Larry Seibert, Ph.D.

1
Loyalty Research The Next Generation of
Voice-of-the-Member Research
Larry Seibert, Ph.D. LSeibert_at_loyaltyresearch.com
317-466-5004
2
Housekeeping Details

• The presentation slides of this webinar will be
  emailed to you in a day or so, and will be
  available on our website - www.loyaltyresearch.com
  .

3
Housekeeping Details

• The presentation slides of this webinar will be
  emailed to you in a day or so, and will be
  available on our website - www.loyaltyresearch.com
  .
• You will also be emailed a link to the recording
  of this webinar, and a link will be put on the
  home page of our website. The recording of this
  webinar will be available for 30 days.

4
Housekeeping Details

• The presentation slides of this webinar will be
  emailed to you in a day or so, and will be
  available on our website - www.loyaltyresearch.com
  
• You will also be emailed a link to the recording
  of this webinar, and a link will be put on the
  home page of our website. The recording of this
  webinar will be available for 30 days.
• You can submit questions at any time during the
  webinar. Any questions not addressed in the
  webinar will be addressed individually following
  the webinar. Please include your name and email
  address.

5
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.

6
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.
• Structuring survey questions for a loyalty survey.

7
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.
• Structuring survey questions for a loyalty
  survey.
• Analyzing survey responses.

8
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.
• Structuring survey questions for a loyalty
  survey.
• Analyzing survey responses.
• Calculating the Loyalty Profile of your current
  member base.

9
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.
• Structuring survey questions for a loyalty
  survey.
• Analyzing survey responses.
• Calculating the Loyalty Profile of your current
  member base.
• Developing a composite description of loyal,
  neutral and vulnerable members.

10
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.
• Structuring survey questions for a loyalty
  survey.
• Analyzing survey responses.
• Calculating the Loyalty Profile of your current
  member base.
• Developing a composite description of loyal,
  neutral and vulnerable members.
• Identifying the key drivers of loyalty.

11
Discussion Topics

• Explaining the benefits of conducting loyalty
  studies.
• Structuring survey questions for a loyalty
  survey.
• Analyzing survey responses.
• Calculating the Loyalty Profile of your current
  member base.
• Developing a composite description of loyal,
  neutral and vulnerable members.
• Identifying the key drivers of loyalty.
• 7. Developing an improvement plan with priorities.

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Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).

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Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).
• Benefits assessment.

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Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).
• Benefits assessment.
• Marketing and member recruitment.

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Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).
• Benefits assessment.
• Marketing and member recruitment.
• Vulnerable member intervention.

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Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).
• Benefits assessment.
• Marketing and member recruitment.
• Vulnerable member intervention.
• Develop internal metrics.

17
Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).
• Benefits assessment.
• Marketing and member recruitment.
• Vulnerable member intervention.
• Develop internal metrics.
• Management performance (e.g. dashboard).

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Benefits of Loyalty Research

• Improve organizational processes (e.g. Member
  Services, Website, Conferences, Education,
  Government Relations).
• Benefits assessment.
• Marketing and member recruitment.
• Vulnerable member intervention.
• Develop internal metrics.
• Management performance (e.g. dashboard).
• Guidance for Board of Directors.

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Satisfaction
Satisfaction is the degree to which an event or
an experience meets or exceeds expectations.
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Limitations of Satisfaction
Satisfaction is the degree to which an event or
an experience meets or exceeds expectations.
Satisfied
Expected Grade - C
Actual Grade - C
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Limitations of Satisfaction
Satisfaction is the degree to which an event or
an experience meets or exceeds expectations.
Satisfied
Expected Grade - C
Actual Grade - C
Extremely Satisfied
Expected Grade - F
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Limitations of Satisfaction
Satisfaction is the degree to which an event or
an experience meets or exceeds expectations.
Expected Grade - A
Extremely Dissatisfied
Satisfied
Expected Grade - C
Actual Grade - C
Extremely Satisfied
Expected Grade - F
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What is Loyalty?

• Loyalty is a measure of the strength of the
  relationship between an association and its
  members.

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What is Loyalty?

• Loyalty is a measure of the strength of the
  relationship between an association and its
  members.
• Loyalty is an abstract concept that cannot be
  determined through direct questioning. That is,
  you cannot get reliable results by asking members
  to rate their loyalty.

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What is Loyalty?

