Customer Experience Presentation

“Customer Experience…..

Mapping and Measuring”
Prepared for CCA Seminar
27th October 2005
Bramley Orchard, Bryne Lane, Padbury

Bucks, MK18 2AL
Tel: +44(0) 128 081 5117
Fax: +44(0) 128 081 5117
Mobile: +44 (0) 7958 794 701
Email: tony@marketinginside.co.uk
Retention Through Experience
• As the cost of acquiring customers rises organisations are
investing in retention
Index of Costs Retention 100
Winback 140
Acquisition 240
[source QCI/WPP customer management research 2003]
• Key Retention Drivers
– Brand Traditional Marketing
– Proposition Elements Experience
– Contact Service
• Customer Lifecycles suggest increasing customer
interactions/contacts and more demanding customers
– National Consumer Council reported an increase in complaints
from consumers in 2003 of 24% over the past 5 years
© Marketing Inside Ltd 2004

Service Impact
• Customer Experience through contact influences customer’s
perception of the brand and is a key component of brand
loyalty and can often override traditional/other marketing
communication, for example recent outsourcing of customer
service……
– Indian Call Centres
“you can’t subcontract your relationships with customers”
– Richard Pym CEO Alliance & Leicester
• Customer Experience Impacts on Retention
“A Good Experience is based on strong relationships between
dialogue, satisfaction and these drive customer retention”
– Maggie Evans marketing director iSKY Europe
• The Customer’s experience is an area where the successful
businesses are very good in this respect…and the not so
successful are very poor (First Direct Vs PC World)

Most companies have fundamental
gaps in their customer lifecycle model
Although 52% look at the quantity of In more than 90% of companies,
Only 2% have Staff who are responsible for talking
customers acquired, only 8% look at
regular winback programmes to customers could not articulate why
the quality of customers acquired.
customers should buy from them
63% do not know how many
high value customers they lose
47% do not have any sales
lead distribution agreements
30% follow-up a complaint to
check on satisfactory resolution
Only 35% bother to
thank new customers
Only 13% of senior management
have regular contact with customers Only 4% of companies have an
enterprise-wide customer information
In most markets, plan
just 1% of customers are
worth about 30% of total margin, 11% drive contact strategies via
but 58% do not have any a database
special development 41% do not record customer contact
plans for these key customers channel preferences, let alone contact
customers through their preferred medium.
Source:
QCI/WPP
© MarketingCustomer
Inside Ltd 2004 Management Research project 2003
Measurement and Improvement
• Key question is how do you know if you’re delivering a good
experience (customer satisfaction scores?) and how do you
know where to improve?
• Organisations tend to measure Experience by measuring
Customer Satisfaction
– Only measures single activity in isolation
– Ignores the context
• Organisations therefore traditionally tend to look for
improvement in this area in one of two ways
– Significant investment in CRM IT systems (EdF; ESB; Britannic)
– Reengineer their customer service processes (ESB; National
Express)

Customer Experience Influencing
Components
• Is there delivery of a consistent experience Brand Values
• Touchpoints – customers can interact with a company in
increasing ways and how do they impact cost? Some
channels are more expensive than others
• Organisational Priority – which experiences are more
important than others and what is the organisational driver?
– Segmentation?
– Revenue?
– Cost? (activity based)

Customer Experience Steps
Step I
• Define Experience Priorities
– opportunities (e.g. high value customer segments)
– high impact/risk (e.g. sales and processing for new customers)
• Understand/Define Brand Values
• Agree Customer Touchpoints
• Map Customer Experience at Touchpoints using model
• Identify poor experience areas and examine Cost Benefit at those
points
Step II
• Look for quick wins (non System/IT)
Step III
• Improvements
– Implement Plans to improve and measure effect using model
– Use QCI Cmat Benchmarking to develop long term KPI’s and monitor

Customer Experience Approach
• Developed simple tool
– Map Touch Points which generate “The Experience”
– Attach values to Touch Points “Experience Score”
– Weight these values by importance the customer places on a
given part of the experience
• 2 part approach
– Map and Measure experience with front line staff who represent
Touchpoints (internally)
– Map and Measure experience with customers who have recently
passed through experience
• Workshop approach taken internally for staff and quantitive
research (telephone/interview) for customers

An Example – Electricity Company

Bucks, MK18 2AL
Tel: +44(0) 128 081 5117
Fax: +44(0) 128 081 5117
Mobile: +44 (0) 7958 794 701
Background
• This company is approaching a fully competitive electricity
market in 2005 (some business customers can choose
supplier currently)
• As the monopoly supplier overt retention in the short term is
not possible, but building a strong position for the future is
recognised as important
• Segmentation has identified valuable customers which are
desirable to retain and Customer Experience was recognised
as a key driver
• CRM is so large a subject that many people didn’t know
where to start in terms of Customer Experience and we
discovered there was no simple tool to measure Customer
Experience

