Voices: the CMB Blog

In a few weeks I’ll be taking a cruise to the Caribbean—a cruise that I have spent 9 months planning. Needless to say, I’ve been a little preoccupied making sure everything is in place to ensure a flawless vacation. And as I sorted through all of these details, I couldn’t help but notice the similarities between vacation planning and how we at CMB prepare for a smooth, successful research project. You might be thinking “this is a woman who really needs a vacation.” But hear me out.

The first step of vacation planning is to put together a list of possible locations for a trip and select an appropriate timeframe. Planning a successful research study works on the same principles, every project starts with taking the time to define and understand the main decisions that need to be made from the research—we use tools like our Business Decision Worksheet—which directly ties the questionnaire, analysis and reporting to the business decisions, letting us identify and gain consensus on the most pressing decisions, and ensuring the results are actionable.

We also know how critical it is to develop (and stick to) a schedule that aligns with our clients’ needs. One of the first things that we at CMB do at the beginning of each project is put together a schedule outlining each key milestone of the process, all the way up to delivery of the final results. Putting together a detailed schedule helps us align resources and ensure we stay on track to meet our client deadlines. Knowing how much our clients rely on our research makes the scheduling a crucial part of the process and an important key to our success in executing projects.

Once the schedule is set, the project kicks off and the exploratory phase begins. I personally did lots of exploratory research before selecting my specific cruise line, ship, and date. Through this exploratory research, I was able to drill down and identify what aspects were most important in making my decision. Exploratory phases are also crucial for determining what will be most important to measure in the questionnaire and which areas are “nice to haves,” but not necessary to be included for the project.

Exploratory research also helps generate new ideas that may not have been previously considered. Similar to the many resources available for cruise planning (cruise line website, message boards, etc.), exploratory research for a project can span several platforms, including a review of secondary research, conducting in-depth interviews or focus groups, or hosting online discussion boards.

Sometimes the exploratory phase of a project gets less attention/recognition than is deserved because it doesn’t come across as being as “glamorous” as the analysis and insights that will come from the quantitative research. However, all market researchers know that the level of planning can make or break a project. CMB’s focus on planning allows us to try and anticipate what potential issues may come up down the road so that we can troubleshoot effectively and properly set expectations with our clients. Of course just like you can’t predict a rogue wave, there are times when the unexpected happens. When this happens we know we need to remain flexible enough to make course corrections and steer us back to the business decisions that our clients are trying to make.

I know we can only take the analogy so far; when all is said and done, often the only tangible evidence of having been on a vacation are the pictures. While the deliverables we produce for our clients are polished and shiny, they’re hardly the end “goal” of the research. Successful research is useful and used, and that starts well before a questionnaire is designed.

Cara is a Research Manager at CMB. She enjoys spending time with her husband Brett, her dog Nala, and planning her next vacation.

Recently, the US Supreme Court heard an argument from frequent flyer Binyomin Ginsberg, whose membership in Northwest’s WorldPerks program was revoked, after he complained too often. While the practical and legal questions of enforcing contracts under the specialized application of airline deregulation are interesting, the question for us today is: does loyalty run both ways?  Any customer-facing employee of a loyalty program can probably name a handful of customers who regularly call to complain—about the service, the rewards, the benefits. They, like the people at Northwest/Delta, may feel that some of these customers contact them for the sole purpose of obtaining compensation. Should their frustration with these members lead them to take their points away, or cut them off entirely? 

Let’s look at the case of Binyomin Ginsberg:   

• He was a very frequent flier – 75+ times/year with top Platinum Elite status.  At $350/flight his annual value to NWA is nearly $30k.

• In 8 months, he complained 24 times about late and lost luggage and long delays. He didn’t complain to the flight attendants, gate personnel or pilots but instead to top managers in the corporate office of the frequent flier program. "I did exactly what they asked you to do," Ginsberg said in an interview with NPR. "If you have a negative experience, they want you to give them feedback."  And so he did — a lot.

• Ginsberg says he never asked for anything when logging his complaints; the airline reports he repeatedly asked for compensation, and that they tried to soothe the unhappy flier.  In 2007, Ginsberg was awarded nearly $2k in travel vouchers, 78k bonus miles and $491 for a lost bag. 

• And then he got the call telling him he was no longer a member of the program, that his miles had been confiscated and he’d been black-listed and would never be able to join the program again. 

• He was told he complained too much about the service and the airline has ‘total discretion’ in such matters. 

The case will be decided in the spring. In the meantime, here are some questions for you to ponder as you consider how loyal you are to your loyal customers: 

Do you solicit feedback from your members on their experience with your product/service? 

