Whereas last week I outlined how the companies bring their customers to life for their employees. This week I delve into determining the Metrics that Matter – the second component of Customer Intelligence.
I wrote before about how The Perfect Customer Experience Score is not universal – it varies for each company. Great organizations do not just plug in the Net Promoter Score or satisfaction because they heard they’re great measurements – they take the time to discover whether the scores actually predict important outcomes such as client loyalty. NPS may or may not be the right score. Superior companies test to see if improving NPS improves their customers’ loyalty. If not, then NPS is not a Metric that Matters for your company.
So how do these great companies discover the Metrics that Matter? Unfortunately, respondents did not offer as many details in the Metrics that Matter as they did in how they bring their customers to life – likely because the financial metrics are more of a competitive issue. But there are some great nuggets here.
I’ll start with my favorite story, of how Citrix links financial and customer experience measures.
Citrix sees a direct connection between their Net Promoter Scores and customer retention. As a result, NPS improvement becomes a key input to their “Customer Driven Business Cases,” placing customers’ needs at the top of their priorities. While they did not share all of their measurements, three items listed were NPS (the Net Promoter Score), customer retention and customer losses, as well as drivers of these items. See this post for more information on drivers and their importance to your customer experience.
Citrix establishes the linkage between their customer scores and Customer Lifetime Value. Even better, they track the results of each change, giving them a backward look into how changes in their scores impact revenue.
While I’ve typically summarized responses, Citrix has one comment that strikes to the heart of this matter, so I want to include it in whole:
“We marry up customer feedback to customer behaviors and financial results. We have built out a deep knowledge of our customer and prospect behavior and match that information up to customer lifetime value, which relates to revenue. This also means having a very strong relationship with the finance teams and the product teams, to ensure that models and recommendations are clearly understood and supported…. This isn’t a one-off effort but something that we keep updated and partner with the product leaders to communicate and continuously improve. But we go even further by using this customer behavior, feedback and financial information to predict customer retention, understand the changes in customer behavior that indicate a customer is becoming less engaged and proactively reach out to repair the relationship when needed.”
This is an excellent example of determining the Metrics that Matter and using them to drive a superior customer experience.
While they did not go to the length that Citrix did in their response, EMC has found a direct link between their NPS scores and competitive growth rates, as well as customer retention.
Fidelity is a financial services company, so it’s no surprise that they have taken the time to prove the linkage between their customer experience scores and business outcomes. While they do not give detail on which measurements they use, they have determined the economic impact of improving customer satisfaction.
They also share the example that, through outreach programs, they were able to move over half of their NPS detractors out of the detractor category. As a result, these clients saw increased assets in the following year.
Oracle apparently uses emotional engagement as their metric, although they do not share who their research partner is. They have discovered that engaged customers are more loyal and are spend three times as much per opportunity.
Safelite did not give a great amount of detail, but they did report that one department improved scores by 28% in one year, which resulted in a value of over $11 million to the company.
It takes significant effort to measure your customer experience, but it’s one of the cores of creating Customer Intelligence. From building and maintaining a survey to training your employees on how to improve your scores, it takes hard work do it right. Which is why you owe it to both yourself and your customers to make sure you’re measuring the right thing.
These award winners have taken the time to validate their customer experience scores’ relationship to the financial metrics that matter, and thus are able to take action confident that they are measuring the Metrics that Matter.