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State of the Nation: UKCSI Jan 2016 results. New Year New Start?

The latest results are out and make in the main for encouraging reading.

This month, the UKCSI, the national measure of customer satisfaction on the high street has seen an index 2 year high, reversing, for the second consecutive period the previous two year decline we saw between January ‘13 and ‘15.

39,000 customer responses were collated covering 296 organisations, which gave an overall index of 77.0 (out of 100) this month, up 0.8 points compared to July 2015 (76.2) and up one point compared to January 2015 (76.0).

However this is still below the all-time high of 78.2 seen in January 2013 so whilst it’s a positive sign, we’re not there yet in terms of customer recovery.

However of those 296 organisation, 96 saw an increase, whilst only 44 saw a decrease in results.

Other key highlights include;

  • Amazon topping the charts with a score of 86.6, albeit down marginally (0.1) in the Jan16 UKCSI top 19 last 12 months. They displace First Direct who have held the top spot for a while now to 3rd place behind Utility Warehouse
  • Retail (food) and Retail (non-food) still top the sectors
  • Utilities as a sector shows the biggest increase with 1.9 points, albeit 12th from 13 sectors overall. Encouraging gains but not out of the woods just yet as 1 of 5 sectors below the average.
  • Utility Warehouse (top of their Utility sector and straight in at 2nd place), Trailfinders (top of their Tourism sector)and RIAS (over 50’s insurance) all appear in the Top 50 for the first time
  • T-Mobile sees the biggest increase at 9 points over the last twelve month which is a significant shift, a similar performance last seen by Lovefilm in July 2015 with an 8.2 point increase.
  • Banks and Building Societies is the only sector down by over 1 point in the last twelve month
  • Telecomms and Media still languish at the bottom with a sector average of 72.6
  • The 25 and over 65 age groups remain the most satisfied
  • As do the Welsh amongst areas in the UK, compared to the Southwest who saw a decline in satisfaction
  • As are Women who are more satisfied in general than men (apart from in the Automotive sector)
  • For the naysayers who still don’t believe that great experiences and high levels of satisfaction drive (financial) results, Food retailers with a UKCSI at least one point higher than the sector average achieved average sales growth of 7.6% compared to a drop in sales of 0.4% for those with a UKCSI at least a point below the sector average.

Customer preference by channel and method of interaction;

  • In person (46.9%)
  • Website (22.6%)
  • Over the phone (20.2%)

However, when you look at the new channels of contact including apps and social media the results are not as I expected them to be;

Jan16 UKCSI channel preference

  • Out of all 13 sectors, apps only provide the highest levels of customer satisfaction in the Bank and Building Societies sectors although it’s unclear how widespread apps are deployed across the other sectors.
  • Public sector local and national websites provide the least satisfying experiences (think HMRC – ok so maybe that’s not a surprise)
  • Webchat only features in the Telecomms and Media sector and not for the right reasons being below average satisfaction

Channel Hopping

Nothing new here on this but goes to reinforce previous research and patterns of customer behaviour;

  • Most customers (58%) use one channel of communication when they interact with organisations.
  • A sizeable minority say that they use two (34.1%), but then there’s a marked drop off in usage (both overall and across sectors) to three (5.6%) or more than three (2.3%) channels.
  • Customers who used three or more channels were much more likely to say that they had experienced a problem (27.7%) with the organisation in the previous three months and give them a lower customer satisfaction rating. This is 3x higher than those that use 1 channel.

I can personally testify to doing this with a company when I didn’t get the results I wanted by email and phone, before taking to twitter to complain. This is all about customer effort. More effort = less satisfaction.

Customer Priorities

Also at the end of 2015, the UKCSI reviewed the importance of customer priorities which was last reviewed in 2010 and there’s some noticeable changes across the – wait for it, 47 customer priorities.

The top 4 most important all relate to staff attitude with the 5th being complaint handling. In order they are;

  1. Staff competence (in person)
  2. Staff doing what they say they will do
  3. Staff competence (over the phone)
  4. Helpfulness of staff (in person)
  5. Handling of the complaint

Interestingly, value for money only features at 13th with price/cost at 20th.

And finally a word about the most important features of delivering a great customer experience; employees.

Employees’ friendliness, helpfulness and competence have become relatively more important in the eyes of customers over the last 5 years, as well as speed of service, especially when dealing with employees in person. Ease of doing business has also increased in importance along the theme of reduced customer effort we’ve discussed over the last 12 months.

