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55 customer experience facts not worth ignoring 0

Posted on January 29, 2017 by Rob Petersen

customer experience

Customer Experience (CX) is the interaction between an organization and a customer over the duration of their relationship.

The quality of the interaction is determined by:

  • Journey the customers has to take
  • Touchpoints of the company with the customer along the way
  • Environment (e.g. in person, digital, phone) in which the customer and the company interact

Customer Experience is measured by the individual’s experience during all the points of contact versus the individual’s expectations.

Much research has been done on signs companies should pay attention to help create awesome customer experiences.

Here are 55 customer experience facts not worth ignoring.

  1. 12 positive experiences are necessary to make up for one unresolved negative experience. (Rudy Newall-Legner)
  2. 6-7 times more expensive to acquire a new customer than it is to keep a current one. (Bain & Co.)
  3. A customer is 4 times more likely to buy from a competitor if the problem is service related vs. price or product related. (Bain & Co.)
  4. Consumers are 2 times more likely to share their bad customer service experiences than they are to talk about positive experiences.  (Global Customer Service Barometer)
  5. Only 1 out of 26 unhappy customers complain. The rest churn. Indifference is the enemy. (Huffington Post)
  6. A one-star increase in Yelp rating leads to a 5-9 percent increase in revenue. (Harvard Business Review)
  7. 91% of customer who had a bad customer experience won’t willing do business with your company again. (Glance)
  8. 89% of consumers who experience poor service with your brand will leave for your competition. (Forrester)
  9. 88% have been influenced by an online customer service review when making a buying decision. (Zendesk)
  10. 85% of customer churn due to poor service was preventable. (Huffington Post)
  11. 83% of consumers require some degree of customer support while making an online purchase. (eConsultancy)
  12. 82% say that getting their issue resolved quickly is the number 1 factor to a great customer experience. (LivePerson)
  13. 81% of companies motivate employees to treat customers fairly, and 65% provide effective tools and training to gain trust with their customers. (Peppers and Rogers Group)
  14. of companies with strong capabilities and competencies for delivering customer experience excellence are outperforming their competition. (Pepper and Rogers Group)
  15. 80% of companies say they deliver “superior” customer service; 8% of people think these same companies deliver “superior” customer service. (Bain & Co.)
  16. 80% of Americans agree that smaller companies place a greater emphasis on customer service than large businesses. (American Express)
  17. 78% of consumers have bailed on a transaction or not made an intended purchase because of a poor service experience. (American Express)
  18. 75% of customers believe it takes too long to reach a live agent. (Harris Interactive)
  19. 75% of brands do not know what engagement means – but are measuring “it.” (Huffington Post)
  20. 72% of consumers share a positive experience with 6 or more people; 13% of consumers who had a negative experience tell 15 or more people if they’re unhappy. (Huffington Post)
  21. 72% blamed their bad customer service interaction on having to explain their problem to multiple people. (Zendesk)
  22. 71% of visitors expect help within five minutes when purchasing product online. (LivePerson)
  23. 70% of customers whose issues were resolved in their favor say they would return to purchase from that company again (Glance)
  24. 70% of buying experiences are based on how the customer feels they are being treated.  (McKinsey)
  25. 69% attributed their good customer service experience to quick resolution of their problem. (Zendesk)
  26. 67% of consumers site bad experiences as reason for churn. (Huffington Post)
  27. 67% of customer churn is preventable if the customer issue was resolved at the first engagement. (Huffington Post)
  28. 67% of of customers reported hanging up on an automated system out of frustration at not being able to reach a live person. (Glance)
  29. 66% of consumers who switched brands did so because of poor service. (Huffington Post)
  30. 66% of B2B and 52% of B2C customers stopped buying after a bad customer service interaction. (Zendesk)
  31. 62% of organizations view customer experience provided through contact centers as a competitive differentiator. (Deloitte)
  32. 62% of B2B and 42% of B2C customers purchased more after a good customer service experience. (Zendesk)
  33. 61% of consumers age 30-49 are the most frequently angered. (American Express)
  34. 59% would try a new brand or company for a better service experience. (American Express)
  35. 58% of Americans perform online research about the products and services that they are considering purchasing. (Pew Research)
  36. 56% admit to having lost their temper with a customer service professional. (American Express)
  37. 55% of consumers would pay more for a better customer experience. (Salesforce)
  38. 55% of customer requests for service on social media are not acknowledged. (Huffington Post)
  39. 54% of those age 18-29 say they’ve never lost their temper with a service professional. (American Express)
  40. 50% of the time, customer service agents failed to answer their questions according to customers (Harris Interactive)
  41. 45% of US consumers will abandon an online transaction if their questions or concerns are not addressed quickly. (Forrester)
  42. 45% of companies offering web or mobile self-service reported an increase in site traffic and reduced phone inquiries. (CRM Magazine)
  43. 42% of service agents are unable to efficiently resolve customer issues due to disconnected systems, archaic user interfaces, and multiple applications. (Forrester)
  44. 42% of online shoppers said they had contacted a retailer about an online purchase in the last 6 months. (Forrester)
  45. 42% say companies are helpful but don’t do anything extra to keep their business. (American Express)
  46. 41% of consumers expect an e-mail response within six hours. Only 36% of retailers responded that quickly. (Forrester)
  47. 36% of customer service organizations deployed communities in the past 12 months. (Huffington Post)
  48. 33% of consumers would recommend a brand that provides a quick but ineffective response. (Nielsen-McKinsey)
  49. 26% of consumers have experienced being transferred from agent to agent without any resolution of their problem. (Global Customer Service Barometer)
  50. 24% of American adults have posted comments or reviews online about the product or services they buy. (Pew Research)
  51. 22% think companies take their business for granted. (American Express)
  52. 17% of consumers would recommend a brand that provides a slow but effective solution. (Nielsen-McKinsey)
  53. 11% of customer churn good be prevented by simple company outreach. (Huffington Post)
  54. 10% increase in customer retention levels result in a 30% increase in the value of the company. (Bain & Co)
  55. Consumers prefer assistance over the following channels: Phone (61%), email (60%), Live Chat (57%), online knowledge base (51%), “click-to-call” support automation (34%). (eConsultancy)

