Q 370. EMO Index is an alternative to traditional methods for Customer Satisfaction. Explain EMO Index and its methodology.

 

 

Note for website visitors - Two questions are asked every week on this platform. One on Tuesday and the other on Friday.

• All questions so far can be seen here - https://www.benchmarksixsigma.com/forum/lean-six-sigma-business-excellence-questions/
• Please visit the forum home page at https://www.benchmarksixsigma.com/forum/ to respond to the latest question open till the next Tuesday/ Friday evening 5 PM as per Indian Standard Time. Questions launched on Tuesdays are open till Friday and questions launched on Friday are open till Tuesday. 
• When you respond to this question, your answer will not be visible till it is reviewed. Only non-plagiarised (plagiarism below 5-10%) responses will be approved. If you have doubts about plagiarism, please check your answer with a plagiarism checker tool like https://smallseotools.com/plagiarism-checker/ before submitting. 
• The best answer is always shown at the top among responses and the author finds honorable mention in our Business Excellence dictionary at https://www.benchmarksixsigma.com/forum/business-excellence-dictionary-glossary/ along with the related term

EMO Index is termed as individual or aggregate indicator which determines the general feelings of each customer, group of customers or stakeholder towards a company, product or service.

EMO index is a combination of the Net Emotional State and the Net Intensity Balance and it is generally measured values from -100% to +100% similar to NPS.

Below are some of the EMO Clusters and measure values:

• Fans (+100 to +80)
• Believers (+80 to +55)
• Followers (+55 to +30)
• Stand By (+30 to +15)
• Lost Souls (+15 to -5)
• Burned Out (-5 to -30)
• Opponents (-100 to -30)

It is seen emotional segmentation (EMO) model challenges the traditional (NPS) models used for predicting behavior based social or product sector details below.

• Sociodemographic variables (sex, age, social class, etc.)
• Classification parameters (product purchased, volume of purchases, reasons for purchase, etc.)

It is generally consider EMO Index is a more reliable indicator compared to likelihood to recommend used by other tools (NPS) , since it is not entirely based on what customers feels or what they will do.

Traditional Customer Satisfaction systems measure Satisfaction on a scale of 1 to 10 wherein Rating of 9 to 10 are deemed as Promoters and 1 to 6 are Detractors. Score of Promoters - Detractors is considered as Net Promoter Score. It has been found in some sectors that NPS Score is not entirely aligned with what customers feel or say they will do. Also it it does not seem to match the emotional state

 

Thus EMO Insights International has come up with an EMO Index in 2012 based on their study of the Spanish Banking Market. They interviewed 1900+ retail banking customers of both genders and used neuroscience tools to understand emotions felt by these customers in their past experiences with banks

 

Based on that, they arrived at the EMO Index which is a combination of the Net Emotional State (emotions felt) and the Net Intensity Balance (intensity of emotions), which take on values from -100% to +100%

 

It classifies customers into seven broad, emotional states (called EMO Clusters) :

 

• Fans (+100 to +80)
• Believers (+80 to +55)
• Followers (+55 to +30)
• Stand By (+30 to +15)
• Lost Souls (+15 to -5)
• Burned Out (-5 to -30)
• Opponents (-100 to -30)

 

The company argues that this index is more reliable indicator than NPS. A second wave of emotions study was done a year later to validate the methodology.
 

EMO (Emotional) Index measures the feelings of a customer or stakeholder towards a company, its product or service. This tool acts as an alternative to traditional customer satisfaction research methodology.

EMO Index is an indicator that measures the emotional state of customers and stakeholders and is a registered trademark of EMO Insights International (A Spanish Marketing Consultancy Firm). In 2012, Company introduced an indicator for studying the Emotional Management in Spanish Banking Sector.  A study was done on retail banking customers (male and female), aged 18 and over and Spain residents and Neuroscience techniques were used in this study to analyse the customers' current and past experiences with banks and the emotions felt via these experiences to calculate impact on customers' behaviour.

EMO Index is an individual or aggregate indicator which measures the general feelings of each customer or stakeholder towards a company, product or service. This index takes into account the Net Emotional State (balance of emotions felt) and the Net Intensity Balance (intensity with which they are felt) and, therefore, can measure values from -100% (Extremely Bad) to +100% (Extremely Good).

