopoly legacy? Or companies like HP or Starbucks that were born with a customer culture, lost it along the way and are having to work hard to get it back.

Research and experience show there are 4 stages to getting and keeping a customer culture: Initiation, Implementation, Embedding and Reinforcement. I will talk about each stage in my next four blog posts.

If you want to build this capability in your organization check out our MarketCulture Academy.

Leave a comment

Posted in Customer Centric Culture, Customer Experience, customer focus, Customer Insight, Customer-Centricity, Market Culture in Action

Tagged ,

How customer immersion programs amplify a customer culture

Posted on October 26, 2012 by | 4 comments

customer immersion programs

One of the most significant challenges for large businesses is staying engaged with the lifeblood of the business – customers. As businesses grow people become disconnected from customers at all levels of the organization. It’s the leadership’s role to bring a focus back to customers and how every individual has an impact.

There is nothing like the personal customer insight and impact to be gained from interacting with customers. You get the raw emotion of a frustrated customer appealing for help if you listen in to customers describing the problems they are having with your product or service to a call center rep. It can have even greater impact if you watch customers trying to buy your product and experiencing increasing frustration from time-consuming processes or unwieldy websites.

Senior executives and other non-customer facing staff don’t really understand their customers unless they can experience what customers are going through. Customer immersion programs are designed to do just that – give people a first hand experience of how customers are thinking and acting.

Credit Suisse, based in Switzerland, follows a five step process for immersing executives and senior managers with a customer perspective:

  1. Conduct business: the executive goes into a branch, waits in line and conducts business with a teller
  2. Watch the customer: look at what the customer looks at and see how he behaves when doing business with the company
  3. Talk to customers: ask questions of customers and listen to their responses
  4. Investigate other channels used by customers such as the website, call center and the company’s publications: use these channels as a customer to apply for credit, get an answer from a sales rep and decipher brochures
  5. Review the experience at a workshop: discuss insights, compare experiences and lessons learned

On this side of the Atlantic, Adobe recognized they weren’t always easy to do business with, and were not consistently delivering the level of service customers expected. Adobe’s Customer Immersion Program provides Adobe’s senior leaders with the opportunity to experience first-hand what their customers experience when they engage with Adobe. Like Credit Suisse, executives and senior managers at Adobe have the opportunity to experience what a customer would experience by playing the role of a customer. Also they experience the interaction with customers when they call in with a problem or a need. Check out this short video describing what’s involved:

Adobe’s Customer Listening Post facility brings customer experiences to life –  live video and data feeds showing what’s happing in real-time.

Technology such as camera phones, videography, button cameras and online diaries to document the immersion process enable you to play back customer interactions and experiences with your business.

The power of the immersion program is when it challenges people’s perceptions of who their customers are and how they use their products. A key benefit of immersion is its ability to create a culture of consumer-focused thinking within the organization from top to bottom. First-hand experience and advocacy by senior executives dramatically enhances a customer culture in the organization. Companies best internalize the consumer perspective when executives at all levels can experience its impact. It fosters a greater appetite for customer understanding. It ultimately leads to an improved customer experience.

Come and hear more about how to create a customer culture at these two great live events put on by GlobalHRNews and the Executive Next Practices Institute:

November 13, 2012 – Global Leader Conference – Chase Building New York

BUILDING the “CUSTOMER CENTRIC” ORGANIZATION

November 29, 2012 – A Re-Set of Strategy and Opportunity Capture for 2013 – Academy of Motion Pictures in LA

Just 3 weeks after the US elections, join top CEO’s and other leaders from the FORTUNE 500, regulators, authors and industry thought leaders as we view a “360″ of the economic and leadership world for 2013.

I will be presenting on  “The Seven Disciplines of a Customer Centric Culture” and part of a panel discussion on the implications of the election results and what to expect in 2013.

