Customer-Experience Measurement & Analytics

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1 Measuring & Monetizing the

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  • 1

    Measuring & Monetizing the

  • 2About Us

    Bottom-Line Analytics is a full-service consulting group

    focused on marketing effectiveness and brand performance analytics

    We are dedicated to the principles of innovation, excellence, and

    uncompromising customer service

    Everything we do is geared toward improving the commercial performance

    of our clients

    Our experts have a total of more than 100 years of direct experience in

    research, insights, and ROI measurement

  • 3

    What is Customer Experience(CX) ?

    Social Media brand comments represent a large and valuable source for CX insights.

    CX are internal and personal responses of customers to a brand or service either

    through direct usage or relationships with brand representatives and communications

    CX is customers positive or negative feedback regarding how well the brands promise

    is fulfilled through this experience.

    CX often contains reviews of

    Product or brand performance

    The satisfaction with services and its delivery

    Other aspects of the brand promise, including value, reliability, brand loyalty and the degree of

    personal attachment to a brand.

  • 4Measuring the customer experience is imperative

    Youve got to start with the customer experience

    and work back toward the technology not the other way around.

    ~ Steve Jobs

  • 5Customer Experience Leaders Outperform the Market

    CX Leaders100.3%

    Your Category?77.5%

    CX Laggards28.9%

    0%

    20%

    40%

    60%

    80%

    100%

    120%

    Cum

    ula

    tive T

    ota

    l R

    etu

    rn

    Eight-year Stock Performance of Customer Experience Leaders vs. Laggards vs. S&P 500

    (2007-2014)

    CX Laggards

    In addition to posting a total return

    that was 74 points lower than CX

    leaders, laggards also had higher

    customer frustration, increased

    attrition, more negative word-of

    mouth, and higher operating

    expenses

    CX Leaders

    Over 8 years, the leaders of

    Forresters CX Index enjoyed a higher

    total return, higher revenues from

    better retention, less price sensitivity,

    greater wallet share and positive word-

    of-mouth) and lower expenses from

    reduced acquisition costs, and fewer

    complaints,

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    We collect hundred of thousands of brand-experiential commentsacross

    social media channels. These are parsed into distinct content themes.

    These content themes define what brands meanto customers.

    United Airlines is

    never on-time, and

    their service sucks.

    Your brand is what people say

    about you when youre not in the room.

    ~ Jeff Bezos

  • 7We use a linguistics/language-based system to score social media textual brand

    comments. We convert these texts to a metric called the SEItm

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  • 8C

    Case Study: Alpha Total Retail Sales and SEItmAlpha is Mexican Restaurant

    -

    1.00

    2.00

    3.00

    4.00

    -

    50,000

    100,000

    150,000

    200,000

    250,000

    Tota

    l SEI

    Sale

    s

    WeeksRetail Sales 000 SEI Ratio

    Alphas overall SEI demonstrated strong predictive capability with a correlation to sales of 80 percent.

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  • 9Measuring CX through a holistic media mix model

    Sales

    Seasonality

    Operational Business Drivers

    Digital MediaOffline Media

    We incorporate our trended SEI and

    CX Drivers into a holistic media mix

    model.1. Service2. Delivery3. Convenience4. Value5. Food Quality6. The Menu

    SEItm /CX Drivers

  • 10

    Sales Contributions

    52.6%

    4.5%1.3%

    2.2%

    0.8% 5.6% 3.1% 2.2%1.1%

    0.8%7.8%

    1.0%1.7%

    5.7%

    1.3%

    6.3%

    1.9%

    18.0%

    Alpha Sales Contributions

    Baseline Competitive.Media Digital.Display.Media Digital.Search.Media

    Digital.Email Direct.Mail Media.Cable.TV Media.Network.TV

    Media.Radio Media.Magazines Consumer.Promotion SEI.Service

    SEI.Delivery SEI.Value SEI.Food Quality SEI.Convenience

    SEI.The Menu

    Shows incremental contribution toward total revenue from all drivers.

    Digital & traditional media contributes 16%, promotions 7.8% and direct marketing 5.6%.

    The six SEI/CX drivers account for 18 percent of total sales, the largest contributor among the groups.

    The SEI values here represent the monetization of Alphas CX.

    Embedded within the SEI/CX is the essence and value of Alphas brand promise to customers.

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    Marketing Variance Business Drivers versus Last Year

    -3.0%

    -2.2%

    -2.0%

    -1.3%

    -1.1%

    -1.0%

    -0.2%

    -0.2%

    -0.1%

    0.0%

    0.0%

    0.1%

    0.1%

    0.1%

    0.1%

    0.3%

    0.4%

    0.4%

    0.7%

    3.7%

    -4.0% -2.0% 0.0% 2.0% 4.0% 6.0%

    SEI.The Menu

    Retail Pricing

    SEI.Food Quality

    SEI.Service

    SEI.Delivery

    Baseline

    Direct.Mail

    Media.Network.TV

    Media.Magazines

    Digital.Email

    Media.Radio

    Digital.Search.Media

    Media.Cable.TV

    Consumer.Promotion

    Digital.Display.Media

    Economy**

    Competitive.Media

    SEI.Value

    SEI.Convenience

    Store.Penetration

    Alpha Marketing Variance v. YA Alphas overall retail sales declined -5.2% versus last year

    While Alphas strong values of Convenience and Value showed positive year-over-year gains, the remaining were substantially negative.

    Menu and Food Quality are clearly the weakest factors and must be a priority for resolution in the next year.

