Tag Archives: james edmonds

Customer Lifetime Value – can you solve the formula?

Can you solve the formula
to the right?
If you paid as much attention to algebra as me in maths lessons at school, probably not.

That said, I can almost guarantee that you do understand the formula (or at the very least will by the end of this blog!).

In my time working on a very progressive service initiative in the commercial insurance area, the organisation I was with were responsible for a huge upturn in their new business, rate and retention results by understanding that just because a customer doesn’t choose you this time, doesn’t mean they will make the same decision the next time round.

What will dictate their next decision will be the feelings and associations they have of you and your brand as a result of the experience you gave them.

I listened in to a call once where a city Broker spoke with our Trader to say he was placing a £900k risk with a rival insurer after three months of effort on our Traders part. I’ll never forget the startled reaction of the Broker as our trader told him:

“not a problem, well done, you’ve done a great job to get that price. We’d love to speak with you about it again next year, I’ll put something in our diaries as a reminder”.

Not only did we win back the risk the next year, but we got a lot more incremental business in the following 12 months from the Broker.

Moving on to an example of a slightly smaller value, my mortgage company with whom I also have a credit card and a debit card (let’s call it a 321 debit card) recently failed to apply the new rate I had chosen following my initial two year rate coming to its end. They said they hadn’t received the letter, I knew I had sent it – it was their word against mine and as a result of the mistake, I had been overpaying for three months.

As the conversation unfolded, it became clear that the experience I had expected; application of the new rate going forwards, and no reimbursement for me, wasn’t going to happen. In fact, the excellent, empathetic, and well trained advisor applied and backdated the rate, taking the corresponding amount of money off my next mortgage payment.

Am I likely to move my mortgage or any of my cards now? Not a chance.

We at Lexden take the same view. We feel that when deciding whether to set out on a CX journey or not, the last thing any organisation should do is call in the consultants to decide for them.

It sounds counter-intuitive coming from a CX consultant, but it’s something that we beleive must be owned and driven from within rather than outsourced. It can lead to a complete lack of ownership of CX within the business.

Whereas we find the most fruitful engagements are those with clients who have a clear desire to deliver excellent experiences. We do of course help them understand what matters most to their customers and how to amplify their authentic difference through customer experience, but throughout we are ensuring ownership, drive and knowledge rests with our clients.

Our experience of this approach has led to client’s inviting us back in and welcoming us rather than judging the value of CX support provided, time after time. This is my understanding of customer lifetime value (even if I still can’t quite decode the equation!)

Posted by James Edmonds, Senior Consultant, Lexden

Lexden helps deliver effective customer experience strategy and solutions for clients seeking sustainable profit from customer experience.

If you like what you’ve read please sign-up to Lexden’s ‘Customer Experience’ Update for monthly ideas, inspiration and insights to improve your customer strategy endeavours. 

Lexden’s top 3 Customer Experience moments of 2016

As you would expect from a Customer Experience Consultancy, we collect examples of good and bad practice in customer experience as sales execs collect air-miles. So the office conversation often turns to something we’ve seen or experienced and what impact we feel it has on customer’s future commitment to that brand.

We took this ‘I wonder’ a little further and created two twitter characters to collect stories from people too. Grumpy persona @vexvox collects and distributes stories from others on the woes of customer experience, whilst his upbeat cousin @fondfox shares applauds stories of positive customer experience.

If you want to here what people have been saying about your brand, let us know

Keeping the mood on customer experience light, we’ve collated our favourite three experiences from last year. We hope you find these examples inspirational and can see how the ‘themes’ involved can be taken back and embedded in to your own programmes.

#1 Adidas (Christopher, MD, Lexden)

July 2016 and walking down the Champs-Elysee my son spots an Adidas store. Despite his heart being set on a pair of Nike ‘sock’ football boots for his birthday the following month, we go in.

adiddas-2

In the store, we were approached. When we mentioned the sock boot the assistant said the only way to know if the Adidas boot might be better is to play football in them. At which point he got a pair out which my son tried. The Adidas assistant also got out a ball and turned the shop into a training ground; passing, lobbing over clothes rails and shooting at walls. My son stated it was one of the highlights of his time in Paris. The next month he switched his allegiance and requested a pair of Adidas sock boots for his birthday. Link to full article.

#2 Wordery (Leanne, Office Manager, Lexden)

wordery2One of the gifts Leanne ordered up as a Christmas present for a nephew was an Aladdin, popup book which also played music. Although on opening it her nephew found it didn’t play anything. Fretting about how to get it returned as it had been free delivery, Leanne contacted the online retailer, Wordery. Their returns policy couldn’t have been better. They apologised, didn’t question the legitimacy of the dispute, explained even though it doesn’t happen often a replacement was in the post already. Not bad.

