Speaker 1 (0s):
Welcome to “Let’s Talk Loyalty”, an industry podcast for loyalty marketing professionals. I’m your host, Paula Thomas and if you work in loyalty marketing, join me every week to learn the latest ideas from loyalty specialists around the world.
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Hello, and welcome to episode 146 of let’s talk loyalty, a short summary of my interview with Rob Markey, the founder of Bain and company’s Customer Practice.
Bain and Company is best known for his work creating the net promoter system that so many of us use as a metric to measure and improve our relationships with our customers.
With NPS now so widely known and used around the world, I was keen to understand the latest insights that they are sharing with their global clients, and Rob began by sharing the concept of the founder’s mentality, a mindset and a perspective. They have identified as a powerful driver of corporate success. Two thirds of companies, Rob believes are enduring loyalty leaders are either owned by their founders or descendants are owned by their customers. So they are privately rather than publicly traded. In essence, this idea helps us appreciate the challenges that companies that are professionally managed suffer from purely as result of their size and their structure. As we know the bigger the company, the bigger, the risk of becoming alienated from customers. So Bain is focused on helping to bring the intimacy of a small company to large organizations. Rob talked me through one great example of this, how companies sometimes create problems for their customers by solving their own departmental challenges to the best of their ability. So it’s important for leadership teams to ensure that they don’t ever lose sight of the customer perspective when they make decisions to become more efficient and effective operationally. The main topic of our conversation then of course, was the NPS framework. And Rob talked me through the fascinating history, how he and Fred Reichheld realized the power of one single question to understand ways to predict future customer behavior. And then how that one question was chosen and has been applied so powerfully by so many marketeers for so many years, he admitted it’s not perfect, but believes it’s better than anything else available and really emphasized the purpose of measuring your net promoter score, which is not to improve your net promoter score, but rather to improve the relationship with your customers. It’s a powerful distinction and one that can actually help solve the problems that customers have rather than get lost in endless analysis, as it can so often happen when asking customers for their feedback. Rob explained to me why some entire industries sometimes score negatively and the potential for disruption when that occurs, giving new competitors the opportunity to serve those customers and their needs much better. We also had a great conversation discussing the work that Rob is doing in conjunction with professor Peter fader and professor Dan McCarthy, who are all equally focused on developing predictive models that can help companies and most notably investors predict customer loyalty with much more precision together. The three gentlemen have written a series of articles for the Harvard business review series to help readers begin to make more rational trade offs between short-term revenue expectations and the future value of better customer relationships. This approach will drive the future value of the company, but must be visible to investors in order for day-to-day business decisions to support the future of customer lifetime value to be accepted. We agreed that loyalty professionals are critical in terms of both our mindset and our analytical skills to help educate our colleagues and or investors of the power of this more balanced approach to business. Quite simply, RA believes that companies need to accept the need for new standards for disclosure on customer metrics that these need to be accurately defined and disclosed. So investors understand them and then they should be able to access this insightful information consistently. So that’s it for the short summary of my exciting interview with Rob Markey. The next time you have an hour to listen, do check out the full conversation. It’s episode 42 of let’s talk loyalty. And finally, please do join me now again, this Thursday, when I’ll be chatting with flying Blue’s director of partnerships, Gerben cinema to share all of his insights from the loyalty program of air France and KLM. Thanks again for listening guys. This show is sponsored by the wise market here. The world’s most popular source of loyalty marketing news insights and research. The wise marketeer also offers loyalty marketing training through its loyalty academy, which has already certified over 170 executives in 20 countries as certified loyalty marketing professionals. For more information, check out the wise market tier.com and loyalty academy.org. Thanks so much for listening to this episode of let’s talk loyalty. If you’d like me to send you the latest show each week, simply sign up for the show newsletter on let’s talk loyalty.com and I’ll send you the latest episode to your inbox every Thursday, or just head to your favorite podcast platform. Find let’s talk loyalty and subscribe. Of course I’d love your feedback and reviews. And thanks again for supporting the show.