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Remember when Ron Shevlin and I used to publicly spar about Net Promoter Score and member service as a differentiator? Good times. Nothing anyone can say will ever make me feel otherwise. We are in the service business, period. We cannot differentiate with unique products or packaging, we sell and move money. Boring. Banking is an errand. Members don’t GET to go into the credit union, sometimes they HAVE to. Boring. And most member’s expectations? Very low. Their goal is to get in, get out and no one gets hurt.

That’s why one “wow” experience can produce so much value. It’s not expected, so it makes a lasting impression.

Fred Reichheld, co-creator of Net Promoter Score said it best. We know loyal members do three things for us:

  1. They will buy more from us and are less likely to rate shop (increasing services per household)
  2. They will market for us. Word of mouth is, has been, and always will be the most effective marketing.
  3. They will tell us how to improve the credit union. When you hear “I’ve been a member for X years” know that that is a gift because you are about to get a loyalty lesson. Listen.

If you would have told me in 2007 when I was in NYC with America First, Baxter, and Educators credit unions at the Inaugural Net Promoter Score conference that 8 years later I would be the one responsible for putting ON the annual conferences in US and London AND that I would also get to resurrect Loyalty Live – well, I would have slapped you and then kissed you on the mouth. Because you never know where life is going to take you, right?

It is with great pride that I invite you to join me and all my friends in Phoenix on March 4th and 5th at the Arizona Grand Spa & Resort for Loyalty Live. We are going to share stories about success, failure and the challenges that come with truly listening and responding to the authentic voice of the member.

I love recruiting speakers for events because I basically get to bring in people I love and admire. Check out who’s going to be there:


  • Sandy Anderson, Sr. VP Client Support & Sales Operations, Experian
  • Sally and John Myers, CEO and President of c.Myers
  • Matt Davis, former Director of Innovation Filene Research Institute and founder of GameFI

Thanks to our amazing and generous sponsors we are able to offer credit-union friendly pricing. Give it up for Co-OP Financial Services, Kasasa by Bancvue, MARQUIS, Geezeo, CUNA Mutual and CU Direct Lending.

I hope to see all the credit unions who are passionate about service there because we’re getting the band back together!

Next week I begin my new adventure with Satmetrix, the Net Promoter Score company. It’s a dream come true for me and it means I still get to work with credit unions through the Member Loyalty Group. Yay!

My office is in San Mateo so I’ve rented a studio apartment in the same town. Bay Area real estate is insane. San Francisco is the second most expensive rental market in the US (Honolulu is number one).

My sister Daedre (pronounced daydream – drop the “m”) is the Queen of “vertical” living. IKEA is only 12 miles away. Her plane lands at 7:45 this morning. She flies out at noon tomorrow, I fly to London at 7:30 tomorrow night (for my first week of work).

Our challenge: to create a gorgeous, comfortable, functional living space in 36 hours. We are starting from scratch. I arrived yesterday with my Mazda Millennia packed full of clothes, shoes, my favorite picture of Mark, bathroom stuff and one flying pig.

My sister has a process she uses for every move. She creates a scale floor plan using graph paper and makes little furniture pieces (also to scale) so you can play around with the room without breaking your back. The apartment is basically one big room, with a separate very small kitchen and bathroom. The main room is almost perfectly square and has a huge picture window on one wall with an amazing view.

Daedre asked me what my requirements were. I need a real bed and I don’t want to eat dinner on the couch. So we are going to try and get a bedroom, dining room and living room in 412 square feet. I am writing this from the Marriott Courtyard. And looking at this room, I think we can do it.

Stay tuned.

No one disputes that loyal members do three things:

  1. They buy more from you – increasing services per hh and profitability.
  2. Market for you – decreasing your marketing expense
  3. Tell you how to improve their cooperative – “I’ve been a member since…”

You know they do it – but can you measure it? A study released today from the Filene Research Institute, Exploring Ongoing Member Loyalty: Net Promoter in Credit Unions, proves that credit unions with the highest Net Promoter Scores (NPS) also have the highest profits. Fred Reichheld, author of The Ultimate Question, refers to NPS as the company’s growth engine. If done properly, it is a valid predictor of the future health of the organization. Unlike ROA which reflects the current operating condition.

In my opinion, NPS was the missing link on the balance sheet. The majority of our accounting measures focus on the quality of our widget (loan) rather than the quality of our product (service).  If your credit union believes that service is your differentiator, why wouldn’t you measure it as rigorously and accurately as ROA?

NPS does just that. And, it’s very simple.  By asking a random sample of your members this question: “On a scale of 0 to 10, how likely is it that you would recommend the credit union?” you can begin to understand what really drives loyalty.

