Tuesday, August 19, 2008

"The only card excepted there"?

If you've been watching the Olympics along with millions of other viewers you have seen the VISA ads. While some have criticized their focus on American athletes and ending with the tag line "go world", I'm more interested in why they end the commercial with the message "the only card accepted there". Where is a value proposition in that?

The ads are pretty good, evokes pride in American athletes, but I don't think ending with "the only card accepted there" evokes pride or loyalty to VISA. It says to me, we paid enough sponsorship dollars to lock up this venue and trap all customers to using our card. Hum, is that something you want to advertise?

While I can appreciate the economics of sponsoring an event like the Olympics at upwards of $750,000 for 30 seconds, and the economic return they gain by having VISA as the only card earning their transaction fees at the Olympics, I would not advertise that to the consumer. That's not a value proposition for the consumer, that's a business reality.

Wednesday, August 06, 2008

* Letter to Joseph Jaffe * Comments on your recent podcast *

Dear Joseph,

I have been an avid listener to Jaffe Juice/Across the Sound for 2 years now. I believe my first episode was in the 20s or 30s. I wanted to participate in some recent conversations from your podcast.

1. Regarding your partnership with Deliver magazine and the listeners comment about their most recent “conversation starter” attempting to separate themselves for the impact of direct mail on the environment. When you began the sponsorship with USPS, I complexly understood the need to create a business model that made sense for podcasting. However, the “announcer” that delivers the “conversation starter” is anything by conversational. In my opinion their segment is just another form of the “30 second spot”. Advertisers have trained us to tune out the voice over and this is no different. I enjoy your audio comments, your rants, and your guests, but honestly you need to lose the commercial sounding message. If Deliver magazine wants to participate in the conversation, make it a conversation, not a commercial message. Put a real person on that is an expert in their business, in the industry, not a hired voice. I’m quite surprised that you have let this go on as long as you have as I find the segment off message.

2. Secondly regarding your recent discussion of the Net Promoter Score. First, let me make sure all disclaimers are completed. I’m the CMO of Satmetrix, the co-developer of Net Promoter and an organization that makes it’s living helping companies implement Net Promoter. In your most recent podcast you indicated that “easy to do business with” was the most accurate reflection of loyalty, not NPS. In the original research behind Net Promoter we found “likelihood to recommend” to be strongest correlate to actual customer behavior, with “easy to do business with: coming in at #5. While I get the point that it’s about the experience, doesn’t it make sense that recommendation sets the bar higher than easy to do business with? In your Delta experience, their lack of easy to do business with not only impacted your loyalty, but also your recommendation.

3. On the topic of Delta airlines, I encourage you to be the Jeff Jarvis of the airline industry and take up the battle with Delta. I will sign up for your war against poor customer experience. One way I am considering is to play a portion of your podcast in my module of the Net Promoter Certification training. I teach the closing module of which a portion is to redefine the customer experience for an airline. Funny how we all find that airlines needs this re-engineering but they just can’t seem to do anything about it! You would be amused at some of the experience design our students come up with.

I could “rant” on and on about the topics covered on Jaffe Juice, but a long blog post won’t get read. In summary, I ask that you:

1. Reconsider the delivery of your commercial sponsor more along the tone of a conversation.
2. Reconsider Net Promoter as a measure of both loyalty and word of mouth.
3. Take on Delta airlines and enlist your fan base to fight the war with you. Jeff Jarvis did Dell a big favor, look how far they have come in joining the conversation. Perhaps you could be that helpful to Delta.

I was disappointed to have missed you at WOMMA this year, but I was teaching Net Promoter in London at the time. Hope our paths cross in the future. Let me say explicitly, I recommend Jaffe Juice and Join the Conversation to all marketers. This captures both my loyalty and my positive word of mouth.

Wednesday, April 30, 2008

Bad Profits are just plain BAD

I am an American Airlines frequent flyer. While I would not consider myself a promoter (I was Passive), I have just turned Detractor. Oh, I'll continue to fly on American domestically because of the benefits I get, but I have taken my last international flight on American.

