Customer Feedback, Without the Static

How to find out what your customers really think.

Customer feedback is precious and powerful. Precious, because we don’t always get as much as we’d like. Powerful because it can impact our investments, strategies, and in some cases even compensation.

But customer feedback can also be tricky. It’s easy to over-react in response to anecdotal feedback. One customer complains about a shipping problem, and you decide to focus all of your energy there. Maybe that is the thing to do…but maybe it isn’t. It could just be static that is distracting you from more important—and widespread—customer concerns.

To really use customer feedback as a basis for prioritizing strategic—even tactical—activities, it should be based on more than anecdotes. Especially anecdotes from unhappy clients (you know the old adage—customers will call with complaints, but almost never with praise). Sure you want to know what you are doing wrong, but you also want to know (from the customers’ perspective) what you are doing right.

Customer Satisfaction Surveys
Yes, they cost money. But thanks to a number of recent advances, not as much as you may think. Here are some ideas to consider about how to collect the data in ways that minimize the investment.

1. Choose a market research firm that specializes in Internet-based surveying. The cost to design a survey and collect responses over the Internet is really very low. Choosing this method assumes, of course, that your customers are Internet users. If this is not the case, you should stick with more traditional data collection methods (such as telephone or paper-based).
2. Ask your supplier to deliver the results in a “top-line” memo, not as a full report. Some research firms put a lot of time into writing full-blown reports. And while these can be very useful, they do cost a lot. In many cases, a top-line memo (usually 3 to 5 pages), will adequately summarize the key findings. The firm should also deliver the data to you as simple percentages so you have all of the results handy.
3. Do the research yourself. If you really have no budget to hire an outside firm, do it yourself. But do take the time to make sure the survey is designed to yield objective feedback. For example, don’t ask, “Please indicate your agreement with the following statement: ABC’s customer service is excellent.” Instead ask, “How would you describe ABC’s customer service quality?” Then offer a five point scale ranging from Very Poor to Excellent. There are many resources on the web offering survey design tips. And some good books on the subject are also available, including, “Designing and Conducting Survey Research: A Comprehensive Guide”and “How to Conduct Your Own Survey.” If you do decide to do the research yourself, be aware that some customers may be inclined to be polite with you (and as a result may give you artificially rosy feedback)—so if you conduct research by telephone, consider hiring someone to make the actual calls for you—someone the customers won’t care about being nice to.

Outsource vs. Insource
If you do hire an outside firm, the costs will typically range from $10,000 to $60,000—but can certainly cost more depending on how fancy you get with statistical analysis and reporting options. If you do the survey in-house, and you don’t count the cost of your own time, you are probably looking at costs anywhere form $500 to $5,000. Those in-house costs could include telephone costs, mailing costs, and perhaps an incentive budget (you may want to offer gift certificates or other small incentives to encourage participation).

Survey Content
No matter who does the research (you or an outside firm), it’s your job to set specific objectives about what to measure. Try to avoid questions that are too vague. Sure, you want to ask about overall satisfaction, but get specific too. Some targeted areas to ask about satisfaction would include the following:

• Pricing
• Customer service
• Packaging
• Salesperson’s knowledge
• Product/service reliability
• Product/service features
• Product/service meets expectations
• Product/service ease of use

In addition, ask sneaky questions. For example, in addition to asking about overall satisfaction, ask questions that would reflect their actual satisfaction. One of my favorite ways to get at this is to ask about their likelihood to recommend the product/service to a friend. If they say at one point in the survey that they are satisfied, but in another point that they are not likely to recommend your company, you know you have a problem.

Conclusion
Customer satisfaction surveys ensure that you have accurate knowledge of relevant attitudes—and measurements of how widespread they are. Maybe 5% of your customers are unhappy with your shipping schedules. But maybe 30% are unsatisfied with product reliability. Maybe 50% are satisfied with your price, but 90% are satisfied with your product’s ease of use. You may discover that the things that your customers perceive as your strengths and weaknesses are not the ones you expect.

About the Author

Kathryn Korostoff is president of Sage Research in Natick . MA, a full-service market research firm serving clients in the computer, software and telecommunications industries. She can be reached at Kathryn@sageresearch.com.