Since this Index is calculated at an individual level, it can classify the customers into seven broad, general emotional states which its creators call EMO Clusters as depicted in figure below :

 

 

Fans (+100% to +80%), Believers (+80% to +55%), Followers (+55% to +30%), Stand By (+30% to +15%), Lost Souls (+15% to -5%), Burned Out (-5% to -30%) and Opponents (-100% to -30%)

This model challenges the traditional models used for predicting behaviour based on sociodemographic variables (sex, age, social class, etc.) or classification parameters linked to a specific sector (product purchased, volume of purchases, reasons for purchase, etc.)

 

The developers of this model mention that the EMO Index is a more reliable indicator than the likelihood to recommend used by other tools such as the Net Promoter Score. Their argument is supported by a second part of the study on emotions in banking conducted one year later on 500 customers who had participated in the previous study as well. The purpose of the second part of the study was to determine whether they recommended the bank to their acquaintances and the following results were obtained:

 

Net Promoter Score (Promoters, Passives and Detractors) = % of Promoters - % of Detractors (As shown in figure below for 0-10 customer survey rating scale) is not entirely consistent with regard to what the customers feel or what the customers say they will do, at least in Spanish Retail Banking Sector. In particular, it is worth noting that the term "Detractors" includes ~ 60 % of the customers and, therefore, it does not differentiate between the majority of people who are falling in this band. Also, it does not seem to correspond to the emotional state and the stated behaviour of these customers or, at least not all of them.

 

So the question is If the Net Promoter Score (NPS) alone enough or there shall be a better measure like EMO? I believe below quote nicely sums it up:

"Emotional Attachments will no longer be a mystery in the future: they can act as a new source of competitive advantage and growth in your business"

"When evaluating brands, customers primarily use emotions (personal feelings and experiences), rather than information available about the brand (attributes, characteristics and facts)."

 

 

Some other Interesting facts about the tool / approach / company:

·  EMO Insights was born in 2010 with the vocation of "putting the focus" on the emotional. The motivation to develop methodologies that did not exist to date to make emotions

·  It uses a unique methodology that combines clinical psychology techniques with neuromarketing and state-of-the-art mathematical models.

·  EMO creates advanced emotional metrics using neuroscientific technologies (galvanometers, attention meters, etc.), and techniques from clinical psychology to detect and quantify customer emotions towards a brand.

·  It focuses on Detection of Moments of Truth (MOT's), Touch points, Pain points, Emotional triggers, Motivations, Trends in satisfaction with customer experience and loyalty, Return channels for the business.

·  85-95% decision-making has an emotional or subconscious component

·  Another very innovative and effective - FEM®  (Feelings Experience Management) methodology has been recognized by very famous management institutions such as London Business School

·  It identifies the leading emotions in the sector and make an emotional ranking of brands and predict changes and opportunities in the market

EMO Index outlines the Emotional State (Emotional Footprint) of the consumer or group of customer towards a Company based on Positive(+) and Negative(-) emotions and their magnitude.

This is examined on a scale of -100 to +100 based on their previous experience towards the Company. 

 

EMO Index can be closely compared with NPS (Net Promoter Score), which measures Customer Loyalty and Satisfaction measurement taken from customers, asking, how likely they are to recommend Companies product or service to others on a scale of 0-10.

NPS is a measure of the percentage of customers who are promoters of a brand name or company, minus the percentage of detractors.

 

At times, it is debated that NPS is a poor indicator to predict the growth of a company.

On the contrary, EMO Index adds significant value in comparison with more traditional and simplistic classification approaches. 

 

Here in EMO Index, customer classification is done based on the emotional print associated with the Company based on the experience as Fans, Believers, Followers, Stand by, Lost Souls, Burned-out and Opponents. 

 

 

Modus operandi:

To calculate EMO Index, primarily comprehensive analysis is performed to determine which emotions are relevant for the Studied Domain/Industry/Sector. Id ést, emotions such as Surprise, Happiness, Love, Irritation, disappointments, Anger, et cetera. 

 

Then representative sample of customers are identified and asked if they have experienced each of these emotions at any particular time in dealing with the Company.

 

Emotional Levels are also measured parallelly with the possible reasons that may have caused them (Triggers).

Customer are then classified as Fans, Believers, Followers, Stand by, Lost Souls, Burned-out and Opponents.