The Member Loyalty Group, a CUSO founded by Addison Avenue, America First, Baxter, BECU, Educators and San Francisco Fire Credit Unions, partnered with Dr. Laura Brooks (co-author of the book Answering the Ultimate Question) for the Filene Report.  If you’re not already a Filene member, you should join. If you are, your copy is on its way.

For those of you that remember my precious Miss Mavis, you know that’s not possible. But, she’s a close second. Her new book, titled “I Love You More Than My Dog” takes a new and fresh look at what she calls beloved companies.

Trader Joe’s, Container Store, LUSH, Netflix, IKEA. What do these entirely different brands have in common? They are irrational. Their love of customers is irrational. From a CFO perspective, some of the things they do to delight customers makes no mathematical sense. But they cannot help themselves. They decided to love customers – every day.

Her book is centered around the five decisions made by beloved companies:

  1. Beloved companies decide to believe.
  2. Beloved companies decide with clarity of purpose.
  3. Beloved companies decide to be real.
  4. Beloved companies decide to be there.
  5. Beloved companies decide to say sorry.

Last week at the NPS Conference in NYC, Jeanne Bliss invited three people, highlighted in her book,  to join her on stage to tell their stories. First up was Christopher Zane, president and founder of Zane’s Cycles. He started this company when he was 16 years old and his love of bicycling has now turned into an extremely profitable enterprise. He believes that people are good and can be trusted. So when someone comes in to look at a bike, his store encourages them to take it for a spin. With no collateral (like wallet, car keys, etc) required to leave behind. Sure, about 6 bikes a year get stolen. But he did the math. The losses he takes for those six jerks versus the love he creates for the 99.9% of his customers by deciding to believe, makes mathematical sense.

Next up, Fred Taylor from Southwest Airlines (SWA). He is the Chief Apology Officer for Southwest Airlines. Even though SWA has consistently received the lowest ratio of complaints per passengers boarded of all major US carriers – when you employee 35,000 people that fly more than 3100 flights a day – stuff happens.

They decided to be real and to say they are sorry. They start each day with MOM. The Morning Overview Meeting. Weather, staffing issues, mechanical, anything that might get in the way of passengers delight, they are proactively working it.

I was supposed to fly through Dulles tomorrow on my way to Jacksonville. I got a text page from United that said simply “cancelled” and gave me a number to call. I called and got a recording that said, and I’m paraphrasing here: “We are experiencing crazy high call volume and can’t help you right now……good bye.”

The folks at SWA are busy responding with customized messages to those passengers that are screwed.  Their goal is to reach the customer electronically before the customer has to reach out to them to lodge a complaint. You can’t control the weather, but you can control how you react to it. At SWA it’s simple:

  1. They acknowledge the situation.
  2. They apologize for the experience they have had.
  3. They make some gesture to help regain the customer’s trust.

When is the last time you proactively apologized to a member?

And finally, Wayne Peacock from USAA. USAA is a membership organization (much like a credit union) serving over 7 million members of the US military. They provide legendary service that focuses on one word: empathy. Their products are insurance and financial services. Their customers are fighting everyday for our freedom.

A big part of their culture is understanding intimately their customer’s world. So in new employee orientation, they spend a day wearing a soldier’s uniform complete with those big boots, and eating MREs – meals ready to eat. They need to empathize with their customer.

The session concluded with Jeanne donning the soldier’s gear and dining on MRE fettucini. A powerful visual and reminder to us all – to walk a mile in our customer’s shoes and ask “Do we make it easy to do business with us?”

In this economy, we’d better find a way.

I’m sitting in New York listening to Richard Owen, co-author of Answering the Ultimate Question. He has just asked for two volunteers from the audience of 450 people, from 20 countries and 40 of the United States. Their job. To hold up a sign. One says “What I Expect,” the other “What I Want.”

He proceeded to illustrate a very simple exercise in creating promoters. Many companies have a goal to exceed customer’s expectations, very few put any real muscle behind that goal. Many will try (dabble) and end up in the big fat nebulous bell curve of, satisfied. One of the biggest problems, we don’t know what people want, and we really don’t care.

Consider the airline industry. Customers expectations got lowered (dude holding the “what I expect” sign took a step to the left) in the past two years by a new policy – charging for bags. One big player starts it (American) and everyone follows. Customers don’t want these fees (dude holding the “what I want” takes a giant step to the right) but now because everyone is doing it – expectations get lowered, complaints slow, but no love is gained. No promoters = no profit.