• Loyalty is a measure of the strength of the
  relationship between an association and its
  members.
• Loyalty is an abstract concept that cannot be
  determined through direct questioning. That is,
  you cannot get reliable results by asking members
  to rate their loyalty.
• Loyalty is determined by indicators, and
  validated with outcomes.

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Outcomes of Loyalty

• Member retention

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Outcomes of Loyalty

• Member retention
• Non-dues revenue (e.g. conferences, continuing
  education)

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Outcomes of Loyalty

• Member retention
• Non-dues revenue (e.g. conferences, continuing
  education)
• Contributions/donations

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Outcomes of Loyalty

• Member retention
• Non-dues revenue (e.g. conferences, continuing
  education)
• Contributions/donations
• Member involvement (e.g. volunteerism,
  governance)

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Outcomes of Loyalty

• Member retention
• Non-dues revenue (e.g. conferences, continuing
  education)
• Contributions/donations
• Member involvement (e.g. volunteerism,
  governance)
• Recruitment (member-get-a-member)

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Outcomes of Loyalty

• Member retention
• Non-dues revenue (e.g. conferences, continuing
  education)
• Contributions/donations
• Member involvement (e.g. volunteerism,
  governance)
• Recruitment (member-get-a-member)
• Understanding of dues increases

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Outcomes of Loyalty

• Member retention
• Non-dues revenue (e.g. conferences, continuing
  education)
• Contributions/donations
• Member involvement (e.g. volunteerism,
  governance)
• Recruitment (member-get-a-member)
• Understanding of dues increases
• Forgiveness when problems are encountered

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Indicators of Loyalty

• Likely to recommend your association
• Likely to renew their membership
• Value of their association membership

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Likely to Recommend
Q1. If a friend or relative asks you to
recommend a professional association, how likely
would you be to recommend ABC? 1. Extremely
likely 2. Very likely 3. Somewhat
likely 4. Not very likely 5. Not at all likely
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Likely to Renew
Q2. When your ABC membership is up for renewal,
how likely would you be to renew your
membership? 1. Extremely likely 2. Very
likely 3. Somewhat likely 4. Not very
likely 5. Not at all likely
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Value
Q3. Considering the benefits you receive from
ABC in relation to the price you pay for
membership, how would you rate the overall value
of your ABC membership? 1. Excellent 2. Very
good 3. Good 4. Marginal 5. Poor
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Loyalty Segments

• Loyal strong relationship with association

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Loyalty Segments

• Loyal strong relationship with association
• Neutral moderately strong relationship with
  association

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Loyalty Segments

• Loyal strong relationship with association
• Neutral moderately strong relationship with
  association
• Vulnerable weak relationship with association

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Loyalty Segments

• Loyal strong relationship with association
• Neutral moderately strong relationship with
  association
• Vulnerable weak relationship with association
• Poor performance in areas that are key drivers

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Loyalty Segments

• Loyal strong relationship with association
• Neutral moderately strong relationship with
  association
• Vulnerable weak relationship with association
• Poor performance in areas that are key drivers
• Bad fit between the associations business model
  and the members needs

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Rule For Loyal Members
Q1. Likely to recommend ABC? 1. Extremely
likely 2. Very likely Q2. Likely to renew your
membership? 1. Extremely likely 2. Very likely
Q3. Overall value? 1. Excellent 2. Very good
To be considered Loyal, respondents must give a
Top 2 response to all three questions used in the
Loyalty index.
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Rule For Vulnerable Members
Q1. Likely to recommend ABC? 4. Not very
likely 5. Not at all likely Q2. Likely to
renew your membership? 4. Not very likely 5. Not
at all likely Q3. Overall value? 4. Marginal 5.
Poor
Any Bottom 2 response qualifies a respondent as
Vulnerable
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Rules For Neutral Members
1. Neutral members are any members that do not
qualify as Loyal or Vulnerable.
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Rules For Neutral Members
1. Neutral members are any members that do not
qualify as Loyal or Vulnerable. 2. Neutrals
may have some Top 2 responses, but will not have
all three.
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Rules For Neutral Members
1. Neutral members are any members that do not
qualify as Loyal or Vulnerable. 2. Neutrals
may have some Top 2 responses, but will not have
all three. 3. They will not have any Bottom 2
responses.
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Rules For Neutral Members
1. Neutral members are any members that do not
qualify as Loyal or Vulnerable. 2. Neutrals
may have some Top 2 responses, but will not have
all three. 3. They will not have any Bottom 2
responses. 4. Respondents will be classified as
Neutral if they provide a Dont Know to any of
these three questions, or leave any of the three
questions unanswered.
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Classifying Respondents
To classify respondents using Excel, assign
numeric values to responses (e.g. Extremely
likely 1, Very likely 2, Somewhat likely 3,
etc.), and sort.
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Classifying Respondents
Classify respondents as Loyal if they give Top 2
responses to all three questions.
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Classifying Respondents
Classify respondents as Neutral if they dont
give all three Top 2 responses, AND they dont
give ANY Bottom 2 responses. (Or leave a
question unanswered.)
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Classifying Respondents
Classify respondents as Vulnerable if they give
at least one Bottom 2 response.
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Loyalty Profile
An associations Loyalty Profile is the
percentage of respondents in each of the loyalty
segments.
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Loyalty Profile - Education

