Mastercard Incorporated (MA) Earnings Call Transcript & Summary

Hi there. I'm Lance Gruner, and I'm the Executive Vice President of Global Customer Care for Mastercard. And today, I'm going to be discussing how Mastercard really sees an opportunity during this really time of uncertainty. And I want to share some insights on how we are driving change. Thanks for being here today, but I would like to let you know, before I begin, that this session is being prerecorded, so I have an opportunity to participate in the live Q&A session, which you'll be participating by clicking on the link on your screen. So let's get started. So the title of my presentation is really leading the charge on change and really the opportunity during uncertainty. We see a lot of opportunity here. Anytime that there's a crisis, you never want to let a good crisis go to waste. You really want to take an opportunity to really seize that. And what really is being highlighted or emphasized is that even during this time, there's a difference between understanding what customer experience is and knowing what to do about it. And we also know that any change that you want to drive has to be driven from the customer perspective or from the customer team. And as I said, there's lots of opportunity that we see. And I'm going to share some of the learnings that I've had over the years. So I know everybody is interested and really talking about the crisis, and I want to get to where we share some of the, really, things going forward. But let's talk about COVID right now and the day that the world stopped. This really has been unprecedented times, and our industry really has been faced with historic challenges. And even at this time, demand is up. See, we've got customers looking to be serviced, looking to have their answers -- answered. And what this time has really done is really reveal our resiliency and reveal our ability on looking at our infrastructure, and it really looks at our ability from a nimbleness standpoint. Now as I said, Mastercard, just like everyone else, experienced the same thing with COVID. I mean literally, overnight, we dropped to a 24% capacity. We were faced with lockdowns, just like it did countries across, we're shutting down. And so we quickly had to get to a 4-phase approach. And our first phase was really around -- centered around containment. We really had to look at what was happening, how it was changing overnight, and literally, we were standing up shifts -- adding shifts in different countries to try to meet demand. We were making hundreds and hundreds of routing changes just as things evolve. And we also stood up a virtual call center almost overnight. We went from concept to production in 3 weeks, which, in my history, has been record time. But we really had to look at how do we contain this and how do we get to some type of stabilization, and which has been a challenge. But today, we're really proud that through all this, over the last 60 days, we really haven't missed a service level. And we're looking at now how do we seize that opportunity in the future. But what we're doing now as we look at the first 2 phases of this crisis, we're focusing in on normalization and eventually growth because today the world is starting to open. And what has changed is the customers changed. There is a new normal of operating. And how do we look at going to normalize our operations post crisis? And the scary part is how do we make sure that what has changed, that we're able to incorporate the new normal and really get to a growth very quickly. Because as I said, this is the new normal. Well, what has been really clear during this crisis is that consumers, even before this crisis, really weren't as willingness and forgiving as part of it, but even more so during this crisis, consumers' willingness and forgiveness is decreasing very rapidly. And I want to show you a model that even pre-crisis really pertains to today. And this is a study conducted by Bain where they interviewed over 360 companies. And they went to those companies and they said, "Do you have a great experience? Do you provide a superior experience?" And the interesting thing was 80% of them said they had a great experience, that they provided a superior experience. But when they interviewed the customers of those companies, only 8% said that they had a great experience or where customers really agreed. So what are we seeing here? We're seeing an experience gap. So even pre-crisis, there is experience gap for what companies thought was a great experience and what customers really observed and dealt with the customer experience. So this experience gap is something that is front and center in their mind and even more so during this crisis that we're experiencing. But what it really brings up to us is that experience of the product is bigger than the product itself. And let me say that again, the experience of the product is bigger than the product itself. Customers today, especially during the crisis, pre and post, really want to know that they're making that emotional connection, that companies are there for them to solve their needs and that there is that trust there for them. Now really, what defines a great experience? The great experience really is about the intersection of 3 things. It is the need. It is really a solving a need. Customers are looking for companies that are able to solve their need for them. They're not necessarily interested in all the bells and whistles and all the features and functionalities. What they want to know is how are they solving a need. How are we solving the need? But solving that need, it has to be easy. It has to -- we provide an opportunity for them to have it as easy as possible in the flow as they're connecting with you. And the third part is how is the need and the ease of doing that creating that emotional connection with our customers. And it really solves that problem, and by solving that problem and make it easy, that's where you create that emotional connection. Now the rest of the time we have today, I really want to focus on 3 steps to really start seizing that opportunity and becoming a CX champion. Because as I said in the beginning, it really is the change has to be driven by the customer team, who is driving the customer. We have the insights. We understand the customer. It's in our DNA. So the first step really is around evolving the mindset. Too many times, I talk to companies and I talk to people, who think that their customer service, their call centers and everything, are just -- they think we just answer the phone, that we just serve a small purpose, when in reality, we really have a huge value. So when you evolve the mindset, you really have to look at establishing the value of your organization, your team. You need to make sure that you're optimizing the channels that you're using. You have to really make sure that you've established service level objectives, as you unify the user experience, explain -- employee experience and the customer experience. And with that, you