Except at Southwest Airlines. They have always been focused on what people want. People want to get to their destination on time. That’s why they have the unique boarding process. No one can turn a plane like SWA. The flight attendants clean the planes, mechanics only have to service one type of plane, and point to point routes dodge the nightmare that is hub and spoke and snow.

The other airlines are creating even more delays with their bag policy. People are choosing to carry-on all kinds of unwieldy bags to avoid the fee.

Southwest Airlines does not have to charge for bags.  And by doing nothing, they have become what customers want. Truly exceeding expectations. They are having a blast telling that story with these clever commercials.

They just posted a fourth quarter profit and logged their 37th consecutive year of profitability. It’s very simple. Stay focused on the customer, listen to what they want, get out of the zone of tolerance and have the balls to stick with something.

Richard just closed with a great quote from the late great Sam Walton (and I’m paraphrasing here)

Rule #10 – Swim upstream. You should go the other way and ignore the conventional wisdom. If everyone is going one way, there’s a good chance you’ll find success in the other direction. Beware –  people will flag you down and tell you you’re going the wrong way – so swim faster….

It’s budget time. I know this because I’m married to a credit union CFO. My rallying cry has always been to “question everything.” And in these tough economic times seems everyone is. Especially the budget makers.

That’s why now, more than ever, marketing needs to remain relevant. We need to stop doing what doesn’t work.

y2k.001Y2K preparation was the warning shot across the bow. Remember? We were labeled a “non-essential function” in times of crisis. I tried to argue it, to no avail. I mean, IF the world’s computer systems went kapooey – as predicted – would my membership drive still go on? Not likely. Would I get to begin production on that snappy radio ad? Hell no.

We’re in a crisis. One we could’ve been prepared for – like Y2K – but was largely ignored. So now people are panicking. Marketing is getting cut. I know of three marketing professionals who have been laid off. CFOs are seeing our budgets as black holes.

Now more than ever marketing needs to prove to world that they are the custodian of the credit union brand. Not a schlepper of products, or creator of promotions. Marketing’s sole job is to protect and preserve the credit union’s reputation.

The best way to do that is to show management the power of the Net Promoter Score. Ask a random sample of your membership a few simple questions:

1. On a scale of 0 to 10, how likely is it that you would recommend the credit union to a friend, family member of colleague?

2. What is the primary reason for the score you gave?

3. Have you recommended the credit union in the last 12 months?

4. If yes, how many members have you recommended in the last 12 months? 0-1- 2-3-4-5-6-7-8-9-10 or more?

5. What can we do to improve your experience with the credit union.

We measure and lament over ROA, delinquencies, net worth, loan-to-share ratios, asset and membership growth – what about our reputation? Our service levels? Our member’s perceptions?

This is the new normal for marketing.

I am very passionate about loyalty. And many of you know that I’m a kool-aid drinking Fred Reichheld NPS purist!

IMG_0225That’s why it’s so important that credit unions develop a standard methodology for calculating their relationship Net Promoter Score. The Member Loyalty Group has done just that.

The beautiful thing about NPS is its simplicity. Fred Reichheld intended the survey tool to be “open source” meaning, anyone can do it. You don’t have to hire a statistician to calculate the score.

Simply ask a random sample of your members (to calculate a statistically significant response rate use this calculator) the ultimate question:

“How likely is it that you would recommend the credit union to a friend, family member or co-worker?” On a scale of 0 – 10.

Those that score you a 9 or a 10 are fiercely loyal promoters. They will do three things for you:

1. Buy more from you.
2. Market for you.
3. Tell you how to improve their credit union.

Number 3 is done by asking the simple follow-up question Why did you answer the way you did?”

Detractors are defined as those that score you between 0 and 6. Why such a large scale? Because Fred found in his twenty years of research that loyalty is not easily won. And those that score you even a 6 are likely to defect. Passives are members sitting on the fence at 7 and 8. They are satisfied but can be easily wooed by the competition.

To calculate the value of your brand you simply take the percentage of promoters (your loyalty assets) and subtract the percentage of detractors (your loyalty liabilities). According to Member Loyalty Group, the average credit union industry score is 55%. This is nearly five times the banking industry. But I think it should be much higher.

Remember, hope is not a strategy. I know many credit unions have engaged in this important measure but are hoping their scores go up. Tying employee incentives to such a goal without really diving into the data and listening to members. NPS is not a survey, but rather a discipline, like accounting. 

The founders of the Member Loyalty Group get this. Addison Avenue, BECU, Baxter, Educators (Racine, WI) San Francisco Fire and America First all have Member Loyalty as a separate department in their organization. They listen and respond to members daily. Not annually.