• Calculate the distribution of loyal, neutral and
  vulnerable members for each demographic variable
  to identify profiling characteristics.

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Loyalty Profile - Education

• Calculate the distribution of loyal, neutral and
  vulnerable members for each demographic variable
  to identify profiling characteristics.
• In this example, respondents with higher levels
  of education are less likely to be loyal.

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Loyalty Profile - Sources of Influence to Join

• Profiling variables do not have to be linear.

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Loyalty Profile - Sources of Influence to Join

• Profiling variables do not have to be linear.
• In the example below, individuals who were not
  influenced by anyone to join the association have
  a higher likelihood of being neutral.

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Characteristics of Loyal Members

• The Loyalty Profile can be used to build a
  composite of the characteristics of loyal
  members.
• These characteristics can be applied to
  membership at large, even members who did not
  participate in the loyalty study.

Loyal Members (Example) 1. Tend to be Baby
Boomers 2. Have less formal education 3. Joined
the association as a result of a
referral 4. Joined primarily for networking and
career advancement
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Profiling Characteristics

• Some profiling characteristics can be determined
  by internal member data (e.g. from membership
  application, continuing education classes taken,
  conferences attended).

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Profiling Characteristics

• Some profiling characteristics can be determined
  by internal member data (e.g. from membership
  application, continuing education classes taken,
  conferences attended).
• Other characteristics can be determined from
  survey questions (e.g. what were the main reasons
  you joined the association, who/what influenced
  you to join the association).

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Uses For Loyalty Profiles

• Develop marketing tactics to attract more members
  with characteristics of loyal members.

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Uses For Loyalty Profiles

• Develop marketing tactics to attract more members
  with characteristics of loyal members.
• Improve organizational processes to strengthen
  the relationship with neutral members and migrate
  neutral members to the loyal status.

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Uses For Loyalty Profiles

• Develop marketing tactics to attract more members
  with characteristics of loyal members.
• Improve organizational processes to strengthen
  the relationship with neutral members and migrate
  neutral members to the loyal status.
• Develop intervention tactics to retain vulnerable
  members.

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Member Loyalty Model
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Member Loyalty Model
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Member Loyalty Model
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Member Loyalty Model
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Member Loyalty Model
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Member Loyalty Model
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Member Loyalty Model
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Member Loyalty Model
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Evaluation of Member Dues
Q4. Compared to other associations, would you
say ABCs dues are ? 1. Lower 2. Somewhat
lower 3. About the same 4. Somewhat
higher 5. Higher
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Overall Rating - Website
Q5. Overall, how would you rate ABCs website?
1. Excellent 2. Very good 3. Good 4. Fair
5. Poor
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Website - Attributes
Q6. More specifically, how would you rate ABCs
website on the ease of finding information?
1. Excellent 2. Very good 3. Good 4. Fair
5. Poor
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Reporting Results
The table below shows how 100 individuals rated
their associations benefits, continuing
education, national conference and publications.
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Reporting Results
All four processes receive the same average
rating, even though each has a unique
distribution of responses.
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Reporting Results
Research shows that for attitudes (and behaviors)
to change, the respondent has to have a strong
positive evaluation (a top box or top two box
evaluation).
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Process Performance
1. A bar chart of Top 2 ratings shows how
members rate an associations various
processes. 2. However this is not enough
information to determine which processes are key
drivers.
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Member Loyalty Model
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Database Preparation
In the key driver analysis, value is used as the
dependent variable and all the organizations
processes are the independent variables.
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Driver Analysis - Value
Goodness of fit.
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Driver Analysis - Value
Key drivers have P-value .05
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Driver Analysis - Value
Coefficients indicate relative impact.
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Driver Analysis - Value
Contribution to Value
A pie chart shows the relative weight that each
key driver has on membership value. A bar chart
shows performance ratings for value and each
process.
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Priority Table - Value
Areas for improvement can be prioritized by their
impact (contribution to value), the percentage of
respondents who experience that process, overall
Top 2 performance ratings, and the drop in Top 2
performance ratings from Loyal to Neutral.
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Member Loyalty Model
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Database Preparation
To determine the key drivers of the website, the
overall website rating is used as the dependent
variable and the ratings for all the websites
attributes are the independent variables.
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Driver Analysis - Website
Key drivers have P-value .05
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Driver Analysis - Website
Contribution to Website Rating
A pie chart shows the relative weight that each
key driver has on the website. A bar chart shows
performance ratings for the website and each
website attribute.
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Priority Table Website
Areas for improvement can be prioritized for each
organizational process. The table below shows
what a priority table for an associations
website might look like.
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Effects of Problems

