Linda Sease The E.W. Scripps Company

1. Beyond Behavior: Understanding Reader Satisfaction Linda Sease The E.W. Scripps Company

2. Traditional customer satisfaction metrics do not necessarily measure customer loyalty or predict company growth.

3. Customer loyalty and satisfaction is about much more than repeat purchases.

4. A customer who buys again and again from the same company may not necessarily be displaying loyalty – they may be trapped by inertia, indifference, or exit barriers erected by the company or circumstances. • Conversely, a loyal customer may not make frequent repeat purchases because of a reduced need for a product or service.

5. Traditional measures of customer loyalty (such as customer retention rates) are complicated measures that may relate to company profitability – but not growth. • Conventional customer satisfaction measures often lack a demonstrable connection to actual customer behavior and growth.

6. The Net-Promoter Score (NPS) metric was designed to offer an effective measure of customer loyalty, one that predicts company growth. • Survey responses from 4,000+ customers matched to actual behavior over time • Fourteen case studies built • Resulting data determined which survey question had the strongest statistical correlation with repeat purchases or referrals

7. “How likely is it that you would recommend [Company X] to a friend or colleague?” • One question effectively predicted the behaviors that drive growth:

8. That is, the likelihood of a consumer to recommend a product is a predictive measure of loyalty. • A customer’s likelihood of recommending a company to a friend or colleague captures the essence of customer loyalty. • Measured by how often a customer talks up a company to family, friends, and colleagues.

9. They typically only take that risk when they are intensely loyal. • When customers act as references, they do more than indicate they have received good economic value from a company. • Their own reputation is on the line

10. Customer loyalty and satisfaction can be measured by asking, “How likely would you be to recommend [Company X] to a friend or colleague?” Not At All Likely 0 Extremely Likely 10 Neutral 5 1 2 3 4 6 7 8 9 Detractors Promoters Passively Satisfied

11. Defining the three customer clusters: • Promoters have the highest rates of repurchase and referral. • Passively Satisfied customers stay witha particular company more due to inertiathan true loyalty. • Quickly use a different company if presented with a better deal • Detractors spread negative word-of-mouth comments about the company. • Negatively impacts company’s reputation, ability to attract newcustomers and employee morale

12. Promoters – Detractors = Net-Promoter Score

13. The size of a company has no apparent relationship to its NPS. • Strong correlation between a company’s growth rate and the percentage of customers who are Promoters. • Getting customers enthusiastic enough to recommend a company appears to becrucial to growth.

14. Median NPS across 400 companies in 28 industries surveyed was 16%. • Companies with the most enthusiastic customer referrals have Net-Promoter Scores from 75% to more than 80%.

15. NPS provides a measure of customer loyalty linked to customer behavior and ultimately, to company growth. • In order for a company to experience “true growth” and “good profits” it must have customers that are both profitable and satisfied. • Customers are profitable when they make repeat purchases, are less price-sensitive, and show interest in new products or brand extensions. • Customers are truly satisfied if they refer the company to friends and colleagues.

16. Promoters are generally profitable and satisfied – they usually buy more and actively refer friends and colleagues. • A company will experience long-term and sustainable growth only if the percentage of Promoters is greater than the percentage of Detractors.

17. NPS enables companies to gather simple, timely, and actionable information. • Keep customer surveys simple and gathertimely information that is easy to act upon • Data obtained by the NPS metric is actionableand easy to interpret and communicate • Allows for tracking and comparing NPS over time, within a company, and against national averages, as well as against direct competitors

18. No airline has found a way to increase growth without improving its ratio ofPromoters to Detractors. • In most industries there is a strong correlation between a company’s growth rate and the percentage of its customers who are Promoters. • Airlines: strong correlation between NPS and a company’s average growth rate • Rental cars: Enterprise Rent-A-Car enjoys the highest rate of growth and highest Net-Promoter percentage among its competitors

19. “We need more Promoters and fewer Detractorsin order to grow.” • Guidelines for using NPS to motivate company-wide change: • Be sure that everyone in the company knowswhich customers they’re responsible for. • Make your scores transparent throughoutyour organization. • Create a sense of urgency by tying rewardsto score improvement.

20. The NPS metric can be applied to the newspaper industry to provide insight into readership behavior and satisfaction. • Traditional readership studies help illustrate behavior but do not gauge reader satisfaction • NPS allows for a new level of accountability, actionability, and urgency to address readers’ needs and expectations

21. Establish a disciplined approach to understand how well the newspapers are meeting consumer needs. • Scripps Readership Survey:

22. Scripps Readership Survey Goals:

23. Scripps Readership Survey Requirements: • Current readers of Scripps newspapers • Read at least one time in the last monthor visited the website three to four timesin the last month • Ages 18 to 54 • Sample to reflect market in age, gender,and race/ethnicity • Actionable and customer-focused questions

24. Of 8,838 total respondents, almost 60% were current Scripps newspaper subscribers. Respondent Buying Behavior – Total Scripps Markets Read Online 3% Read Someone Else’s 16% Current Subscriber 59% Buy Single Copy 22% N = 8,838

25. Across Scripps markets, one-quarter of respondents read both the print and online versions of the newspaper. Audience Reach – Total Scripps Markets Online Only 2% Print and Online 25% Print Only 73% N = 8,838

26. The sample reflected the markets overall in age and gender… Respondent Demographics 45 to 54 Male 25 to 44 Female 18 to 24 By AgeN = 8,838 By GenderN = 8,838

27. …but there was a higher percentage of households with children represented. Respondent Demographics No Yes By Presence of ChildrenN = 8,156

28. Education and income levels were also higher than the total market population. Respondent Demographics Post-Grad+ $75,000+ Bachelor’s $50,000 to $74,999 Some College/ Associate’s $25,000 to $49,999 HS Grad Under$25,000 Less than HS By EducationN = 8,676 By IncomeN = 7,975

