WWW.CUSTOMER-INSIGHT.CO.UK AUTUMN/WINTER 2012
DOES SPONSORSHIP WORK? LATEST UKCSI RESULTS INTERNAL CUSTOMERS HOW PEOPLE USE TABLETS AND SMARTPHONES MEASURING SATISFACTION IN SOCIAL HOUSING SPONSORSHIP
COMPANIES IN THIS ISSUE Halfords Land Securities The Co-operative Group Leeds Federated Plus... Latest Thinking Online Panels Book Review
New Half Day Briefings Measuring complaints A practical guide on how to measure your customers’ experience with your complaints process. Find out how to drive improvements and reduce customer defections.
Thursday 18th October 2012 09.00 – 12.00 - Central London
Thursday 15th November 2012 09.00 – 12.00 - Central Manchester
Consistent customer experience across communication channels Whether it’s face to face, online or through a call centre, customers expect consistency in their experience every time they interact with a company. Do you have the right measures to understand your customers’ multi channel experience?
Thursday 18th October 2012 13.00 – 17.00 - Central London
Thursday 15th November 2012 13.00 – 17.00 - Central Manchester
Customer Satisfaction v Net Promoter Score v Customer Effort Score Debate the pros and cons of different ways of surveying your customers. Find out which is the best measure for your organisation and how you can use the best bits of all three.
Tuesday 23rd October 2012 09.00 – 12.00 - Central Manchester
Tuesday 6th November 2012 09.00 – 12.00 - Central London
Measuring the non customer experience Most organisations measure their customer experience but they tend to know very little about the people who aren’t their customers. Find out what causes customers to defect or not become a customer – no one can answer this better than your non customers.
Tuesday 23rd October 2012 Tuesday 6th November 2012 13.00 – 15.00 – Central Manchester 13.00 – 15.00 - Central London Housing Briefing – measuring tenant satisfaction with your repairer contractors Assessing contractor performance is important - a well designed and actionable survey will track and highlight any issues that impact on your overall tenant satisfaction. Find out how to set fair targets for your contractors to ensure high quality standards.
Wednesday 7th November 2012 09.00 – 12.00 - Central London
Further information please visit our website or email info@leadershipfactor.com
www.leadershipfactor.com
AUTUMN/WINTER 2012
6 UKCSI
24 Technology
The latest results and insights from the UK Customer Satisfaction Index
iTV. Another game changer? 26 Latest thinking The long and winding customer journey 29 Technology Social satisfaction
12 Case study
30 Case study
Land Securities - Satisfying internal customers
A new approach to customer satisfaction in social housing
18 Online panel Pulse of the nation online panel surveys
YSP
32 Customer Satisfying the high rollers 33 Customer
In this issue...
VOLUME 2 ISSUE 2
Golf club satisfaction 34 Book review Thinking Fast and Slow by Daniel Kahneman 21 Technology How do people use smartphones? 22 Technology How do people use tablets?
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Nigel Hill editor
Companies are racing to adopt technology and be seen as leaders. Within the last month M&S announced the roll-out of a wi-fi initiative in its stores to “enhance the customer experience”. It will see staff equipped with iPads to help them give a better response to customer enquiries, QR codes around the store for customers to scan with their mobile devices and large interactive screens resembling giant iPhones to engage customers. The latest UKCSI results (from page 6) confirm that organisations with the best customer satisfaction tend to deliver the best customer experience across multiple channels. But just because technology is exploding and the top 2 companies on the UKCSI are both internet retailers, it would be a mistake to assume that the web is where you need to focus your customer service investment. The importance of channels varies across industries and above all depends on how customers want to interact with your type of business. For example, for utilities and most public services, customers are much more satisfied when they receive personal service than when using the internet (see page 8).
Customer Insight is the magazine for people who want their organisation to deliver results to employees, customers and any other stakeholders as part of a coherent strategy to create value for shareholders. We publish serious articles designed to inform, stimulate debate and sometimes to provoke. We aim to be thought leaders in the field of managing relationships with all stakeholder groups.
Nigel Hill
Editor:
Clearly it’s a dilemma. You’re being warned from all sides not to get left behind on technology and we’re saying the same in several technologyfocused articles in this issue of Customer Insight (from page 21). Moreover, there’s a strong trend across many organisations towards encouraging (forcing?) customers to deal with them over the web. This has strong appeal to the organisations because it’s cheap. But is it right? There are some guidelines that apply almost universally. Information gathering is a very popular use of the web, so make it easy for customers and potential customers to find out anything they want to know from your website and from other relevant third party sites. When it comes to other things customers want to do with your organisation (e.g. purchase, communicate, make an enquiry or a complaint, get advice or assistance), most organisations will find that they are faced with a range of segments with different needs, priorities and expectations. The only way to keep customers highly satisfied and loyal is to understand and meet the varied channel needs of your particular customer base. So you must survey your customers to establish their channel preferences by activity, by touchpoint and by segment, and make your customer service investment decisions accordingly. For most organisations this will mean giving customers a choice of channels. That is likely to include embracing the internet and social media for customers who can’t live without their mobile devices (see pages 21 to 23), but it does not necessarily mean reducing levels of service via traditional channels. You might find that a significant percentage of your most valuable customers prefer to interact with you this way. Moreover, since people’s use of technology is changing rapidly you need to research on a regular basis (at least once a year) and use the findings to evolve your customer management investment in a way that will maximise customer satisfaction and loyalty.
Production Editor: Chris Newbold Rob Ward
Designer:
Creative Director: Rob Egan Advertising:
Charlotte Ratcliffe
Printers of Customer Insight Magazine
www.customer-insight.co.uk info@customer-insight.co.uk Customer Insight c/o The Leadership Factor Taylor Hill Mill Huddersfield HD4 6JA NB: Customer Insight does not accept responsibility for omissions or errors. The points of view expressed in the articles by contributing writers and/or in advertisements included in this magazine do not necessarily represent those of the publisher. Whilst every effort is made to ensure the accuracy of the information contained within this magazine, no legal responsibility will be accepted by the publishers for loss arising from use of information published. All rights reserved. No part of this publication may be reproduced or stored in a retrievable system or transmitted in any form or by any means without prior written consent of the publisher. Copyright © CUSTOMER INSIGHT 2012
ISSN 1749-088X www.customer-insight.co.uk
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UKCSI
The State of Customer Satisfaction in the UK The latest wave of the UKCSI was conducted for The Institute of Customer Service by The Leadership Factor by web survey during May and June 2012. The results are based on a representative sample of 26,000 UK adults and show that overall customer satisfaction in the UK has slightly increased from 77.4 to 78, continuing the long-term trend of increased customer satisfaction in the UK.
Customer satisfaction by sector As shown in Figure 2: • Retail (non-food) has extended its lead over other sectors • Leisure and Automotive have improved significantly since January 2010 • The lowest performing sectors are relatively unchanged or improving only slowly – the gap between the highest and lowest performing has increased from 8.6 points in July 2011 to 11.8 points in July 2012 • We can divide the sectors into four groups based on their success in satisfying customers.
Group one - Retail (non-food)
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Figure 1: UKCSI by sector - July 2012 versus January 2012 50
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78.0
Table 1: The top 10 companies and their sector are shown in the table below:
This sector has extended its lead over other sectors and with a score of 84.1 it is 2.5 ahead of the next best sector Retail (food) with 81.6. This has been driven by very high scores for internet retailers such as Amazon and ASOS as well as traditional bricks and mortar high performers such as John Lewis. It is interesting to see how the non-food retail sector has pulled away from the others over the last year as the most popular internet retailers have gained market share and thus become a bigger component of the sector index.
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What the scores mean - A score of 80 corresponds to an ‘8 out of 10’ rating for customer satisfaction. - E ighty organisations achieved a score of over 80, and 21 organisations achieved a score of 85 or over. Customer satisfaction can be assessed by both an organisation’s absolute score, and how they compare to the average score in their sector.
July 2012 Jan 2012
UKCSI
Group two This group comprises Food Retail, Services, Leisure, Automotive and Tourism. Some of these sectors have always been high performers, but Leisure and Automotive have not always been in the lead group - both have improved rapidly from January 2010. Although its index remains good at over 80%, Tourism is one of only three sectors to show a downward trend over the last year.
