Identified the 10 highest-ranked public companies (CXP Leaders) and the 10 lowest-ranked public companies (CXP Laggards).
Calculated the average annual total returns of the Leader group and the Laggard group
Compared the results for each group to the S&P 500 index for years 2007 – 2009.
Andrew’s analysis confirmed Watermark’s findings: The customer experience leaders consistently outperformed the other two groups; the customer experience laggards consistently fell short.
Does this prove that good customer experience leads to good stock performance (or that the CxPi picks hot stocks)? No. Stock performance relies on many factors, including human irrationality.
However, the correlation does highlight a relationship we all intuitively understand: Companies that treat their customers well perform better than companies that don’t. (And it sure looks like treating your customers poorly is a very bad idea, especially in an economic downturn.)
I've been analyzing consumer technology uptake for years — helping retailers, for example, understand the barriers to and drivers of online buying behavior. Forrester's Technographics® research shows that preferred online payment methods differ greatly between countries, and companies need to understand this complexity of payment options and how that affects consumer behavior.
Unlike in North America, where the top payment methods tend to be similar in the countries surveyed (the US and Canada), the payment preferences of online buyers in Europe differ both between countries and from their North American counterparts. For example, the popularity of prepaid cards is unique to Italy: Roughly a third of Italian online users have taken advantage of prepaid cards. Global organizations need this detailed understanding of consumer payment preferences across markets in order to be successful internationally.
I was on client calls most of the day, and when I came up for air in the afternoon to check my RSS reader and Tweetdeck to see what what going on in the world I made a fascinating discovery. Like many of you I came across the following post from the Google Analytics Blog:
This was most unexpected, and my Thursday suddenly got alot more interesting.
Before we go any further let me state that I have not been briefed by Google on this news item. This post is purely based on my own initial thoughts on the matter.
The blog post announces Google's plans to release a browser plug-in that would allow consumers to opt-out of Google Analytics tracking. This offering is still in development, and the post offers no specifics on the release date, although it implies that this is only weeks away.
(Side note: It is also interesting to note the language used in the post. The post leads with "As an enterprise-class web analytics solution..." This isn't a surprising or entirely inappropriate assertion, but it strongly implies Google's aspirations for GA.)
There are many reasons why Google's course of action is counterintuitive. Naturally, the marketer in me recoils at the idea of voluntarily allowing measurable data to slip through our hands. Rationalizing web analytics data is already hard enough, and now this? And we can certainly debate the true privacy impact of web analytics on consumers.
Welcome to Q&Agency! Each week, I get to talk to agencies small and large and get to hear (in their words) what differentiates them and the experiences they create. To help bring some of that information to you, I plan to showcase an ongoing series of interviews with small to mid-size interactive and design agencies. If you'd like to see your agency or an agency you work with here, let me know!
On March 16th, I talked with Rebecca Flavin, CEO and Peyton Lindley, Executive Director of UX Design and Technology at EffectiveUI. Although they were both busy at SXSW, they were kind enough to chat with me. Edited excerpts from that conversation follow.
Forrester: Tell me a little bit about EffectiveUI?
Rebecca: EffectiveUI is a full service user experience agency based in Denver, Colorado with offices in Rochester, New York and Vancouver, British Columbia. We specialize in the custom design and development of Web, desktop, and mobile applications with a zealous focus on driving user adoption and loyalty. We primarily work with Fortune 1000 and enterprise companies across multiple industry verticals. Our team is passionate about improving the quality of people’s lives through their interactions with technology and brands.
Mobile apps are all the rage these days in the music industry circles and justifiably so. Sales of traditional console-based music games have dropped significantly, but music and gaming still do make great partners. And while people’s interest in paying for music is waning, paying for apps is a growing phenomenon. Universal Music Group’s newly launched “Six-String” music app for iPhone/iPod touch is a case in point. The question now is not whether the industry should invest in iPhone apps but what is the best way to do so.
For an answer to that question let’s examine the current most successful paid music app on iTunes - I am T-Pain. “I am T-Pain” allows users to record their version of the T-Pain song into iTunes and auto-tune it. Here’s why I think the app is successful –
The game is engaging to all levels of gamers and music fans – Most people can sing an out-of-tune song into a micro phone. As the app is not very challenging it attracts a wider range of individuals and than the instrument simulation apps such as Six-String would.
It allows users to share the experience and be social – Once you have auto-tuned your voice you can upload it to your Facebook, MySpace page or email it to your friends. You can also check out the best auto-tuned songs that others have uploaded. Unlike other social games, however, this app is not really about competition and shows that music apps don’t have to be.
