Last week, in my blog called “Reputation Management: Customer Experience or Marketing,” I established that reputation management is a way to assess an individual’s customer experience and, more importantly (to companies), a marketing tool to manage the impact of past customer experiences on other customers’ decision making in the future.
It’s hard to imagine any company that shouldn’t have some form of a reputation management program in place. The use of user reviews by prospective customers to inform their decision making is nearing ubiquity. Failing to monitor user reviews and respond appropriately to unhappy customers would be like putting one’s head in the sand.
That said, some constituencies within companies have begun to argue that reputation management (both social media monitoring and engagement with socially active customers) should be the centerpiece—or even the entire customer experience measurement program—used by the company to guide its customer experience management efforts going forward. Implementing such a strategy would be a mistake. Let’s discuss how reputation management should fit into your customer experience measurement and management program.
The purpose of a customer experience measurement and management program is to understand performance in delivering the customer experience today, as well as identification of opportunities for actions that improve the customer experience going forward. Within any enterprise business, there are three important constituencies that need to be served by your customer experience program—your customers, your sales and service delivery channels, and company management. To answer the question of how reputation management fits into a customer experience measurement and management program, let’s examine it in context of the needs of these constituencies.
Company Management:
Performance Measurement–Company management scorecards are frequently tied to executive bonuses. These scorecards are also often used as a benchmark of comparison to competitors, as well as leading customer experience providers across industries. Effective measures of the customer experience for management are metrics that are most associated with business growth. This is why “likely to recommend,” “likely to re-purchase,” and similar measures are frequently used metrics. Can reputation management be meaningful in this context? Yes, because it is an indicator of reputation that impacts future business prospects. Management should be accountable, however, it cannot be the only indicator that factors into assessing management performance, as it is often not representative of the organization’s performance overall. Social media posting is by nature self-selected, and is often biased to those with extreme sentiments. Transactional customer satisfaction surveys are critical to properly assessing performance systematically across different touchpoints and service delivery channels. It also allows management to assess the impact of customer experience improvement strategies it has implemented.
Identifying Improvement Actions–To take action at the enterprise level, feedback collected needs to be analyzed with some level of confidence to assess opportunities for improvement. While social media data can be analyzed collectively, it tends to have only an overall rating (if that) and text. Therefore it needs to be analyzed with text analytic tools to find patterns. These are useful and important, but by no means comprehensive. To fully assess action opportunities, management needs insight from its reputation management program as well as transactional satisfaction programs, which have more detailed and representative quantitative data on the breadth of touchpoints with the customer. Both of these tools look at the customer experience retrospectively. Management also uses tools, such as customer journey maps or purchase process studies, to assess the customer experience prospectively and drive action.
Sales and Service Delivery Channels:
Performance Measurement–Sales and service delivery channel scorecards are frequently tied to bonuses as well. This is especially important for franchise and outsourcing situations where the company is relying on another entity to deliver a component of the customer experience. Effective measures of the customer experience for delivery channels tend to be overall satisfaction metrics, measures of key component functions within the customer experience, and problem incidence/handling. Can reputation management be meaningful in this context? Only in a limited way as it does not properly represent the performance of the channel on the whole. Further, if an independent entity has SLAs in place, lack of representativeness of reputation management would clearly be insufficient for assessing performance of the SLA. Transactional customer satisfaction surveys are critical to properly assessing performance at the channel level. Reputation management results can be additive to understanding problem incidence, as well as delight incidence.
Identifying Improvement Actions–Improvement actions at the channel level fall into two buckets—process changes and employee training and coaching. Both of these activities benefit from having a representative measure of performance that transactional satisfaction studies provide. These studies ask about specific aspects of the sales/service delivery, as well as determine context for why customers feel the way they do. Reputation management can provide additional input into the coaching component, as long as the comments can be associated with a specific employee or delivery channel.
Customers:
Performance Measurement–Today, there is an opportunity around measuring performance at the customer level. Increasingly, companies are trying and customers are demanding that their experience be personalized and customized. If companies are to take the long view of their customer relationships, they need to understand how they are performing across the customer’s journey, not just at specific touchpoints. To do this effectively, companies need to have a program that engages customers over time and in an ongoing conversation that checks in on them periodically. Companies need to understand how they are performing for individual customers and small subsegments of customers. This can be important feedback on and input to growth initiatives. Reputation management provides information on a small portion of the customer base and often reflects an incident or transaction rather than the relationship or customer journey as a whole.
Identifying Improvement Actions–Reputation management activities, as well as hot alerts from transactional satisfaction studies, provide valuable input for taking action to repair individual relationships and address service failures. However, these identified issues occur among a small percentage of customers and are reactive in nature. Also, for the most part the action is service recovery. With a proper customer journey program, companies can engage with customers proactively, and identify both risks and opportunities throughout the journey that, when addressed, will strengthen individual customer relationships.
Reputation management is an important component of a robust customer experience measurement and management program. Ideally, its results should be integrated with results from transactional customer satisfaction studies, as well as a customer journey program, to address the needs of customers, service and delivery channels, and company management.