All in all interesting times and a continuingly changing customer and business landscape where the agile, fleet of foot excel and the legacy industrial monoliths creak and groan. Here’s to a continued improvement and let’s see what the next 6 months brings.

You can download the report in full here

Source: UKCSI Executive Summary Results January 2016.

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Lush tops Which? customer service survey

The annual customer service survey from Which? is out and the usual suspects feature at both the top and bottom of the list of the 100 big brands rated. You can read the full results here but we’ve summarised the highlights below.

Lush_Logo_640x350The top rated brands were;

1. Lush – 89%

2. First Direct – 86%

3. Lakeland – 84%

=4. Body Shop – 83%

=4. John Lewis – 83%

=4. Waitrose – 83%

Floundering around at the bottom of the list, providing little in the way of surprises came these brands;

=95. Ryanair – 66%

=95. Vodafone – 66%        Which best buy

97. Talk Talk – 64%

98. BT – 63%

99. npower – 61%

100. Scottish Power – 59%

Each brand was rated across 5 areas of service with a possible 5 star maximum in each. The areas scored were;

  • making their customers feel valued
  • knowledge of products and services
  • helpfulness of staff
  • resolving complaints or problems
  • access to customer support.

The 3,501 general public respondents were also asked to give brands an overall rating for customer service, which is where the customer service score comes from. Amazon, M&S, Pets at Home, Waterstones, Dunelm, Clarks and the RAC all made the top 10.

Despite being voted Which? supermarket of the year in 2014, Aldi only managed joint 73rd with 14 other brands including Virgin, British Gas and JD Sports all scoring 71%.

Utilities and telecoms continue to struggle to get to grips with customer service with Scottish Power who were 99th last year swapping places with npower who have been bottom for at least the last two years. Scottish Power, attributed their woes to the often blamed scapegoat of IT. “Last year all our customer accounts were migrated on to a new IT system, which resulted in a very busy period as disappointingly we experienced more problems with the new system than we would have liked.”

IT aside, these two sectors have done little to visibly improve, with big players losing significant ground and customers to the disruptive likes of Ovo Energy and Ecotricity.

If this continues, I wouldn’t be surprised if the respective regulators for these two industries ‘impose’ a change on behalf of customers. Interesting times!

 

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Are Digital Marketers Missing A Trick?

The top three obstacles that marketers face in 2015 are apparently;

  1. New business development
  2. Quality of leads
  3. Keeping up to date with current marketing technology and trends

This is according to research conducted globally across 5000 marketing professionals and published in the 2015 State of Marketing by salesforce.com Marketing Cloud.

The report is interesting and you can find a copy here via the fierce website. Below is the full list of 20 challenges that were articulated;

Most pressing business challenges_2015

The report goes on to further confirm the focus on digital platforms for marketing and that this year is the ‘definitive’ year for mobile.

The report also talks about ‘using technology to craft the customer journey’ and goes on to state;

“For the past 10 years, digital channels and data points have been accumulating at breakneck speed. Every industry has been disrupted. The customer now rules, and speed is the new currency of business. Marketers have scarcely had a moment to make sense of it all with a single big idea that ties everything together. Enter the customer journey. A growing number of marketers today are envisioning their entire marketing strategy under the umbrella of a cohesive customer journey, which we define as all of the interactions a customer has with brands, products, or services across all touchpoints and channels.
According to recent research, 86% of senior-level marketers say that it’s absolutely critical or very important to create a cohesive customer journey. Another 11% view the customer journey as moderately important.

Technology is the essential glue that connects various moments along the customer journey to create one-to-one experiences. From analytics that help marketers create personalized interactions, to mobile applications that create personal brand experiences for every interaction, to CRM tools that let marketers track the span of a customer relationship, the customer journey relies completely on its technological elements.”

The article goes on to chart exactly which technologies are priority to creating a cohesive customer journey, which is as equally important to start ups as it is to established businesses;

Technologies for cohesive customer journey_Sept15

The top 3 being;

  1. Mobile applications
  2. Marketing analytics
  3. CRM tools

So it was at this point that the penny dropped. What about customer retention? Why isn’t this a business challenge?

Are 5000 global marketers saying that customer retention is really not a challenge? Arguably, it could sit outside of the top 20 or it could sit within the ‘other’ category at 1% but to me this doesn’t feel right.