Background
• A new approach was required
• There were a number of projects in customer services
amending processes and systems and a significant
investment by IT in CRM systems (SAP with a CRM module)
• BUT Process work was almost ad hoc (aimed at fixing broken
processes) and Implementation of SAP is problematical
• Key Question how to leverage longer term benefits from
investment in Customer Experience to drive better Retention?
• Operational Business was charged with delivering these
benefits
– Marketing (scope possibilities)
– Customer Services; Retail Shops; Metering (delivery and change
management)

• Agreed Brand Values
– “brand iceberg”
– reflected in brand(s)
• Agree Customer Touchpoints and the brand values to be
communicated at those points
– high impact/risk (e.g. billing and processing)
– opportunities (e.g. home movers)  chose this one
• Map Customer Experience (for home movers) using model
– Internally (own front line staff)
– Externally (customers who have recently experienced)
• Identify poor experience areas
• Look for quick wins (non IT)
• Implement Plans to improve and measure effect using model

Customer Experience
Measurement
• Objective was to examine the end to end experience for
residential home movers and called it “Crate Expectations”
• Used simple tool
– Attaches values to customer experience “Experience Score”
– Weights these values by importance the customer places on
each aspect of the experience relative to each other
• 2 part approach
– Map experience with front line call centre staff (internally)
– Map experience with customers who had recently passed
through home moving (externally)
• Workshop approach taken internally for staff and quantitive
research (telephone) for customers

Home Movers
“Crate Expectations”
• Objective: review and improve the residential customer
experience for home movers setting a platform for retention
and in the longer term winning opportunities to acquire
customers (once the market opens)
• 180,000 moves each year (400,000 inbound calls)
• Reducing calls by 20% reduces cost by €30k
• Losses predicted at 20% Year 1 = 36,000. Reduced losses to
10% = 18,000. Estimated incremental enterprise value
(retention:18k customers at €40 = €720k)
• 3 customer experience scenarios identified e.g. existing
customer moving to existing supplied property

Home Movers Experience – staff view
Ref C001 C002 L001 L002 L003 L004 C003 L005 L006 C004 C005
Contact Receipt of
Obtain contact with final Receipt of Welcome
Process - Customer details Contact - Tel reading Final Bill Letter
Handle call Handle call Produce
Answer call (o/bound (i/bound Welcome Handle Bill
Process - Internal (opening) property) property) Letter call production
Experience Score 0 0 4 -3 -2 -3 -3 0 0 0 -5 -1.09

Importance assigned by customer 3 1 3 2 7 7 4 5 8
Weighting by Importance 1.7 1.9 1.7 1.8 1.3 1.3 1.6 1.5 1.2
Weighted Score 0 0 6.8 -5.4 -2.6 -3.1 -3.9 0 0 0 -6 -1.29
Weighting Calculator
Importance Score 1 2 3 4 5 6 7 8 9 10
Corresponding Weighting 1.9 1.8 1.7 1.6 1.5 1.4 1.3 1.2 1.1 1

Home Movers Experience – customer view
Ref C001 C002 L001 L002 L003 L004 C003 L005 L006 C004 C005
Contact Receipt of
Customer Experience
Experience Score -2 0 3 -4 1 -3 -4 0 0 -1 -5 -1.36

Importance assigned by customer 2 1 3 2 8 3 4 3 8
Weighting by Importance 1.8 1.9 1.7 1.8 1.2 1.7 1.6 1.7 1.2
Weighted Score -3.6 0 5.1 -7.2 1.2 -3.1 -6.8 0 0 -1.7 -6 -2.01

Home Movers Experience – compared
Ref C001 C002 L001 L002 L003 L004 C003 L005 L006 C004 C005
Contact Receipt of
Experience Score - Staff Weighted Score - Staff Experience Score - Customer Weighted Score - Customer

Conclusions
• Customer perception of experience different to staff view
• Internal process not being followed, so experience being
mapped is on different basis
• Improvements required are centred on communications
(support material and calls and are largely not IT related)
• 4 Quick Wins (not IT dependant)
– Call backs in all scenarios and by same CSA
– Create check list for the CSA's to use during the calls e.g.
prompt
– Home Movers Pack/Booklet (tips;do’s and don’ts;contact
numbers) and Welcome letter rewrite
– Training for Customer Services
• E.g. Set expectations on when welcome letter will arrive

– early implementation
• Call Backs by CSA’s
– 18% of all inbound calling in contact centres related to
home moving
– In first 3 months of implementation calls reduced by 30%
(stable state = 12% of all inbound calls now relate to home
movers). Estimated cost reduction €48k
• Customer Service Training
– Total Customer Experience Weighted Score (average)
moved from 2.01 to 1.8
• Customer Satisfaction
– Revisited customer satisfaction tracking and re
aligned/added some questions to track this
activity/experience

An Example – Life Assurance
(early work)

