Customer satisfaction & loyalty by Marketing Insight

MARKETING INSIGHT CUSTOM MARKET RESEARCH TRY IMMEDIATE ORDERING VIA ONLINE CONFIGURATOR OUTPUTS INCLUDING INTERPRETATION AND RECOMMENDATIONS WITHIN 1 WEEK

CUSTOMER SATISFACTION & LOYALTY CSL PROPRIETARY TECHNIQUE - validated solution used by most of Marketing Insight's Clients

Marketing Insight s.r.o. | Vladislavova 17 | 110 00 Praha 1 client.service@marketing-insight.cz | www.marketing-insight.cz

BASICS OF THE CSL CONCEPT PRIMARY FOCUS OF THE CSL TECHNIQUE o  Measuring and diagnosing customer retention / loyalty / commitment o  Identification of key areas and attributes for improvement i.e. areas where improvement: –  Prevents churn and decline of retention of the own customers in the most efficient way –  Motivates competitive customers to switch in the most efficient way o  Continual monitoring of these areas and adjusting long-term strategy to knowledge gained above

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THE THREE KEY BUILDING BLOCKS OVERALL EVALUATION • Mainly retention / behavioral loyalty, satisfaction, commitment, NPS

EVALUATION OF PERFORMANCE ON ALL AREAS & ATTRIBUTES

IMPORTANCE • Implicit / derived & explicit / declared of individual areas and factors of quality

HIERARCHY OF THE CSL CONCEPT

Overall customer satisfaction index

Aggregate customer experience

AGGREGATE MEASURES OVERALL SATISFACTION RETENTION / LOYALTY

COMMITMENT

DIAGNOSTICS OF INDIVIDUAL AREAS Client service

Products / services

Information

…

DIAGNOSTICS OF FACTORS

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hotline

…

personnel

…

oﬀers

…

MAIN ANALYSES INCLUDED IN THE CSL Concept of the challenged loyalty is based on ﬁnding than on many markets customer loyalty is on high level and the standard loyalty measures thus become insensitive. Therefore we introduced the second level, so called challenged loyalty, which challenges the standard loyalty by suppressing conversion costs, limitations caused by long-term contracts and oﬀering discounts from competition.

Application of the CSL methodology provides the following validated and benchmarked analyses: o  Overall evaluation of the Client and competitors –  retention / behavioral loyalty (not just standard, but challenged as well) –  satisfaction –  commitment –  Customer Satisfaction Index (CSI – weighted) –  NPS o  Implicit and derived importance o  Importance / performance analyses –  link together performance on areas / attributes of satisfaction and importance o  Diagnostics –  why importance is high / low and what to do to achieve improvements

RETENTION VS. SATISFACTION

Business objective is having loyal customers i.e. maximization of retention. Satisfaction is an important, but not the only driver of retention. Moreover maximizing satisfaction may not be cost eﬃcient i.e. may be in contradiction to business objectives, which usually focus on proﬁt maximization slide 4

NET PROMOTER SCORE (NPS) NPS is a straightforward yet valid and actionable loyalty metric that has become one of standard approaches for measuring and improving customer loyalty.

o  Based on a single 0-10 scale question o  Results in just one score that can be easily benchmarked o  With added diagnostic questions capable of identiﬁcation of key loyalty and disloyalty drivers How likely would you recommend ________ to a colleague or friend?

0 1 2 3

DETRACTORS

4 5 6 7 8 9 10 slide 5

NEUTRALS

PROMOTERS

% promoters

% detractors

NPS

SATISFACTION VS. LOYALTY SEGMENTATION: EXAMPLE The chart links satisfaction and challenged loyalty to a brand together and segments the target group based on their mutual relationship:

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HIGH 33% SATISFACTION

10%

10%!

13%!

AVERAGE 38% SATISFACTION

10%

19%!

10%!

LOW 29% SATISFACTION

10%

LOW 29% LOYALTY

AVERAGE 38% LOYALTY

HIGH 33% LOYALTY

IMPORTANCE / PERFORMANCE MATRIX: EXAMPLE The chart links absolute and relative satisfaction with the measured attributes of a brand with their implicit / derived and explicit / declared importance: CRITICAL FACTORS

100%

FACTORS TO BE KEPT

SATISFACTION

EXPLICIT IMPORTANCE

Attribute2

HIGH

90%

Attribute6

MEDIUM LOW

80%

Attribute4

70%

Attribute5

50%

Attribute10

Attribute3

Attribute8

40%

Attribute1

Attribute7

30% 20%

IMPLICIT IMPORTANCE

Attribute9 60%

RELATIVE SATISFACTION AGAINST COMPETITION HIGHER

10%

PARITY LOWER

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LESS IMPORTANT 0% FACTORS

10%

20%

30%

40%

50%

60%

70%

80%

90%

OCCASIONS

100%FOR SAVINGS

ADVANTAGES OF CSL The CSL technique provides clear and straightforward recommendations for the Client, mainly in terms of allocation of priorities i.e. identiﬁcation of primary areas for improvement vs. areas where savings are possible. Other advantages include:

Focus not only on satisfaction, but primarily on retention (i.e. behavioral loyalty) and commitment (i.e. attitudinal loyalty) which are much more business-relevant

Advanced approach to retention – not just standard, but also challenged retention included in the behavioral loyalty calculations

Validation and various types of benchmarks - only direct and relevant benchmarks are used (same target group, same market, comparable products, timing and other relevant factors) slide 8

Possibility of competitive analysis which enables conversion of 'defensive' type of analysis into tool of 'oﬀensive' marketing – Client can identify and attack competitors' weak points

Possibility of linkage to CRM systems and KPIs

KEY COMPETITIVE ADVANTAGES

1. State of the art proprietary technique for satisfaction & loyalty analysis •  The most sophisticated analytical techniques delivered through streamlined and easy-to-understand reporting templates •  Innovative approach to loyalty analysis (standard loyalty + challenged loyalty concept)

2. Better benchmarking •  Only direct and relevant benchmarks are used (same target group, same market, comparable products, timing and other relevant factors) •  Necessary for credible KPIs setting

3. More qualitative approach •  While most customer satisfaction surveys are able to describe the situation (i.e. identiﬁcation of overall performance and strong / weak points), they often fall short in the subsequent phase when action steps are to be deﬁned and implemented – they do not provide enough qualitative diagnostics to be able to fully understand WHY the situation is the way it is and WHAT steps are the most appropriate to achieve improvements

4. Interpretation and implementation support •  We understand that end-users on client's side (product / brand / channel / segment managers) are experts in other areas, not in market research •  Therefore, we provide the most comprehensive follow up support (including workshop programs and various forms of consulting) in development of projects to implement and take actual use of conclusions of the CSL study •  We also participate in development of KPIs if relevant slide 9

MARKETING INSIGHT CUSTOM MARKET RESEARCH TRY IMMEDIATE ORDERING VIA ONLINE CONFIGURATOR OUTPUTS INCLUDING INTERPRETATION AND RECOMMENDATIONS WITHIN 1 WEEK