Now I’m not a marketer I must confess, but this feels like marketing are trying to do what they’ve always done. That is to focus pretty much exclusively on front end customer acquisition, with a sprinkling of a focus on ‘in life’ customer interaction but with little or no focus on customer retention, advocacy and loyalty throughout the customer journey. They’re currently trying to do this by moving away from more traditional marketing tools and instead using lots of sparkly new digital toys without truly understanding new digital, personalised customer habits and trends. As a result, there’s no paradigm shift to a new marketing mind set that sees the total customer lifetime as their responsibility beyond mere acquisition.

Now it might be that these 5000 marketers have in their business, someone else responsible for customer retention but surely if this is the case, these should be symbiotically related and so as to share the responsibility of customer retention beyond mere acquisition? It’s more costly just to shovel new customers in at the front end without the opportunity to retain and grow those same customers for life.

To further substantiate this point, looking at the top 10 technologies to create a cohesive customer journey, there’s no mention of any Voice of Customer (VoC) technology to provide customer insight into the journey at critical touch points as a way to further inform and improve the customer experience and subsequently the marketing process.

VoC Hub Dashboard

VoC systems such as SandSIV’s VoC Hub are as much an asset to marketing as they are to any other part of the business and marketing are missing a trick if they’re not ‘plugged in’ to, or even considering tools like this to complete the holistic picture of the end to end customer experience.

Whilst it shows an increased willingness for marketers to communicate with customers across multiple channels and touch points, the rationale for this is still based on what’s most important to the business first (new customer acquisition), rather than what’s most important to customers.

‘Listen hard and act fast’ as SandSIV would say and include VoC within the marketing mind set and on the technology wish if you want to stay ahead.

 

 

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UKCSI – State Of The Nation Update

Customer satisfaction on the high street seems to be pulling out of the destructive nose dive we’ve seen in the last 4 waves.

The July 2015 results from the UKCSI are out now and as in earlier posts, I’ve trawled the results and here is a summary for you. Uk map UKCSI

The previous two years of decline seems to have now plateaued with the index rising by a meagre 0.2 from this survey wave to 76.2 overall (out of 100). Way down from the heady heights of 78.2 in January 2013.

194 companies received a score with 56 companies improving by 1 point or higher, with 86 companies registering a fall of 1 point or more.

Interestingly, the historically lowest performing sectors like public sector and utilities are up by at least 1 point in the last 12 months, whereas the higher performing sectors like retail food (-1.2), automotive (-1.4), leisure (-1.4) and services (-1) are down by at least 1 point in the last 6 months.

In terms of sectors, retail food is still top overall with Amazon the highest ranked company at 86.3. Retail food is second with Waitrose ( 84.5) and Tourism is third with Centre Parcs (82.1) taking pole.

UKCSI sector table

Variation within sector though is still vast, with public sector and travel showing a 21 point difference between highest and lowest performers.

Whilst the sectors included are still the same overall there’s some noticeable new entrants signalling a change to established players who need to be wary and double their efforts if they want to keep their ground and not loose further gains.

Ovo energy tops the utilities sector, with Giff Gaff leading Telecomms and Media whilst LOVEfilm top the leisure sector. No surprise on the really latter given its acquisition by Amazon in 2011.

ovo-energy

The usual suspects are still top of the table; first direct, Amazon and John Lewis, despite the latter two showing a decline in performance over the last 12 months down 1.3 and 1.5 respectively.

Again LOVEfilm have had a storming 12 months with the single biggest increase out of the top 50 companies, up a whopping 8.2 points year on year to take them up to fourth place overall.

Skoda is the only automotive company in the top 20 at 11th place (83.0 up 0.3), and Premier Inn is the only hotel chain in the top 50 (80.8 down 1.2).

Most improved, in addition to LOVEfilm are Ryanair (up 8.6 to 68.8) and Southeastern Trains (up 8.4 to 66.9).

Ease of doing business is a key driver to high levels of customer satisfaction and a differentiator between high and low performers. Most of the top 20 performers also rated highly on ease of doing business and low customer effort should be included by organisations looking to improve their overall customer experience.

So why does all this matter?

Well, the UKCSI has tracked the relationship for the last 3 years between customer satisfaction, sales growth and market share for food retailers, a very pressurised market for consumer spend and behaviour, where customer preferences quickly affect business performance.

The research show a strong correlation between customer satisfaction, growth and market share with organisations seeing a 5.5% increases in growth with a score of 1 point higher than the average, compared to a 1% reduction in growth with a mere 1 point performance below the UKCSI average.

Retail Sales Growth

According to the Kantar World panel, Aldi (7th in the UKCSI) lead the way with 15% annual growth follow by Lidl at 10% (outside the top 50) and below the sector average despite performing lower on satisfaction than Waitrose, Iceland and Asda.

