Case study: nib health fund’s Sucessful Net Promoter Score Implementation

May 15, 2012 By Leave a Comment

Over the last 12 months we (Genroe) have been lucky to work with nib health funds, one of Australia’s fastest growing health funds, to help them evolve their Net Promoter Score processes. In that time we have helped them to implement CustomerGauge, an end to end, integrated, Net Promoter Score data collection, reporting, analysis and action system.

In the past nib have allowed us to publish insightful information in two blog posts

Now, however, the full story behind the successful NPS implementation process has been captured in a new case study: nib health funds: Checking Up On Customer Loyalty.

In this case study nib offer more insights into the changes they have made using NPS insights:

“Based on the customer feedback, nib has implemented the following specific changes to its claims processes in order to improve the customer experience:

1. Faster processing and payment of customer claims. Claims are also now paid directly into a customer’s account.

2. Simplification and streamlining of Orthodontia claims processes.

3. Simplification of online claiming through the improvement of internal processes.

4. Improved communication by consultants to customers about items covered under individual policies to help reduce confusion surrounding hospital out-of-pocket expenses

5. Instantaneous delivery of key paperwork, allowing customers to receive and discuss such items during the course of a call with a consultant. This has had a significant positive effect on customer satisfaction and nib’s  goal to answer customer queries at the first point of contact.”

Download the full case study here: nib health funds: Checking Up On Customer Loyalty.

More Information

For more information on Net Promoter Score and how/why it works download our free Introduction to Net Promoter Score (NPS).

If you are thinking about implementing a Net Promoter Score process in your organisation give us a call. We can help you to implement right systems and change management program for your organisation to drive long term success.

 

By Adam Ramshaw

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

Filed Under: Case Studies and Statisitics, Net Promoter Score Tagged With: , ,

Five things to do right now that will drive more value from customer feedback

May 8, 2012 By 2 Comments

Meta-analysis of a new Aberdeen report provides important insights into the most important customer feedback management differences between successful companies and unsuccessful companies. What is really interesting is that the drivers of success are less about collecting customer feedback and more about what you do with it.

The April 2012 Aberdeen report “Customer Feedback Management” investigates the business attributes of successful (Best-In-Class) and unsuccessful (Laggards) companies to identify those that are most important. While their key conclusions include the need for laggards to include customer feedback into business decisions (well of course!) and listening to customer via social media (social media will solve all our problems…).

I disagree with their conclusions but a little meta-analysis of their results gives some very interesting insights.

In the typical Aberdeen report structure they first identify successful and unsuccessful organisations by way of a range of factors. The one that I think is most important in this context is Revenue growth. Best-In-Class companies achieved an average of 28% year on year revenue growth but laggards were at best flat.

They then examine how often the various business features are implemented in each class of company. My analysis looked for the biggest differences in what was being implemented for each company group. The logic being that if you look for the differences between the two groups you will identify what is key to success. If everyone uses KPI’s but some massively outperform others, KIPs are not a key differentiator.

Click to Enlarge

So here are the five most important VoC things that you should start doing right now, if you’re not already doing them.

1. Automated alerts to notify customer-facing functions of a poor customer experience

To you and me this is an automated service recovery processes for unhappy customers. When we implement best practice Net Promoter Score with our clients we emphasize this process and in fact have a whole section of our implementation service dedicated to it’s design.

This works. It works to drive customer centric values for the organisation. It works to turn unhappy customers into devoted promoters. It works to drive up revenue.

The chart below, from the report, shows the impact of automated alerts on various element of customer delight.

2. Compensation and/or incentives for employee in customer facing functions are tied to achievement of VoC objectives

No surprises here.

Staff don’t listen to what you say, they watch your feet. If you tie incentives to average hold time or number of transactions per hour but not delivering on VoC objectives, they know what is really important.

If you really care about the VoC objectives you need to make sure that they are just as important in the compensation scheme as average hold time.

3. Playbooks to support employees streamline the management of VoC and address negative customer feedback

Tied to the first point, this is all about helping client facing staff to resolve customer issues quickly and efficiently. If you give them some guidance and approved approaches then they can be more efficient and effective in resolving customer issues.

 4. Live Chat

Again I suggest this is tied to a tight customer feedback and resolution loop. Having live chat available allows the organisation to collect and act on customer feedback quickly.