4 Comments

Posted in Case Study, Customer Centric Culture, Customer Centric Leadership, customer focus, Customer Foresight, Customer Insight, Customer-Centricity, innovation, Market Culture in Action

Tagged ,

Stop adding features start adding value!

Posted on October 22, 2012 by | 1 comment

marketculture_feature_creep

Those of us that have worked in the product management world know too well how easy it is to add features to a product without adding value. This is one of the key challenges in business – how do we improve the value we are offering customers without adding cost?

Unfortunately this question is often answered by adding more features to an already feature rich product. The outcome is usually a product that is more complex and often less valuable at a higher cost (thanks to the costs of adding the new features!)

What drives this behavior? Usually is one or more of the following factors:

  1. The pressure to constantly increase sales.
  2. The pressure to lead the competition
  3. Trying to be all things to all customers. (Listening to that one customer that wants a special feature)
  4. Making assumptions about what customers want without really testing their validity

How do you avoid making this mistake?

Ask yourself three questions:

1.  Does this new feature compliment the core purpose of the product?

In other words is it adding value to the problem being solved by the product. For example does it make sense to add a clock to a dishwasher? No! the product is not designed to tell the time, its job is to wash dishes.

2. Does adding this feature reduce the value of other features?

There are many examples of overly complicated solutions frustrating users. Logitech has built a whole business around simplifying remote TV controls which are notoriously difficult to use. It feels like 90% of the buttons on a TV remote are for features I would never use. This makes the whole device seem clumsy and over engineered.

3. If I add this new feature what can I take away?

Regularly review what can be removed from the product and still have it accomplish what the customer wants to achieve. Use the following criteria to prioritize which features must go:

  1. Features that are costly to support
  2. Features that detract from other value-adding features
  3. Features not used by customers

This same thinking applies to everything in marketing. Are adding value or destroying it?

1 Comment

Posted in customer focus, Customer Insight, Customer Value, innovation, Innovative Thought

Tagged

How knowing your customers improves your ability to communicate

Posted on October 16, 2012 by | Leave a comment

Stop shouting at your customers

It may sound obvious but the better you know who your customers are and what their preferences are the better your chances of finding them without having to SHOUT!

How do you get the attention of your potential customers?

What media do your customers prefer to use to get information on the problems you can solve? With the ever expanding universe of media options how do you decide where to invest? Let your customers make the decisions for you.

Where do they spend time online? Where do they network? How do they learn more about their profession? Who are they influenced by?

Finding out more about your customer’s preferences is crucial to making the right investment decisions. However choosing the right media vehicles (mouth pieces) is only half of the journey. What you have to say to customers when you find them is even more important.

What insight do you have about customers that can demonstrate you know them perhaps better than they know themselves?

Being an Ironman triathlete one of my favorite examples of this comes from the following Cliff Bar commercial which shows what its like to be a “triathlete”

This super creative 30 second tv spot really speaks to the target customer. It says we know who you are and how you feel, it is a great example of connecting with customers on an emotional level.

Was it successful? Only Cliff Bar have the actual data on that but as a customer its something I love to talk with other triathletes about. The impact of the message also means that Cliff Bar is always top of mind when it comes to selecting or recommended sports nutritional products to others.

Which company ads or messages really stand out for you?

Leave a comment

Posted in customer focus, Customer Insight, Innovative Thought, Value Propositions, viral video

Tagged

Stop listening to everything customers say!

Posted on October 10, 2012 by | Leave a comment

stop listening to customers

Now I realize this is a strange heading for someone that evangelizes creating a customer centered culture. However, there is a subtle nuance to one of the core elements of our model – the customer insight and foresight dimensions.

This nuance is significant as it relates to the biggest challenge in innovation – how do we know what customers really want?

Henry Ford has one of the most famous quotes on this idea, to paraphrase:

“If I had asked my customers what they wanted they would have told me to build a faster horse”.