The July results further demonstrate and reinforce the view that we have firmly entered the relationship economy.

Customers giving an organisation a 9 or 10 out of 10 are much more likely to trust, recommend and stay with an organisation over those that score 8 showing that companies need to be both aiming and performing at the highest levels in order to keep customers in an era of rapid technology advances and disruptive new entrants to markets.

Organisations achieving scores of 9 or 10 achieve 96% loyalty compared to only 65% of companies getting scores of 8. In addition they achieve 55% of customer recommendation compared to only 39% of those that get an 8.

TrustWordCloud

The biggest gap is around trust with 83% of customers trusting an organisation which they score 9 or 10 out of 10, compared to only 39% of customers who score an 8.

That’s a massive difference that pushes the performance (and expectation) bar only higher.

Companies also need to address how they serve the millennial generation (born 1981-2004) who are the least satisfied generation and the only age group to have fallen year on year, even behind 18-24 year olds. Interestingly however, younger people appear to be more tolerant (and satisfied) when it comes to complaint handling.

The Welsh are most satisfied at 78, compared to the South East who are the least satisfied at 75.2. From a gender perspective, women are on average more satisfied than men, although this varies at sector level where for example in automotive, men are more satisfied, compared to utilities where it’s women.

The volume of complaints expressed by customers are broadly the same year on year at 13.2% with some sector like utilities with lower satisfaction levels, experiencing a higher percentage of complaints at 14.9% compared to retail non food at 9.8% with telecoms at 22.2%.  However nearly a third of customers (26.9%) are ‘silent suffers’  with the view that making a complaint won’t make a difference.

Shouting down phone

The top 3 problems experienced by customers are;

  1. Quality or reliability of good or services (30%)
  2. Staff competence (25.9%)
  3. Late delivery or slow service (25.1%)

A more alarming trend seems to be around escalation and compensation.  41.3% of customers who made a complaint needed to escalate it, up 3% year on year with 31.7% of customers asking for compensation up from 28.1% 12 months ago.

Complaint handling is both a hygiene factor and a differentiator and staff should be empowered and empathetic to meet the needs of customers to avoid damaging relationships and trust, which is difficult to recover.

It’s clear from this latest set of results that customer expectation continues to rise at pace with competition with the pace of change intensifying. The relationship economy continues to be built on quality relationship with customers, and those organisations that see beyond the product and commodity view of the world and both meet and deliver on customer’s psychological needs will continue to outperform and lead the way. However, this is a long term game and businesses should set their sights accordingly, whilst be flexible and adaptive to change. The ‘agile’ approach is the way forward for business and customers.

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State of the Nation: UKCSI results are out and it’s not pretty!

The most recent results of the UKCSI are out this month and they don’t make for good reading as to the state of the nation for UK Customer Experience.

Companion_member_logo_-_full_colour

The executive summary can be found here if you want to read it but I’ll cover the key highlights and trends for you here.

  • Customer satisfaction in the UK has now dropped for the fourth consecutive period to the lowest point since July 2010.
  • Only 33 out of 196 organisation have recorded an increase in the last 6 month period
  • Only 2 from 13 industry sectors have improved; Utilities and Banks and Building Societies
  • 3 water companies have shown the largest increases in customer satisfaction by any organisation in the measure; Southern Water, Yorkshire Water and United Utilities
  • John Lewis tops the league table overall, as does the Retail (non food) sector, followed by the Retail Food sector with Ocado scoring highest. John Lewis logo
  • Amazon and First Direct come in joint second
  • Bringing up the rear is the Utilities Sector with Public Services second from bottom
  • The 18-24 age group is least satisfied overall, as are people based in the South East. The over 65s are most satisfied as are people living in Wales
  • Aldi and Lidl continue to dominate the Retail Food sector both on customer satisfaction and annual sales according to the Kantar World panel. All the other majors, apart from Asda and Waitrose saw negative sales growth.
  • At a more granular level, only 2 out of 28 metrics that make up the UKCSI have improved in customer’s eyes; ‘outcome of complaint’ and ‘on time delivery’

Not great news to start the New Year, but not really a surprise as I outlined in my last blog post. So what’s going on?

Well this obviously has significant ramifications for UK businesses on many levels and reflects a number of changing factors which include the economic environment, continued and rapid increases in customer expectation and the inability of organisations to keep pace, in part marked by a lack of investment in infrastructure, digital technology and employee engagement.