My passion for this program – that I really think is the missing link between your credit union’s brand and your bottom line – began with the Filene Research Study that was published in May of 2007. At that time, the benchmark came in at 54.3%.

Two years later we raised our number to 55%. I still think that’s way too low. And with the banks doing everything they possibly can to market FOR us right now – let’s get that number up!

Who’s with me?

img_02221I’m in a very dysfunctional relationship right now – with Saturn.

Today I got my email survey from Saturn. I’ve been waiting for it. As some of you may know, I was a crazy loyal Saturn owner. I’ve owned 5 Saturns over a 15 year period. I included my Saturn story in my first book. I have the mug, bumper sticker, key chain, license plate holder (I heart my Saturn).

But lately, they have disappointed me. Big time.

I blogged about the faux pas of the XM radio and their second survey trying to get a high rating from me. I also threatened to leave them. But I can’t. I’m still trying.

I found out last week that the Smithtown Saturn no longer washes my car when I get service and forgot to torque my oil filter down (or so the wonderful people at Springfield, Mass Saturn told me) so my brand new VUE breaks down on a road trip. Oh yes….it’s bad.

But I’m rooting for Saturn. I know GM has to cut costs to placate the government and Saturn is on the block. Only the dealers can save this brand and I sincerely hope they do. BUT, they have to remember what made us so loyal. It’s not the car, it’s the experience buying and servicing the car. It’s yours to lose dealers.

According to Fred Reichheld, author of the Ultimate Question, loyal customers will do three things:

1. Buy more from you (check – bought five).
2. Market for you (check – included you in my book).
3. Tell you how to improve your business – I’m ready.

Page one of the online survey – language selection. okay. English.

First Question: How satisfied are you that your vehicle was fixed right on this service visit? Completely? Very? Satisfied? Somewhat? Not at all?

WHAT? You forgot to torque down my oil filter and all the oil slowly drained from my car causing my engine to sound like a jack hammer was under the hood as I pulled into a client’s driveway 180 miles from home!!!!!

15 questions later, similar in their delivery.

“How would you rate the lighting in the waiting room?”
Not too bright. Just bright enough. Satisfactorily bright. Not bright enough.

They NEVER gave me an opportunity to tell them what happened and why I can’t give them the highest rating that they are used to.

This is why I love the ultimate question:

On a scale of 0 to 10, how likely are you to recommend Saturn to a friend, family member or colleague?

And then the golden question: WHY did you answer the way you did?

Two questions. No bullshit.

If they had only asked me those two questions, they would KNOW why my loyalty is waning and they could respond to me and close the loop – solidifying my continued love which they so desperately need in order to stay alive!!

And here’s what Saturn needs to know. I would probably give them an 8. A passive score. Because I felt that we had a relationship. I have time invested in this relationship and I want to continue, but ONLY if they care enough to listen to me!


Fred says the score is dead – stop being score whores and DO something with the data already!

Okay – I’m paraphrasing. I just returned from the third annual Satmetrix NPS Conference. This one was in San Francisco and included such speakers as the CEOs of Charles Schwab, Intuit, Logitech and my favorite, It also included Tammy Gallegos from America First Credit Union and Diana Dykstra, San Francisco Fire Credit Union.

This conference is two days of non-stop sessions designed to push your brain into another realm. They don’t give you a giant notebook full of power point presentations, but rather a pad of paper in a nice leather portfolio and a pen. Take notes!

Here are my favorite notes from the sessions I attended:

Charles Schwab CEO, Walter Bettinger II:

Financial institutions are the king of “gotcha” fees!

Do not give a great deal to a new (unknown) client if you can’t offer the same deal to an existing (loyal) client!

Bad data leads to bad decisions.

Servant leaders breed a customer-centric culture.

Richard Owen, CEO of Satmetrix:

Flat is the new UP!

The economics of customers acquisition is changing. It’s lots harder to acquire new customers, so you better not lose the ones you have!
Word-of-mouth has always been the Holy Grail and is trusted 78% of the time.
Let your customers market FOR you! CEL Tony Hsieh:

Retention is the new Acquisition!

We are a service company that happens to sell shoes, clothing, handbags, etc.

75% of our business comes form repeat customers.

Take the money they would have spent on marketing and put it into the customer experience and let them market FOR us!

Whatever you’re thinking – think BIGGER!

Chase the vision, not the money.

and finally

Fred Reichheld, author of The Ultimate Question and co-author of the Net Promoter Score:

The only way you can afford to grow in tough times is through referral.

A promoter is worth 3X more than a detractor.