 

Finally, emotional segmentation is introduced based on above said classification. This ties in with the power of emotions on the future behavior of the Customer. 

 

EMO Index is widely used in Retail Banking, Healthcare, Telecommunication and Advertising sectors majorly adopted in Spain and Latin America.

 

Below is the example of a comprehensive study conducted by EMO Insights on popular banks in Spain. Ranking based on more fans than opponents. 

 

     

Integration of emotions in the models of decision-making improve their explanatory power tremendously.

 

Quote

"Customers make Permanent Decisions based on Temporary Emotions."

 

Any emotion, even those that are not directly related to decision-making, may have a significant impact on the opinion or final decisions. Measuring loyalty, satisfaction and emotions are much needed to keep the customer tied to the company in a long run. 

EMO Index is a tool which helps in measuring the feelings of a customer with regards to any product or services that are sold. It is an alternative to traditional customer satisfaction research.

It is a registered trademark of EMO Insights International.

 

Calculation Methodology:-

EMO Index is calculated at an individual level. It is a combination of the Net Emotional State (balance of emotions felt) and the Net Intensity Balance (intensity with which they are felt). The measuring values is from -100% to +100%.

Customers general emotional states are classified into seven broad categories called as EMO Clusters;

1.    Fans (+100 to +80)

2.    Believers (+80 to +55)

3.    Followers (+55 to +30)

4.    Stand By (+30 to +15)

5.    Lost Souls (+15 to -5)

6.    Burned Out (-5 to -30)

7.    Opponents (-100 to -30)

Source:- emoinsights.com

 

Leading emotions in the sector is identified and an emotional ranking of brands are made.

This also helps is predicting changes and opportunities in the market.

EMO Index:

EMO index is a tool to measure customer satisfaction like our traditional Net promoter scores (NPS). EMO uses neuroscience technique by analyzing customer experience on the products and services offered.

 

It is a tool which helps to gauge not only the customer satisfaction but also the intensity to which customer is satisfied or dissatisfied. In tradition tools like we NPS, Customer satisfaction score and surveys is used majorly to understand the likelihood that customer can promote the business or how happy the customer is with the product or services.

 

EMO index helps to understand the positive and negative emotions of the customers and the intensity of those emotions.

 

Methodology:

As the name states EMO Index, where “Index” refers to numerical scale to some reference number. In this case EMO uses scale of -100 to +100 to measure customer positive and negative emotions and their intensity which will impact the behavior of the customer to the business.

 

Example:

Lets assume that business is offering Holiday packages to the customers and want to research on the customer experience.

 

Since Holiday is so closely attached to the emotions of the customers and their memories. With the traditional approach we may just understand the customer if they would recommend or not

 

In EMO index, we can classify the customers into different categories which will gauge the intensity of their feelings towards the services offered

 

It can be categorized like;

 

Positive Emotions: Valued, Respected, Happy, Grateful & Appreciated

 

Negative Emotions: Frustrated, Disappointed & Annoyed

 

This would help to realize the real pulse of the customer with intensity of the feelings to the business

EMO Index :- is a tool used to measure feelings of a customer or stakeholders or a group of customers for a company, product or service. It is an alternative to traditional customer satisfaction research.

EMO Index is one of the indicator which measures the emotional state of customers and stakeholders. EMO Index is a registered trademark of EMO Insights International. In 2012 Company introduced the indicator in Emotional Management study in the Spanish Retail Banking Market . This study was conducted on Spain residents based on 1,968 interviews of retail banking customers, including male and female having age 18 and over. Neuroscience techniques were used  to analyze the customers' past and current experiences with the banks and the emotions these experiences generated in order to calculate their impact on the customers' behavior.

How It Works:-
EMO Index is an aggregate or individual indicator which determines the general feelings of each customer or stakeholder or group of customers  towards a product, service or company. It is a combination of the Net Intensity Balance (intensity with which they are felt)and  Net Emotional State (balance of emotions felt) and, therefore, have measuring values from -100% to +100%.
Since it is calculated at an individual level, so it can also classify customers into seven broad, basic emotional states which are called EMO Clusters:

•    Fans.. (+100 to +80)
•    Believers.. (+80 to +55)
•    Followers.. (+55 to +30)
•    Stand By.. (+30 to +15)
•    Lost Souls.. (+15 to -5)
•    Burned Out.. (-5 to -30)
•    Opponents.. (-100 to -30)

 

Customers with Opponents till Standby states are not in favor of your Product/Service/Company. While followers should be converted into Believers and believers into Fans by taking appropriate actions.