have to use tools such as automation and artificial intelligence. And you need to make sure that experience is the prioritization in your company. So again, it really is evolving the mindset. You have to get in your head that you are the voice of customer, that what you do serves a huge value to your organization. You have data that helps them decide and make decisions on how that experience is going to be. Now part of that evolving the mindset, you really have to get to what -- I'm originally from the hospitality industry. And one of the things that we use was walking the property. And you can really use this, whether you are managing hotels, whether you're managing a technology team, call center, et cetera, it really is getting into walking the property. What I mean is you have to have an end-to-end look of what your services, your product is doing. And in Mastercard, we have this type of process that I'm showing you. We have the first stage as developed product, market and sell, onboard, enroll, service and then bill. But what's important is you really need to understand what is the experience at each one of these points. That's walking the property. As a hotelier, when I would arrive at the property in the morning, I would walk the property. I would walk and see what the customers are going to see. What is the guest going to see from the landscaping, from coming into the front desk to going to a conference or even in the room. It's really walking around making sure that you are seeing it in the customers' eyes. But in doing that, you really ought to have -- understand at each point, what is the pain points? What is the challenges at each one? And this is when I talk about walking a property is really understanding that at each point of the flow that a customer is experiencing your product or service. What is the pain points? What are they experiencing? And so I challenge you with when was the last time you, your team, your leadership actually walked in the customers' shoes? Now the second step really is optimizing the system and processes. And it really is -- it is a cornerstone of everything we do. It really is about data. It really is about making sure your automation, your systems, your processes all provide data, great data, deep and rich data about what the customer is doing, what the customer is experiencing. You can't just do the typical KPIs. I talked to too many companies, I talked to too many leaders who basically are providing just the typical KPIs. There's a lot more information, rich data, actionable data that can be mined from the things that we do each and every day of what is in the customers' mind and how they use our products that is valuable for product delivery, for product development, for technology development. So it really is looking at how do I optimize the systems. And really, when we look at this area, when we look at data, it really is making sure that you're co-creating with your customers. It's having those conversations. It's that if you're thinking about your new development, your new feature, is it something that customers want? At Mastercard, we can constantly bring in customers. Our top customers for think-tank sessions, we have advisory boards. We bring them in and discuss flows. In this picture, this is where we brought in our customers and we talked about how we were releasing information to them and having them do, when we do releases, how and timing and what is the information they need. So it really was a valuable session, and I really encourage you that if you haven't done this and you're not doing this that you find a way to really co-create with your customers. And along with really optimizing your systems, it's really taking advantage of the technology. There's a lot of technology that we have today. There's so many different myriads from switching, to analytics, to tech speech analytics, different softwares, different things. You really have to understand what you want to use and how you use it. It can be very confusing, and we're inundated with all this different type of technology. But what data and technology do is offer us new ways to cater to our customers. And the challenge with technology, come social media, and with social media, it really amplifies a lot of experiences in unprecedented ways. Many of you that are listening to this that run contact centers, we pride our ability to handle on the way calls would arrive in a system, and we could actually eke out a few extra seconds as we're routing, and it gave us time to respond. What social media does is almost eliminates the time to respond because once it's out there in social media, it's out there. And your cycle time to respond is very, very short. So you need to make sure that as you're embracing technology, as you're going out there and realizing social media has an impact, you need to make sure that social media is also a support channel, and you need to make sure that you're recognizing that. And automation really drives the behind-the-scenes transformation. Automation is a tool. It can't be the end all be all. Too many times, I was speaking with leaders, and they talk about their leadership saying, are you using Box, are you using automation? And that's what we've got to focus in on. Automation really is a tool, an enabler, and it really drives the behind-the-scenes transformation. It really allows us to use technology and automation to self-style, to make the customer experience easier, to make the intelligence, to push that intelligence to agents, to even customers as part of their self-serving. Automation is a great tool, and it really helps us in many different ways. Now the third area really is the most important. And it really is about telling the story. When you look at these 3 items, you talk about evolving the mindset, number one was really changing the way you look at yourself, your team and making sure how other people look at you, see the value of what your team delivers. The second is making sure that you're optimizing the systems and processes and making sure that you're using data, deep and rich data to make your decisions and making sure that you have that available. But number three really gets into telling the story. And telling the story is really important. Are you the type that typically take it -- and putting a dashboard and typical KPIs? Or are you telling insights that go along with that data? Here, it's really important that you are partnering both internal and external, that you are not only telling the story internally to your team, to your leadership, but that you're also telling the story externally to your customers. And in my case, in Mastercard as well other, you have to look at it globally and regional. We all have to have a great experience platform. And when you look at indexes and you look at experience, it can't be just your typical KPIs. It really has to look at sentiment. It really has to look at customer experience, indexes, satisfaction. And if you tell the right story, you can be the catalyst for change. But to do that