The simple fact is that CDs are perceived to be too expensive for many consumers. CD price changes will bring some much needed momentum back to CD sales but – and it’s a crucial ‘but’ – it won’t halt the decline. Instead it will slow the prolonged demise. The CD is a dying music product format, but it has some life left in it because downloads haven’t generated the format replacement they were expected to. With all previous music formats the successor format was firmly in the ascendancy by the time its predecessor was in terminal decline (see chart below). So until the online marketplace gets its act together there’s a stay of execution for the CD. And the labels need this breathing space, because the core impact of online’s under performance is that the CD paradoxically remains the bedrock of revenue.
There’s still more distance to go with CD pricing though. The next crucial step is tiered products with a basic product at c $5, the standard at $10 and the deluxe at $15. We’re some way off that becoming reality, but it will - and must - happen some time in the next few years if maximum extended life is to be squeezed out of the shiny little disc.
First of all, let me welcome you to Forrester's new blogging platform. Hopefully you'll find this blogging environment an easy way to access our blog-worthy ideas and community comments
Next, I wanted to officially announce (drum roll please) that I am back leading Forrester's email marketing research. Some of you may know that I did a lot of work in email marketing until 2007 when Julie Katz took the helm, joined subsequently by David Daniels following Forrester's acquisition of Jupiter. I'm excited to be back in the space and already have a stream of research underway.
First up is a piece on how the recession has affected consumer attitudes toward email marketing.
Then next quarter look for three pieces:
*One on the integration of email and social media
*Another updating our email marketing review methodology. See here for the older version.
*And then the third doing a best and worst of email marketing. This piece is also an update of some similar research we did here a few years ago.
What email marketing research would you like to see from us? I'd love to include your ideas in my research plan.
No one that manages a P&L will ever look back at 2009 and say "what a fun year!" eBusiness executives are certainly glad to have 2009 behind them and report to us that 2010 is not as fraught with economic concerns. We just published the results of our most recent survey of 100 eBusiness and Channel Strategy executives and found that although overall budgets for eBusiness aren't increasing that dramatically, our respondents aren't feeling the heat to cut back like they were last year.
Even better, our survey respondents are increasing their budget for new innovation and technology. In 2010, the percentage of the online budget dedicated to new investment and innovation is expected to increase or significantly increase at 52% of firms. Hooray! It's a battle cry for all eBusiness execs to step up their games, and for senior executives in their firms to step up their commitment to and support of the channel. Spending (by our respondents) will focus on analytics and then ratings and review platforms.
Analytics have been a constant in our surveys, and ratings and reviews don't surprise us. Social media is hard for eBusiness execs to get their heads around because many social efforts clearly drive marketing objectives like brand engagement, but the impact on actual sales and conversion is fuzzier. Ratings and reviews are a clearer conversion tool for retailers in particular. My colleague Brad Strothkamp wrote a blog post though about the use of ratings and reviews in financial services, which is not nearly as black and white an issue.
For my current research on social media and market research, I’m interested in listening platforms (and the text analysis that’s usually packaged with them) for the purposes of mining the social Web – be it on blogs, open community sites, social networks or the like.
There’s a lively debate around the value of social media listening for market research, and there are many people willing to share their opinion. Last week, I attended a Webinar on this very subject, hosted by Peanut Labs, with multiple guest speakers from the industry. Here are some of the key points that market researchers should consider when assessing the need for – and effort in -- social media research.
“Process and methods need to be developed to make social media data be another source for Marketing Research” -- From Jean Davis, co-founder of Conversition, and former president of Ipsos Online, North America. This means: Platforms need to be created with the market researcher in mind. They must be able to reliably sift through online conversations to sort out low-quality data; apply weighting schemes to that data reflects that true share of volume that different sources have online; and create constructs so that data from social media can be proxied to represent common measures such as five-point scales and top-two boxes.
Numerous conversations over the last few months with financial service firms has proven one thing to me - most are dealing with questions around social media and social commerce and yet few are sure how best to proceed. Much of what has been written thus far centers around the role social can play in the areas of marketing and brand, but there are beginning to be more stories that are surfacing around uses directly related to eBusiness on a firm's Web site.
The best case I have seen for social on a Web site came from USAA and is part of a case study I wrote with Tom Vaughn, director of social media at USAA. View Now.
What separates USAA's story from others we have heard? It is backed up with direct ROI and metrics in areas that drive the business - conversion and sales. USAA was able to prove that providing ratings and reviews using Bazaarvoice's solution drove an incremental 15 thousand plus products sales in a nine month period.
So should you rush out and add ratings and reviews to your Web site? Probably not since most financial services Web site fail to get the basics done right. But assuming you have the basics down, I would consider adding this one to your functionality roadmap.