If you do, are you:

• Making improvements based on the feedback

• Communicating the improvement you’ve made

• Responding in a timely fashion to individuals who ask to be contacted

• Sharing results and verbatim customers comments with senior managers 

Take the case of AeroMexico, whose customer feedback surveys revealed the two biggest pain points impacting loyalty were on-time performance and delay management—hardly atypical for an airline, but the survey also revealed customers felt the airline’s staff lacked empathy in communicating delays. To fix this problem, the airline’s customer experience team recruited key executives to personally call customers who have experienced delays—the executives are coached to resolve issues and listen to the customer. And according to AeroMexico’s VP of Customer Experience, Eduardo Piquant, the innovative program has been a success: “We always start with an apology for the delay and then ask for feedback about what we can do better. In the beginning, people don’t believe it is the CEO or CFO or other senior executive calling. But when they realize this is a true company-wide project, the results are remarkable. And what we’ve found is simple: Customers just want to be heard.”  The airline estimates this approach has resulted in a win back of more than 3000 customers. 

Do you have a clear policy in place for compensating members for a bad experience?

For many companies, continuously improving quality standards and keeping customers satisfied are the key goals to maintaining a competitive position in the marketplace. But these intangible goals often can be difficult to achieve in practice and occasionally – for reasons within and outside your control – customers will have a bad experience.  And in the world of Trip Advisor and Facebook, these bad experiences and your corporate reactions to those experiences will be widely shared and will influence the decisions of other prospective guests. 

Assuming the corporate decision on compensation has been made and is appropriate, the actions associated with dealing with disappointed members (whether you compensate them or not) are the same:  

• Express gratefulness for their business

• Listen to complaints with empathy

• Clearly and consistently present the information on compensation policy

• Track the behavior of guests “post-interaction”– do they continue to spend (as they did prior to the problem)?  Or has the problem (and your recovery efforts) caused them to take their business elsewhere?

A compensation policy doesn’t get much clearer than Hampton Inn hotel’s 100% Satisfaction Guarantee. While the idea of a “No questions asked 100% guarantee” might sound outlandish, the policy has been a success since it was implemented nearly 25 years ago.  Years ago, Phil Cordell, the senior VP of Brand Management at the hotel chain described the success of the program: “...Compared to the more than $6 million in free rooms we’ve given away over the past decade due to invoking the Guarantee, we have been able to track more than $41 million in repeat business, a nearly seven-fold return. But more than just dollars and cents, we’ve converted unhappy guests into satisfied customers across the country, loyal to the Hampton Inn brand.”

Are you doing all you can to take care of your highest value customers?

One of the primary benefits of a loyalty program is the ability to track each customer’s spend so you can identify your most valuable customers. Calculating the percent of corporate revenue obtained from each membership tier puts their value in perspective. While every customer is important, from a revenue perspective, some customers are clearly more important.

If your loyalty program has tiers:

• Ensure your compensation policy recognizes and reflects the unique value associated with your top tier guests. Create an elite group of customer service reps to deal with your top tier guests and their challenges. 

• Conduct research to determine the share of wallet you get from members, and how much they spend with competitors. Ask questions to examine which competitors they use–for which occasions and why–to set strategies to concentrate their spend, and further build their value with your firm. 

• Closely examine the behavior of your top tier members to see if it’s time to develop a super-elite level. You may find a sizable group of customers who max out on your program, and then move their business to your competitor. 

Caesars Entertainments’ Total Rewards program, the largest casino rewards program in the world, has 4 distinct tiers. The value of a member at each tier is carefully calculated, and rewards and service aligned with value, this insight leads to smoother operations, better front-line service, and differentiated pricing. Joshua Kanter, Senior Vice President, Revenue Acceleration and Total Rewards, reports: “We have a ‘differentiated service model’ that’s keyed off of Total Rewards tiers. We strive to provide a great experience to every guest, including our entry-level Gold members but we also have special hotel check-in areas, shorter lines and exclusive lounges for our Diamond and Seven Stars members. And our VIP-focused organization engages with our most high-value customers individually. When a guest presents their card, every member of our front-line staff responds immediately with the level of service appropriate to the tier.”

So, can I imagine a customer who was so much trouble that he or she needed to be kicked out of their loyalty program? Sure, but the crimes committed would have to be much more egregious than too many complaints. Your loyal customers have made a commitment to you, they’ve shared their information with you, they’ve chosen you when it might have been easier to go with a competitor, and many have advocated for you with their colleagues, friends and family: doesn’t that deserve some loyalty in return?