really takes a program around changing the culture in your organization. It really is changing the culture and mindset of the leadership that you have on your team because, again, if they don't understand and heeded in your mind that you should be at the center of the conversation and you should be the voice of customer partnering with your teams of development, engineering, product development, marketing, et cetera, you need to make sure that you're partnering with that. And it's also making sure that you have the right challenge, that really is a part of your team and understanding. They're just not only takers. It's just that let's move the curtain back and seeing what's happened behind the curtain. This is a valuable -- you are the voice of customer. You have the data. You have the insights that are necessary. So what has that really driven at Mastercard? And I'll share some of the data points that when we have looked at this over the years, when we've really put together this plan of changing the mindset, optimizing our systems and new technology and processes and how we're telling the story. So since 2014, we've had an increase of 260% more customer voices. And what I mean by that is really not just typical KPIs. It's different views. It's different sources. It's information. It really gives you a more complete picture of what the customer is thinking, feeling and sentiment. Since 2014, we've moved from the 50th percentile to the 99th percentile in NPS score. I mean that was a herculean, monumental effort. And also since 2014, we've increased our customer satisfaction by 23%. Now specifically for my team, just to kind of give you the size and scope, we do -- we handle over 14 million customer interactions annually. And we're growing on the average of 20% a year when we look at those interactions. And also, over the years, we shifted to make sure that our team interact directly with our customers. And one of the things we really looked at was 91% of my team directly has interfaces with customers. So they're directly communicating with customers. They interact with customers. We do service in 186 countries, in 64 different languages. And if you look at overall from the B2B and B2C side of the business here, we have an average 81% customer satisfaction. Now what does all that data and insights and storytelling allow us to do? It really allows us to look at new products and services that we've really inspired our company, whether it is contactless, whether it is our features, our functionalities, access, using government watches, smart watches. There are so many different new products and services that come out because that's what the customers are telling us. That's what they need. And we're able to be on the leading edge of development. It's new products and services really inspired by the customer story. Now as I go into final thoughts before a couple of questions, I want to share this quote. And it really is important. I love what Jeff Bezos says. The single most important thing is to focus obsessively on the customer. Customer has to be the center of everything that we do. Customer has to be the focus in the mindset of the development. It has to be how is the customer going to use our products and services. So when I look at the opportunity, when I look at what this crisis has provided us, it's an opportunity for us to really communicate and tell the story of what the customer is thinking, how they're feeling, how they're using their products and services and how we can best service them in the future because that is the opportunity to create that emotional connection with our customers. So that's kind of my insights for today. And we have a couple of pre-submitted questions from the audience that I'd like to take a stab at answering.

So the first question that came in is how can you create meaningful and distinct connections with customers when every company uses the same channel? Great question. And it really gets into what I said about understanding how the customer is using your product and service. Because the customer will choose the channel. It may be that they want to choose to self-serve. It may be that they want to start a process on one channel and move to another channel. It may be that they decided to use the voice channel or chat or even social media. So everybody has those channels available. What it really is, how well do you understand the customer, how well do you understand the pain points? Have you walked in your customers' shoes? Have you actually gone through that process? And it really is the companies that understand that process and have removed the pain points and made it easy for customers to engage with you, those are going to be the winners. And that's what really differentiates one company from the other company. The second question that was submitted is how do you think customer support will change post COVID? I think it really is -- I think the new normal is really going to affect everything. I think customers are going to have higher expectations of the companies they choose to do business with. I think that COVID is going to open up, and I've already seen new ways of new modeling. Things that I didn't even think of that could be done 6 months ago. And even if I proposed something 6 months ago, I would have been laughed at. But it really is -- or even the 6 months ago, I didn't even think was possible. But today, it is possible. And so there's different ways of looking at that modeling. And so how is it going to change? It will change. It will impact and change everything that we do and how we engage our customers. You need to make sure that you're dialed in how your customers have evolved, how your customers are going to be using your products and services and making sure that you are solving that need. Get back to that 3, define a great experience. Are you solving the need? How easy is it? And making sure that when it comes together, you've created that emotional connection. Great question. And the third question is what tips can you provide for revamping customer journey maps during this crisis? It gets back to walking that property. As I said, you need to first identify what is the customer flow? How is the customer going through those channels to get their problem solved? Once you've established it, then you need to take a look at each and every point and start looking at what is the flow. How is it easy -- is it for -- easy to get the customers through? Are there pain points? Are there challenges? So what you do is you really identify what is the good path, what is the bad path, the pain points, what do we need to do to change it. So when I talk about data, this is part of that data. It is part of that opportunity for us to take a look at walking the property. I go back to my hotel days. Unless you've seen it through the customers' eyes, you're not going to be able to build and deliver a great experience. So with that, I want to say thank you for joining us today, and appreciate you being part of the CX Summit today. Thank you.