Group three - Financial Services This group comprises the insurance sector and banks/building societies. These sectors have scored relatively close to the overall average - with scores of 78.3 and 78.1 respectively. Over recent years, insurance has improved customer satisfaction only marginally but banking has made much stronger gains in the last two years.
Group four – Utilities and Public Sector Comprising Utilities, Public Services (national), Public Services (local), Telecommunications and Transport, this remains the poorest performing group in terms of customer satisfaction, but as a group has shown good improvement over the years, particularly National Public Services and Utilities. By contrast, customer satisfaction has fallen over the last year with Local Public Services and Transport.
Figure 2: Customer satisfaction by sector 85 Retail (non-food) Retail (food) Services Leisure Automotive Tourism
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UKCSI
Customer satisfaction by channel
How customer satisfaction drives business performance Organisations invest in customer service to achieve tangible business benefits in terms of increased sales and profit. This can take a number of forms including customers buying more products and services, customers becoming more familiar with an organisation and therefore less costly to serve and customers recommending an organisation to others. In this section we examine some key indicators for a number of sectors – Retail (food), Telecommunications, Finance (banking and building societies) and Finance (insurance) – that demonstrate how companies benefit when they achieve high levels of customer satisfaction.
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In the Retail (food) sector, the UKCSI results suggest a correlation between high (or low) customer satisfaction and market share growth. Companies with an overall customer satisfaction score higher than the sector average (81.6), have seen an average market share growth of 0.8% in the last 12 months. Companies with an overall customer satisfaction score lower than 81.6 have seen an average market share drop of -0.13%.
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Services
Figure 4: Supermarkets’ market share change (May 2011 – May 2012)
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Figure 5: Customer satisfaction and average market share change
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The organisations with the highest satisfaction tend to have the least variation of satisfaction rates across channels of communication. In keeping with the best customer service advice, they are offering a more consistently satisfying experience, whichever channel a customer chooses. In person is the preferred channel for many sectors including Services, Automotive, Leisure, Finance (insurance), Finance (banks and building societies), Public Services (local), Telecommunications and Utilities. Web is the highest scoring channel for Retail (food), Retail (non-food), Public Services (national) and Transport. In Public Services (local) and Utilities, customers are much more satisfied when dealing in person than over the web.
Figure 3: Customer satisfaction by channel 90
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There is also a good relationship between customer satisfaction and sales growth. Supermarkets with customer satisfaction levels above the sector average achieved an average year-on-year sales growth of 9%, compared with only 3% on average for supermarkets recording customer satisfaction below the sector average.
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The score for banks and building societies has increased from 77.4 to 78.1. Organisations that have a customer satisfaction score higher than the sector average (78.1) have an average positive recommendation rate of 37%. For those who score less than 78.1 on overall satisfaction the recommendation rate is only 24%.
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Finance (insurance) The Finance (insurance) sector score has increased from 78 to 78.3. Companies who have achieved a customer satisfaction score higher than the sector average (78.3), have a larger number of customers who have recommended them - an average of 33% - compared to 27% for companies whose overall satisfaction is lower than the sector average. Companies with higher customer satisfaction scores are also more likely to have higher renewal rates, and more customers who hold multiple policies.
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Figure 8: Recommending insurance 0%
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UKCSI
Figure 9: Recommending telecoms
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0%
The Telecommunications sector score has increased from 74.1 to 74.7. Companies with a customer satisfaction higher than the sector average (74.7), have an average positive recommendation of 36%, compared to an average of only 26% for companies who score less than the sector average.
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The Automotive average customer satisfaction score has increased from 80 to 80.9. The companies whose satisfaction scores are higher than the sector average (80.9), have an average recommendation rate of 49%, compared to 30% for the companies below the sector average for customer satisfaction. The companies with the highest customer satisfaction scores (over 83), have an even higher recommendation rate - 55%.
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Figure 10: Recommending cars 0%
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The service/price trade-off We asked customers in four sectors – Finance (banks and building societies), Finance (insurance), Automotive and Telecommunications - to rate the relative importance they give to price and service, on a scale of 1 to 10. Higher scores meant that service was more important to them; lower scores meant that price was more important. Most customers seek a balance of price and service, with the balance tipped slightly in favour of service over price. This pattern was similar in the four sectors we surveyed, with three of the four sectors registering the same average score of 5.8.
30%
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Figure 11: The service / price trade-off
25% Banking (5.8) Insurance (5.8)
20%
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15% % customers 10%
But there are notable minorities of customers who are either very price-driven or very service-driven. It’s likely that these groups of customers would find their needs met by different suppliers in most markets. In the four sectors surveyed, more than 1 in 4 people indicated a strong preference for excellent service, even if this meant a higher price. There is an especially high proportion of customers in the Automotive sector who are more service-driven – 31% of customers rated service much more important than price. This may reflect that buying a car is a high involvement purchase for most customers. CI
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Stephen Hampshire Client Manager The Leadership Factor If you have any thoughts about this article you can contact Stephen at stephenhampshire@leadershipfactor.com
Case Study
Satisfying Internal Customers is vital too Improving internal performance results in higher customer loyalty and improved business performance. Measuring this allows you to manage it but it is not often done because it can be complex and painful. Here we present a new approach.
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Case Study
Action
Measure 1
Improvement in employee selection, development, recognition, reward
Result Higher retention
Employee satisfaction Increased capability
Measure 2
Result
Internal service satisfaction
Better external service quality
Measure 3
Result Retention
Customer satisfaction
Growth
Related sales Referrals
Lower costs Higher productivity
Result
Better ROI
Increased customer lifetime value
Use customer centred survey results to identify the focus needed to improve performance perceptions Figure 1 - investing in your most important asset produces results
There is a chain of events that creates business success The Service Profit Chain concept described in detail by The Harvard Business School almost 20 years ago makes it clear that business success is dependent on customer engagement and that high levels of satisfaction with the product and service relationship are needed to create this engagement. Satisfaction with service delivery is strongly linked to staff engagement, and staff engagement is dependent on their satisfaction at work. Staff satisfaction is dependent on a mixture of such elements as security, achievement, recognition, reward, development, relationships with coworkers, and the working environment. My own interpretation of these links is shown in Figure 1. The focus of this article is on ‘Measure 2’ (readers and clients will already be familiar with our work on ‘Measure 3’ and ‘Measure 1’). Successful organisations are focused on delivering the elements that result in an engaging customer experience and this means ensuring that all parts of the organisation understand how the work they do contributes to this and that the service they provide to colleagues is an integral part of the picture. Operational Management Corporate Comms 3rd Party Suppliers
Planning
Human Resources
Training Regional Offices Sales Dept Information Contact Technology Centre Customer Marketing Logistics Facilities Accounts & Mngmnt Credit Production Control
Field Staff Tech. Support
R&D Design
Finance Legal
Feedback about performance is an essential part of performance improvement, whether the intention is to improve your golf swing, your creative writing or your ability to retain loyal customers. By measuring your performance you are more able to manage it. Measurement of the end-customer’s satisfaction is critical but measurement of the internal services that help to deliver that satisfaction is just as important. In some organisations this is conducted using such techniques as six-sigma or of course individual performance appraisal systems but these may be too complex or not effectively pursued. So, working closely with our client Land Securities (see inset) I devised a new system which has already worked very well for them.
Objective To reveal internal customer perceptions about the service or services they receive from other departments and to use the result to promote best practice. This will increase internal satisfaction and efficiency which will in turn improve external customer experience.
Background considerations The first thing to be aware of is that this type of survey needs to provide anonymity to respondents so that they neither conceal nor exaggerate their real perceptions. Web surveying should work for such a survey but using external resources and assuring staff about confidentiality is critical to success.