EMO index is a customer satisfaction measurement tool which helps to measure the feelings of a customer or a group of customers/ stakeholders towards a company, its products or services. It is used as an alternative to traditional ways of measuring Customer Satisfaction where the customer behavior was predicted primarily on the basis of socio- demographic variables like- sex, age, class) or specific parameters basis historical purchases.

 

The index is measures by combining Net Emotional State (i.e. balance of emotions felt) and the Net Intensity Balance (i.e. intensity with which they are felt) in a scale of -100% to 100%.

 

EMO Index classifies customers into seven EMO Clusters:

Ø  Fans (+100 to +80)

Ø  Believers (+80 to +55)

Ø  Followers (+55 to +30)

Ø  Stand By (+30 to +15)

Ø  Lost Souls (+15 to -5)

Ø  Burned Out (-5 to -30)

Ø  Opponents (-100 to -30)

 

Its creators believe that EMO Index is more reliable indicator than traditional tools like Net Promoter Score.

EMO Index measures the emotional state of Customers & Stakeholders and it is a registered trademark of EMO Insight International. It determines the general feeling of each customer or group of customer or group of stakeholders towards the Company and its products/Services.   In Traditional methods the focus is more on Sociodemographic variables like Race, Age, Sex, Standard of living etc. or pattern basis Product purchase, Quantity purchased, seasonality etc.

 

EMO is a combination of Emotion felt and Intensity at which they are felt and it can be measured with -100% and +100% and it can be calculated at individual Level or at a group level by dividing the Customers into Seven broad clusters, like:

 

1.       Fans (+100 to +80)

2.       Believers (+80 to +55)

3.       Followers (+55 to +30)

4.       Stand By (+30 to +15)

5.       Lost Souls (+15 to -5)

6.       Burned Out (-5 to -30)

7.       Opponents (-100 to -30)

 

So, by grouping the customers/stakeholders into these segments basis the emotion felt, and its intensity helps to measure the impact on the Customer Behaviors.

EMO Index
 

There are different ways on how we intend to take a feedback and arriving at method to make more appropriate to the one who will consume it, be it Kano model, Net promoter score and others.

 

EMO Index, this is one such indicator adopted to gauge emotional state of the stakeholders, clients. There are several ways how we are receiving the feedback primarily through the telephonic interviews that we conduct, survey questions, face to face interactions.

 

Methodology : Here we are trying to fit in a close emotion to the general feelings of each customer which can be extended to product, service and organization. The emotions can give us more clarity as to who are those super excited customers who will get us more through their influence. Those happy will continue to be there but cannot expect them to be promoters etc.

Translating by capturing the energy levels of their association will help us to get more insights for business expansion, retaining business and deactivation.

What is EMO Index ?

EMO Index is a framework which helps to quantify the client feelings, a gathering of clients or partners towards an organization, item or administration. It fills in as an option in contrast to conventional consumer loyalty research.

 

EMO Index is an measure which calculated the emotional state of customers and stakeholders and is a registered trademark of EMO Insights International. In 2012 the EMO Insights International introduced the indicator in the study Emotional Management in the Spanish Retail Banking Market.  The study was done based on close to 2000 interviews with retail banking customers, across all demographics. The study used neuro-science approach to analyze the customers' past and current experiences with the banks, and at the same time, the emotions these experiences generated in order to calculate their impact on the customers' behavior.

 

How EMO Index works?

 

EMO Index is an indicator which determines the general feelings of customer/s, group of customers or stakeholder/s towards a company, product or service. It is a combination of the Net Emotional State or balance of emotions felt and the Net Intensity Balance or intensity with which they are felt and, therefore, can measure values from -100% to +100%.

 

Since EMO index is calculated at an individual level, it can also group customers into seven broad, general emotional categories which its creators call EMO Clusters:

•           Fans

•           Believers

•           Followers

•           Stand By

•           Lost Souls

•           Burned Out

•           Opponents

 

EMO emotional segmentation model challenges the traditional models used for predicting behavior based on various sociodemographic variables like sex, age, social class, etc. or based on the classification parameters that are linked to a specific sector such as product purchased, volume of purchases, reasons for purchase, etc.