Bucks, MK18 2AL
Tel: +44(0) 128 081 5117
Fax: +44(0) 128 081 5117
Mobile: +44 (0) 7958 794 701
Background
• A portfolio of mainly Life Assurance customers in excess of 1
million
• As acquisition ceased almost 3 yrs ago, this base is slowly
being eroded
• Retention has taken on a new importance
• Policies are purchased and then forgotten with little contact
with the customer and little cross sell/up sell
• Main contact during the life of the policy is with the contact
centre with requests for surrender values

• Agree Customer Touchpoints
– Surrender queries (active customers)
– Aimed at maximum retention (winback of sorts)
• Map Customer Experience (for priorities) using model
– Internally (own front line staff) – completed as a test
– Externally (customers who have experienced) – not yet started
• Identify poor experience areas
• Look for quick wins (non IT)
• Implement Plans to improve and measure effect using model

Surrender Enquiries
– a priority
• Objective: improve the customer experience for surrender
queries increasing retention
• Current attrition is 5% p.a.
• Estimated incremental enterprise value (retention: x
customers at £y =£)
• Map customer Experience both internally and externally
• 3 customer scenarios identified e.g. have received an annual
policy review

Surrender Queries – staff view
Ref B001 C001 C002 C003 B002 C004 C005 C006 C007 B003 C008
Handle
request for Receipt of Answer
Receipt of Answer call surrender value call Handle Send back receipt of
Process - Customer review letter (opening) value confirmation (opening) query surrender monies
Handle Generate
Automatically request for Surrender Answer
generate Answer call surrender value call Handle Process
Process - Internal review letter (opening) value confirmation (opening) query surrender
Customer Experience
Experience Score - Staff Weighted Score - Staff
Staff View
Experience Score 0 -3 -1 2 -1 -4 -4 0 0 2 4
Importance assigned by customer 0 2 4 5 0 6 8 3 9 0 3
Weighting by Importance 0 1.8 1.6 1.5 0 1.4 1.2 1.7 1.1 0 1.7
Weighted Score 0 -5.4 -1.6 3 0 -3.1 -4.8 0 0 3.4 6.8
Surrender Enquiries
– early thoughts
• Making it easy for customer to leave is seen as good
customer experience internally !
• Customer receives cash at end of experience is viewed as a
positive finish point for customer
– Issue is lost relationship, no winback
– As there is no acquisition, any brand value cannot be leveraged
in longer term
• Support communications is unexpected, confusing and
regulatory based

An Example – Train Franchise

Bucks, MK18 2AL
Tel: +44(0) 128 081 5117
Fax: +44(0) 128 081 5117
Mobile: +44 (0) 7958 794 701
Objectives
• Phase I – Existing Customer Data
– Examine current customer satisfaction position, in particular
current data (SRA biannual reports and CSS quarterly surveys)
and methods of survey
– Where possible aligning customer experience factors
(touchpoints) in each
– Generate messaging template (internal comms and media)
– Reexamine role of SRA (regulator) survey and CSS (internal)
survey
• Phase II – Customer Experience Measure
– Look at end to end experience and develop scoring map
• Score with internal staff as a comparison (it will be different from
customers)
– Identify key drivers of customer experience
– Calculate cost impact
– Focus on those factors which are most important to customer
and there is under performance on
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Phase II Key Findings
• Staff Score the experience lower than customers
– Rail staff tend to have a pessimistic view
– In terms of what they believe to be important to customers, their
view is very different to customers
• Commuters accept Punctuality is an issue within the
experience, but is not the most important factor
– Punctuality has become a hygiene factor
– Customers are more concerned about provision of information
• Ease of Access to stations and trains is important
– Disabled customers are an important group
– Opportunity for a “Priority Customer” approach
• Cost of focussing on Punctuality does not provide cost benefit
– Cost of additional staff balanced by improvement in experience
score
– Better information provision and leveraging technology has a
significant impact on experience score

Summary
• Customer Experience is a powerful driver of retention
• Measuring customer satisfaction is misleading
• The Approach demonstrated
– can be applied to any organisation/market
– Is simple
– Will deliver quick wins
– Is not costly e.g. Electricity Co. total cost was £17k
– Ongoing benchmarking will deliver ongoing benefits

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“Customer Experience…..

Bramley Orchard, Bryne Lane, Padbury

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

Bramley Orchard, Bryne Lane, Padbury

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

Experience Score 0 0 4 -3 -2 -3 -3 0 0 0 -5 -1.09

© Marketing Inside Ltd 2004

Experience Score -2 0 3 -4 1 -3 -4 0 0 -1 -5 -1.36

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

Bramley Orchard, Bryne Lane, Padbury

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

Experience Score - Staff Weighted Score - Staff

© Marketing Inside Ltd 2004

Bramley Orchard, Bryne Lane, Padbury

© Marketing Inside Ltd 2004

Customers Experience Score

Staff Experience Score

© Marketing Inside Ltd 2004

© Marketing Inside Ltd 2004

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