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You Talkin’ to Me?

Digital Library > Defining and Serving a Market > Customer feedback “You Talkin’ to Me?”

Taking time out to get customer feedback pays off.

If you want to know what your customers really think of your company, products and services, ask them.

Common sense? Perhaps. But it may be just what the doctor ordered if you’ve been relying too much on your salespeople, service reps or marketing staff to tell you about customer perceptions. Customers are most in tune with what they want or need and how they feel about your company. And many are more than willing to share that valuable information with you — if you ask and make it easy for them to answer your questions.

Set key objectives

Have a clear goal when you solicit customer feedback. Know exactly what you want to find out, such as how your customers see a new product or promotional campaign you’re set to launch. Probing precisely what keeps your customers satisfied is always worthwhile because the responses can help you remove roadblocks to growth.

Case in point: When PEB Financial Group Inc. surveyed customers, one objective was to detect any correlation between the number of contacts by a sales rep and the customer’s level of satisfaction. "We assumed that the more frequently a rep sees a customer, the higher the level of satisfaction and the better the relationship," says Jim Corrigan, executive vice president of the fast-growth Chicago firm.

"A key finding of our survey was that with two personal contacts annually, a customer’s satisfaction rate was 94%," Corrigan explains. "Surprisingly, additional contacts didn’t significantly increase their satisfaction level. We also found that satisfaction dropped to 64% for customers who weren’t contacted at all, and with one personal contact it rose to 78%." These findings helped the company restructure its customer-contact strategy. "Reps were able to ‘tier’ their client base and make additional contacts more efficiently, rather than just focus on the 20% of clients that generated 80% of their income," says Corrigan.

Surveys get results

Customers will participate in phone or mail surveys on issues that are important to them. For example, they don’t care about management concerns such as hiring or training practices. But they do care about how new products taste or operate, and how the company handles questions or complaints.

To get the best results with surveys:

  • Involve a select group of customers at the design stage. Explain what information you’re after, and ask for help framing your questions so they’re relevant to customers. Also take the time to do a test run with this group. Then you can fine-tune your questions to make sure they’re clear.
  • Use in-house resources. Ask sales and service reps about feedback they’ve received, and analyze those complaints and comments. They reflect key customer concerns that you can address in your survey.
  • Provide for both objective ratings and customer comments. Objective rating questions ("on a scale of 1 to 5 …") will give you useful numbers such as, "95% of respondents are satisfied with our service." But open-ended questions such as, "Where have we exceeded your service expectations?" and "Where have we failed to meet your service expectations?" will tell you why respondents feel the way they do. This anecdotal information helps you make changes that meet customer needs.
  • Keep it short. Ask no more than 12 brief questions. Customers are more likely to respond if the survey is easy.
  • Ask very specific questions. Avoid double-barreled questions such as, "How would you rate our products and services?" Instead, ask: "How would you rate our products?" and "How would you rate our services?" That way you get separate ratings.
  • Choose between phone or mail surveys — or both. Phone surveys allow you to get information quickly and tabulate results within a couple of weeks. You can also ask "branch" questions to probe for more information: "What is it about the product that made you react that way? Is it the design or …?"Consider a phone survey (conducted by appointment) of a sampling of your best customers; this gives you in-depth information from people who want to help grow your business. You could then do a mail survey of your second- and third-tier customers. These responses will take longer, and you’ll need to set a cut-off date. A 5% to 10% response rate to mail surveys is considered good, with 30% the highest you can expect.
  • Customize to meet your needs. Example: PEB Financial Group sent existing clients a full-page questionnaire with open-ended questions and space for comments. Then, to find out why the company had lost some business, "We did a phone survey of defecting clients, knowing they wouldn’t be willing to spend time filling out and returning a questionnaire," says Corrigan.
  • Use only token incentives. If you’re offering a premium to obtain a higher response rate, make sure it’s of nominal value. Sending a coaster or pen with the company logo as "a token of our appreciation for your cooperation" is fine. But offering expensive items such as crystal paperweights or gold pens can skew the results by encouraging favorable responses.
  • Decide whether you need professional help. You can do surveys in house, but consultants experienced in handling surveys can make sure you get it right. Depending on the extent and complexity of your survey, consulting fees could run $3,000 to $5,000.

Conducting focus groups

Focus groups bring together eight to 10 current or prospective customers to discuss your product, service or any other aspect of your business on which you want feedback. One of the advantages of focus groups is that you get initial results immediately. That’s because you’re there — behind a one-way mirror — watching and listening as people respond to the moderator’s questions about your company.

Warning: The goal of focus groups is to provide qualitative insights. The impressions you receive should be validated by quantitative research — statistically valid surveys, for example.

To ensure focus groups provide useful information:

  • Hire a professional. Just as doctors don’t operate on their own family members, your strong emotional attachment to your company disqualifies you from running your own focus group. The moderator must be emotionally detached and able to hear the good and bad feedback without grimacing, flinching or protesting, "But you don’t understand what our company’s about!" Even subtle signs of disapproval will cue participants that they’ve given the "wrong" response and should be more positive next time.Remember: The last thing you need is for participants to give responses that they think you want to hear. You need the truth — real feelings and opinions — to make crucial business decisions.
  • Find a reputable market-research firm. Use your business network and ask for recommendations. Expect to pay about $5,000 per focus group; that includes an average cost of $50 for each participant. If your group consists of high-level executives, however, participant compensation will range from $300-$400 each.
  • Pay attention during the session. It’s OK to bring along observers, such as key decision-makers in your company, as well as your public relations and advertising people. But keep talk to a minimum in the observation room. Watch and listen carefully so you learn as much as possible from your focus group in action.
  • Be accepting. You may feel yourself getting angry, upset or embarrassed at the responses you’re hearing and observing. Those negative feelings are a sign that you’re learning something about your business that you really need to know. It might be difficult to face, but by accepting what you’re hearing, you’ll be open to making changes that will improve your company.
  • Treat the moderator as a member of your team. Work with him or her before the focus group meets to explain what you want to learn from the session. Also provide complete background about the issues or problems you want to explore. The information you provide will help the moderator prepare the discussion guide or outline for the focus group.Caution: Never blame the moderator for negative responses of group members. Some "kill the messenger" types have even fired moderators, claiming, "He encouraged them to say bad things about our product." You’re there to hear "bad things" so that you can plan corrective action.
  • Take the results seriously. Your moderator will analyze the results and report back to you, interpreting customer input and explaining its implications. He or she might suggest specific actions you can take. Consider those suggestions in light of your own experience and knowledge of your business. Then follow up with any actions you believe will keep your company on the fast track.

Writer: Kathleen Conroy

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