In addition to these facts in print, below is an infographic with many of these key Customer Experience facts in pictures.

Is an awesome experience worth creating for your customers? Does your business need help improving customer experience?

customer experience infographic

9 inspiring case studies of Customer Lifetime Value (CLV) 0

Posted on January 15, 2017 by Rob Petersen

customer lifetime value (CLV)

Customer Lifetime Value (CLV) is a prediction of the net profit attributed to the future relationship with a customer.

Peter Drucker said: “The purpose of a business is to create and keep a customer.” Which pretty much sums up the value of Customer Lifetime Value (CLV) .

CLV helps make important business decisions about sales, marketing, product development, and customer support. For example:

  • Marketing: How much should I spend to acquire a customer?
  • Product: How can I offer products and services tailored for my best customers?
  • Customer Support: How much should I spend to service and retain a customer?
  • Sales: What types of customers should sales reps spend the most time on trying to acquire?

To calculate Customer Lifetime Value, here is how to do it.

If you want examples of brands that are making the most of it, here are 9 inspiring case studies of Customer Lifetime Value (CLV).

  1. AMAZON: Consumer Intelligence Research Partners estimates that Amazon Kindle owners spend approximately $1,233 per year buying stuff from Amazon, compared to $790 per year for other customers. So Amazon pays close attention to Customer Lifetime Value (CLV). Amazon Prime has been developed to enable Amazon to efficiently compete on price and to increase customer lifetime value. According to a 2013 study by the Consumer Intelligence Research Partners, Amazon Prime members spend $1,340 annually. And that was 3 year ago. It’s more now. By applying Customer Lifestyle Value (CLV) to the development of Amazon Prime, Amazon knows how to get the most out of their most profitable customer segments.
  2. BONOBOS: Is a leading e-commerce driven men’s apparel brand focused on delivering great fit, a fun approach to style, and superb customer experience. Bonobos has always been a data-driven, customer-focused retailer. With Guideshops, Bonobos has service-oriented e-commerce stores that enable men to try on Bonobos clothing in person before ordering online. Bonobos discovers that Guideshops bring in customers with the highest lifetime value across all of its marketing channels. Insights into which channels are attracting Bonobos’ highest-value shoppers has helped Bonobos increase the predicted lifetime value of its new customers by 20%.
  3. CROCS: has always had a data-driven, customer-centric approach to marketing. When the marketing team is given a mandate to transform Crocs’ online business by becoming less reliant on promotions and discounts, the team is excited by the opportunity to improve Crocs’ profitability. The team tests to optimize promotions aimed at customers who are predicted to churn, and expands programs to coordinate a “no discount” experience across site, email and display for customers with the lowest price sensitivity. Crocs realizes 10X and 2X lift in revenue.
  4. HEAR AND PLAY MUSIC: A provider of music lesson products, uses automated lead nurturing and scoring to turn prospects into customers and repeat customers. Many of the company’s products cost less than $100. With automated messages that have a personalized tone to high value prospect, the company has seen: 1) 416% increase in Customer Lifetime Value, 2) 67% increase in click through rate from the best prospects (increased from 24.73% to 41.28% for subscribers with the highest lead scores) and 3) 18.4% improvement in lead-to-purchase time.