5. Workflow automation

In this case workflow automation is about mapping and management customer engagement processes. Here the link may be about using tools to ensure that the ball does not get dropped at any point in process.

What about the rest?

The difference between Best-In-Class and Laggards for most of the rest of the company attributes is not as marked. Both use KPIs to measure the effectiveness of the VoC program at about the same rate and both have CRM technology at about the same level, etc.

I’m not saying that these items are not important. I am saying that you have probably already implemented these technologies and processes so don’t look there for major improvements. Look to the major differences between laggards and the best-in-class for insights on how to improve.

More Information

Download our free report: How to implement an effective customer feedback system for more information on how to run a great customer feedback process.

If you are thinking about implementing a customer feedback process in your organisation give us a call. We can help you to implement right program for your organisation for the long term.

 

By Adam Ramshaw

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

Filed Under: Best Practices, Customer Feedback Process

The 4 Drivers Of Customer Retention

May 3, 2012 By Leave a Comment

Many companies would like to improve their customer retention but are unsure how to make the changes in their business to improve this important profit lever.

Identify Customer Retention Drivers

The first step in implementing customer retention programs is to identify the customer retention drivers. Without first identifying the retention drivers you run the risk of blindly implementing a range of programs which may or may not impact customer retention.

So let’s go back to basics and identify some of the retention related drivers that are going to support the achievement of greater profits for your company.

Identifying drivers always starts with outcomes, in this case profit. Profit increases are driven by both increasing revenue (assuming positive gross margin) and lowering overall costs (assuming no loss in revenue). This seems simple, and it is, but it gives us the first two retention drivers: Increased revenue per customer and lowered cost per customer.

Examining each of these primary drivers we also discover two secondary drivers.

It is reasonably obvious that preventing customer loss drives increased revenue. However, it is also true that improving customer loyalty drives both increased revenue and lower costs through the ability to get to know the customer better and align your company business processes to their needs.

This leaves us with four fundamental drivers of customer retention:

  1. Improving Customer Loyalty
  2. Preventing Customer Loss
  3. Lowering Overall Costs
  4. Increasing Total Revenue

Now the drivers have been identified let’s examine how they can be affected:

Improving Customer Loyalty

Improvement in loyalty can equate to significant increases in profitability as customers stay longer with your company and it becomes more difficult for your competitors to lure them away.

Customer loyalty is driven mainly by a combination of delighting your customers, educating them, having effective complaint resolution and high service quality.

From a company perspective, this means that you need to deliver on your promises. This can be done by exceeding customers’ expectations and occasionally rewarding them for their continued patronage.

Regarding complaints resolution; complaints and negative customer feedback need to be followed up with the customer and the issues resolved to the customer’s satisfaction. It is common to hear of the same customer issues occurring without a company taking action to resolve the problem or fix the source of the complaint. Don’t let this happen to you.

Loss Prevention

Loss prevention is a critical element that is driven by attrition management and win back success. Attrition management entails anticipating when customers are likely to defect and managing proactive initiatives to stop the defection. This has a direct impact on preventing revenue loss.

Alternatively, winback is the process of retaining a customer that has stated that they no longer want your product or service. Implemented correctly this can be an excellent way to prevent revenue loss. However, it needs to be implemented carefully; with a full knowledge of the customer’s profit to the business and the costs of the save offer. Otherwise, you can spend more saving a customer than they will inject into in future profits.

Cost Reduction

Effectively managing customer touch points is a key way to minimise the cost to serve and communicate with your customers. Managing touch points is the process of examining the media and timing of customer contact to optimise it for impact and cost.

Organisations that successfully manage touch points know when and how to contact their customers so that they maximise each contact opportunity. As a result money is not wasted on unnecessary contacts and the lowest cost applicable media is used.

Increase Revenue

Finally, there are the drivers that increase revenue. These are upsell and cross sell. When customers are encouraged to take up more products through cross sell, or upgrade their current product plans, revenue from these customers will increase.

We’ve talked about upsell and cross sell previously in this column so we won’t add more to it here.

Now you’ve identified the drivers for retention you can start to examine how to improve them and the outcome; customer retention. At this point we’ve returned full circle to where we started; we’ve identified ways to help improve customer retention and thus increase profits. Here’s where the rubber hits the road and it’s up to you to implement.

More Information

Free Download: Customer Lifetime Value Estimation Tool

In addition to calculating the lifetime customer value the Genroe Return on Retention Estimator also calculates impact of changes in customer attrition rates.