We asked David Holt (Finance Director of Land Securities) to tell us a little about the company and why this change in survey design was needed. “Land Securities is the UK’s largest Real Estate Investment Trust (REIT) with a commercial property portfolio worth over £10.0bn including landmark developments such as New Street Square and One New Change in London and the White Rose centre in Leeds. We own and manage approximately 29 million sq ft of commercial property and provide property services to more than 2,500 private and public sector clients. We go beyond bricks and mortar, through design, community engagement and customer service to create places where people choose to shop, are proud to work and want to live. Our approach to customer service excellence differentiates us from our peers and helps ensure that our clients make us their partner of choice for commercial property relationships. The whole company needs to perform well to deliver that service excellence and for several years we have been measuring the ability of a number of our central services teams to work with other areas to deliver the best experience to our clients. The system had become tiresome for staff since it asked them to rate a wide range of areas on a broad set of criteria. Giving feedback took too long, response had fallen and it was hard to translate the results into improvement plans. The solution that we developed with Jim removed these problems and revitalised the process so that it is easier for staff to participate and much more focused and useful for management.”
The previous approach was to conduct an annual web-based survey covering
Figure 2 - everyone serves the customer www.customer-insight.co.uk
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Case Study
all departments. This meant that the staff involved were expected to complete a long survey about more than one service. Experience revealed that over time this was increasingly likely to be considered too much to ask and that response rate and the quality of response would suffer. So we needed to find a more acceptable way of obtaining the vital feedback.
The web survey question would therefore look similar to this – In relation to the Legal Department what score out of 10 would you give them for ….. Staff reliability
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(Delivering on their promises, being accountable, keeping you informed about issues raised)
The next question would depend on the score given, and only one comment would be requested –
important to focus strongly on the improvement opportunities identified. The next step will be for each department to read all the comments and develop plans for action.
The proposed solution As a first step some exploratory work should be carried out to define the criteria by which staff will judge the success of other departments. This would ideally involve staff themselves by running a few focus groups or it may be sufficient (as in Land Securities’ case) to develop the questions with management. It will then be possible to focus the measures so that the survey will be more interesting to complete, still be focused on the priority areas, and provide a greater depth of understanding about the action that can be pursued to improve the user experience. The survey could be ‘staggered’ across the year, perhaps running every four months and surveying up to six service areas each time. In each case staff could select up to three services to assess. This would mean that each service would achieve a good response rate and that no member of staff would be asked to assess too many services at one time. Surveys should also be focused on obtaining useful comments so staff would only need to give a score for a few broad measures rather than a long list of detailed specifics. To ensure that the score is a considered one a context statement is included (this would be agreed with each department being assessed). The example below shows the main five areas that customers may experience, along with a context statement:-
If the score is from 1 to 5 the question is “ What has made you dissatisfied with the service?” If the score is from 6 to 7 the question is “ What would need to change for you to be more satisfied with the service?” If the score is 8 to 10 the question is “ What has made you so satisfied with the service?” In this way just five satisfaction scores are given but every score will be accompanied by a comment that is focused to provide guidance about improvement actions. The five main questions are likely to apply to all areas but the bracketed descriptions can be made specific to each. Further questions can be included, these being – “ Has the service improved, deteriorated or stayed the same in the last year?” If improved or deteriorated the survey would ask ‘In what ways?” “ What, if anything, would you like to add that has not been covered already?”
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The information produced by this activity would play a significant role in achieving internal efficiency improvement and in improving the satisfaction of external customers. It is an essential part of the Service Profit Chain. CI
The staff delivering the service can also participate by completing the survey as they believe their customers will. This provides a useful comparison and can help to realign the views of the supplier and the recipient. Jim Alexander
Analysis should produce a simple set of scores for each service. This may not convert easily into an Index but it is more
• Staff reliability (Delivering on their promises, being accountable, keeping you informed about issues raised) • Staff competence (Responsiveness, proactivity, creativity) • Communication (Accuracy, relevancy, timeliness, being pitched appropriately) • The relationship (Treating you with respect, being open to suggestions, being flexible when possible) • Processes and systems (Effectiveness, ease of use, having the right tools for the job)
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For the activity to be of maximum benefit it is important for each service department to assess the results and establish a plan of action that becomes part of the annual business plan. This will mean that the implementation of these plans will be reviewed at senior management level and that staff objectives will include them, both of which make it more likely that improvement will be achieved. The staggered timing of the surveys is not an issue, since each department can simply use the most recent of their surveys to draw up plans and progress will be assessed in relation to the trend of results. The department heads will be able to feed back the survey results easily and staff will become engaged in developing the action plans and should be encouraged to take ownership of them.
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Client Manager and a Director of The Leadership Factor Contact Jim to discuss any aspect of this article on 01484 467025 or e-mail him at jimalexander@leadershipfactor.com
The Opinion Dashboard is an online tool where you can watch, listen to and read the thoughts and views of your customers or UK consumers. Individuals can respond to your questions quickly, bringing research to life and provide in-depth qualitative insights.
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For more information please contact: Darren Wake 01484 467012 darrenwake@leadershipfactor.com
To view this Dashboard:
To view this Dashboard please visit: www.leadershipfactor.com/dashboard
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YSP
Online panel
Darren Wake
Business Development Manager The Leadership Factor
01484 467012 darrenwake@leadershipfactor.com
Parents and carers putting children’s lives in danger Research carried out by YourSayPays showed parents have little understanding of booster seat law and generated significant exposure for road safety charity BRAKE and BubbleBum car seats. Every year 1,423 children aged 11 and under are killed or seriously injured whilst travelling on UK roads - and travelling by car is when Britons are most worried that children are at risk of injury, with 41% citing this as their main concern. Yet parents, grandparents and carers are putting children’s lives in danger by allowing them to travel in cars without booster seats before they are legally allowed. The research of 1,000 carers by YourSayPays showed that three-quarters of respondents (74%) have stopped or plan to stop using booster seats while their children are aged ten or under, despite the law saying that children must be aged 12, unless they are over 135cm tall. YourSayPays sourced and surveyed a sample of over 1000 UK adults who regularly care for young children and transport them by car. Men are less likely than women to use a booster seat and women are more likely than men to keep a child in a booster seat for longer – 58% of men will stop using a booster seat when a child reaches 8 years of age, compared to 43% of women. Moreover, quite a lot of people, of both genders
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(35% of respondents) regularly carried three or more children in the backseat of a car even if there was not a booster seat for each child. There is also considerable ignorance of the 2005 laws relating to booster seats. 72% of those surveyed did not understand when it was permissible to carry children without booster seats and 75% did not know the purpose of booster seats. Another misconception is the view that children are exempt from wearing a booster seat if they are renting a car and no booster is available or if they are travelling outside the UK. Martin Howard, spokesperson at Brake, said: “It is alarming that so many drivers are unaware of the height and age at which children are safe to travel without using booster seats. Children have delicate bodies and are never more at risk than when travelling as passengers on the roads, and it is therefore vital that they are provided with the correct support. Brake is calling for parents, grandparents and carers to ensure that children are carried safely in booster seats until they are over 150cm tall, in line with EU recommendations. We
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are also urging the Government to invest in educational campaigns to raise awareness about the dangers of not using booster seats, which will help ensure that drivers are not unwittingly putting children’s lives at risk”. “These findings from YourSayPays offer real insight into the limited knowledge parents today have about booster seat safety,” said Grainne Kelly, CEO of BubbleBum. “It’s apparent that whilst many parents are doing everything they can to keep their children safe in cars, there’s no real understanding of the protection provided by booster seats. There is clearly a lot of work to do to educate about not only the law but the reasons why it’s in place, and to make sure parents aren’t putting the lives of children at risk.” The research generated huge exposure for BRAKE and Bubblebum car seats. The findings were discussed on both national and local radio stations with the BBC highlighting the statistics. The findings were also published in many newspapers including Metro, Daily Mail, The Sun and The Independent.
Online panel
YSP
Talk Talk Another YourSayPays survey which recently generated significant exposure in the media was for Talk Talk Business, the telecommunications company. 500 SME Directors and Senior Managers were asked questions relating to business communications and key issues relating to technology. The resulting story has generated 22 pieces of coverage to date reaching a readership of nearly 3.5 million people. Highlight pieces included Reuters, Wall Street Journal Europe, IT Europa, Total Telecoms and extensive regional coverage.