  5. KIMBERLY-CLARK: According to Nielsen, the typical family spends over $1,000 on diapers and baby wipes during the two-and-a-half years their children are in diapers. A Nielsen study was able to quantify the dollar value of key consumer segments, the critical nature of brand selection at various points in the consumer lifecycle and distinct differences in channel choices through key points in the baby care lifecycle.  Kimberly-Clark has a clearer picture of its target market and where its greatest marketing and promotional opportunities exist to extend and expand their market share. “Nielsen’s lifetime.
  6. NETFLIX: An average Netflix subscriber stays on board for 25 months. According to Netflix, the lifetime value of a Netflix customer is $291.25. Netflix knows that customers are impatient and some customers cancel because they don’t like waiting for movies to arrive in the mail. Due to this they’ve added a feature where you can stream movies on the web, which not only satisfies your movie urge, but it keeps you busy while you are waiting. By tracking these stats and behavior, Netflix has reduced their churn to 4%.
  7. STARBUCKS: One of the most effective ways to boost Customer Lifetime Value (CLV) is to increase customer satisfaction. Bain & Co has found a 5% increase in customer satisfaction can increase by 25% to 95%.  The same study shows it costs 6 to 7 times more to acquire a new customer than keep an existing one. Starbucks’ customer satisfaction has been reported as high as 89%. Due to high customer satisfaction, Starbucks’ Customer Lifetime Value has been calculated at $14,099.
  8. U.S. AUTO PARTS:  Realizes the competitive advantage of loyalty and decided to invest. The company debuted the Auto Parts Warehouse loyalty program, known as APW Rewards. U.S. Auto Parts began to leverage capabilities such as increased rewards for high-margin products, personalized post-purchase enrollment offers, a status tier, and triggered email campaigns based off of a person’s repurchase history to maximize customer lifetime value. U.S. Auto parts increased its spend per member by 20%, its repurchase rate by 14%, and its enrollment rate by 45% after updating the loyalty program of its flagship brand,
  9. ZAPPOS: Has found people who regularly return items can be some of your best customers. It says that clients buying its most expensive shoes have a 50% return rate. Placing a priority on Customer Lifetime Value, Zappos has identified their best customers have the highest returns rates. They are also the ones that spend the most money and their most profitable customers. That’s why Zappos has a 365-day returns policy, free two-way shipping and doesn’t charge for returns.

Do the way these companies pay attention to Customer Lifetime Value inspire you with ideas for your company. Do you want to learn more about making the most of out of CLV.

10 best tools for Sentiment Analysis from free to fee 0

Posted on January 02, 2017 by Rob Petersen

Sentiment Analysis

Sentiment Analysis extracts relevant actionable information and “overall” attitude of customers toward specific product, service or topics from unstructured  data without reading thousands of documents manually, thus saving valuable time and resources.

Sentiment Analysis is a key metric in many industries for gauging reaction to a new product or services, identifying major difficulties that customers are experiencing in a product, identifying root causes of quality issues and gaining inputs for marketing campaigns. Many consider Sentiment Analysis an essential element for any company doing Social Media Monitoring.