• For some benefits or services, minimal damage is
  done if problems are successfully resolved.

Percentages above indicate Top 2 performance
ratings
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Effects of Problems

• For some benefits or services, minimal damage is
  done if problems are successfully resolved.
• Problems in other areas must be prevented, as
  even successful problem resolution cannot mend
  the relationship.

Percentages above indicate Top 2 performance
ratings
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Communication

• Immediately after the survey has been completed,
  thank respondents for participating and sharing
  their opinions, and let them know that
  improvement will take place.

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Communication

• Immediately after the survey has been completed,
  thank respondents for participating and sharing
  their opinions, and let them know that
  improvement will take place.
• Once the improvements have been implemented,
  communicate the changes to members. Do not wait
  for members to discover the improvements on their
  own.

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Communication

• Immediately after the survey has been completed,
  thank respondents for participating and sharing
  their opinions, and let them know that
  improvement will take place.
• Once the improvements have been implemented,
  communicate the changes to members. Do not wait
  for members to discover the improvements on their
  own.
• Case Top 2 rating 46
• Next year 49 for group with no communication
• Next year 64 for group with communication

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Developing Internal Metrics

• Processes that were determined to be key drivers
  in the analysis can be monitored regularly by
  putting internal metrics in place.

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Developing Internal Metrics

• Processes that were determined to be key drivers
  in the analysis can be monitored regularly by
  putting internal metrics in place.
• Example 1 If caller hold time is a key driver
  of customer (member) service, put system in place
  to track hold times.

97
Developing Internal Metrics

• Processes that were determined to be key drivers
  in the analysis can be monitored regularly by
  putting internal metrics in place.
• Example 1 If caller hold time is a key driver
  of customer (member) service, put system in place
  to track hold times.
• Example 2 If welcoming new members is a key
  driver, put metrics in place to monitor new
  member welcoming activities.

98
Monitor Progress With Surveys

• Periodically, select a random sample of members
  and survey them on the key processes and key
  attributes to verify that progress is being made.

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Monitor Progress With Surveys

• Periodically, select a random sample of members
  and survey them on the key processes and key
  attributes to verify that progress is being made.
• Follow-up surveys should be conducted after
  changes have been made and communicated to
  members.

100
Employee Mirror

• Give your employees the same survey questions
  regarding value, price and processes as you give
  members.

101
Employee Mirror

• Give your employees the same survey questions
  regarding value, price and processes as you give
  members.
• Ask employees to answer questions in the way they
  believe the majority of members would answer the
  questions.

102
Employee Mirror

• Give your employees the same survey questions
  regarding value, price and processes as you give
  members.
• Ask employees to answer questions in the way they
  believe the majority of members would answer the
  questions.
• Calculate the differences in Top 2 box
  percentages between members and employees for
  value, dues, and each process.

103
Employee Mirror

• Give your employees the same survey questions
  regarding value, price and processes as you give
  members.
• Ask employees to answer questions in the way they
  believe the majority of members would answer the
  questions.
• Calculate the differences in Top 2 box
  percentages between members and employees for
  value, dues, and each process.
• Show employees where members ratings are higher
  than employees, and where members ratings are
  lower than employees.

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Question/Answer Session
Questions?
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Larry Seibert, Ph.D. LSeibert_at_loyaltyresearch.co
m 317-466-5004