This presentation was made in April 2012 at the Text Analytics Summit in London. The presentation outlines Customer Experience Management (CEM) best practices and their value to both the customer and the vendor. In addition we look at the technical, operational and measurement challenges of CEM, and the customer decision journey.

1. Text Analytics to Optimise Customer Experience
Management (CEM) for increased Customer
Retention and Shareholder Value
Gerry Brown
Director
MIS Associates
For: Text Analytics Summit Europe
Date: Tuesday 24th April 2012
Location: Royal Gardens Hotel, London W8

2. What does Gerry do?
 Strategy advisor
 Technology industry analyst
 Marketing lecturer
2 Text Analytics Summit Europe 24th April 2012

3. Agenda
1. CEM: best practices, customer value and profitability
2. Technical, operational and measurement challenges
3. Conclusions
3 Text Analytics Summit Europe 24th April 2012

4. Who does CEM well?
4 Text Analytics Summit Europe 24th April 2012

5. 6 Behaviours of CEM Champions
1. Recruit and train to deliver the brand promise
2. Differentiate through service and personalisation
3. Promote from within and reward staff well
4. Innovate as a result of listening
5. Under-promise and over-deliver
6. Data-driven – measure everything
5 Text Analytics Summit Europe 24th April 2012

6. Most important attributes for delivering
customer experience
Foviance (2012)
6 Text Analytics Summit Europe 24th April 2012

7. Loyalty / Retention Strategies
1. Create targeted and unique interactions with high value
customers based on a 360 degree view
2. Recognize and reward customers in real time across
multiple channels
3. Integrate partners into loyalty programmes
4. Develop online communities using social media
7 Text Analytics Summit Europe 24th April 2012

8. How Loyalty & Retention Contribute to
Shareholder Value
7
6
5 Acquisition Cost
Year
4 Base Profit
Revenue Growth
3
Reduced cost-to-serve
2 Referrals value
1 Price Premium
-20 0 20 40 60
Customer Profitability ($)
Fred Reichheld (1996)
8 Text Analytics Summit Europe 24th April 2012

9. Management Gurus Agree . . .
 Reichheld: a 5% reduction in customer defection increases profits by 25% to 80%
 McKinsey: retaining customers is 3 to 10 times cheaper than acquiring new
However customer leakage is occurring . . .
 Bain: 80% of organizations surveyed felt they did a great job in delivering customer
experiences. Only 8% of their customers agreed
 McKinsey: 7/10 customers switch to a competitor because of poor service
 University of Pennsylvania: 96% of dissatisfied customers leave quietly, 68% of which
never reveal their dissatisfaction because of perceived indifference
9 Text Analytics Summit Europe 24th April 2012

10. What is CEM & Key Concepts
“The orchestration and integration of
all touch-points and activities
performed for the customer”
What CEM advocates believe:
 Customer acquisition is expensive, and profitability comes from longer
term Life Time Value (LTV)
 Delight the customer with product and service experiences beyond their
expectations and be rewarded with customer retention, loyalty and
advocacy
 A satisfied customer is the most profitable customer. High value customer
churn must be avoided at all costs
10 Text Analytics Summit Europe 24th April 2012

11. What text analytics does for CEM
• Integrates raw unstructured data on customer experience from
Integrates multiple enterprise applications and social media sources
• Reveals customer sentiments, concerns, intentions, and issues
Reveals
• Refines data into categories, themes, sentiments, emerging issues
Refines and root causes for analysis and reporting
• Provides real time actionable insights
Insight
11 Text Analytics Summit Europe 24th April 2012

12. What are the text sources?
12 Text Analytics Summit Europe 24th April 2012

13. Barriers preventing multichannel customer
experience
Foviance (2012)
13 Text Analytics Summit Europe 24th April 2012

14. The Traditional Linear AIDA Model
Awareness
Marketing
Interest
Desire
Sales
Action
Services
14 Text Analytics Summit Europe 24th April 2012

15. McKinsey’s Consumer Decision Journey
Active Evaluation
Loyalty Loop
Initial Moment of
Consideration Purchase
Trigger
Post-purchase experience
15 Text Analytics Summit Europe 24th April 2012

16. Measuring CEM
Important data sources Key measurement metrics
 Web site analytics (77%)  Sales / revenue (66%)
 Customer satisfaction  Customer retention / loyalty
surveys (72%) (65%)
 Social media (50%)  Customer satisfaction / net
 Call centre (49%) promoter score (57%)
 CRM (39%)  Call centre (36%)
 Ad campaigns (36%)  Social media (36%)
 Profitability (34%)
eConsultancy (2012)
16 Text Analytics Summit Europe 24th April 2012

17. Conclusions
 CEM is a core organisational strategy – it best suits ‘high service’
organisations e.g. travel, hotels, retail
 Text analytics on the desktop enables service encounter
personalisation by providing a 360 degree single customer view via
multiple online feeds
 Text analytics identifies issues and root causes for management
corrective action and service continuity
 A few organisations are advanced in CEM, most are early stage –
culture and complexity are key challenges
17 Text Analytics Summit Europe 24th April 2012

18. Thank you

19. Questions?
Gerry Brown
Director
MIS Associates Limited
5 Kew Road, Richmond TW9 2PR
Mobile: +44 (0)7855 525598
Email: gerry.brown@misassocs.com
Web: www.misassocs.com
Twitter: @gerrybrown
. . . optimise your marketing strategies