Is a Sentiment Analysis something that has value for your business? Then, here are the 10 best tools for a Sentiment Analysis from fee to free.

Apache NiFi - Sentiment Analysis

APACHE HADOOP: Is an open source framework for distributed storage and processing of large sets of data on commodity hardware. Hadoop enables businesses to quickly gain insight from massive amounts of structured and unstructured data. A wide variety of companies and organizations use Hadoop for both research and production. Apache NiFi supports powerful and scalable directed graphs of data routing and transformation.

Brandwatch - Sentiment Analysis

BRANDWATCH: Get deep insights into consumer opinion on any topic from across the social web. Brandwatch can deliver a huge amount of data for analysis. Its extensive filters and customizable reports make that data easy to analyze and put to use for marketing campaigns, product research and reputation management. It’s especially good for agencies or businesses with multiple users with different needs.

Cision - Sentiment Analysis

CISION: Monitor conversations across social channels including Twitter, Instagram, Pinterest, YouTube, Google+, Tumblr, Foursquare, and more. Identify performance trends and insights with social media listening. Manage and track your brand’s reputation by exploring what people are saying about your business across a variety of social platforms. Identify leads, gauge the impact of your tactics and determine how you stack up against the competition.

Critical Mention - Sentiment Analysis

CRITICAL MENTION: Analyzes your saved searches so you can gain qualitative and quantitative insight into media coverage. Benchmark against competitors, drill in on stories with negative and positive sentiment, spot themes using word clouds, and visualize density of coverage on maps.

Google Alerts - Sentiment Analysis

GOOGLE ALERTS: Is a free, simple and very useful way to monitor your search queries. I use it to track “content marketing” and get regular email updates on the latest relevant Google results. This is a good starting point for tracking influencers, trends and competitors.

Hootsuite - Sentiment Analysis

HOOTSUITE: A great freemium tool that allows you to manage and measure your social networks. Understand how people feel about your brand and then easily filter results by location, language, and gender—for a multi-dimensional view of your market segments. Hootsuite Insights accesses real-time data from over 100 million sources in 50+ languages across 25+ social networks and other platforms.

`Hortonworks - Sentiment Analysis

HORTONWORKS: Enable an organization to manage all data, data-in-motion and data-at-rest to empower action intelligence for your organization whether the data is in the data center or in cloud. Hortonworks uses Hive to analyze the social sentiment after we have finished collecting our data from Apache NiFi. Meltwater - Sentiment Analysis

MELTWATER: Assess the tone of the commentary as a proxy for brand reputation and uncover new insights that help you understand your target audience. Stay on top of billions of real-time editorial, blog, and social media conversations, and extract the insights you need to understand and drive brand perception for your company.

OpenText - Sentment Analysis

OPEN TEXT: Sentiment Analysis module is a specialized classification engine used to identify and evaluate subjective patterns and expressions of sentiment within textual content. The analysis is performed at the topic, sentence, and document level and is configured to recognize if the opinion expressed within these pieces of content are positive, negative, mixed, or neutral. Combining machine learning with natural language processing techniques, the OpenText Sentiment Analysis module is one of the most powerful engines available out of the box.

Statsoft - Sentiment Analysis

STATSOFT: Sentiment Analysis Solution provides cutting-edge analysis tools allowing innovative businesses to extract meaningful patterns and information through Statistica’s powerful state-of-the-art Statistical Natural Language Processing methods (SNLP).  With Statistica advanced modeling algorithms and massively parallel and in-memory processing, SNLP can be applied easily to large volumes of documents in virtually any databases and repositories to efficiently score large numbers of records.

Sentiment Analysis plays an important role in the measurement of any communication program. Are these tools you would use for Sentiment Analysis? Would you include any others?

10 very real reasons polls get it wrong 0

Posted on November 13, 2016 by Rob Petersen

polls

Polls are a record of public opinion. Here are polls taken on Monday, November 7, the day before election day, from very reliable organizations.