Funeral etiquette given last rites
Funeral etiquette is dying out as more than one in four people admit to not paying their respects to a passing procession. YourSayPays asked a nationally representative sample of over 2000 adults questions about funeral etiquette and how they act if a procession passes. The research, commissioned by Co-operative Funeralcare, the UK’s largest funeral director, revealed that generations of people are unaware of traditional funeral etiquette and show no courtesy to funeral corteges – with teenagers and those aged up to their mid-forties the most likely to be ill mannered. The research found that those in their late twenties and early thirties were the most oblivious to funeral traditions and etiquette while Scots remained the most courteous. Almost one in three (29%) of those aged 18 to 44 years old were unaware of the unwritten rules for funeral processions and how to act when a procession passes. Over half of those questioned (51%) were unaware of etiquette such as workers stopping by the roadside as a funeral procession passed. 43% of pedestrians would no longer ‘doth’ their cap as a sign of respect and 38% would not stop what they were doing for a passing funeral cortege. Our research was independently backed by the views of funeral directors from The Co-operative Funeralcare, with almost three-quarters of staff having witnessed an increase in discourteous behaviour even within the last five years. Earlier in the year, The Co-operative Funeralcare reported that instances of road rage against funeral processions were on the increase. David Collingwood, National Operations
Director, The Co-operative Funeralcare, said: “There has been much talk since the riots last summer about attitudes and respect within society and we have seen a significant shift over the years away from people observing the unwritten rules of funeral etiquette. Many people ignore a passing funeral procession and it is not uncommon for pedestrians to purposely disrupt a cortege by using a pelican crossing to stop funeral cars or even cross the road between funeral cars. Our research has highlighted generations of people who are unaware of the traditions and etiquette which were once commonplace for people to show to a passing funeral.” He added: “The days of workers stopping what they were doing to mark a passing procession or people removing their hats and bowing their heads has long gone.” The top three regions that show the greatest respect are Scotland, Northern Ireland and Northern England. The regions least likely to follow funeral etiquette are the Midlands, South East England and South West England. The research generated significant media exposure for Co-operative Funeralcare. The findings were discussed on BBC Breakfast News and Radio 2’s Jeremy Vine hosted a phone in to discuss the research and people’s experiences with regards to funeral etiquette. The research also featured in many newspapers including The Daily Telegraph and The Independent, and launched numerous discussions in blogs, forums and social media channels. The news article on The Telegraph website alone was re-tweeted over 300 times. CI
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Online panel
YSP
Has Brad inspired us to get on our bikes? According to a survey conducted by YourSayPays for Halfords, the answer is ‘Yes’! Based on a sample of 1,000 adults, the data was gathered after the Tour de France but before Bradley Wiggins’ Olympic gold medal. An amazing 64% had seen the Tour de France on ITV4 at least once and whilst only 27% of the total sample correctly identified that the programme was sponsored by Halfords, 37% of the 664 respondents who had seen it identified Halfords. This level of awareness is good for a programme that was broadcast for only three weeks.
Participation There has been much speculation about whether greater participation in sport will be one of the legacies of the Olympic Games. According to this survey, greater participation in cycling will definitely be a legacy of this year’s Tour de France. 58% of people who had seen the ITV4 coverage said it had inspired them to get out on their bike. 43% of the total sample were also inspired, and of course there was plenty of other media exposure for the tour including radio, newspapers, websites and apps as well as other TV coverage. 76% of the sample felt proud of the
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example that Bradley Wiggins is setting to up and coming cyclists, rising to 88% amongst those who had seen the coverage, and very similar numbers thought it would inspire other people to get out on their bikes.
four selected are from a list of 19 brands stocked by Halfords. They are Raleigh, Apollo, Carrera and Boardman. Perhaps more interesting is that it was the higher end bikes, Boardman and Carrera that showed the biggest increase if people had actually seen the ITV4 coverage.
Impact on buying intentions For any TV advertising or sponsorship, awareness and recall are always important measures. Impact on purchasing behaviour is always harder to quantify and, due to the many other variables involved, very difficult to link directly to the specific slots on TV. However, based on the results of this survey, there should be a clear financial benefit for Halfords. 49% of the total sample said they were thinking of buying or upgrading a bike (for themselves or family members) and this rose to 56% amongst those who had seen the ITV4 coverage. Of these 56%, the majority (58%) said they had been inspired by the achievements of the British competitors in the Tour and the TV coverage. This is a very interesting statistic, because normally, many people whose purchase decisions are influenced by TV advertising do not acknowledge that possibility when asked the direct question. Even more encouraging for Halfords is that when asked which brands they would consider if buying a new bike, all of the top
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16.4% of the sample knew other people who had been inspired to buy a bike as a result of this year’s Tour de France, rising to 22.6% amongst those who had seen the ITV4 coverage. When incorporating the fact that some knew two people and others three or more, it emerges that every 100 people who saw the ITV4 coverage know at least 29 others who are now thinking of buying or upgrading a bike. All things considered, this suggests a great return for Halfords on its sponsorship of the Tour de France coverage. CI
Mark Forde Business Development Manager 01484 467050 markforde@yoursaypays.co.uk
Technology
How People Use Smartphones According to Nielsen data, only 5.4% of mobile phone time is taken up by the phone’s “dialler” function, meaning traditional talking. We’re spending 2.3% of the time with music and video apps, 11% with the browser and more than half with “other” apps. And text messaging consumes 13.4%. The iPhone has shaken up entire industries, from navigation to gaming, and replaced household items such as torches and alarm clocks for many of us. Their constant companionship has also made our smartphones handy shopping tools -- to the chagrin of plenty of bricks-and-mortar retailers. According to Nielsen, 29% of owners use their smartphones for shopping activities, including comparing prices and purchasing.
Fewer devices Thanks to the almost limitless functionality of smartphone apps, people now need fewer gadgets. In a recent survey conducted by Gazelle.com (a company that buys your old iPhone), nearly 70% of survey respondents have said goodbye to their iPod or mp3 player, 55% have ditched their camera, and over 40% no longer use their GPS unit since buying an iPhone.
Phones for babies? In June, Asda conducted a survey of 1,662 mums and found that smartphones are increasingly becoming the primary way to entertain young children. The research
revealed that 27% of mums use their phone regularly to entertain their off-spring, ahead of a bottle or a drink (25%), soft toys (21%) or a dummy (9%). 40% of mums let their children play with their smartphone for an average of 10 minutes or less a day, but 10% admit to allowing them to regularly play for one to two hours at a time. Mums in Scotland are most likely to entertain their children with a phone (40% of them do it), followed by Wales (32%), the Midlands (32%) and Northern Ireland (30%). Parents most often use smartphones to keep their children quiet when they wake up early in the morning, or when at a restaurant, in the car or waiting for an appointment. Most have a range of apps on their phones for their children to play with from puzzles and games to educational programmes. Popular ‘electronic pacifier’ apps include: Wheels on the Bus - Winner of multiple awards, this animated and interactive music story book allows children to do things such as spin the wheels and swish the wipers of the bus alongside the happy tunes. Classic Simon - An updated version of retro classic Simon Says, the app features four colour modes, along with more
advanced challenges for older children. It has already racked up 3.5m downloads with an average rating of 3.5 stars. i Story Books - Aimed at kids aged two to eight, this app offers various free books complete with text, audio and pictures. New books are added to the app each week.
Not improving our manners However, smartphones are not so good for our manners, with more than 25% reporting that they “almost always” use their iPhone while in a social setting such as during a meal or while at a party. A further 58% say they use their iPhone in a social setting either “usually” or “occasionally,” while only 17% say they “rarely” or “never” use it in a social gathering.
Smartphone or sex? Which would you rather give up for a weekend - sex or your iPhone? 15% of respondents to the Gazelle.com survey said they would choose a romance-free weekend rather than go without their beloved device. But why not have both? Nearly 4% of respondents to the Gazelle survey reported having used their iPhones whilst having sex!!! CI
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Technology
Are Tablets a Game Changer?