Even with flight status, American does not allow electronic upgrades on International flights. To secure a business class seat, you have to use miles and pay a $300 fee EACH WAY! In addition, if you request the upgrade within 30 days of your flight it is a $100 expedite fee! Even then you can be "wait listed" and may or may not get upgraded.

On my recent flight to London I had a nightmare reservation thanks to a travel agent error. This fee structure combined with the fact that American does not fly direct to London, creating a 3 hour delay out of Chicago this week, has changed my Net Promoter status and my "continue to buy". I'm ready for another airline to take me to/from London. If I like them enough I may switch my domestic flights as well.

The point here is this nickle and dime philosophy has cost American my International business. This is the perfect example of what Fred would call bad profits. Profits at the expense of loyalty.

American, do you listen to your customers? Fix this policy! Is it really necessary to charge a $100 expedite fee in todays world of Internet connectivity? What cost do you incur? Is it worth the thousands of dollars I would have otherwise spent to travel back and forth to Europe several times a year?

Thursday, April 17, 2008

Net Promoter Adoption

Hello old friends, it's been a while. I'm trying to get my corporate blog to be more real-time, so in the meantime, I'm back to my personal blog and back in the game.

I have the opportunity to speak often on Net Promoter as part of my role as CMO at Satmetrix, including teaching Net Promoter certification. One of the key themes I share with business leaders is that Net Promoter Score is easy to adopt across a large complex organization because everyone can understand the concept of making more Promoters and less Detractors.

Well, recently my husband has returned to the consulting business. As part of my marketing consultation I recommended he start blogging to increase his visibility in the market. His recent post is a great illustration of how easy it is to understand and adopt NPS. Because of my influence, nearly every customer experience he has is critiqued, and he catagorizes himself as a Promoter or Detractor. With the power of the Internet, his Promoter/Detractor status is now displayed for all to see.

While he is still new and gaining readership, I noticed when I did a google search for him today that his blog was mentioned on an apache blog posting. For those not in the software world, this is a big deal!

Let the word of mouth begin!

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Saturday, December 08, 2007

Blogging and Day Jobs

Well, as you can see it's been a long time since I posted anything. As noted in a prior post, I took a day job as CMO at Satmetrix. Since that time, life has been crazy.

In addition to the many things on the to-do list, my husband and I took a two week vacation down the Rhine River. It was the first time in nearly 10 years that we went on a real vacation without kids! Pictures are available here. It was an awesome trip and as a result, I would highly recommend Uniworld. In fact, we liked it so much we are returning next year with our new friends to take a trip through Eastern Europe from Budapest to Prague on the Danube.

I also started a Facebook account to learn more about that form of social media, and launched the Satmetrix blog. For more frequent postings on the world of Customer Loyalty, visit me here.

In the meantime, I will maintain this blog site and post whenever possible. I'm still very passionate about sharing my own customer experiences with various brands and communicating events in my life.

Thursday, July 19, 2007

The Net Promoter Debate

There is a healthy conversation happening about Net Promoter, it's link to growth, and it's success in driving customer centric organization.

The debate has been stirred up recently by a paper published in the Journal of Marketing where they authors attempt to discredit the research done by Satmetrix and Fred Reichheld on the connection between Net Promoter and growth.

After reading the Journal of Marketing paper, I have the following observations.

1. In Table 1, they show a correlation between revenue and commonly used satisfaction/loyalty metrics in various industries. The Net Promoter research was done at the organizational level demonstrating the correlation of an organization's Net Promoter Score and their growth rate. The research in the Journal of Marketing is different in it's approach and has little in common with the original research. Organizations use Net Promoter to measure their own customer loyalty and to benchmark their performance relative to their competitors.

2. In Figure 1 the Journal of Marketing research shows that Net Promoter is, at a minimum, equivalent to ACSI in correlating to growth. That says that a simple metric driven by a single question is at least as accurate at predicting growth than a more complex algorithm driven by multiple questions.

3. This conversation is missing the point that is attracting business leaders. The value of Net Promoter is its simplicity. Unlike complex satisfaction indexes, Net Promoter is easy to understand and take action on. Simplified surveys drive higher response rates, a better reflection of the customers that matter, rather than random sampling. Using real-time reporting, leaders can get information in the hands of employees that can address detractors, move the passives and nurture the promoters.

