1. Creating Customer Relationships: Is it the Person or the Brand?
October 12, 2010
Beth Schelske, Vice President ITAGroup
Keith Fenhaus, CEO/President Hallmark Business Connections

2. Research Center within Medill IMC graduate program at Northwestern University
Our central objective is to develop and disseminate knowledge about communications, motivation and management
We believe businesses can better design, implement and manage people-based initiatives - inside and outside an organization
We bring like-minded individuals together during an annual “Think Tank” event

3. This research is based on the study, “The Employee or the Company: The Relative Importance of People Versus the Company Brand on Customer Experience”
Dr. Frank Mulhern
Academic Director for the Forum for People Performance Management and Measurement

4. 1601 N Bond Street, Suite 303
Naperville, IL P: F:

5. Research Question
What is the relative importance of a person versus a brand in a business relationship?

6. Key Findings
Customers build relationships with individual employees more than a corporate brand
When a company has a strong, positive brand reputation, it may have more to gain by investing in its employees than in investing more in the company’s reputation
Investments in employees could include training, incentives, rewards, career development, benefits, and improved compensation
The findings are central to many service industries including healthcare, financial services, and education

7. Case Study Insurance Industry
Excellent industry for investigating the role of front line personnel in the customer experience
Major, high involvement purchase that results in long term customer-to-company relationship
Industry is struggling with whether to maintain networks of sales agents versus selling direct
Direct selling allows for lower premiums but eliminates the opportunity for personal relationships

8. Case Study National Insurance Company
Portfolio = full range of retail insurance products including life, health, property and auto
Products are exclusively sold through company sales agents
Agents only sell products for one company

9. Case Study Data Customer Satisfaction Survey
Employee Engagement Survey
Employee Performance

10. Case Study Results Experiences with Agent vs Company
On average customer rate their agents higher than they rate the company with respect to their experience
90% of the Agents scored higher on customer satisfaction with the agent than with the company.
Agent is the “public face” of the company

11. Case Study Results Agent Performance
Customer ratings of the agent closely tied to the performance of the agent
Agents in the top quartile of engagement and customer satisfaction had significantly higher levels of account growth and customer retention
Best performance achieved by having both highly engaged employees and satisfied customers

12. Case Study

13. Case Study

14. Insurance Case Study Implications
Customers build relationships with individual employees more than a company brand
Insurance agents play a measurable role in the customer experience
That role translates into better performance for the agent and the company
The agent’s rating of the company has no effect on the performance of the agent.
This result suggests that companies have more to gain by investing in sales agents than in building the brand

15. Insurance Case Study Implications
Investments in agents could include sales training, incentives, rewards, career development, extension of benefits and improved compensation
Agents perform better when they are more engaged
Agents in the top quartile for agent engagement and customer rating achieve over 4X the account growth of agents not in the top quartile for either measure.

17. Brand Value

18. Brand Value

19. Brand Value

20. “The earlier you make the emotional connection the better, because once consumers have decided they like a particular option, the more difficult it is for them to backpedal. Their thinking falls in line with their emotions.”
Raj Raghunathan, of McCombs School of Business

21. Equity

22. Social Connections

23. Experience
“Our ladies and gentlemen are our most important resource in our service commitment to our guests.”
Ritz Carlton

24. Energy

25. Brand Selection The Fundamentals: The Ethereal: Price
Product Performance
Differentiation
The Ethereal:
Equity
Social Experience
Energy

27. Mission: To live and deliver WOW!

28. “We wanted a list of committable core values that we were willing to hire and fire on. If we weren’t willing to do that, then they weren’t really ‘values.’”
Tony Hsieh, founder of Zappos

29. Brand Value

30. Core of the Brand

31. Conclusion
Customers build relationships with individual employees more than a brand
Employees perform better when they are engaged
Employees perform better when their customers are satisfied
Focusing simultaneously on employee engagement and customer experiences drives brand value