BUT, who do we care most about to learn from? Which customers should you listen to? NPS is a conversation, not a survey. Who cares what your score is, what are you DOING with the data (verbatims) you receive?

You need to get your CFO involved. Accounting systems have not caught up with NPS.

My take: This is the third year NPS practitioners from around the world have gathered and I’ve seen a distinct shift from, how to gather good data and how does your score compare in the industry to “screw the score” if you’re not listening to the RIGHT customers and making the RIGHT decisions (hard decisions) to improve your service to them, you’re toast.

Retention today is everything – stop wasting money on membership bribes and the spray and pray approach to marketing. We need new tools in this economy – the DISCIPLINE of NPS is the right tool for the right job.

(Side note: You should read NPS in NYC first to fully enjoy this post)

Cultural anthropology is basically the holistic study of humanity. I like to think of it as cause and effect. You know the old saying, when a butterfly flaps its wings in South America a Republican gets elected in Florida, or something like that. As a Culture Consultant I try to help people see that all of their actions have consequences. All of their measures emphasize what they manage. Moments of truth need to be measured and managed as thoroughly as the bottom line.

My research:
Yesterday I made a deposit to my account at the credit union. Yes, I’m a branch groupie. The hardest thing to do at my credit union is to give them money. Can’t make them in most ATMs anymore, don’t trust the mail, the night drop slot — yeah, right. Direct deposit? I’m self-employed. I’m the errand runner. Post office, dry cleaners, credit union. In that order yesterday. As I’ve mentioned before in this blog, the folks at the post office are getting to know me. They smile, they thank me, it’s all pretty nice. The dry cleaners have me set up on an account so I can just drop my clothes off in a cool bag that they provide, they hand me the clean ones and debit my account after I’ve gone.

My last errand. A simple deposit to savings at my credit union. I’ve been in there only three times. Each time I’ve had to come into close proximity to this one teller. She’s an older lady and she’s not friendly. Hell, she’s mean. She’s clearly been there a long time because when there’s a question the other tellers need an answer to, they go to her. She does the dramatic sigh, slight roll of the eyes and then snips a response.

When I opened my account two months ago I received their new member welcome packet. The marketing department has chosen a red carpet as the symbol on this piece. I have it right here on my desk.

Today I tripped over the carpet. It was late afternoon (after the lunch rush, before the after work crowd) and I was the only one in the branch. As I was walking through the maze of teller ropes to get to the “cheese” she looked up at me, no expression, and quickly looked down again. The tuck-and-roll I call it. As I reached the end of the ropes and did as the sign instructed “Wait here for next available teller” I looked straight ahead at her window. She was still in it. She was apparently running a tape on her checks, her NEXT WINDOW sign was NOT present and yet now she was determined to ignore me. I tried to invoke my super powers to bore holes in her head and guilt her into helping me when I was startled by a friendly voice of a young man at the farthest window saying, “I can help you down here…”

He made up for her rudeness. We chatted politely. I made him laugh. You see, I AM a nice customer. I like to bond. She apparently has no time for it.

Cultural Anthropologists know not to blame this teller entirely for being mean. Some of the blame should go to the management of the credit union, some to the board of directors. Clearly there is not a culture of service in this organization. I believe the teller that offered to shield me from the mean one is the result of his “mama raising him right.” Not a cultural or strategic condition. Every memo, measure, management meeting and mannerism by the upper management is creating the ripples in the organization that the front-line responds to. If the only measure is the bottom line – that becomes the filter for the organization’s culture. If you are in the “service” business, you need to start measuring “it” and managing “it.”

The Net Promoter Score (NPS) is the purest form of measurement for your culture. Period. It asks the most basic of questions AFTER a customer has EXPERIENCED your culture. Would I recommend “it” to a friend or family member? In the case of this entire organization and its 50 plus years of existence based on my three minutes of interaction at a very expensive and beautifully decorated branch I can say NO WAY. But you know what, I’ll probably keep my account there. It’s a real pain to move a checking account these days. In the industry we call it “stickiness.” It’s kind of sick when you think about it — like the old days of the phone company. We’re AT&T, we don’t have to care.

We’ve got your checking account. We don’t have to care. Their tag-line should be “We Bank on Inertia.”

If this credit union adopts the NPS I would be classified as a profitable detractor. They are making some money off of me, but they cannot count on me to grow future business for them. Without NPS data, you are measuring my profit (a snapshot in time) but with net promoter you have to admit that it’s not sustainable.

I like to think of NPS as a wake up call to all service providers. I may give you my business, today, but not my love. But if you care to listen, I’ll tell you how you can get it.

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June 2023