CustomerEngage The Heart and Mind of Customer Experience Measurement
Contact Details Name: Registered office address: Fifth Quadrant Pty Ltd Northpoint Level 11, 100 Miller Street North Sydney NSW 2060 Australia Australian Company Number: 088 072 940 Australian Business Number: 53 088 072 940 Name and title of key contact: Chris Kirby, Head of Research Telephone: +61 2 9927 3369 Mobile: +61 411 036 572 Facsimile: +61 2 9927 3327 Email: ckirby@fifthquadrant.com.au P a g e 2
Table of Contents 1. A new approach to measuring customer experience... 4 2. What is measured: Pre-condition... 5 3. What is measured: Service Experience... 6 4. What is measured: Engagement... 7 5. What is measured: Future Behaviour... 8 6. Business outcomes... 9 7. Methodology... 10 8. Our clients... 11 9. Our team... 12 10. About Fifth Quadrant Customer Experience Research... 13 11. About Fifth Quadrant... 14 P a g e 3
1. A new approach to measuring customer experience A few years ago we started to question the traditional measure of customer satisfaction as a predictor of a customer s future behaviour (e.g. likelihood to increase spend, increase advocacy, increase contract renewal or decrease defection). Our own research had shown the relationship between the two to be limited. So we went back to the drawing board and looked at basic human behaviour. Humans constantly assess relationships and to do this they ask three key questions: what do I think about it? what do I feel about it? and how much effort do I have to put into it? And relationships are really what customer interactions are all about. This led us on a journey to where we are now: customer engagement. CustomerEngage measures engagement and we define this as a customer s cognitive and emotional response to a service experience plus a consideration of the amount of effort a customer has had to invest in that service experience. And it works. We ve found engagement to be a far more reliable predictor of customer future behaviour than satisfaction alone. We re quite happy with ourselves. And our clients are happy too. P a g e 4
2. What is measured: Pre-condition We have observed and measured that a how a customer responds to a service interaction is strongly influenced by: 1. Their emotional state of mind coming into the service experience; State of mind 2. Their preconceptions previous experience with the organisation, product or service channel service performance. Experience Relationship This means that if a customer enters a service experience with a lower Pre-condition (i.e. a negative emotional state of mind or a negative attitude towards the organisation, product or service channel, stemming from previous service experience) that customer is statistically significantly more likely to rate this service experience lower than a customer with a positive Pre-condition, even if they have exactly the same service experience. The Pre-condition includes a measure of the customer s: 1. Emotions felt prior to the experience; 2. Attitudes and preferences towards the organisation, product or service channel; 3. Previous experience with the organisation, product or service channel; 4. Overall relationship with the organisation or product. P a g e 5
3. What is measured: Service Experience People A key step in the CustomerEngage model is the assessment of the actual service experience by the customer. This is crucial to understanding how an organisation is servicing the customer and to determining the key drivers of engagement and future behaviour i.e. which specific elements of its service delivery an organisation should focus on to achieve the best bang for its buck. Process CustomerEngage focuses on the core service attributes of each service channel (a list we ve compiled from researching and statistically modelling service for over 15 years) and asks the customer to rate the organisation s or customer service representative s performance on these. Technology We identify over 20 different service channels that a customer may use to interact with an organisation and we group these under five categories: voice, face-to-face, online, correspondence and social media service channels. P a g e 6
4. What is measured: Engagement Immediately after a service experience, a customer enters a state of engagement. Engagement is a measure of the customer s cognitive (rational) and emotional response to a service experience, as well as the amount of effort invested by the customer. Emotional Engagement includes a measure of the customer s: Cognitive 1. Emotional response. 2. Cognitive response (including satisfaction). 3. Invested effort. Effort These measures combine into an overall assessment of the whole service experience, the Engagement Index. The Engagement Index is a standardised measure which can be compared across industry and channel. This measure of Engagement provides a statistically significant predictor of customer future behaviour. P a g e 7
5. What is measured: Future Behaviour We know that great service leads to customer engagement and that engagement correlates strongly with business performance. Whatever we do, we re focused on business outcomes. 1st choice Recommend Renew / Re-use Defection Consequently, we believe that the most important information a customer experience measurement programme can deliver is the identification of which aspects of the customer interaction process drive customer future behaviour. In CustomerEngage we measure a range of future behaviour indicators, relevant to the organisation s strategic goals, product or service channel being measured. The indicators we use include: 1. Choosing the organisation as first choice for future products and services. 2. Recommending the organisation / the product or service / the service channel for the type of enquiry. This indicator is also used to calculate the Net Promoter Score. 3. Renewing a product, service or contract. 4. Reusing the organisation / the product or service / the service channel for the type of enquiry. 5. Defecting or switching business to another organisation. 6. Likelihood to increase spend. P a g e 8
6. Business outcomes In a nutshell, CustomerEngage : 1. Identifies the service behaviours and processes that have the most significant influence on improving the customer service experience. 2. Allows organisations to more accurately resource and allocate funds to find the right balance between investment and return. 3. Allows organisations to benchmark their service against competitors, industry and best practice. P a g e 9
7. Methodology CustomerEngage uses a questionnaire approach that may be fielded either by Fifth Quadrant s in-house CATI based telephone interview team or online. The CustomerEngage model showing the key stages of the research programme is shown below. Figure 1: CustomerEngage Model P a g e 10
8. Our clients We ve worked with some of the best organisations across Australia, Asia Pacific and beyond. These include: Banking Finance and Insurance MLC Suncorp AustralianSuper NAB ANZ CBA IAG Telecommunications Vodafone Optus Telstra Technology Avaya IBM Ricoh Nuance Canon Genesys Fujitsu CSC Government Australian Customs DIIRD NSW Police VIC Gov DIAC Retail & Wholesale Bridgestone AVIS Caltex Woolworths NRMA P a g e 11
9. Our team We have 25 of the smartest and most highly engaged subject matter experts who develop amazing proprietary and customised Customer Experience Strategy and Research models and tools. Key people Catriona Wallace CEO Chris Kirby Head of Customer Experience Research Phillipa Beltran Senior Account Manager Lin-Rimae Moong Project Manager P a g e 12
10. About Fifth Quadrant Customer Experience Research Fifth Quadrant Customer Experience Research delivers an unrivalled level of knowledge, subject matter expertise and proprietary methodologies to help organisations become more connected with their customers and improve business performance. Fifth Quadrant Customer Experience is able to do this by having more customer based data and information related to service than any other company, meaning we are able to offer tremendous insight, value and direction to effective Service Strategy and the customer experience. We offer a multitude of methodologies covering a wide range of research types and localities. These include: Proprietary CustomerEngage ChannelEngage CustomerStories Methodologies EmployeeEngage Research Types Business-to-Consumer Business-to-Business Quantitative Qualitative Data Collection Telephone / CATI (we operate our own on-site CATI centre) Online SMS Mobile Application In-depth Interviews (IDIs) Focus Groups Research Coverage Australia New Zealand Asia Pacific Global And because we are part of Fifth Quadrant, our offering extends beyond just research to an integrated programme including strategy development and execution, market analysis, diagnostic assessment of service performance and training. P a g e 13
11. About Fifth Quadrant Established in 1998, Fifth Quadrant Pty Ltd is a Customer Experience Management Consultancy and Analyst organisation. We provide customer experience management consulting, service industry reports, customer experience design, customer research and executive training programmes. We work across contact centre, face-to-face, online, correspondence and social media service channels. Fifth Quadrant is also an online publishing organisation providing news, insights and research on customer experience across Australia, New Zealand and globally. P a g e 14