At the time of writing (July 2012), 13% of UK households now own at least one tablet computer or e-reader compared with only 2% in March 2011, and an additional 17% intend to buy one in the next year. According to Ofcom’s annual ‘Communications Market Report’, entertainment is the main reason for buying a tablet, having been cited by 56% of owners. Next on the list was easy internet access (53%) followed by portability (52%). 45% of tablet buyers admitted they had no particular need for the device but just wanted to treat themselves. Needless to say, this huge increase in adoption rate has led to a spate of research into tablet ownership and usage driven by companies’ growing interest in this market and communication channel.
Ownership profile Ofcom report that tablet uptake is currently highest amongst families with children and 45-54 year olds (42%). Over half live in London, the Home Counties or Manchester and over two thirds are ABC1. In line with this affluent ownership (and the 45% of buyers who didn’t need one), upmarket tablet users are “spontaneous and materialistic”, being 79% more likely than other upmarket adults to
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spend money without thinking – clearly an audience worth chasing! Fully functional tablets such as iPads have a male bias, whereas women are more likely to own an e-reader such as a Kindle.
Tablet Usage InMobi, the largest independent mobile advertising network, and Mobext, the mobile marketing network of Havas Digital, recently released the results of their global
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consumer research, ‘The Role of Tablets in the Consumer Sales Journey’. Conducted on mobile and tablet devices, the survey examined the media consumption habits of over 8,400 respondents across seven different markets and demonstrated that consumers are spending increasing amounts of time on mobile connected devices, with tablets strongly influencing purchasing decisions as consumers find new ways to research and interact with brands. The key take-outs include:
Technology
69
% of tablet users have shopped via their device in the last 30 days
7 out of 10
users regularly use their tablet and watch TV at the same time
The average number of in-home devices is 9.7, up from 8.7 in 2010
44
% of tablet owners would not want to be separated from their tablet
Over
50%
of tablet owners spend at least an hour a day accessing media content
22
% of tablet owners have shopped in physical stores less since getting their tablet
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m tablets were shipped in Q1 2012
Apple dominates the market with a 68% share
There are 1m+ Zeebox users in the UK (30 min average session)
51
% use a tablet to fill what would previously have been ‘dead time’
49
% of respondents share their tablet with family members
42
% said that their tablet has revolutionised the way they communicate with friends/colleagues.
63
% of tablet users think it is easier to access media content on a tablet than on a mobile or laptop/ desktop.
pple dominates the A market with a 68% share According to Adobe’s ‘Digital Index Report’, one tablet generates as many website visits as four smartphones, so although there are far fewer tablets around, by March this year they already accounted for 4.3% of website hits compared with 6.1% on smartphones. Adobe predicts that internet traffic on tablets will overtake smartphones by the beginning of 2013. However, organisations mustn’t lose sight of the fact that PCs/laptops still generate the lion’s share of website visits – 19 times more than tablets in Q1 2012. This isn’t surprising in view of the vast installed base and the fact that shipments of PCs/laptops still considerably out-number tablets – a lead that may even increase from the end of October with the launch of Windows 8 and ultrabooks.
of research, whereas tablets are more likely to be used for passive consumption of content or for more repetitive, routine purchases or information gathering. Laptops/PCs therefore remain well ahead for anything where consumers lack expertise such as buying a smart TV, anything where they make multiple comparisons, such as holidays or, to a lesser extent, purchases where they rely on peer reviews. So, for example, deciding on an up-market restaurant for a special occasion (especially if it will be a first visit) is more likely to be researched and booked on a laptop/PC, but takeaway owners should make sure that they have a very tablet friendly website. Interestingly, tablet owners are very likely to use their device for repeated interactions with financial services providers.
Tablet users are buyers
Impact on traditional media
Tablet users do more things on their tablet (an average of 3.9 activities chosen from a list of six broad options) compared with laptop (3.6) or smartphones (2.7). They also use their tablet more than any other device to buy stuff. 46% preferred to make purchases on their tablet compared with 41% on a PC/laptop and only 9% on a smartphone. And 69% of tablet owners had actually done some shopping on their tablet in the last 30 days, with almost 10% of these happy to use it for a ‘big ticket’ purchase, in contrast with smartphone users who typically use their device for smaller, more functional purchases. Moreover, 20% of tablet users claim to shop less in bricks and mortar stores since purchasing their device. These facts, together with the half of tablet owners who share the device with family members illustrate the value of tablets for companies selling products or services that are often family decisions. Joint family decision making includes items such as holidays, tourist attractions, eating out and takeaways as well as bigger decisions such as cars and housing. However, according to Adobe, PC/laptop conversion rates remain much higher for any shopping activity that involves a significant amount
The research also revealed that 72% of respondents watch TV while using their tablet. This helps to explain the growing popularity of Zeebox. Somewhat surprisingly, 20% of owners claim to watch more TV since buying their tablet, so maybe mobile internet won’t be bad for the TV industry. Interestingly the UK showed the highest levels of ‘dual-screening’ across the globe. This is consistent with the fact that tablet usage peaks between 7.30 and 10.30 in the evening, when owners use them more than PCs/laptops or smartphones. During the daytime, however, PC/laptop usage is twice that of tablets, suggesting that BYOD (bring your own device) remains far from universal. CI
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Technology
ITV or iTV? Reflecting on the massive behavioural change over a relatively short time stimulated by the 2007 introduction of the iPhone, what will happen when Apple introduces a TV? Is the TV ecosystem -- from programme makers, the marketers that rely on TV to sell products, to the ad agencies that buy its media -- ready for TV’s iPhone moment? Just as with the iPhone (or the iPad or iPod), Apple TV won’t be the first device of its kind. Even without “smart TVs,” early adopters have been streaming for some time via a range of set top boxes such as Xbox or Roku or via the Airplay function on Apple’s existing TV solution, all of which bring wireless connectivity to the TV. And increasing numbers are turning to the Zeebox app to combine their TV viewing and social media activities.
But the Apple TV set will almost certainly be beautiful, easy to use, and it will usher in a whole new way to navigate nearly unlimited content through the electronic device that is still the hub of most households’ home entertainment. Here’s how Walter Isaacson put it in his biography of Steve Jobs.
“Steve very much wanted to do for television sets what he had done for computers, music players and phones: make them simple and elegant. ‘I’d like to create an integrated television set that is completely easy to use. It would be seamlessly synced with all your devices and with iCloud. No longer would users have to fiddle with complex remotes for DVD players and cable channels. It would have the simplest user interface you could imagine. I finally cracked it.’
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Assuming he had ‘cracked it’, has Apple acted in time? Some very large players in electronics and TV, such as LG and Samsung, have already launched very elegant all-in-one smart TVs whose appearance and functionality will be difficult to better. Due to advances in screen technology even the largest sets have edge-to-edge displays and are much thinner than current plasma or LCD TVs (only 4cms thick for a 55 inch display). They are wi-fi enabled, will link with smartphones, tablets and PCs and have a home screen which looks rather like the forthcoming Windows 8 but is fully customisable. LG call it a Home Dashboard. It can be controlled by the traditional remote or an app on your phone or tablet. Whilst the manufacturers such as LG are heavily promoting 3D and gaming, which is very impressive on the big high resolution screens, businesses will be more interested in the possibilities afforded by the household’s entertainment hub working just like a smartphone or tablet. Whether its social media, YouTube
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or just surfing the web, the opportunities for communicating with customers are immense. Clearly this will have massive ramifications for the TV-ad industry. Whether that threat will be spearheaded by Apple or the current TV market leaders is anyone’s guess. The incumbents now have a clear lead but every time Apple has launched a disruptive device critics have said that it’s too expensive and people don’t really need it. They’re also saying that since we hang onto TVs longer than we do phones or computers, there’s no way it will have the impact of Apple’s other innovations. But similar criticisms were levelled at the iPod, the iPhone, and the iPad (that costly, “in-between” device that people weren’t even asking for). Though the iPhone wasn’t the first smartphone, it ushered in a different way to think about and use mobile (see page 17), and dramatically altered people’s behaviour. So maybe Apple will surprise us with something noone had thought of for TVs as well. CI
Latest thinking
The Long and Winding Customer Journey Understanding how consumers use various touch points to research and buy different products is essential to gaining full customer insight in today’s multichannel marketplace. Andy Wood explores the implications for CRM and marketing. UK consumers today face an almost bewildering choice of channels when it comes to engaging with brands. The high street, the industrial park, the website, email, the catalogue, direct mail, interactive television, SMS, mobile apps and social media are all part of the rich mix of touch points that make tracking the customer journey more of a challenge than ever before. And for companies operating in this dynamic and competitive environment, understanding consumer behaviour on a multichannel level is becoming ever more crucial for the successful management of their customers.
what they are buying. Few, in fact, limit themselves to one channel for both researching then purchasing a product or service. But far from viewing consumers as fickle and indecisive when they consult not only a high street store but also a brand’s website and relevant social media pages before making a purchase, companies must use all data to hand to analyse, interpret and then address customer behaviour. Only then do they stand a chance of growing loyalty and building sales through tailored communications and offers that demonstrate genuine insight.
