Analyst Q&A: Customer Feedback Essentials
Ashley Verrill is the CRM Analyst at Software Advice. She has spent the last six years reporting and writing business news and strategy features. Her work has been featured or cited in Inc., Forbes, Business Insider, GigaOM, CIO.com, Yahoo News, the Upstart Business Journal, the Austin Business Journal and the North Bay Business Journal, among others. She also produces original research-based reports and video content with industry experts and thought leaders.
It’s true. Customer feedback is essential to providing your customers with the best and most relevant customer experience possible. We chatted with Ashley Verrill of Software Advice to discuss the importance of gathering and acting on feedback to become a truly “customer-centric” organization.
How important is it for companies today to collect and act on customer feedback?
It’s crucial because customers have so many more choices than they once did, not to mention resources for researching the plethora of options available to them. Companies can no longer rely on marketing to add that patina of magic that “sells” their product. Customers know what they want, and they know how to find out who has it. Part of what customer feedback provides is figuring out what this “want” is; what they are looking for that you can provide. How can you provide that thing even better, or make it easier for them to find? It’s no longer this mantra, “if you build it, they will come.” Now it’s, “if they will come, you should build it.” Companies also have so many opportunities and avenues today for collecting this feedback–from customer communities, to email outreach, to on-site surveys and market research. Why wouldn’t you do something?
Can you outline for us the Customer Feedback test that you completed, the primary results and any lessons learned for our readers?
Sure thing. So I ran an experiment in three retail businesses — a bicycle store, ice cream shop and a burger chain — where we tested a “text the manager” program. The goal was to see whether having this text component influenced the amount of feedback each store received, as well as the quality of feedback (each store also had a physical “comments” box). After a month of having these two options available, we received very little feedback in any of the locations, and the feedback we did receive wasn’t really useful. People said things like, “I love your ice cream,” or “Thanks for the great experience.” While this is nice to hear, it’s not really actionable. What I discovered was that the people “on the floor” weren’t really proactively talking to customers about why they wanted their feedback, or what they planned to do with it. So customers had no real incentive to participate. Also, the “ask” was so general. What we should have done is identify those factors that most impacted the customer experience and asked questions about those things.
Often we hear about “survey fatigue” and how respondents aren’t as likely to give feedback because they don’t think their concerns will be addressed. Can you discuss the importance of actually responding to and acting on customer feedback?
Absolutely. I think companies forget that when they ask customers for feedback, they are asking them to take time out of their day to help you. They want to feel like there’s something in it for them too. This can be done by literally giving the customer something. One company that I shop with, for example, is always asking me for feedback, and normally I’d be like, “Jeez, give it a rest,” but usually it’s coupled with a discount on my next purchase, or a $5 credit. It’s not much, but it’s something. On at least three occasions, they’ve actually snail mailed a thank you card to me. The card thanked me for my business, was “signed” by the CEO, and then invited me to participate in a survey in exchange for a $20 credit to my account. All of these efforts help them recruit feedback from people who might not have otherwise participated, but it’s also important to emphasize the importance of responding to people that want to give you feedback because they had a bad experience. If someone is really upset, tells you about it, but doesn’t hear back from you (with an apology, and promise to improve their experience next time), you risk that person spreading negative word of mouth. Sure, that’s one person, but what if they go to social media? What if they’re an influencer? This could spell major trouble for you.
In your view, how important has customer experience become to the success or failure of brands today?
It’s crucial. We’ve all seen the statistics showing the cost difference between acquiring a new customer and retaining a current customer. Customer retention and loyalty is imperative to success, and it’s so dependent on the customer experience. Today, this means being more proactive in serving their needs. So no just waiting until they reach out to you with a question or a request, but proactively solving the problem for them, often times before they even know they have it. This is where data can be really valuable. You probably already know the most common reasons customers call you. Your data can reveal trends around these “most common reasons” so that you can preemptively reach out to the customer. These trends commonly align with your customer lifecycle. Once you have this intelligence, you can automate these kinds of actions — as soon as a customer reaches a certain stage in the lifecycle, your system could trigger a certain response.
Can you talk a bit about what it means to truly be a “customer-centric” company?
To me, customer-centric means making decisions based on what customers have expressed they want from you, as well as what most impacts their decision to buy from you. So rather than just looking at what is most cost-effective, or what might be “trending in the market,” it’s looking at what your specific target customer has expressed as a need. It’s also proving to customers that you are listening and responding to their needs.