29. Hispanic respondents reflect the market, but African-American respondents were slightly underrepresented. Respondent Demographics Other All Others African-American All Others Hispanic San Angelo Evansville TC Naples Anderson Ventura Caucasian/Non-Hispanic Memphis Corpus Versus MarketsN = 8,689 Sample Concentration by Market N = 8,689

30. “On a ten-point scale, where1 = Extremely Unimportant and 10 = Extremely Important, how would you rate the topic of [Topic]at this point in your life?” • Questionnaire Structure: • Part 1: Topic importance

31. Questionnaire Structure: • Part 1: Topic importance Topics Covered

32. Questionnaire Structure: • Part 1: Topic definitions were as specific as possible to avoid confusion or overlap

33. Questionnaire Structure: • Part 1: Topic definitions (continued)

34. Questionnaire Structure: • Part 1: Topic definitions (continued)

35. “Using a ten-point scale where1 = Not At All and 10 = Extremely Likely,how likely would you be to recommend [Scripps Newspaper]to a friend or colleague as a source for [Topic]?” • Questionnaire Structure: • Part 1: If topic is important (8, 9, 10), then ask:

36. “Based on your interest in the topic, what do you think is your single most important source for information about [Topic]?” • Questionnaire Structure: • Part 1: If NOT likely to recommend (1 – 7), then ask:

37. “It is in touch withthe community.” “This newspaper presents a broad range of opinions.” “ I trust this newspaperto be honest and fair.” “I learn things from this newspaper.” • Questionnaire Structure: • Part 2: Attitudinal statements:

38. Questionnaire Structure: • Part 2: Statements reflected: • Personal fulfillment/knowledge • Connectedness to local community • Ease of use • Credibility/accountability • Value • Inhibitors • Several were “Motivator” statements taken from Readership Institute New Readers Study

39. “If you could talk directly to [Scripps Newspaper], what suggestions could you give them to make the newspaper and/or its website more satisfying to you in your daily life?” • Questionnaire Structure: • Part 3: Open-ended suggestions • Verbatims were coded and grouped by subject for each market.

40. Questionnaire Structure: • Part 4: Likely to recommend “Considering all the aspects of [Scripps Newspaper], how likely would you be to recommend the newspaper to a friend or colleague as a source of informationin general?”

41. Fourteen Scripps markets participated in the study.

42. Plotting topic importance against NPS revealed areas of opportunity. Topic Importance/Assessment – Newspaper B by NPS (Southern) Median = 37% High Opportunity Defend Schools/Ed Local News Religion/ Spirituality Other Newspaper Advertising Family/Friends Classified Advertising Topic Importance Health Median = 6.9 Community/Neighborhood Entertainment/Leisure Finances Careers PersonalGrowth Sports Home Low Net-Promoter Score Low High • Religion/spirituality scored higher in importance in Southern Scripps markets.

43. Promoters (9-10) 48% – Detractors (0-6) 22% Net-Promoter Score 26% • Newspaper B had an NPS of 26%, with 48% of respondents as Promoters. Newspaper B Overall Assessment Detractors Passively Satisfied Promoters Mean = 8.0

44. The topics of Health, Family/Friends, and Finances emerged as areas of opportunity for Newspaper G. Topic Importance/Assessment – Newspaper G by NPS Median = 20% High Opportunity Defend Local News Health Entertainment/Leisure Schools/Ed Family/Friends Finances Community/Neighborhood Topic Importance Median = 6.7 PersonalGrowth Home Other Newspaper Advertising Religion/ Spirituality Classified Advertising Sports Careers Low Net-Promoter Score Low High • The topic of Finances moved into the Opportunity quadrant in select Scripps markets.

45. Promoters (9-10) 42% – Detractors (0-6) 25% Net-Promoter Score 17% • Newspaper G had a NPS of 17%, with 42% of respondents as Promoters. Newspaper G Overall Assessment Detractors Passively Satisfied Promoters Mean = 7.7

46. Across all Scripps markets, several topics emerge as areas of opportunity. Gap Analysis Topic Importance/Assessment, All Markets Median = 27% High Opportunity Defend Local News Schools/Ed Health Family/Friends Entertainment/Leisure Religion/ Spirituality Community/Neighborhood Topic Importance Median = 6.5 Other Newspaper Advertising Finances Classified Advertising Home PersonalGrowth Careers Sports Secondary Foundational Low Net-Promoter Score Low High

47. Several topics and attitudes influence NPS: • The more readers recommend the Scripps newspaper for Local News, Entertainment/ Leisure, Advertising, and Sports, the more they recommend the Scripps newspaper overall; however, improving content in topic areas alone will be insufficient. • Newspaper enjoyment and value are predictive of overall recommendation ratings.

48. Trusting the newspaper to be honest and fair and believing thenewspaperpresents a broad range of opinions also are positively correlated with overall recommendation ratings. • NPS among respondents who had concerns about bias were lower than those who did not share the concerns, suggesting that the perception of bias negatively impacts NPS.

49. Promoters (9-10) 43% – Detractors (0-6) 26% Net-Promoter Score 17% • Scripps had a total NPS of 17%, with43% of total respondents as Promoters. Total Respondents Detractors Passively Satisfied Promoters Mean = 7.6

50. -35% 0% 20% 35% • • • • • • • • • • • • • • • • • • • • • • • • • Net-Promoter Scores ranged from 33% to -26% across Scripps Markets. Overall NPS by Market 17% Scripps Mean Newspaper E, F Newspaper B Newspaper A Newspaper C Newspaper H Newspaper N Newspaper L Newspaper I Newspaper D Newspaper G Newspaper M Newspaper J, K