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Towards a better measure of customer experience
Philipp Klaus and Stan Maklan, International Journal of Market Research, Vol. 55, No. 2, 2013, pp. 227-246
Defining and improving customer experience is a growing priority for market research because experience is replacing quality as the competitive battleground for marketing.
Defining and improving customer experience is a growing priority for market research because experience is replacing quality as the competitive battleground for marketing. Service quality is an outgrowth of the total quality management (TQM) movement of the 1980s and suffers from that movement’s focus on the provider rather than the value derived by customers. Researchers today state that customer experience is generated through a longer process of company–customer interaction across multiple channels, generated through both functional and emotional clues. Our research with practitioners indicates that most firms use customer satisfaction, or its derivative the Net Promoter Score, to assess their customers’ experiences. We question this practice based on the conceptual gap between these measures and the customer experience. In IJMR 53, 6 (2011), we introduce a new measure appropriate for the modern conceptualisation of customer experience: the customer experience quality (EXQ) scale. In this article we extend that work and compare EXQ’s predictive power with that of customer satisfaction. We establish that EXQ better explains and predicts both, loyalty and recommendations, than customer satisfaction.
Choosing the right baskets for your eggs: deriving actionable customer segments using supervised genetic algorithms
Sam Davis, International Journal of Market Research, Vol. 54, No. 5, 2012, pp. 689-706
In the context of key driver analysis in applied customer satisfaction research, the assumption of sample homogeneity (that single models perform adequately over the entirety of a survey sample) can be shown to restrict the value of the insights derived.
In the context of key driver analysis in applied customer satisfaction research, the assumption of sample homogeneity (that single models perform adequately over the entirety of a survey sample) can be shown to restrict the value of the insights derived. While latent class regression has been used as a method of circumventing some of these issues, it is proposed that there are major barriers to both uptake and successful practical usage of the technique. Several of these issues are common to any multivariate technique, while others are specific to latent class regression. Following an examination of these issues, we introduce an alternative technique for deriving discrete latent classes, using a combination of genetic algorithms and (bivariate) correlations. This paper concludes that the proposed approach outperforms latent class regression in its ability to deliver action-orientated insights, and is better placed to assist marketers facing real-world research questions and datasets.
Why customers are loyal: Pitfalls and paradoxes of customer satisfaction studies
Dobromir Cias, Katarzyna Polok and Tomasz Opalski, ESOMAR, CEE Research Forum, Krakow, March 2012
This paper considers methodological assumptions concerning customer satisfaction studies. Methodological discussion is based on real-life examples of customer satisfaction projects conducted at ING Bank (leading example) and in other market sectors, including telecom, the auto industry, and TV/Sat providers.
This paper considers methodological assumptions concerning customer satisfaction studies. Methodological discussion is based on real-life examples of customer satisfaction projects conducted at ING Bank (leading example) and in other market sectors, including telecom, the auto industry, and TV/Sat providers. Conclusions drawn from the research includes that when talking about their satisfaction with a service provider, customers do not usually hold memories but they tend to hold a grudge; an increase in loyalty and satisfaction results from a decrease in loyalty; and building satisfaction is not the same as building loyalty.
Make or break: a simple non-compensatory customer satisfaction model
Keith Chrzan and Michael Kemery, International Journal of Market Research, Vol. 54, No. 2, 2012, pp. 163-176
We propose a model that allows analysts to capture and quantify realistic non-linear, non-compensatory effects in customer satisfaction modelling.
We propose a model that allows analysts to capture and quantify realistic non-linear, non-compensatory effects in customer satisfaction modelling. For too long, academic and applied marketing researchers have relied upon restrictive linear, compensatory statistical models to inform their understanding of how performance on product and service attributes impacts overall satisfaction, loyalty, etc. An extended case study and a summary of 22 further empirical studies illustrate the utility and robustness of the proposed Make or Break model of customer satisfaction.
Service quality perceptions of solely loyal customers
Swetlana Bogomolova, International Journal of Market Research, Vol. 53, No. 6, 2011, pp. 793-810
Having more solely loyal customers (those who only use one supplier) is an aspiration for most service providers.
Having more solely loyal customers (those who only use one supplier) is an aspiration for most service providers. Yet, it is unclear whether, or in what way, solely loyal customers differ from customers whose loyalty is divided between more than one service provider. One loyalty indicator is a consumer's evaluation of the quality of service they receive. Using seven sets of cross-sectional data, this research reveals that solely loyal customers give, on average, approximately 10% more positive service quality evaluations than customers of the same provider who also use other providers. The implication of this finding for market researchers and practitioners is that service quality scores could be moderated by the distribution of solely loyal and multiple-provider users in a given sample. Therefore, every service quality survey should measure how many providers a customer uses and control for the proportion of solely loyal customers when tracking change using cross-sectional samples.
