News,  Vendor Selection

Propensity to Switch CDM Vendors


A few months ago, I had collected together all the Recommendation Index (RI) values from my 2020 Vendor Selection MatrixTM reports on various marketing process automation topics. I had proposed that I see this becoming a significant leading indicator of long-term customer satisfaction but also, more importantly, of the propensity to switch indicated by customers. It is for that reason that we have included the points earned through the RI score in our Strategy axis on the matrix and give it a significant 25% weighting. 

in our surveys, we actually ask about two items directly related to customer retention: the current satisfaction, and the “would you recommend this vendor?” question. Customer satisfaction is defined as a measurement that determines how happy customers are right now with the solution being evaluated and flows into the Execution axis of the matrix. 

The RI (the simple percentage of respondents who answer “yes”) encapsulates a longer- term, more strategic element of customer satisfaction – essentially it is a measurement of customer loyalty.

Vendors. I think that any RI 95% or over is satisfactory, an RI between 90-94% should raise some alarm signals about your customers’ emerging propensity to switch, while below 90% is already a state of alarm.

Buyers. There is nothing stopping you interpreting the numbers in a similar manner. 

The first blog had the data for Marketing Lead Management, Sales Engagement Management, and 

Marketing Resource Management vendors. Here is the data from my latest report on Customer Data Management. The table shows quite a range of Recommendation Index values — but all in the 90s. However, as this is a relatively new area of investment and quite a few companies (users) are still creating, developing and/or tuning their CDM strategy, there is likely to be some churn in this market segment over the next years.    

Always keeping you informed! Peter 

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