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[/vc_column_text][vc_column_text]If you capture feedback from your customers, odds are that you use some form of a performance scorecard to determine how well your company is doing at delivering a great customer experience. You probably also have competitive and industry benchmarks that you can reference to ensure that you’re performing at the level of your peers.
This is good . . . but it may not be enough. If you’re not careful, you might actually allocate resources to the wrong areas of the business.
Measuring Performance tells you how well you’re doing. Measuring Impact tells you whether or not it will change customer behavior.
A BANKING EXAMPLE
Take for example our recent banking study. We surveyed customers of banks across the country to see how well the banking industry is performing. Using a 0-100 scale, you can see that the satisfaction driver of Online & Mobile Banking performs well at 87, while Rates & Fees is rated the lowest at 73. The ultimate business goal, of course, is to boost customer satisfaction so that they increase their future behaviors: remaining a customer, using additional services, and recommending the bank to others.[/vc_column_text][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row][vc_row][vc_column width=”1/4″][/vc_column][vc_column width=”1/2″][vc_single_image image=”8364″ img_size=”full” alignment=”center”][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row][vc_row][vc_column width=”1/4″][/vc_column][vc_column width=”1/2″][vc_column_text]However, if you only look at Performance scores you might conclude that your top priority as a bank in 2015 should be to offer more competitive rates and fees to your customers. After all, that’s your lowest score, and you obviously want your customers to be satisfied so that they exhibit the future behaviors that you desire of them.
Your conclusion, though, would be a mistake.
Striving to have the most competitive rates may shrink margins while attracting rate-only-driven customers. Higher-margin customers with less price sensitivity and a greater need for ease of transactions and support will be driven away to competitors due to your lack of sufficient investment in service and support.
If your bank’s competitive strategy is lowest-rate provider, you will be fine. But if your strategy is to compete on customer experience, you will likely fail.
To make solid decisions, you also need to know Impacts. The Impact is how much leverage an area of customer experience has on customer satisfaction. In other words, you need to know how much more satisfied your customers will be if you improve your Rates & Fees score. More importantly, you need to know how much more likely are they to remain a customer, use additional services, and recommend the bank.
In our banking study, we used predictive modeling to determine the Impacts of each customer experience area. It turns out that the Impact of Rates & Fees is at 15%, while Online & Mobile Baking is at 25%. So, Online & Mobile Banking has an Impact that is 67% (10% / 15%) larger than the Impact of Rates & Fees.[/vc_column_text][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row][vc_row][vc_column width=”1/4″][/vc_column][vc_column width=”1/2″][vc_single_image image=”8365″ img_size=”full” alignment=”center”][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row][vc_row][vc_column width=”1/4″][/vc_column][vc_column width=”1/2″][vc_column_text]Impacts can be determined by simple statistical tools, such as SPSS or SAS, or through more advanced methods such as the ACSI modeling approach. Either way, once you are armed with both Performance scores and Impacts you can better allocate your labor and budget to initiatives to deliver greater ROI.[/vc_column_text][/vc_column][vc_column width=”1/4″][/vc_column][/vc_row]