At the end of the day, it’s what companies do to improve loyalty that drives growth. Net Promoter offers an approach that is understandable by everyone in the business, not just the statisticians. This gives an organization a rallying cry for building customer-centric organizations. The paper lists a number of business leaders that are doing exactly that including companies such as GE, T-Mobile, Intuit, Progressive, Overstock.com, and American Express.

Net Promoter is a disruptive approach to traditional research. It does not attempt to replace all forms of market research, but creates a formula for understanding customer loyalty and focusing an organization on delighting customers and building Promoters that will protect and grow revenues. Net Promoter is not just a score, and not just a survey design; but an overall approach for how organizations collect, distribute and use the information to improve customer relationships. Leaders adopting Net Promoter want to do more than watch the score, they want to improve it. Read the many success stories of companies adopting Net Promoter and decide for yourself whether this approach will help you drive customer centricity in your organization.

Here are some of my favorite responses to the debate:

NPS What is it REALLY good for...
, where the author says:

This all aside, however, I think the true value of the Net Promoter Score as a tool within companies lies simply in the focus on the customer it generates.
Where many marketers are now buried under reams of data, KPI’s, customer satisfaction studies, brandvalue analysis, etc ad infinitum, this is replaced by one single and easy to handle and understand metric. It focuses the organization on concrete results, on “how will we delight” instead of generic customer satisfaction indexes. It creates a dollars-and-cents conversation due to the measurable value of an individual promoter to the company. And again it focuses the organization on precisely that point – to get more profitable customers (insert dollar value here) I need to improve specifically X, Y and Z. “Here you go, dear finance director – my new marketing initiative will generate this ROI for the company, because of 500 detractors being turned into promoters, generating 1000 X, 500 Y and 750 Z. “

Net Promoter and Customer Loyalty

But does this matter? The answer is probably not. While Keiningham’s statistical analysis might be correct - and it’s important that we should take no proprietary management tool as gospel - it perhaps misses the point. Brands everywhere need a simple method to point them in the right direction; if anything encourages them to cut down on long, pointless customer surveys and look more closely at what people really want, surely that is a good thing?

Posted Love this comment on July 19, 2007 17:55
Alain Thys:


to continue our phone conversation online :-) I thin k you hit closest to home with the "focus comment". As a CEO or Senior executive you're confronted with a gazillion KPI's which gives everyone in the organisations a large amount of excuses to everything under the sun, except "delight" the customer. focusing everyone on "one metric" may not be academically correct (but who cares), it does get the point across and eliminated internal excuses. It also is extremely helpful in getting various "silos" in the organisation to pay attention to the same thing.

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Tuesday, July 17, 2007

Deb Eastman Joins Satmetrix

For those of you I missed in my email distribution. I sent the following note last night to announce my new Adventure.

Dear Friends & Colleagues,

After much consideration I have decided to rejoin the corporate world. I have accepted the role of Chief Marketing Officer at Satmetrix. I know this comes as a surprise to many of you, but after careful consideration I have decided this is the right move for me at this time. While I have thoroughly enjoyed the last year of consulting, one of the reasons I have enjoyed it so much is because of the work I have done with Satmetrix and their clients. I have a real passion for customer experience/customer loyalty and Satmetrix is experiencing tremendous success in helping companies implement enterprise wide customer loyalty programs. Net Promoter presents a market disruption that I just can’t sit on the side lines and watch, I want to get into the game and help companies win.

My background in deploying similar programs at BearingPoint and my passion for strategic marketing makes this the perfect sandbox to play in. The CEO, Richard Owen, and I have talked about this for years and it’s time to make it happen. I have had the opportunity to work with the management team over the past 6 months and believe we have a real opportunity to drive the business to the next level.

So, for now I will have to give up my mid day walks in the hills and my poolside conference room to take another ride on the corporate train. Wish me luck as I take on this new challenge. My new contact information is deb.eastman@satmetrix.com, but I will keep my Windward account active as well. I look forward to catching up with many of you soon.



For more details, here is the press release.