Judy is VP of CMB's Travel & Entertainment practice and loves collaborating with her clients. She's the mom of two college students and the wife of an oyster farmer. Follow Judy on Twitter at @Judy_LC

Goodbye, plastic hotel room key. So long, wallet. Farewell camera. These days you don’t need any of the above to unlock a hotel room, buy a mojito or snap a vacation photo.  All you need is, well — you. –Stephanie Rosenbloom, “Just Tap Here,” The New York Times

That quote, from an article in the NY Times’ Travel section, hit me like a wave. Since the beginning of the year, I’ve managed to lose a hotel key card, leave my cell phone at the office before going on a business trip (after carefully placing it where I would see it before dashing to the airport), lose my office and son’s daycare key cards, drop my American Express card somewhere during a 3-mile run, leave my reusable coffee cup next to the register at my local Trader Joe’s, and lose my sunglasses. It’s painfully obvious why this article, on the wonders of biometrics, hit so close to home.Biometrics have come a long way since the retinal scans featured in the old Bond and Batman movies. Now you can do more than imagine scanning your fingers to open the door, or make a purchase; hotels can use infrared signals as a virtual “Do not Enter” sign, detecting body heat and ensuring housekeeping staff doesn’t knock or barge in.

While I look at technology as enabling convenience, others just see more evidence of Big Brother penetrating our lives—all that data needs to live somewhere and that makes many people uneasy. Of course, you could make the argument that the NSA is already collecting vast amounts of data tracking our every move; we may as well use it to our advantage by gaining something out of this sharing.  As Zachary Karabell notes in a recent article in The Atlantic:

…for all of the legitimate concerns about government intrusions on personal privacy, Americans today -- along with many people worldwide -- surrender vast amounts of personal information to companies and seem quite prepared to surrender even more if it adds to the enjoyment and reduces the friction of myriad transactions that are part of everyday life.

With that quote in mind, I thought about how my clients can leverage this technology to deliver a better experience to their guests (while decreasing their operating costs, and gain repeat business and free marketing through advocacy).  Our work in the cruise industry, as well as the JD Power 2013 Cruise Line Satisfaction Report, reveals that the embarkation and debarkation process are very important in driving guest satisfaction. Think about how much more quickly those lines would move if an iris and/or fingerprint scan were all it took to board the ship?  Guests get where they want to be more quickly and cruise lines need fewer embark and debark crew members to manage the process.

Onboard photography is another area that frustrates guests (and represents lost revenue) when they don’t have an adequate number of photos from which to choose. Facial recognition technology that enables onboard photographers to group every candid picture they take, so passengers can easily browse, would solve that problem.

For cruises attracting a mix of guests from all over the world, using fingertips as a purchase trigger rather than cash or credit cards would also help improve the onboard shopping experience for those guests who do not hold currency in the denomination used on the ship and/or who are not fluent in the primary language spoken onboard.

New tools and emerging technologies offer myriad opportunities to improve the customer experience. Biometrics and mobile tracking are giving brick and mortar businesses the opportunity to catch up with their online counterparts. But there’s a real trade-off here—if customers are going to take that leap of faith it needs to be worth it. What do you think?

Lynne is Research Director of CMB’s Retail and Travel practice; she has not lost one personal object since June. She would like to thank the The London Hotel NYC for getting her back in her room quickly (after verifying her identity), Judy Melanson for letting her use her phone to stay in touch with her family while traveling and Sean Kearney for dropping off her phone at home so it would be there when she returned, AmEx for getting sending a replacement card within 24 hours and Trader Joe’s for maintaining a Lost & Found. 

Learn how we help Royal Caribbean measure guest experience and improve customer satisfaction and retention.

Originally published in Loyalty360

Innovating and successfully launching new products, be they loyalty programs or sneakers, is a difficult job requiring significant investment and navigating initiative-sinking risks.  Compounding the problem, for many firms, the innovation process itself is poorly-defined and unfocused—a great idea can morph into a poorly conceived solution or fail at execution.mproving your chance of success requires a focused innovation process—a structured process where you apply the “right method” to the “right questions;” pursuing innovation within constraints, and focusing on untapped market opportunities.

We recently presented a case study of focused innovation in action at the Front End of Innovation conference.  The case study highlights a project with Tauck Worldwide; in partnership with our sister company at the South Street Strategy Group.