    11Total % Volume Variance v. YA

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    SEItm (CX) Amplifies ROI of all Media

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    $0.62

    $1.07

    $1.14

    $1.26

    $1.59

    $1.59

    $1.94

    $3.16

    $3.58

    $1.07

    $1.85

    $1.97

    $2.18

    $2.73

    $2.74

    $3.35

    $5.44

    $6.17

    $- $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00

    MEDIA.NETWORK.TV

    MEDIA.MAGAZINES

    MEDIA.RADIO

    MEDIA.CABLE.TV

    DIRECT.MAIL

    CONSUMER.PROMOTION

    DIGITAL.EMAIL

    DIGITAL.DISPLAY.MEDIA

    DIGITAL.SEARCH.MEDIA

    Alpha Marketing ROI per Dollar Spend

    ROI per Dollar Spend w/SEI Amplified ROI per Dollar Spend

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    CX content volume-drivers for Alpha over Time

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    While Convenience and Value are the largest drivers and growing, all others are declining, especially Food Quality & Alphas Menu.

    0.53 0.23

    0.52

    0.32

    0.79

    0.85

    0.70

    0.28

    0.80

    0.91

    1.08

    0.42

    LAST YEAR CURRENT

    Alpha Customer Experience (SEI) Trends

    Service Delivery Value Food Quality Convenience The Menu

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    (4.00) (2.00) - 2.00 4.00 6.00 8.00 10.00

    Menu

    Service

    Food Quality

    Value

    Convenience

    Delivery

    Negative SEI Net SEI Positive SEI

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    SEItm Ratings of Content Attributes for Alpha

    SEItm also has a positive and negative component. Net is the difference. While convenience is Alphas strengths, food quality and the menu have the highest relative negative ratings and clearly signal an area in which Alpha needs to improve.

    Net SEI

  • 15Mexican Restaurants Competitive Positioning & Image

    Great tasting Food

    Personable Friendly employees

    Treats you like a valued customer

    Authentic Mexican Food

    High Quality Ingredients

    Food from scratch

    Chain 4

    Chain 3

    Clean/comfortable atmosphere

    Food prepared how you want it

    Modern up to date

    Has large portions

    Healthy nutritious items

    Gets order right

    Chain 5

    Chain 6

    Chain 7

    Chain 12

    Chain 2

    Simple Menu

    Good value for money

    Low prices

    Open late night/24 hours

    Chain 10

    Chain 11

    Alpha

    Crave menu items

    Food timely/fast

    Convenient nearby location

    Variety of menu items

    Chain 9

    Has drive-thru

    Chain 8

    Food Quality

    Service & Delivery

    The Menu

    Convenience

    Value

    We can map detailed SEI content into a competitive map to see where Alpha compares to key competitors. We see that, in the words of customers, Alphas advantage is in convenience but not so much on food-quality, service and delivery.

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    Strategic Implications

    For the case study restaurant brand, analysis underscored that traditional strategies of focusing only on

    improving efficiencies in their drive-through and online ordering was not sufficient to drive growth.

    Our SEI analysis reveals that (1) service, (2) value, (3) delivery, (4) convenience, (5) food quality and (6)

    menu form the underlying SEI drivers and comprise the brand promise that Alpha presents to its

    customers, from which they give direct feedback on how theyre performing on these. By ignoring menu

    diversity and improving food quality, they were driving customers to competition and generating a serious

    decline in sales.

    The company launched a massive new ad campaign. This campaign has a mea culpa message. They

    admitted directly to customers that they had ignored and lost their way on product quality and their menu

    was substandard. They told customers directly that they were launching a massive effort to improve their

    menu, product quality and the ingredients in their food.

    One year later, Alpha turned its business around from negative growth to positive sales gains.

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    Measuring the Customer-Brand Experience with SEItm reveals this to

    be a significant driver across many businesses

    Lesson: Brands can not ignore the

    importance of measuring and tracking

    the customer-experience

    It is central to a firms aspiration to be

    customer centric & explains why

    business is underperforming and what

    needs to be done when things go wrong

    for Alpha Corporation case

    What if these companies had this tool?

    Chipotle

    Auto Air-Bag Recalls

    Toyota Acceleration problems

  • 18BLA global leadership team

    Michael Wolfe is CEO of Bottom-Line Analytics (US). Michael has 30 years of direct experience in marketing

    science and analytics both on the client and consulting side. On the former, Michael has worked for Coca-Cola, Kraft

    Foods, Kelloggs and Fisher-Price. He has also consulted with such blue-chip firms as AT&T, McDonalds, Coca-Cola,

    Hyatt Corp., LOreal and Starbucks. Michael has broad experience in marketing analytics covering marketing ROI

    modelling, social media analytics, pricing research and brand strategy.

    E: [email protected]

    Masood Akhtar is the Bottom-Line Analytics managing partner (EMEA). Masood is former Director of Analytics for

    McCann Erickson and has also worked on brands such as; Mintel International Group, Kraft Foods, American Airlines,

    Costa Coffee, Coca Cola and Hyatt Hotels Corp. He is an accomplished econometrician with extensive experience in

    marketing ROI analytics, marketing research, market segmentation, social media analytics and marketing KPI

    dashboards.

    E: [email protected]

    mailto:[email protected]:[email protected]

  • 19

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    5th Floor, 39 Deansgate,

    Manchester, M3 2BA, United Kingdom

    Contact Us US Office:Suite 100, 1780 Chadds Lake Dr, NE

    Marietta, Georgia, 30068-1608

    Atlanta, USA

    Thank You!