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Thursday, 24 April 2014

How customer insight drives customer experience

Nunwood’s strategy director David Conway looks at how insight has helped fuel the performance of the firms that came out top in the agency’s customer experience league table.

In his 2003 book The Fusion Manager, management theorist Robert Heller noted businesspeople’s intense preoccupation with finding the ‘one right answer’ – a belief that a wholesale adoption of a single idea (Total Quality Management, Six Sigma, NPS, Business Process Re-engineering) will lead to success.

In fact, the only right answer is that there is no right answer, says Heller. The world is too complex for that - it is only through understanding and managing this complexity in a way that meets customer needs better than competitors that success can be achieved.

Nunwood recently published the top 100 league table of UK companies for customer experience, and those who lead the pack are not just masters at managing complexity, but have found ways to get up close and personal to thoroughly understand what their customers want.

“Amazon’s recommendation engine is viewed not as a crude cross-selling device, but as a valuable service identifying products which otherwise might have been missed”

Amazon, which tops the league table, resonates with its customers through its offer of the widest possible range of products delivered to exacting time scales. The recommendation engine, which processes huge quantities of customer insight every day, is viewed not as a crude cross-selling device, but as a valuable service identifying products which otherwise might have been missed. As a result, customers feel they receive a highly personalised experience. And more importantly, when things go wrong (as they inevitably must) Amazon responds rapidly and decisively to recover the situation and ensure it continues to deliver on the brand promise. The net result is customers who love the company. If Amazon ceased trading tomorrow, there would be millions of customers who would genuinely miss it.

In a financial industry fraught with problems, the exclusively telephone and online bank First Direct has become something of a ‘beacon brand’, winning not just customers but fans. It came in second on our list. As the bank’s brand supremo Natalie Cowen says: “It’s about creating an effortless and enjoyable process - which are ideas that don’t always go with banking.” First Direct is constantly talking to its customers about how it can improve - every month they measure their performance, striving to achieve industry-leading service - a great lesson in integrating customer service with customer insight.

For department store chain John Lewis and its supermarket brand Waitrose, which came third and fifth respectively, it’s all about listening to their employees. With a business model in which all staff are partners and co-owners, the John Lewis Group has mastered harnessing employee feedback and integrating their observations into brand delivery. When it comes to customer service these co-owners consistently go the extra mile because what is good for customers is good for them.

Marks & Spencer, which came seventh and its M&S Food brand, which came fourth, have clearly listened closely to their customers. The company has responded to concerns over the provenance of food and the wellbeing of those who produce it with large scale in-store statements of how it is improving its practices. This approach not only demonstrates their commitment to the brand promise, but also shows that they have listened to customer concerns.

For Virgin Atlantic, number six on the list, it’s all about being close to customers, taking every opportunity to show they really care. In a market where the low-cost carriers are lowering customer expectations, Virgin sets standards that put them apart. “Every airline should be like this,” one customer said. Its close proximity to customers is no accident as every quarter, Virgin Atlantic runs highly detailed customer satisfaction surveys. The surveys monitor everything from the punctuality of the flight departures to the length of check-in queues and the quality of the in-flight entertainment and service. Results of the surveys are fed back to managers globally and improvements continually implemented.

At positions eight and ten are, respectively, restaurant chains Nando’s and TGI Friday’s. Nandocas and Fridoids (as they call their employees) are carefully selected to be able to deliver the brand proposition. By creating a sense of theatre, both of these brands depend on the shared experience as a differentiator. But it’s their focus on the little things that sets these brands apart. For example, mixing drinks is all part of the show at TGI Fridays, and the company has made a special effort to make its cocktails more accessible, after research suggested people were sometimes nervous about ordering because they weren’t sure what the ingredients were.

At number nine is supermarket chain Asda, which is owned by Wal-Mart. With a market-leading price promise, Asda’s customers value both low prices and the friendly staff - a powerful combination. Using TV to communicate their extensive price-based research, the firm consistently reassures its price-sensitive customers that it is continuing to deliver the brand promise.

Increasingly the insight manager needs to be able to understand the whole picture of how their brand relates to their customers, taking into account service quality and customer experience. And while there might not be ‘one right answer’ to fix your business, it does seem that the ‘one right answer’ when it comes to delivering outstanding customer experiences is: listen to your customer.

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Readers' comments (1)

  • The average customer is complex; it is only through understanding and managing this complexity better than competitors that success can be achieved.

    The question is how can an organization quickly and effectively monitor customer interactions across multiple systems? How can an organization quickly and effectively analyze trends and patterns to discern these sorts of critical interactions? How can an organization quickly and effectively fix such problems before the customer even becomes aware of them?

    The answer lies in Operational Intelligence (OI). OI can improve the customer experience, reduce costs, and increase business agility across the customer life cycle.

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