Tauck is a travel industry leader; for nearly 100 years, it has focused on providing high value guided tours for its highly satisfied customers. But Tauck recognized some challenges to their future success—the erosion of the guided travel industry and an aging of customer base. They needed to create a new kind of travel experience to meet the needs of affluent Baby Boomers, a population extremely comfortable with researching, planning, and traveling on their own.  In partnership with South Street Strategy Group, our Focused Innovation process involved:

1. Identifying the primary goal, opportunity or business challenge, and constraints: We started by exploring the business context through internal ideation, interviews, and workshops with executives and senior managers. This step helped us answer questions and identify constraints, including the need to:

·       Leverage Tauck’s core competencies

·       Design a new product, addressing unmet needs

·       Hit sales goal of $M in X time period by attracting new customers

2. Investigating the opportunity using multiple methods:  We collected insights from different people (e.g., travel agents, call center reps, potential customers) and information sources to uncover customer needs and preferences. We segmented the Boomer market by travel preferences and conducted in-depth qualitative research to identify the target market and flesh out the desired experience for different types of vacations. The key output was a ranking of travel concepts on key criteria, and an initial read on the market opportunity.

3. Validate and optimize:  So we had some great ideas for new trips and a new market to tackle, but we needed more detail to actually build out the product. We used a Discrete Choice model, to simulate market demand for various product alternatives and prices. This information guided product design and pricing. A critical piece of this stage is emulating real world choices—a trip can sound appealing, but at this stage we want to know who would buy, if they are really interested, and how their interest changes by price.

4. Implementation and go to market: With the concept validated, the Tauck team needed to build out the trips, contract with hotels, and identify top events and attractions for multiple locations. The comprehensive understanding of their target market also guided their decisions, including how to brand the products, establish relevant partnerships, and reach out to potential customers using traditional channels as well as online and social media. Although it’s often glossed over, this critical go-to-market planning stage can mean the difference between success and failure.

The result of this focused approach? Tauck launched the Culturious brand as a totally new product line, on time and with unanimous board approval. The new brand meets customer needs by offering small-group tours geared toward active Baby Boomers with an interest in physically challenging, culturally engaging travel. Culturious has consistently received “exceptional” guest satisfaction scores and won the 2010 Innovation prize from the Connecticut Quality Improvement Award Partnerships (CQIA).

Focusing innovation on the end-goal and working within constraints enabled Tauck to quickly launch a successful innovative product. Leveraging their existing competencies to address unmet needs in the Affluent Boomer marketplace enabled them to hit sales goals in Year 1.   

So, what are you waiting for?  Consider your challenge, identify your constraints, and get focused on your Focused Innovation process!

Judy is VP of CMB's Travel & Entertainment practice and loves collaborating with her clients. She's the mom of two teens and the wife of an oyster farmer. Follow Judy on Twitter at @Judy_LC 

This week, Michael Bauer, a restaurant reviewer in San Francisco, published a letter from a reader about a curious experience a diner had with OpenTable—the popular restaurant reservation and review platform.  It wasn’t a dropped reservation, or glitch in the site, it was something a lot stranger. The letter writer had written a negative, but altogether balanced and reasonable review about an unhygienic dining experience at a popular restaurant, and OpenTable had censored it—in 2013!I’ll admit I’ve heard a few compelling arguments for a moderated/curated review experience, a practiced “Yelper” knows you have to wade through insanely negative, or inordinately positive, reviews to get a real sense of which reviewers to trust. There’s no doubt some filters have appeal, case in point the new app, Find. Eat. Drink., which features reviews exclusively from chefs, bartenders and others in the food industry, not from lowly civilians. But was OpenTable, who responded to Bauer’s questions by saying the review was inappropriate according to their terms of service, out of line? Immersed in the world of Yelp, Trip Advisor, and other sites where the reviews (much less balanced reviews, might I add) flow free, censoring just feels like an anachronism.

OpenTable certainly has every right to moderate reviews as they see fit, but I’d argue they’ve done no one, the restaurant, the customers, nor themselves any favors. For the restaurant, they’ve taken away an opportunity to address a potentially business-altering problem and make it right for the reviewing-customer, who incidentally said the food was quite good. Beyond the reviewing customer, scrubbing the review doesn’t do much for potential customers who could benefit from that information—most of us have learned to filter out the noise of a lone negative review—maybe OpenTable and its restaurant partners need to have a little more faith. And finally, it’s not good for OpenTable, review sites like Yelp, social media sites like Facebook and Twitter, and countless other platforms let people share their thoughts on businesses with huge audiences. Scrubbing away the negative reviews just negates the experience.

Maybe it’s not just the unnamed restaurant that needs to clean up its act. What do you think?

Judy is VP of CMB's Travel & Entertainment practice and loves collaborating with clients on driving customer loyalty.  She's the mom of two teens and the wife of an oyster farmer. Follow Judy on Twitter at @Judy_LC