The power of measuring customers’ experience

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Customer related measurements such as Net Promoter Score (NPS), Customer Effort Score (CES) and Customer Satisfaction Index (CSI) have all made their way into organisations. The intent is to understand the customer issues and concerns better and “fix” the problem. The painful reality is that while these scores help improve the customer transactions, they do not reveal deep underlying issues that affect customers.

Customer satisfaction measurements such as NPS have grown in popularity
Over the last ten years NPS has gained prominence in organisations as the measurement of customer satisfaction. In sectors such as telecoms, energy and insurance it has become the standard against which companies measure themselves and benchmark against other. Many organisations have incorporated NPS in their internal performance and reward systems.

Customer transaction v.s. customer experience
NPS measures the response to a single question, usually after a customer completed a transaction with the organisation. Its simplicity gives great transparency in what fails where in transactions with customers. In some organisations and sectors the score has been elevated to a measurement of customer experience, even though customers usually experience an organisation over multiple interactions and touchpoints. This is where other customer measurements can greatly enhance the NPS and gain better insight into what customers experience.

TIC_Concept3_02 The customers’ experience of a visitor to London is a combination of many impressions and interactions that relate to public transport. Asking an NPS question at different points of a tourist journey yields varied results.

The good: Closing the loop
A good application of NPS is when the organisation follows up with the customer to understand why she scored low after an interaction with the call centre. This enables the team lead and the call centre agent to learn the reason for the low score and address this through training, process adjustments, communication, etc. Reaching out also improves the experience in future customer interactions and possibly “win back” the dissatisfied customer, or detractor.

The main advantage of the Net Promoter Score is that it gets companies thinking about metrics that come from the customer.

The bad: The NPS does not predict actual customer behaviour
A painful example is where an organisation uses NPS to measure customer satisfaction in the different touch points. The customer gives a positive score after an online sales transaction, but calls the call centre because of a problem with the delivery of the service. The call centre gets a negative score on the sales transaction that actually failed in another channel. The issue here is one of not following customers’ behaviours – which are different to customer opinion.

The ugly: Undesirable effects and behaviours
Some organisations tie NPS scores to individual and departmental performance without proper training and guidance. The internal rewards system encourages silo behaviour where everyone is trying to improve their NPS in isolation, losing site of the overall customers’ experience. These negative effects can be addressed by combining NPS with more qualitative measurements that are conducted in regular intervals, and coaching staff around the purpose of NPS, not the mechanics of it.

Using NPS in the customers’ context
Combining the specificity of the NPS measurement with the generic context of a customer lifecycle gives a more comprehensive view of the customers’ feedback. Clear hotspots emerge when relating the underlying transaction to the different stages that customers go through when interacting with the organisation. Further investigation of the hotspots with staff and customers usually shows underlying issues, but also great opportunities for quick improvements in the customers’ experience.

Use the customer framework to deliver the real value
The more complex the product or service is from the customers’ perspective the more rigor is required to properly use NPS. Companies need to decide the purpose, objectives and application of NPS, and complement it with other qualitative and quantitative measurements. The real value lies in mapping all these input into an overarching framework – the customer lifecycle – to release its full potential.

Melvin Brand Flu
Melvin Brand Flu is an author, business, and strategy consultant with over 30 years of experience working for startups to global brands and governments. He advises management and leads projects on the cutting edge of business and technical innovation in industries ranging from telecommunication and financial services to the public sector and insurance.

2 COMMENTS

  1. There’s significant challenge to an observation like this: “Combining the specificity of the NPS measurement with the generic context of a customer lifecycle gives a more comprehensive view of the customers’ feedback. Clear hotspots emerge when relating the underlying transaction to the different stages that customers go through when interacting with the organisation. Further investigation of the hotspots with staff and customers usually shows underlying issues, but also great opportunities for quick improvements in the customers’ experience.” One of the more persistent, and real, criticisms of NPS is its granular actionability applications: http://customerthink.com/is-there-a-single-most-actionable-contemporary-and-real-world-metric-for-managing-optimizing-and-leveraging-customer-experience-and-behavior/

    Also, your ‘good, bad, and ugly’ discussion of NPS resonates with me. In my 2011 book, The Customer Advocate and The Customer Saboteur, an entire chapter was devoted to this same subject.

    Finally, I’d suggest some caution and some additional clarity with identifying NPS as a satisfaction measurement. Satisfaction is principally an attitudinal measure, which has only general correlation to downstream transactional or experience behavior. NPS is puffed as more closely representing future action.

  2. Dear Michael,
    Thanks for your invitation to clarify a couple of things. The article is based on work with clients in various sectors involving projects dealing with a wide range of customer (experience) related topics. http://liveworkstudio.com/the-customer-blah/measure-change-customers-experience/.

    At Livework we often map our clients’ customer data, research, analysis and insights into the customer lifecycle we developed for several sectors. All these inputs separately give a scattered view of the customers’ experience. The customer lifecycle provides a consistent context in order “understand” the customers situation better, by knowing where they are on the lifecycle: in the process of buying, or new customer phase, or an existing customer re-considering. When we map NPS data to the lifecycle a score of 7 for a certain transaction – together with the other data – gets translated into scores of how customers rate the interaction their context. i.e. existing customers rate the transaction high because of speed and accuracy because they are familiar with the product/service, while customers in the buying process rate it low because of they are not yet familiar with the product/service. Tests with other customers usually confirms the assertions given our clients the right things to target for improvement. http://liveworkstudio.com/themes/lifecycle/

    Finally, I agree with your position of not seeing NPS as a satisfaction measurement. We often have to confront clients who believe this is the case with the real customer experience. In one extreme case even building a customer experience lab so that the management team could “experience” the experience instead of reading about it from graphs. http://liveworkstudio.com/topics/dont-fear-customers-reality/

    I enjoy reading the work of Beyond Philosophy and welcome further and future discussions

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