Customer experience: are we measuring the right things?
Stan Maklan and Phil Klaus, International Journal of Market Research, Vol. 53, No. 6, 2011, pp. 771-792
Marketing theory and practice evolved dramatically through a series of transformations from products to services and, recently, customer experiences.
Marketing theory and practice evolved dramatically through a series of transformations from products to services and, recently, customer experiences. Each stage has its own perspective on marketing's purpose, the nature of customer value, and measurements that calibrate performance and guide managerial decisions. The latter is of particular interest to market researchers. Measurement (research) typically lags behind changes in marketing theory due to institutional factors and the time it takes for new practices to diffuse. The authors posit that firms still measure customer experience against criteria more suited to evaluating product and service marketing. Research practice seems rooted in 1990s notions of service quality, itself an outgrowth of total quality management (TQM) originating in manufacturing during the 1980s. The authors argue that market researchers will serve their organisations and customers better if they take an active role in updating the customer experience measurement commensurate with advances in the conceptualisation of that which firms offer customers.
The NPS and the ACSI: a critique and an alternative metric
Robert East, Jenni Romaniuk and Wendy Lomax, International Journal of Market Research, Vol. 53, No. 3, 2011, pp. 327-346
The Net Promoter Score (NPS) and the American Customer Satisfaction Index (ACSI) are metrics used to predict sales, profit and share price change.
The Net Promoter Score (NPS) and the American Customer Satisfaction Index (ACSI) are metrics used to predict sales, profit and share price change. We identify problems with the design of both the NPS and the ACSI. In particular, we find that the NPS does not measure negative word of mouth effectively, and we argue that the ACSI is similarly insensitive to dissatisfaction. This is because ex-customers and never-customers are not sampled in these metrics, and these are the people who express most of the negative sentiments about brands/companies. We propose a method of measuring the effect of word of mouth using the volume and mean impact on purchase probability of both the positive and the negative word of mouth expressed by users of the category.
Marrying CRM Analytics With Research Insights to Formulate the Best in Class Customer Loyalty Strategy
Andy Kung, James Wong and King Fai, ESOMAR, Congress Odyssey, Athens, September 2010
This presentation intends to examine the analytics and research approach that are being used in customer loyalty.
This presentation intends to examine the analytics and research approach that are being used in customer loyalty. It will evaluate the pros and cons of each method and recommend a new methodology to help business leaders and loyalty marketers to better formulate customer loyalty strategy. The presentation will also review the latest development in Customer Loyalty / CRM programs. It will examine the strategic issues that are confronting business leaders / loyalty marketers and most importantly it will identify enhancements in customer research and CRM analytics for building an effective loyalty programs. In addition, business cases will be discussed to showcase how the new analytical approach can be applied in the commercial world and what impacts it could bring in formulating Customer Loyalty strategy.
Feelings You Can Bank On: How Customers' Emotions Can Reveal Actionable Insights For Business
Orlando Wood, Sarajit Mitra and Bhavya Shah, ESOMAR, Congress Odyssey, Athens, September 2010
This presentation reveals an exciting new approach to customer satisfaction tracking, one that takes a proven and intuitive device for measuring emotion and uses it to provide highly actionable, real-time customer feedback for clients.
This presentation reveals an exciting new approach to customer satisfaction tracking, one that takes a proven and intuitive device for measuring emotion and uses it to provide highly actionable, real-time customer feedback for clients. With reference to a pilot study conducted with HSBC, this paper will show how a completely new measurement system for customer satisfaction has uncovered new insights for management and customer-facing staff, and proved to be a great deal more valuable than traditional customer satisfaction research
The heterogeneous best-worst choice method in market research
Susana Tavares, Margarida Cardoso and José G. Dias, International Journal of Market Research, Vol. 52, No. 4, 2010, pp. 533-546
Although there are several methods to assess the relative importance of the attributes in decision making, the mainstream approach has been the direct method (DM).
Although there are several methods to assess the relative importance of the attributes in decision making, the mainstream approach has been the direct method (DM). However, this method, which rates attributes directly, has been criticised, mainly because it does not take into account heterogeneity in the responses. This paper presents the heterogeneous best-worst choice (HBW) method as an alternative to the DM. We illustrate this approach with an application in educational marketing, focusing on the most relevant attributes influencing undergraduate students choosing a business school. The results show that the HBW allows for more heterogeneity in the response patterns, which are similar to those estimated by the DM.
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