 

While creators argue that the EMO Index is a more reliable indicator than the likelihood to recommend used by other tools such as the Net Promoter Score, However, their point is supported by another study on emotions in banking conducted one year later on 500 subjects who had participated in the earlier study. The purpose of the second study was to determine whether they had recommended the bank to their associates and the following results were observed:

 

The grouping proposed by Reicheld in his Net Promoter Score -Promoters, Passives and Detractors is not entirely consistent with regards to what the customers usually feel or what they say they will act, at least in the Spanish banking sector. In specific, it is worth knowing that the term "Detractors" includes 62.6% of the customers and, therefore, it does not differentiate between the majority.

 

In addition, it does not seem to correspond to the emotional state and the stated behavior of these customers or, at least not all of them

EMO Index is an indicator that measures emotional state of customer and stakeholder.
EMO Index is an individual or group indicator which determines the general mood of each customer or group of customers, stakeholder towards a company, product or service. 
It is a mix of the Net Emotional State and the Net Intensity Balance and, therefore, can measure values from -100% to +100%.
As it is calculated at an individual level, it can also classify customers into seven parts, general emotional states which its creators call EMO Clusters:
Fans (+100 to +80)
Believers (+80 to +55)
Followers (+55 to +30)
Stand By (+30 to +15)
Lost Souls (+15 to -5)
Burned Out (-5 to -30)
Opponents (-100 to -30)
 

Customer Loyalty is categorized in 4 types

 

1.     Contractual

2.     Transactional

3.     Functional

4.     Emotional

 

If we are able to measure and analyze emotional state of customers and stake holders then the final resultant is known as EMO Index . Thi9s phrase or term is also a registered trade mark of an organization called EMO Insights International 

 

 

It is believed by industry experts that EMO index is more reliable than Net promoter Score

 

 

 

This indicates the general feelings of each and every customer / group of customers or stake holders while using the products of services of a company .

 

It is known as Net Emotional state and Net intensity balance and hence this can be measured from -100% to +100%

 

While the index is calculated in an individual level its classified in to seven broadly framed emotional states and this is called EMO clusters as below

 

 

 

 

Its said that Emotions are better predictor of whether a customer will return than conventional loyalty measures

EMO Index is a mechanism to quantity the spirits of a patron, a cluster of patrons or contributors to an Organization or facility. This reform the way customer satisfaction has been measured over years. EMO Index basically measures the emotional state of patrons and participants.

It is a combination of the Net Emotional State (stability of emotions felt) and the Net Intensity Balance (intensity with which they are felt) and the measured values range from -100% to +100%.

Since EMO index is calculated at a discrete level, it can also categorize patrons into extensive and universal emotional states called as Groups/Batches. For example, Admirers are a group of patrons who rate between 80 to 100, Supporters are the one who rate between 55 to 80, followed by Rivals who rate between -30 to -100 and many more

Above categorization makes it stand out from the traditional method, which used to predict behavior based on Age, status, groups interested in or even linked to patterns of purchase, occasion of purchase etc.

EMO Index is an indicator to quantify the  emotions of stakeholders and it is a registered trademark of EMO Insights International. A company in spain introduced and did a wide range of study to test the  Emotional Management in Spanish Retail Banking Market.  The sample was taken of 1,968 interviews which were all  retail banking customers, both male and female, aged 18 and were spanish. They used neuro linguistic techniquest also to analyse the past of the customers association with the bank to understand their current behaviour. Customer Satisfaction or voice of customer is an important thing when it comes to any business. This customer satisfaction survey aggregates the information and tells us all the details about each of the customer and groups. The result they got was the Net emotional state and Net Intensity Balance  and they used that to measure values from -100% to +100%.

 

7 broad stakeholder/banking customers were arrived:

 

Fans (+100 to +80)

Believers (+80 to +55)

Followers (+55 to +30)

Stand By (+30 to +15)

Lost Souls (+15 to -5)

Burned Out (-5 to -30)

Opponents (-100 to -30)

 

This clustering model actually is  an opponent for traditional methods which are used to predict behavior of different classes. EMO Index is a more dependable and consistent indicator than Net Promoter Score.

Best answers are provided by Mohamed Asif and Raghunandan Reddy as they have used an example to illustrate how EMO index works.

Rahul's answer is a must read for the additional facts.