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Satisfaction, Loyalty, Advocacy?

Posted by: Jena McGregor on July 9, 2007

Forrester Research analyst Bruce Temkin pointed me the other day to his new blog, Customer Experience Matters. Temkin, who is the vice president of the customer experience practice at Forrester, is a smart guy on the subject. One of his blog posts mentions the role “customer advocacy” plays in improving relationships with customers. As Forrester defines it, customer advocacy is the “perception that the firm does what’s best for customers, not just what’s best for the bottom line.”

The chronology of ways to measure how customers feel about your product or service is a long one. First was customer satisfaction, which measures the quality of your experience with a product of service. Customer loyalty went a step beyond, measuring whether or not someone is likely to buy from you again. Customer experience—that so-broad-it’s-hard-define notion of customers’ emotional relationship with every single way they touch your brand—is one of the measurements du jour. And then there’s the net promoter score, the popular yet controversial practice of measuring customer loyalty simply through whether or not customers would recommend your product or service to a friend.

And now, thanks to Forrester, we have customer advocacy (which should not be confused with net promoter score, though the concept of “recommending” is sometimes referred to as “advocating”). While I’m not going to join the fray of whether customer advocacy is better than any of the other measurement tools right now, the idea does make a lot of sense to me. I can’t think of a reason that would endear me more to a company—as a consumer, at least—than knowing they’re looking out for me first.

As far as I can tell, Forrester has only applied the advocacy idea to financial services firms. Not surprisingly, USAA, the winner of our customer service champions awards, came in first, with 88% of customers agreeing that "my financial provider does what's best for me, not just its own bottom line." While insurers and brokerage firms had decent results, no major bank cracked the 50% mark.

Here's the top and bottom 3 from the report:
USAA 88%
Independent Financial Adviser 76%
AG Edwards 66%
Credit unions 66%
Independent insurance agents 64%
Citibank (credit cards) 27%
US Bank (credit cards) 27%
Chase (banking) 27%
Citibank (banking) 24%
HSBC (credit cards) 24%

Reader Comments

Eddie Stewart

June 27, 2008 10:26 PM

I watched an interview with the president of Mindshare a while ago on Fox where he talked about this very subject. It's a lost art and something most companies lose sight of. I work at a company that considers customer advocacy simply a "cost center" when in actuality it plays a huge part in the company's success.

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