Customer Care: Cable Operators Look to Inspire LoyaltyMediacom Uses 'Net Promoter Score' To Focus More On Subscribers' Point of View 9/09/2013 8:21 AM Eastern
Cable operators have been trying to satisfy their customers for years. But it turns out a satisfied customer doesn’t necessarily translate into a loyal customer and loyal customers are really where it’s at.
Loyal customers are more likely to stick with their service provider longer; spend more money each month; and ultimately recommend their service provider to their friends and family.
So how does an operator inspire loyalty in its customers? Multichannel pay providers need to be receiving the products and benefits promised to them and they need to resolve customers’ problems quickly and efficiently, said Mediacom Communications’ senior vice president of customer service and financial operations Tapan Dandnaik. Not only will that make customers more loyal and sticky, it will reduce churn and operating costs. On the other side of the coin, if a customer has no reason to be loyal to a service provider and ditches that provider for a better deal or the promise of a better experience, that word of mouth can be deadly. Growth can slow down and churn can increase.
Determining a customer’s loyalty level -- called a net promoter score (NPS) -- is pretty easy to determine. Most companies are currently asking their customers to rank the company based on the latest interaction with the company. Depending on their answers, the customers are then ranked as either promoters (9-10); passives (7-8); and detractors (1-6). The average NPS is determined by taking the number of promoters minus the number of detractors. At this point, the multichannel distribution sector is still a little behind the curve, according to Yoav Ziv, client business executive with Amdocs. In a recent multi-industry survey, the average NPS for the telecom/media industry hovered around 20% while the average score for Apple was around 70%. When asked what would lift those multichannel pay numbers, customers said they wanted more control over their service and they wanted their service providers to be more pro-active, he said.
“They told us that they wanted their service providers to tell them when there was a service outage and they wanted more power over their service,” Ziv said. “No one likes having to make a phone call. They want to be able to solve their problems on their own in more ways. It’s like Chase Bank. They figured out how to eliminate the need to go to the bank to deposit a check. You simply take a picture of it on your smartphone. It was brilliant. It saved customers’ time and it save the bank money by eliminating some brick-and-mortar costs.
“NPS has enabled Mediacom Communications, for instance, to focus more on a customer’s point of view than the company’s point of view when it comes to serving customers,” Dandnaik said. “NPS has helped us prioritize what projects we should be focusing on.”
For instance, Mediacom knew it wanted to improve its network reliability and recognized that customers wanted the same thing. But the surveys also told the company that customers understand that there were going to be service problems from time to time. What they wanted was a heads-up and a quick resolution to those problems, Dandniak said. The surveys also revealed that if a customer’s problem is resolved with one call or one click, they tend to have a higher NPS score than customers with no problems at all. A few tweaks later, Mediacom’s NPS scores were higher.
“There is a real financial impact on the company if your NPS scores are going in the wrong direction,” Dandnaik said. “We don’t have to be aggressive with our promotions if we’re doing our job correctly. We can’t ignore a competitor’s promotions, but if people are loyal to you, you’ll lose fewer customers.”
Multichannel pay providers have a way to go, however, before they are really giving customers the power they want over their service, Ziv said. At this point, there is very little personalization and that will continue to hinder NPS scores for a bit. “You can’t serve everyone in a cookie-cutter way and reach those 70%-plus NPS scores,” he said.
Of course, basing a whole business plan on just one metric is dangerous, said Tom Karinshak, senior vice president of customer experience for Comcast. “We have to look at internal and external benchmarks and NPS is one of those. If we can identify trends and drivers that will maximize a customer’s experience, we have done our jobs correctly. We want to look at these scores daily, weekly, monthly and yearly. We want to identify key short-term and long-term drivers and then adjust accordingly.”