 

By Adam Ramshaw

Filed Under: Customer Retention

Four Keys to Successful Business Competitions

May 1, 2012 By Leave a Comment

In today’s marketplace, consumers are bombarded with competitions as companies fight to attract new customers and retain existing customers. Some companies are extremely successful in achieving their marketing objectives through the use of competitions, whilst others fail dismally. So why do some companies fail with competitions and others succeed? It’s all due to planning and implementation.

Here are the four keys to making your competitions as successful as possible:

1. Make sure competitions are part of your overall marketing strategy

Competitions need to be incorporated into your marketing strategy not just tacked on the side as an afterthought.

By incorporating the competition into the overall marketing plan, the evaluation can go beyond the traditional campaign success indicators. Core business drivers such as whether the competition stopped customers from leaving or stimulated product usage become more important than simply how many entries you received.

Another reason to integrate competitions is to ensure that they do not clash with the rest of your programmes.

Maybe you want to launch a new product but you need client requirements to feed into the development process. You could use a series of competitions aimed at existing customers and asking couple of different research questions in each competition. This approach can yield a large amount of accurate information but it needs to be integrated with the rest of your campaigns so as not to clash with them.

Also, as far more customers now want to control their relationship with a company, any contact needs to add value to the customer relationship. A competition can be a way to add value and at the same time reinforce your customer strategy but you need to make sure it is in tune with the rest of that strategy.

2. Target the right customers

Just as you target the rest of your campaigns you need to target the right customers for your competitions in order to achieve the maximum result. Areas to focus on include the target list, communication medium, the competition mechanic and rules.

The prize(s) you offer can also have a major impact on attracting the right type of entrant. For example, it is common for banks to target home lenders by running a competition where winners receive a lump sum off their new home loan. Far more business value might be obtained by offering lifestyle packages that include income protection insurance, a smaller lump sum off the loan and a lump sum into a managed fund.

This prize attracts customers that are potential cross sell customers not just customers looking only for a home loan product. In addition, not only is it a prize but it’s also a promotion of the bank’s product portfolio, helping it to differentiate itself from its competitors. All of sudden the competition is serving a dual purpose.

3. Broaden your communications medium

Multiple communication mechanisms also play an integral role in implementing a successful competition. Appropriate mechanisms need to be used to encourage customers to enter the competition in the way they feel most comfortable.

By using multiple mechanisms such as facebook, twitter, phone, SMS, email, online website and post mail, you will be able to identify the contact mechanisms that your customers prefer. This means that future contact with them can be customised to their preferred methods of communication, leading to a stronger customer relationship.

However, be aware that a common pitfall is the complexity that arises from implementing a competition across a variety of communication mechanisms. Make sure that your vendor is adept at handling all the media you wish to use and that they can provide an integrated implementation and view of the results. Otherwise you could have difficulty in evaluating whether the competition met its success criteria.

4. Collect the data and make use of it

Now the competition is over, make use of the wealth of data you have gathered. Competitions create a window of opportunity to collect and analyse customer information. Customers are susceptible to providing real feedback in a competition entry but many companies do not utilise this data to learn more about their customers.

Competition question content is also vital to collecting useful information that can lead to sales leads capture, cross sell and upsell opportunities, churn triggers, education gaps hindering product usage etc. This customer data analysis can be incorporated into existing customer database information to enhance overall customer knowledge for your business.

In my experience, the average response rate for competitions is 2%. However, clients that have adopted a customer value approach and focused on these four keys have been able to achieve response rates of up to 18%. This has significantly improved the returns on their marketing investment and ultimately lowered the cost to acquire and retain customers.

More Information

Free Download: Customer Lifetime Value Estimation Tool

In addition to calculating the lifetime customer value the Genroe Return on Retention Estimator also calculates impact of changes in customer attrition rates.

 

By Adam Ramshaw

 

Filed Under: Customer Strategy

Positive Customer Experience Drives Loyalty, Revenues

April 27, 2012 By Leave a Comment

New Temkin Group research shows what we believe: the customer experience drives customer loyalty. The chart below shows how much a good customer experience can lift your customer loyalty, and how much a bad customer experience can lower it.


Read the whole story: Positive Customer Experience Drives Loyalty, Revenues

Filed Under: Case Studies and Statisitics, Customer Experience Management Tagged With:
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