This is the dilemma that faces all innovators, you need customer input, but you also have to take what customers say with a grain of salt. Customers often don’t really know what they want, in fact many will tell you “I’ll know it when I see it”.

No one asked Steve Jobs to build an iPad. What Job’s recognized was that tablet devices did not work well enough for them to ever be adopted on a mass scale. The unmet needs existed but customer’s could not articulate them into a product. As an innovator it is up to you to do the hard work of uncovering these unmet needs and devising a way to build a product.

A related challenge is  customers often don’t do what they say they will. Asking a question like “If this product had these features, would you buy it?” can often result in a great response from customers but when it comes down to buying the product customers don’t follow through.

What does this mean for entrepreneurs and innovators? You need to test and learn constantly throughout the product development cycle and track actual customer behavior. Actual behavior is the barometer of a successful innovation.

Customers will vote with their attention and ultimately their wallets – making progress is initially about learning what resonates with customers and what does not.

Leave a comment

Posted in Customer Centric Culture, customer focus, Customer Foresight, Customer Insight, innovation, Innovative Thought

Tagged

4 simple practices to build a customer culture in your company

Posted on October 4, 2012 by | Leave a comment

This is a great short video interview with Tony Hsieh of Zappos discussing how the concept of culture and customers come together. Also thanks to Robert Reiss, host of The CEO TV Show.

The intersection of customers and corporate culture

The culture of an organization dictates how it will view customers and how it will treat them.

If everyone is expected to understand who customers are and what they value, then people naturally start doing this. Culture is a form of social pressure, it is the way you are expected to behave in a group environment, hence it is a very powerful way for leaders to create an environment of success.

Customer culture specifically looks at how much attention is being placed on bring the customer viewpoint into all decision making. It is a proven way to drive better business results as it ensures the business is aligned with its market.

Here are some great customer culture building practices that you can begin today regardless of the role you play in your company:

1. Put Customers on the Agenda

A great habit that gets everyone thinking is to start every meeting with a customer insight. Share one piece of feedback you’ve collected, one idea you have heard directly from a customer. These insights and stories can come from anywhere in the company. It does not have to be a deep conversation – just a way to get in the habit of brining the customer viewpoint inside before getting on with the rest of the meeting’s agenda.

2. Building Customer Empathy

Have someone share their own recent customer experience. Was it a positive one? What made it positive? Why did it stand out in their mind? How does it affect the way they think about that company and would it influence whether that would continue doing business with them? What does it mean for your company?

This simple exercise is a great way to build customer empathy in the team. By thinking like a customer you can make changes that will drive increases in value.

Steve Jobs and his leadership team conducted a similar exercise and recognized how dissatisfied they all were with their mobile phones. In their experience, phone’s were difficult to navigate, complex and basically not user friendly. This created the drive and inspiration to develop the iPhone.

3. Encourage Leaders to Share Customer Stories

Create a regular opportunity for senior executives to report on what they learn from their own conversations and interactions with customers.

There maybe extra leg work to translate what they heard into a useable insight, but it will be well worth the effort.

4. A Top Successes/Frustrations Customer Conversations Report

Create an ongoing forum for people to share what customers are saying in the form of a communication piece to the whole company. It should be in story form but can include statistics on key customer metrics ie things that are important to customers that your company helps them achieve. For example LinkedIn tracks how many new connections it helped people create on its professional networking site each day.

It should also include the top frustrations customers have when doing business with you. This highlights to everyone the priorities in terms of maintaining and improving customer satisfaction levels.

We have lots of FREE tools, templates and elearning modules to help build your customer culture here

What other practices do you use to drive a great level of focus on customers?

Leave a comment

Posted in Branding, C-Level Quotes on MarketCulture, Competitor Insight, Customer Centric Culture, Customer Centric Leadership, Customer Experience, customer focus, Customer Insight, Customer Metrics, Customer Satisfaction, Customer Value, Customer-Centricity, leadership, Market Culture in Action

Tagged , ,