  • Clinton 44%, Trump 41%, Johnson 4%, Stein 2% (Bloomberg)
  • Clinton 44%, Trump 39%, Johnson 6%, Stein 3% (Reuters/Ipsos)
  • Clinton 45%, Trump 41%, Johnson 5%, Stein 2% (Economist)
  • Clinton 48%, Trump 44%, Johnson 3%, Stein 2% (FOX News)

What happened?

Polls have been a part of elections since the country was founded. The language of the Declaration of Independence requires we function with “the consent of the governed.” But this election shook up a lot of things. One of them was our faith in polls.

Should we conclude polls and the people who conduct now don’t know what they’re doing? Or, is it that good analysis is always depends on quality data and a sound methodology.

Judge for yourself. Here are 10 very real reasons polls get it wrong.

  1. SAMPLING: Probability sampling is the fundamental basis for all polls. The basic principle: A randomly selected small sample of a population represents the attitudes, opinions and projected behavior of all people. But random samples almost never occur organically.
  2. SAMPLE RESPONSE RATES. For example, women and older Americans tend to answer the phone more often. This is how most polls are still conducted. This throws off the sex and age ratios of the sample. Instead of relying exclusively on random number dialing, pollsters take the extra step of adjusting or weighting results to match the demographic profile of likely voters.
  3. NON-RESPONSE RATES: Adding to problem of creating a random sample, response rates are way down. In 1997, Pew Research, a very well respected research and polling organization, saw telephone response rates were 36%. By 2012, Pew reported a downward trend to an average response rate of 9%.
  4. WEIGHTING: Since it is virtually impossible for a company conducting polls to expect a random sample much less that participants even answer their phones, weights are assigned to demographic characteristics of the total sample of respondents to match the latest estimates of demographic characteristics available from the U.S. Census Bureau. Weighting has a major impact on the results of polls.
  5. CENSUS RESULTS: Census results reflect hard facts such as age, race, address and family size. They do not reflect characteristics like religion and group affiliations. Beliefs and values that are more likely to determine people’s actions.
  6. BRADLEY EFFECT: We don’t always say in polls what we do. It’s called the Bradley Effect, after Tom Bradley, an African-American candidate for governor of California in 1982. Polls incorrectly predicted he would win. Looking back, experts think that’s because people told pollsters they would vote for Bradley, even though they didn’t plan to, in order to avoid sounding racist.
  7. PHONE SURVEYS: The majority of political polls are still surveys done by phone. That’s because someone’s email is more private and protected than their phone number. Surveys conducted over the phone are a pretty antiquated way to conduct research in the computer age. On the phone, the Bradley effect is more likely to occur than online because someone else is hearing and recording your answers. CNET reported Trumps polls a lot better online than in a polls conducted over the phone.
  8. GROUPS: Census numbers can tell us how many Asian-Americans live in a particular state. They can’t reliably tell us how many conservatives or evangelicals are in that state or groups that systematically exclude themselves from polls at higher rates than other groups. There’s no easy way to fix the problem and know the group that someone belongs.
  9. MULTIPLE AFFILIATIONS: Even if pollsters could reliably align weighted samples with groups, none of us are singularly dedicated to one group. We have multiple affiliations. We belong to a particular religion, participate at a certain level in community affairs and have specific views on the environment. So, even if polls could accurately correlate Census information with groups, there are multiple factors and sub-segments to consider.
  10. EXIT POLLS: In any race, there is a fascination with who is likely to be the winner. So there are exit polls to gauge how the race is going. They’re usually based on a sample of a few dozen precincts or so in a specific state, sometimes not even including many more than 1,000 respondents. Like every other type of survey, they’re subject to a margin of error because of sampling and additional error resulting from various forms of response bias.

Did these reasons explain to you how polls get it wrong? Does your organization need guidance understanding data and its results?

 

7 straightforward steps to measure and manage success 0

Posted on August 14, 2016 by Rob Petersen

measure and manage success

“If you can’t measure it, you can’t mange it.” – Peter Drucker

Management consultant, educator and author Peter Drucker, who is often associated with this quote, means you can’t know whether or not you are successful unless success is defined and tracked.

Without clear metrics for success, you’ll never quantify progress and be able to adjust your process to reach your goal. You’ll always be guessing.