Multiple touch points
Where once businesses debated bricks and mortar versus mail order, today the retail landscape is multifaceted and multidimensional, and the question has moved
Do today’s consumers even have a preferred channel? Well, it can depend on
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onto how they use various channels. The key to understanding this is to look at how consumers use the multiple channels at their disposal for different parts of the decision-making and purchasing process. The latest research from GI Insight shows there is logic to consumer behaviour across multiple channels. Understanding this on an individual level can be crucial to managing customers effectively – getting them to remain loyal, to buy more with each transaction, and to purchase more frequently.
Mixing bricks and clicks The research shows that, when it comes to their favourite brands, consumers are comfortable mixing their points of interaction, with 63% of the 1,000 UK consumers surveyed revealing they buy from both the
Latest thinking
websites and high street stores of the companies they purchase from the most. Indeed, despite the boom in online shopping, consumers today still use high street stores (and other bricks and mortar outlets such as shopping malls and retail parks) to examine and test a great many products prior to final purchase. So, despite the rise of the quick and easy internet purchase, shopping is still not a one dimensional activity that begins and ends with an instant transaction: more than ever it is a social experience, it takes place across channels, and it does not require point of purchase to be the same as point of perusal. Increasingly, traditional high street stores are venturing online, with brands such as John Lewis and Next establishing a
powerful digital presence. And, not to be outdone, pure online players are themselves entering the high street market, with Amazon reportedly establishing its first physical outlet this year to offer customers the opportunity to purchase its Kindle products in-store, believing this could boost sales amongst impatient shoppers and those sceptical of buying sight unseen. When Amazon, arguably the world’s most successful online retail business, acknowledges that the high street is far from obsolete, it signals that the multichannel relationship is here to stay – at least for now.
Product category affects channel choice Although the business of selling uniform
products such as books and CDs – products which easily fit through the letterbox and can be just as successfully vetted online as in-store – works well as a webonly enterprise, many retailers are learning that marketing more varied and bigger products ranging from the latest fashions to consumer electronics to outdoor furniture requires a more complex approach. Indeed, GI Insight’s research confirms that the type of product being purchased has a major effect on the path of the customer journey: 73% of consumers prefer to examine and test bulky products (such as bicycles, garden tools, playpens, furniture) in person and 69% choose to check out and try on fashion items (such as clothes, shoes, sunglasses, accessories) in-store, even if they make their final purchase online. The majority (60%) even prefer to
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Latest thinking
look at and test electronic products such as televisions, DVD players and computers in-store before buying – whether in the shop or later over the internet. This behaviour is in stark contrast to the purchase of standardised products (such as CDs, DVDs, books, batteries, light bulbs and kitchen utensils) – where the trend is reversed: 69% say they make these types of purchases directly online.
Redeeming loyalty rewards The research also uncovers that UK consumers are almost evenly split when it comes to the channel they prefer to redeem their loyalty points through: 54% in store versus 46% online. Clearly, retailers should not presume that customers will redeem their points via the channel of purchase and, in fact, should ensure loyalty scheme members are rewarded with vouchers and points which can easily be used via either channel.
Implications for sales staff It is clear, then, that the modern shopping experience does not involve the straight emergence of a single channel – and no savvy retailer today would wed shoppers to one specific location, physical or virtual. On the contrary, staff dealing directly with consumers across any channel need to be trained to respond to the customer’s preferences and likely customer journey. For instance, if store based staff realise a customer is researching a product in store with the intention of later purchasing online, they should be ready and able to issue a limited time voucher for a web purchase, enabling them to capture a consumer’s business and secure their loyalty to the overall brand. Currently, there are
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very few cases in which retailers provide an incentive to purchase from a brand’s website when a customer is clearly browsing in-store. In the new multichannel environment where shops are used as showrooms, this needs to change.
Implications for customer communications UK consumers typically arrive at the point of purchase via a combination of channels – their journey is rarely linear – and employing data and analysis to derive insight on the customer journey to inform appropriate actions along the way is essential to the future of any successful operation. As the research shows, the customer journey may be complex and winding but, by the same token, it is not wholly unpredictable. If a firm can see that specific products trigger certain types of behaviours and trends, then it can use that insight to tailor post, email and other communications. For instance, if the data shows that a customer tends to browse online first before going in-store, the communications don’t need to push a product but rather the website as a source of information, providing relevant content to make the brand stand out. Or if analysis tells a company that multichannel customers are more loyal and valuable than a single channel customer, it can mould communications to get a store-only customer to become an ecommerce customer too, and viceversa. Recognising, then, that bricks must coexist with clicks, brands should develop relationships which harness multiple touch points so consumers get more from their retail experiences – whether perusing instore, checking a catalogue, browsing
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online or receiving an offer on a smartphone. This process can start even before a customer goes online or visits a store with a longer-term communications programme that uses data to address the consumer’s behaviour and build loyalty through tailored offers demonstrating genuine insight. Appreciating that customers regard brands in a holistic fashion ensures relationships are grown and nurtured regardless of channel.
Implications for customer databases The key to all of this is applying the customer data an organisation has to hand, such as transaction details and information supplied on web forms, and not keeping it in silos. That means collecting it properly in one database for all channels and then analysing it to see what the trends are and what preference and behaviour categories individual customers fall into. Getting a grip on what customers buy, what they are spending, and how they purchase in order to determine how better to motivate them to remain loyal or to purchase more and more frequently is fundamental to a successful brand in today’s multichannel marketplace. CI
Andy Wood Managing Director GI Insight
Andy.Wood@GI-SolutionsGroup.com 01162 321 711
Technology
Mike Ball Client Manager The Leadership Factor If you have any thoughts about this article you can contact Mike at mikeball@leadershipfactor.com
One of the true phenomena of the last ten years has been the rise and rise of social media. You need to have been on Mars for the last decade to not know what Facebook is and even footballers have worked out how to tweet but what is truly staggering is the amount of social media out there. The list is endless and covers work, rest and play in all its forms! In February LinkedIn topped 150 million users and, after launching in 2006, Twitter has over 300 million users generating over 300 million tweets and handling over 1.6 billion search queries per day. So clearly we are interfacing with each other through social media all day, every day on our work PCs, our laptops, our tablets and our smartphones. Walk into any fast food outlet in the country and have a look at what most people are doing whilst they are waiting to be served. The chances are they have their smartphone in hand and are sending / receiving updates on status! It is no surprise that business is increasingly keen to get in on the act and utilise such an instantaneous and pliable technology. Investment in social media strategy is rising exponentially with barely a single brand not wanting you to “like them on Facebook” and “watch them on YouTube”. Service sector based businesses are starting to look at Twitter as a means of providing technical or account support to customers.