Customers want increasingly personalised services and businesses are failing to deliver. Those that are more agile, responsive and innovative are now stealing the lead both in customers’ perception, market share and also on the balance sheet.

Consistency, always has and will continue to play a significant role in delivering a great customer experience. When looking across the 5 service components (professionalism, quality & efficiency, ease of doing business, problem solving and timeliness) John Lewis and First Direct feature in the top 5 organisations in all categories. That’s consistent and systemic customer experience delivery.

So where now? Well I don’t think, this decline in results is at the bottom just yet unfortunately. Businesses always have a choice as to what to do next. Some focus on Hard workshort terms results and quick fixes. Others take the more strategic, longer view in which the customer is front and centre as a priority. Benchmarking, measurement, insight and leadership should command more attention this year combined with a fierce determination to deliver more consistently for customers. It’s now time for everyone to roll up their sleeves and stop talking.

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Customer experience from the crystal ball – the year ahead

January is typically a time for reflection on the past year and an opportunity to refine business plans, set new goals and focus effort and attention on the year ahead. In addition to this, there’s always predictions as to the likely trends for the year so I’d thought I’d join the soothsayers and ‘futurologists’ and share some thoughts on some areas of customer experience for this coming year.

Crystal ballDigital, big data and mobile

…are all here to stay which is probably no surprise. Businesses effectively getting to grips with these elements though is the challenge which is a theme which will continue. There’s always the temptation to be attracted in a magpie-esque way to shiny new things but that won’t necessarily deliver value to either the business or customers. I recently talked to a construction company who had 16 mobile apps for their site managers, but the apps just replicated the paper work system they had replaced without making the task of collecting site information either quicker or easier. As a result, most of the apps weren’t used at all!

Most businesses already have enough data without it getting any bigger (ahem!) and without using it effectively, but co-ordinated, intelligent use of both customer and business data does feature in making the customer experience much more tailored and personal to the individual and is definitely the way forward.

Big data

More intelligent use of mobile apps in store is a great opportunity. If I’m stood in a store with my smart phone or tablet, but searching online for a product, it would be great if an app could direct me to where that product is, in store.. a much more interactive experience between online and in store experience is definitely in the very near future.

Black Friday in December ’14 certainly showed that consumers have grabbed on line shopping by the horns. However, the resulting drop in football on the high street was painful for many retailers, although a delight if you were actually out shopping like we were. I’m not sure I’ve ever seen our local town centre as quiet as it was at Christmas, an observation which was even echoed by the shop assistants.

Measurement & insight

Still an integral part of understanding and improving the customer experience, I think the trends to be seen here are more effective measurement and insight that really drive change and make a difference. Sounds an obvious one, but you can get alot more insight out of the same data by looking at it with fresh eyes. However, measurement systems do mature but that doesn’t mean they’re ineffective. If they’ve stopped serving the business though then they need to change or at least be refreshed.

There’s still alot of uncertainty as to the ‘best’ measure to use from the people I’ve talked to over the last 12 months so let’s kill this one off right now. There is NO best ecosystemmeasure. Instead businesses should develop a measurement ‘eco system’ where measures sit along side each other and compliment each other to give the business a deeper and richer insight in to the customer experience. Don’t get married to your measures and don’t be afraid to change and adapt them this coming year.

SMEs and B2B

I’d like to think that 2015 is the year that these two groups really ‘get it’. In fairness some are there already and as with many aspects, there’s a huge variation between those that do get it and those that don’t.

However, I’d like to see, especially small and medium enterprises start to embrace designing deliberately and consistently great customer experiences more, rather than leaving them to chance or think that it’s something for large businesses with equally large marketing budgets. It isn’t. SMEs, can and should be reaping all the financial rewards from having an outstanding customer experience.

In the same way, business to business organisations need to stop thinking that customer experience is just for the high street and consumer businesses. People buy from people and then rationalize their decisions afterwards and the B2B industry is no different so there’s still alot to be gained from investing in B2B customer experience. As an aside, there’s still no B2B equivalent of the UKCSI and it’s high time there was!

UK Customer satisfaction

Speaking of which, the UKCSI has seen satisfaction on the high street decline since it’s peak in 2011. As a trend I’d like to seen this reverse this year, but I don’t think it will. It might bottom out of the current death spiral but there’s unlikely to be a sudden positive increase with consumer confidence and product price deflation in a negative space.

As a final note, I’d like to see UK businesses invest in more empathetic customer service training for employees along with granting greater levels of empowerment to do ‘the right thing’ for customers when the need arises. Impromptu and personal makes for a great customer experience. Let’s deliver!