How do you get there?

Here are 7 straightforward steps to measure and manage success with plenty of examples.

1. DEFINE WHAT SUCCESS LOOKS LIKE: Success is the achievement of an action within a specified period of time by a specified parameter. Begin with the end in mind. Success looks different based on the type of business and vision of its leadership, but it can’t measured if it can’t be articulated. Here are some examples.

  • Find new customers and get a larger market share than competitors
  • Improve closing ratio from 30 percent to 45 percent
  • Convert 10% of prospect into customers within a year
  • Reduce employee turnover by 25%
  • Earn a substantial return on investment for shareholders who risked their capital in the venture
  • Do ordinary things extraordinary well – Jim Rohn
  • Doing it for yourself and motivating others to work with you in bringing it about – Richard Branson

2. DECIDE WHAT TO MEASURE: “What gets measured gets done” is attributed to Peter Drucker, Tom Peters, Edwards Deming, Lord Kelvin and others. Somebody believes deciding what to measure achieve results. To decide, choose activities and services at the core of what you do and your biggest costs of doing business Think about how they will make your business successful or how they could be improved. Some examples of what to measure are:

  • Number of new leads, sign ups or subscriptions
  • Conversions of leads to sales
  • Sales from returning customers
  • Number of customer complaints
  • Number of returned items
  • Time it takes to fill an order
  • Percentage of incoming calls answered within 30 seconds

3. GET ON TOP OF FINANCIAL MEASURES: In order to achieve success, you need to know how it has to be understood financially. Cash flow is of fundamental importance and can be a particular concern for growing businesses. Most businesses target profits as the key financial metric. It’s important to know how to measure profitability. Key profitability measures to know are:

  • GROSS PROFIT MARGIN: How much money is made after direct costs of sales have been taken into account.
  • OPERATING MARGIN: How much does it cost for the business to run. Overheads are taken into account, but interest and tax payments are not. For this reason, it is also known as the EBIT (earnings before interest and taxes) margin.
  • NET PROFIT MARGIN: When all costs are taken into account, not just direct ones. So all overheads, as well as interest and tax payments, are included in the profit calculation.

4. SELECT KPIs: Key Performance Indicators (KPIs) are business metrics tied to targets. They are used to evaluate factors that are critical to success. KPIs are the actionable scorecard that keeps business strategy on track. KPIs are applicable to your growth cycle and identity your target audience considering their point of view. They are the measurements that matter. Some examples are:

  • Number of new accounts over a specific time period compared to past performance
  • New revenue measured against the money investing in new marketing campaigns
  • Sell-off of investory in a given year
  • Customer acquisition cost
  • Customer lifetime value
  • Sales by region
  • Employee turnover rate

5. LISTEN TO CUSTOMERS: Measurements are based on your needs but, if your needs include your customers, you won’t achieve success unless you listen to their needs. Consider their individuals need, what they think of your brand, your competition and what their future needs are. Some examples of measurements that show you’re listening to customers are:

  • Customer acquisition cost
  • Churn Rate
  • Net Promoter Score
  • Number of customer complaint
  • Time to resolution
  • Customer engagement
  • Annual customer value
  • Lifetime customer value

6. ASSESS EMPLOYEE PERFORMANCE: A company is only as good as the talent behind it. Consistently and accurately evaluating employee performance is essential not only to individual success, but to the overall success of an organization.

  • Employee turnover rate
  • Percentage of responses to open position
  • Employee satisfaction
  • Qualtity of work
  • Employee efficiency
  • Revenue from new ideas and innovation from employees

7. COMPARE AGAINST OTHER BUSINESSES: One of the best ways to keep your business operating successfully is by continually measuring and comparing its performance against competitor averages. Some basic but important measure of comparison include:

  • Sales
  • Market share
  • Channels of distribution
  • New products and/or product improvements
  • Website visits
  • Employee satisfaction

Are these steps straightforward enough for you? Is there anything else you would include? Does your business need help measuring and managing success.

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    BarnRaisers builds brands with proven relationship principles and ROI. We are a full service digital marketing agency. Our expertise is strategy, search and data-driven results.



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