It is instant, trendy, allows them to gather information and provide promotional messages wherever and whenever. What needs to be considered is what impact this will have on customer satisfaction and ergo customer loyalty? Do we want business and brands muscling in on our social media? Should there be a real distinction between the two? Is your favourite sports star’s latest tweet about their new car an honest comment to be shared with the world or a discreet commercial endorsement broadcast to loyal followers? I have heard more than one person comment negatively on someone who has a Facebook type photo on their LinkedIn profile so do they want their bank feeding into their Twitter account? The Leadership Factor recently conducted an online panel survey of Twitter users on behalf of a leading high street bank about Twitter’s usability as a support tool. The results showed that currently 9% used Twitter to contact organisations they did
business with compared to nearly 60% who used it mainly for celebrity news, the majority having genuine concerns about Twitter’s suitability as a business tool due to issues such as privacy and the limited number of characters per tweet. But for the 9% it’s an important channel and banks can’t ignore that. One interesting aspect to consider is the effectiveness of these social media sites as they carry more and more traffic. What is the risk of missing something important in all the chatter? Path is a relatively new kid on the social media block but is based on the anthropological principle Dunbar’s number, which states that we can’t manage a network of more than 150 connections so that is what you are restricted to. So by all means keep on engaging with the social (media) revolution. The more we do, the better we will become. Just make sure it is enabling your organisation to do best what matters most to your customers and not just because it is something new! CI
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Case Study
r e m o st u C to ch a ro p p A w e aN Sati sfa ct io n in Socia l Hou si n g Benchmarking performance against peers is hotly pursued in most business sectors and especially in social housing. Accounting for about 20% of UK households, until recently housing associations had a regulatory requirement to survey tenant satisfaction and report their results to the regulator. The compulsory questions (known as STATUS) provided a general overview of residents’ overall satisfaction with their landlords and made peer benchmarking easy. Following the end of the regulatory requirement to test tenant satisfaction using the old STATUS methodology, HouseMark (a membership based organisation for housing associations) was asked to devise a new voluntary methodology that measured satisfaction and that could be benchmarked in the same way as STATUS. Following extensive consultation with RSLs (Registered Social Landlords), the Survey of Tenants and Residents (STAR) was launched including the STAR benchmarking service. But how actionable is the research? Can it identify key drivers of dissatisfaction amongst tenants that can be actioned and incorporated into the strategic plans of the RSL? Can benchmarking work alongside more detailed research that aims to identify tenant importance, impact and priorities for improving tenant satisfaction? One social housing provider that has championed a new approach to this is Leeds Federated Housing.
Leeds Federated Housing Association Formed in 1973, Leeds Federated Housing Association provides housing for rent and other services to a range of customers around Leeds, Harrogate and Wakefield. The birth of Leeds Federated came from merging a collection of smaller landlords and during the 1970s, 80s and 90s, Leeds Federated grew to its current size of around 4,000 homes. As well as the older homes they inherited, they have built new stock, particularly in partnership with Leeds City Council. Over the last decade, the Association focused on improving the quality of its existing stock resulting in all of
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the Association’s stock now achieving the ‘decent homes’ standard, and the Association performs well across all its housing management functions, when compared to other organisations providing similar services.
Resident focused Leeds Federated pride themselves on being resident-focused, with a mission to ‘make places for people to live become places they want to stay and places other people will want to move to’ . Fundamental to the achievement of this bold vision are four key goals: 1. Maintaining homes with a high quality repairs service. 2. Improving the quality of the neighbourhoods customers live in making people want to stay and others to move into. 3. Helping customers make the most of their lives. 4. Continue to be a high performing housing association in all aspects of its business. It is with these goals in mind that Leeds Federated Housing have taken the journey to understanding their customers and improving their lives.
Simon Williams Research Manager Leeds Federated
“Like most providers in the social housing sector we’ve historically undertaken the regulatory STATUS customer sat-
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isfaction survey as the main source of formal customer feedback”, says Simon Williams, Research Manager at Leeds Federated Housing. “But with the regulatory requirement recently being removed, this provided us with the opportunity to look outside the social housing sector to see how other high performing companies measure customer satisfaction. This is what eventually led us to look at the Leadership Factor and Customer Satisfaction Index methodology.” This move breaks a tradition in the social housing sector. Williams says, “Benchmarking landlord against landlord has been somewhat of a tradition for us but it has always been difficult given the diverse nature of our property stock – we’ve a mix of new estates & older inner city housing within Leeds plus stock in Harrogate, Wakefield and Castleford. So to find a housing association with a similar stock mix and social challenges is very difficult, limiting the value of benchmarking.” “A turning point for me was thinking of customer satisfaction from the customer’s perspective. Whilst we can input data into a computer to benchmark our services against other housing providers the reality is that our customers can’t do the same – they can’t easily move house or request an alternative repairs service from another housing provider. Instead they’ll measure their perception of customer satisfaction against their experiences with their local supermarket, high street bank or shop. Moving to the ‘The Leadership Factor’s Customer Satisfaction Index measurement, which is based on a broader range of companies, seemed such an obvious choice.”
Case Study
Challenges Changing to the Customer Satisfaction Index method has not been without its challenges. There’s a lot of tradition in the social housing sector and with that comes the strong conviction amongst some that STAR should remain the predominant methodology used for tenant satisfaction. But closely looking at HouseMark’s own description tells you that STAR is only designed to provide an overview of tenant satisfaction with the general services they receive from their provider. Williams says, “Due to the nature of our business our services directly affect the quality of people’s lives. Getting the right services delivered consistently in the right way is tremendously important. If we fail to deliver services well, it’s not as if our customers can easily move home. Getting the best information possible enables us to make the best decisions.” “So from the start of 2012 we’ve started using a mix of STAR and Customer Satisfaction Index. In practice this means using the minimum core questions from STAR which allows us to continually
monitor historical trends and benchmark our customer satisfaction performance against our social housing peers regionally and nationally. Customer Satisfaction Index measurement however forms the most important part of the process – we can benchmark our Customer Satisfaction Index score against about 80 other housing associations and also against other big brand high street names. The way the data is collated and analysed has provided us with a far deeper insight into our customers’ needs. This has given us a significant advantage against our competitors who are still only using STAR.” This advantage is enhanced by the fact the Customer Satisfaction Index question set is bespoke to Leeds Federated after being framed round the outcomes of exploratory tenant focus groups to find what was most important to them. This again presented a massive cultural change compared to the ‘one size fits all’ question set of STAR (and STATUS before it).
Outcomes
“The whole thing has been excellent’’, Williams says about the partnership. “It’s provided a great platform for us to refer back to and as far as we are aware we’re the first housing association in the country that uses the combination of STAR and Customer Satisfaction Index. As a method for understanding satisfaction we do feel we are in a strong position and bucking the trend.” The reality is that the two methodologies have a lot to offer; STAR provides a good overview of performance (HouseMark claim nothing more themselves) and can continue to maintain historically measured trends and social housig sector benchmarking. The Leadership Factor provides significant customer insight to tenant satisfaction. CI
Chris Elliott Client Manager The Leadership Factor If you have any thoughts about this article you can contact Chris at
So has Leeds Federated’s decision to work with the Leadership Factor paid off?