But what about returning the faulty book? Returns are proving to be a killer pain point in customer experience for online companies. Not with Wordery, they said no return of the book was needed, just a copy of the ISBN page details. What really impressed us was they asked if Leanne could drop the book off at a children’s home or hospital to enjoy.

#3 Mercedes-Benz (James, Senior Customer Experience Consultant)

You may be aware but Mercedes-Benz are one of the best performing customer experience brands in the world. Their CX drives contentment, commitment and contribution from their customers. This example highlights why.

mercedes

https://mercedes.citnow.com/vxxHgsLNh9S link to service video.

James’ took his car in for a service. Most of us worry about what the costs will be and part of the anxiety is created by the ‘behind closed doors’ set-ups of garages. The layout is no different at Mercedes-Benz, but recognising this anxiety and wanting to reaffirm their transparent approach to servicing, they sent a video of the service being conducted through. It’s not a new idea, Pizza Express brought the kitchen experience into the restaurant a few years ago. But it’s still a powerful one which creates confidence in the quality of the service and therefore overall brand trust.

We hope you enjoy these varied examples from our 2016 vaults.

If it floats your boat, our monthly Customer Experience Update contains similar content as well as the latest developments in Customer Experience, successful case studies and interviews with leaders. You can the vanguards in customer experience, and subscribe for free here.

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Lexden delivers effective customer experience solutions for clients serious about sustainable customer relationships.

 

Can you really coach Customer Experience?

Because I’m totally sure you can.

A recent visit to Bluewater involved buying some new shoes for my wife. On inspecting two different colourways of the said shoes, we inadvertently swapped their designated positions on the wall display. Having worked as Floor Manager between College and University (a good few years ago) in the Nike store in Brighton, I understand that visual merchandising does have a purpose, but what happened next led me to ask the above question.

As we stepped back to review the range again, an employee of the shop then walked over (without asking us if we needed any help may I add) to stand in front of the shoes, and moved the two shoes back to their original positions, while being so far in to our personal space that we had to take a couple of steps back.

No big deal really, but I can think of at least six very simple things that were wrong from a CX perspective within this ten second (non) interaction.

How did it impact our behaviour? We went and got the shoes at a direct competitor.

The thing is though, if I had gone through this with the assistant, I really don’t think he would have for one second understood why any of those six points were a poor experience, and I think his response would have been something like ‘well the shoes have to be in that order…’.

Saving the conversation about customers’ having poor experiences because internal rules and processes for another time, can you really coach Customer Experience to someone this oblivious to what’s best for the customer at any given time?

Satisfied at having a new customer experience to talk about, I began to think back to my time in the Nike sto
re – did my customers have poor experiences under my watch when I was young and single-minded? Well, yes, they did.

I can remember two instances. Firstly, obsessed with my sales figures vs. the 1st floor of the shop, I would routinely send customers upstairs for refunds so my figures weren’t affected. Secondly, I remember closing the changing room to customers once, just so I could get in and out to access mannequins/shelves/fittings etc. to work on merchandising. The area Manager turned up that day, and at the time I scoffed at his disgust that I was making people go upstairs to try on their clothes – of course now practising customer experience I acknowledge how right he was!

So, here I am now able to recognise and improve poor customer journeys – what happened? Was I coached, or did I just learn through osmosis, working in organisations who care about the customer? A mixture, is the answer. Formal coaching has had a place, customer focussed programmes and developing a Customer Experience Centres of Excellence have too, as have particular managers, whom I had great respect for.

The true answer though, if there is one, lies for me in recruitment (and the resulting culture). While my conclusion means that I slipped through the net as someone who didn’t really understand the value of every interaction with the customer at the time.

If your recruitment programme has genuine focus on recruiting staff (consistently and at all levels) who understand that everything they do has a positive or negative emotional impact on the customer at each touchpoint, the organisation itself will begin to take the shape of one that customers want to join, stay with, and talk about positively.

If you run or are involved in a customer experience programme consider how central are Recruitment to that? do they look for people with suitable customer experience tags, or individuals who can talk about emotive and commercial impact in the same sentence? I’d argue the former gives you shoes laid out in the right order, the later a deep understanding of why customer experience matters.

With 89% of companies prioritising customer experience in 2017, attention to all impacting areas on CX success come in to play if you want to drive success. If you’d like to know how to recruit the right customer experience types, contact us and we will let you in on the secret.

Posted by James Edmonds, Senior Consultant, Lexden.

Lexden helps deliver effective customer experience strategy and solutions for clients seeking sustainable profit from customer experience.

If you like what you’ve read please sign-up to Lexden’s ‘Customer Experience’ Update for monthly ideas, inspiration and insights to improve your customer strategy endeavours.