Social media and CRM – does it foster loyalty?

1. Social media and CRM – does it foster loyalty? • Dr. Hanlie Smuts • August 2014 • Enhancing Customer Experience, Loyalty and Retention in Telecom 2014

3. Restaurant 2 … was remodeled in 1989. has a coffee-stained piece of paper. has a crackly sound system and paper placemats. has great food, especially for the price. • Restaurant 1 … • was recently remodeled. • has a fancy looking menu and prices to match. • has flat screen TVs and granite counter tops. • serves something resembling prison food. Which venue would get more of your business?

4. The topic we are discussing today … Social media and CRM – does it foster loyalty? Social media and CRM – does it foster loyalty?

6. What drives customer loyalty? “What makes a memorable experience that causes a customer to remain loyal to a brand?” 36% 55% 73% 33% “... friendly employees or customer service representatives.” “... the ability to easily find information or request help.” “... personalised experiences.” “... a good reputation.” Source: ORACLE

7. What are the consequences of customer dissatisfaction? “50% of customers give a brand only 1 week to respond to a question before they stop doing business with them.” “... of customers surveyed began doing business with a competitor.” “... of which were ignored by the organisation posted a negative comment on a social media networking site.” 89% 79% “... posted a negative comment on a social media networking site.” 26% Source: ORACLE

8. A response makes a huge difference … “When a customer’s online comment was met with a response ...” “... of respondents said their expectations were not met because a company was unavailable by phone or email.” 58% 22% 46% 56% “... said companies are slow to resolve issues.” “... said companies are impersonal and fail to get their customers’ names right.” “... were pleased.” “... posted a positive comment about the organisation.” 51% Source: ORACLE

9. Highly satisfied customers .. … refer the organisation to friends and family with a positive sentiment … shop for longer periods of time … offer the organisation suggestions about products and services … are indifferent to the competing brands … buy more as long as new products are launched and existing products improved Source: BAIN, Kotler

11. Some key metrics for measuring brand loyalty … Brand Trust Brand Goodwill Customer Satisfaction Perceived Quality and Value Source: adapted from multiple models

12. … the result of consistentlypositive emotional experience, physical attribute-based satisfaction and perceived value of an experience, which includes the product or services. Source: Beyond Philosophy

13. Key principles driving loyalty … Customer Satisfaction Perceived Quality and Value Brand Goodwill Brand Trust Product &service differentiation Reduced cost associated with customers and brand promoters Customer retention Emotional bond building Cross-sell and up-sell Product & service attribute-based satisfaction Brand advocacy Customer acquisition Source: Aggregated multiple principles

14. … is a system for managingan organisation’sinteractions with current and future customers, increasing the profitability and productivity of the organisation. Customer experience refers to interaction between a customer and organisation as perceived through a customer’s conscious and subconscious mind i.e. a blend of an organisation’srational performance, emotions evoked and intuitively measured against customer expectations across all moments of contact. Source: Beyond Philosophy, Kirmaci

15. Key principles driving customer experience … Customer Satisfaction Perceived Quality and Value Brand Goodwill Brand Trust Treating team well so they treat customers well Rational choice of products or services that provides the greatest reward at the lowest cost Customer engagement Understand customer expectations Care for and know customer likes and dislikes Optimise rational experience e.g. delivery times, answer rates, ease of engagement Design and deliver an emotionally engaging customer experience Understand what will add value to customer Source: Aggregated multiple principles

16. … is the collective of online communications channels dedicated to community-based input, interaction, content-sharing and collaboration. ... evolution in the way people communicate. It is a fundamental shift in how customers behave and what they expect from the organisationacross the customer life cycle

17. Social media impacts all parts of the customer life cycle…

18. Key principles driving social media … Customer Satisfaction Perceived Quality and Value Brand Goodwill Brand Trust Nurture long term customer relationships “Humanise” social network Targeted brand building Incremental sales channel Cross-sell and up-sell Better quality of interactions & TAT Adopt brand personality Manage degree of alignment and relationship history Multi-channel engagement based on customer choice Source: Lincoln

20. Bringing the principles together and considering the interrelationship among these … Customer complaints Customer requirements Product & service differentiation Customer base CRM Brand Goodwill Perceived Quality and Value Customer Satisfaction Brand awareness Brand engagement Brand Trust Source: Kirmaci, simplified model

22. Understanding what drives loyalty enables targeted and contextual marketing activity … ILLUSTRATIVE

23. #overshare

24. #overshare

25. A last thought … • Everytouch point matters. The first step to customerloyalty is to consistentlydeliver on your core business. Covering it up with gimmicks and gadgets won’t fool any customer. • General industry research can give you the big picture, but it may not explain what drives loyalty specifically with your customers.

27. Dr. Hanlie Smuts General Manager: Digital Mobile Telephone Networks 216 – 14th Avenue Fairland Roodepoort 2195 South Africa Private Bag 9955 Cresta 2118 South Africa Web http://www.mtn.co.za C +27 83 222 1111 E-mail hanlie.smuts@mtn.co.za