chriselliott@leadershipfactor.com
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Customer
Satisfying
Does being a high roller guarantee better service and therefore mean you are more likely to be a satisfied customer? The simple and straightforward answer would seem to be yes. Picture Richard Gere in Pretty Woman producing his exclusive, unlimited credit card and the ensuing service borne only of those who sense a big tip is in the air. However, scratch the surface of service in these platinum plated environments and everything may not quite be as it seems... Having recently undertaken some research within the luxury car sector I was amazed to find the polarity of service levels experienced by high net worth individuals spending in excess of £100,000 on a car, across a whole range of different manufacturers. Further afield the internet is littered with reviews of our celebrated Michelin starred restaurants that prove spending top dollar on your meal is no guarantee that you will enjoy a perfect night out and recommend it to all your friends and family. But why not? Is it really that difficult for businesses to be able to replicate the perfect client experience without fail and are the needs of high rollers different from the rest of us? The real challenge comes, I believe, in the people themselves. High rollers come with big wallets but often even bigger expectations. They are more demanding and have a greater depth of experience to draw on. Additionally they are more than capable and confident in articulating their displeasure should you fail to meet their exacting standards. Above all they prize individual-
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ity, being able to stand out from the crowd whether it is their one of a kind supercar or their VIP table behind the velvet rope. But as a business why bother going to all that trouble? Well, in these recessionary times a recent study by Barclays Wealth shows that there are 619,000 millionaires in the UK, up from 528,000 in 2008 and that the millionaire population is set to grow by another third by 2020. If you were looking for a growth market with disposable income...you’ve found it! So how can businesses efficiently and effectively generate the level of satisfaction in these demanding customers that will make them loyal advocates who will patronise your establishment for years and bring all their friends as well? The answer is no different for the high roller than the average man in the street. Get to know what matters to them and keep your promise in delivering that. What changes is that you may have to bring the research down to a sample size of as little as one! What doesn’t work is simply producing a bigger bang because your customer has more bucks. What came out of the
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research from our luxury car client was that their customers weren’t impressed by the shiny reception area with large screen TV and branded coffee. Whilst they expected the right environment, what really mattered was being treated as an individual, promises being kept and the process being as efficient as possible. It means taking your customer insight to a micro level and really getting to know your customers. Add to that a degree of flexibility in your offering that enables every customer to enjoy their perfect experience and your business has every chance of hitting the jackpot. CI
Mike Ball Client Manager The Leadership Factor If you have any thoughts about this article you can contact Mike at mikeball@leadershipfactor.com
Customer
As a member of a golf club for over 25 years, I have increasingly become interested in how golf clubs create a sense of value for money for their members and particularly for myself as a fee paying member of a golf club. Membership fees in recent years have soared well over inflationary levels and as a result have seen increasing numbers of members take the hard option to cease membership and use municipal ‘pitch up and play’ golf courses as a means to enjoy their sport. Recent research conducted by the YourSayPays consumer panel provides further proof that members of golf clubs are frustrated with the overall value for money and the general feeling of value that golf clubs give back to their membership. Of the panel interviewed, 20% of golfers felt that they didn’t get good value for money with the membership fees they pay and 25% of golfers felt that their golf club did not fully value them as members. When looking at specific segments within the panel, 25% of female golfers felt their membership fee did not represent value for money and 30% felt under-valued as members of their respective clubs. Even more shocking was the fact that 46% of golfers aged 55-64 felt under-valued. The YourSayPays research resonates with other surveys carried out recently. Sport England’s research in levels of satisfaction
with golf clubs showed that overall satisfaction in golf and satisfaction of golf club members fell in the years 2009 – 2011. More specifically within the research by Sport England, the subject of value for money highlighted ‘satisfaction gaps’ between overall satisfaction and importance. All of these findings should be of concern to golf clubs throughout the UK. The stop/ start recovery in the economy continues to leave many golf club members wrestling with the decision of whether to continue to pay considerable sums of money to remain members. Golf clubs therefore need to place much greater emphasis on what the key drivers of satisfaction and dissatisfaction are with their membership. The same principles of customer satisfaction, apply to golf clubs as much as business organisations; high levels of member satisfaction will make members
stay for longer, spend their money at the club more and recommend to friends, family and work colleagues. At the beginning of the article I explained my interest in my own levels of satisfaction at my golf club. The jury is probably out on this question but here’s a real thought provoker. If I continue to play golf for another 25 years (and I’ve already played for 25 years up to now), I’ll be spending over £40,000 on membership fees alone! That is a serious lifetime value of a customer and one that golf clubs should take heed of seriously and quickly. CI
Chris Elliott Client Manager The Leadership Factor If you have any thoughts about this article you can contact Chris at chriselliott@leadershipfactor.com
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Book Review
Book Review Thinking Fast and Slow By Daniel Kahneman
Over the last decade the popularity of the ‘discipline’ of behavioural economics (like all economics, I hesitate to call it a science), has steadily increased. One reason for this is the readability of its literature, based as it is on interesting behavioural experiments, all of which are like short stories - good at entertaining readers and conference audiences alike. The fact that the ‘experiments’ are often conducted with students (very convenient for academics) seems to be widely ignored, although in most disciplines, including customer insight, convenience samples are rightly castigated. Be that as it may, behavioural economics is highly topical and widely discussed. As a brief re-cap, humans have two fundamentally different ways of perceiving the world and making decisions. The left cerebral hemisphere is supposed to be the coldly logical, verbal and dominant half of the brain, while the right was seen as the imaginative side, emotional, spatially aware but suppressed. Slow and fast personalities in one head. Behavioural economists claim that the right hand, emotional side of the brain drives most behaviour even though people may be unaware of it. In 2002, Daniel Kahneman won the Nobel Prize for Economics for his work (much of it with Amos Tversky who died in 1996) challenging the assumptions of traditional economic theory that people make rational choices based on their self-interest. Kahneman claims that people often make decisions using rules of thumb rather than rational analysis, and factors economists traditionally don’t consider, such as fairness and desired rather than probable outcomes.
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There are strong grounds for supporting right brain predominance. Humans’ successful evolution was based on thousands of years of right brain instinctive judgements and it has some great strengths. It’s highly sensitive to environmental cues, signs of danger etc but due to its fast thinking, it also has severe weaknesses for today’s more complex decisions. It simplifies, it jumps to conclusions and it’s subject to irrational biases. Kahneman calls this “System 1”. The rational left-brain thought processes are “System 2” and in the book they are portrayed as the leading characters in a story but Kahneman is very clear who’s pulling the strings. “Although System 2 believes itself to be where the action is, the automatic System 1 is the hero of the book”. In recent years, work by behavioural scientists, plus the recent failure of financial markets, has led many people to question traditional economics. One field of economics where it had always been assumed that the irrational biases of System 1 should matter least was the stock market. Here decisions should be rational and knowledgeable, based on huge amounts of accessible information. Economists coined a phrase, ‘efficient markets’, stating that prices in stock markets are ‘correct’, reflecting the true value of a share over a period of time. If investors believe the price of a security to be under- or over-valued, they will buy or sell it until the price returns to equilibrium. But even before the failure of the markets in 2008, many, including Kahneman, were doubting the efficient markets theory. Kahneman stated that people often
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overestimate their abilities, making them over-confident. For investment this can cause serious problems. In the book Kahneman explains that while investors tell themselves that they are making educated decisions, these are often no better than blind guesses. He cites research that examined 10,000 individual private investors over seven years. The research tracked every time the traders bought or sold stock. If the ‘efficient markets’ theory is correct, stock that they bought should have done better than stock they sold. But on average shares they sold did better than those they bought, by a very substantial margin: 3.2% per annum! “It is clear,” concludes Kahneman, “that for the large majority of individual investors, taking a shower and doing nothing would have been a better policy than implementing the ideas that came to them”. Having sold over a million copies, the book has been described as a “masterpiece” and a “landmark book in social thought”, while Kahneman himself has been called the “most important psychologist alive”. It’s over 400 pages long but very readable. CI
Nigel Hill
Founder of The Leadership Factor and Editor of Customer Insight. info@customer-insight.co.uk
Listen to your customers / target groups give their views on your company product or brands. We can ask your customers and / or YourSayPays panellists to record and upload an audio or video file of their views or an answer to a question. Obtaining the views from customers or target groups through video uploads following a web survey can provide you with all the benefits below.
n Case Study contacts for PR
n Views that can aid internal training programmes
n Vox-pops for Marketing n Evidence for R&D projects n Real life comments to reinforce research statistics
n Insights that can be shown to internal stakeholders
n Another channel to encourage customers to get their message to you
To find out more contact Darren Wake darrenwake@yoursaypays.co.uk or call 01484 467012
online research
www.onlineresearchuk.co.uk
Customer Surveys One day training course £325
(excluding VAT)
Learn how to ask the right questions to the right people in the right way to get actionable customer satisfaction data. Valuable for anyone wishing to initiate customer satisfaction measurement or to improve an existing customer survey programme.
Learn how to: · Generate accurate, reliable and actionable data on customer satisfaction · Design your questionnaire to ensure the most accurate reponses and best response rates · Make sure your responses reflect a truly representative sample of customers · Analyse data and communicate results internally for maximum impact · Introduce the survey to customers for maximum participation · Provide feedback to customers after the survey to demonstrate its value · Calculate an accurate Customer Satisfaction Index (CSI) which can be updated and monitored over time
Birmingham
16th October 2012
London
14th November 2012
For a detailed agenda please contact us on 01484 467000 or email info@leadershipfactor.com THE LEADERSHIP FACTOR
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