As discussed in our learning guide on market orientation, marketing decisions can often seem daunting in mission-driven enterprises because of the lack of a market-oriented culture. One of the three key factors (perhaps the foundational element) of a market-orientated culture is ‘customer orientation’. While there are various aspects that make up a customer orientation, this guide explores it through the lens of customer feedback.
The key rationale for soliciting customer feedback is the need to understand what people care about in order to get them to choose you over your competitors. It also allows for continuous improvement, since it is very difficult to improve unless you find out what customers like/dislike about your offerings. Having a better sense of customer priorities helps you communicate your value better because you can hone in on what matters most.
Soliciting customer feedback should also be an ongoing process, since customer preferences change and what may be working now may not always. Without a finger on the pulse, you will not know when your business is making costly mistakes. Regular customer feedback can be an excellent performance indicator to use for strategic and tactical decision making.
And finally, soliciting customer feedback should be a proactive endeavor; simply waiting for customers to give feedback (through your website, for instance) is not enough. Only 1 out of 27 unhappy customers complain. The rest just don’t come back—meaning your issues may go unaddressed for too long. No feedback does not equal no problems. And unhappy customers cannot simply be ignored. Americans tell an average of 9 people about good experiences and tell 16 people about poor experiences.
This learning guide will provide a practical overview of soliciting customer feedback for improving your offerings and marketing, and give you a good overview of the possibilities and practical considerations for moving forward right away with a solid customer feedback plan.
In doing so, we will cover:
- Who to contact
- How to contact
- What to ask
- Processing and managing feedback
1. Who to Contact
The types of people you can reach out to for feedback and market analysis fall into two very broad categories: those who have purchased from you, and those who have not. There are unique insights to be gained from both, but unless your organization has a large marketing budget, you will likely be talking more consistently with past purchasers.
The easiest place to start is with customers who have purchased your product or service already. Their purchase establishes a connection of sorts that opens the door for (free) communication. This pool has organically experienced your product or service and buying process, which is not that easy to recreate with non-customers. It is also, naturally, a biased population and cannot be assumed to represent the large group of people that have not bought your product. That should be kept in mind when considering the specific purpose of the feedback, but should not discourage you from asking for ongoing feedback from your customers. Just keep this factor in mind when thinking about how to grow beyond your current customer base. Contact info may be obtained through web sales or website widgets/popups. For businesses that mainly sell in-person (restaurants, say), giving out post-service comment cards can be a great way to get feedback as well as contact info. Social media is another good option.
Some businesses may worry about being intrusive or annoying customers in the process of asking for feedback. This is understandable, as people today feel strapped for time more than ever. However, some research around customer behavior has linked survey completion to higher engagement rates and sales long after the survey interaction. It may be that putting positive feelings into words solidifies those as-yet-formless sentiments and thus creates more brand loyalty. Whether or not this is the case, obtaining feedback from current customers is hard to live without, and it may strengthen the connection with some customers who feel valued for being asked their opinion. Remember that you are reaching out to better meet customer needs, which is a commendable pursuit and in service of your social mission—simply balance your efforts with a sensible respect for people’s time.
To contact people who have not yet bought your product, there will most likely be some cost involved. It may be essential to learn from non-customers when you are looking to go after a new market segment whose preferences are not really understood. Non-customers can also tell you more about their first impressions of your product or website, as they are not yet biased towards your brand and are experiencing things fresh.
Online platforms like Survey Monkey allow you to target particular audiences with email surveys. This could be your main target audience or a new target audience. Before starting any email feedback campaign to unsuspecting audiences, especially to non-customers, read up on how to limit your web identity getting listed as spam. You can place ads and offer compensation for interviews or focus groups on sites like Craigslist. For product companies, free samples can both help get the word out and get the word in. Offering samples in grocery stores can drive sales, but can also be thought of as a series of micro focus groups with each sampler asked for a bit of feedback. Sending samples to online reviewers or content producers is a common marketing and PR strategy, but can also provide in-depth insights from the reviews themselves.
2. How to Contact
Survey automation means creating a survey that gets sent to an audience through email or over the phone, allowing you to gather data and feedback from a much larger pool than you might have time to contact individually. While that may sound obvious, it is worth revisiting the concept when deciding on what type of feedback approach to use for a given purpose. Surveys give you a larger sample size, and this can be crucial when you want more solid evidence for decision making.
Surveys can ask anything you need to know, which might seem daunting. Furthermore, as surveys get longer or ask for more in-depth answers, response rates tend to drop. This means that for each survey you will need to think critically about what the purpose of the survey is – what specifically do you want to learn?
Live Customer Interviews
Customer interviews are often neglected, even in the for-profit world, but can yield great insights that might not be obtainable through surveys. Interviews are great for:
- Uncovering needs and perceptions you didn’t expect
- Getting beyond your own/your company’s current marketing perspective
- Learning the language of your customers so you can refine your messaging
- Building connections for future feedback
- Creating richer customer personas
Surveys tend to work best for short, specific questions, whereas interviews work best as more open-ended, exploratory processes. Response rate on surveys tends to go down with more written-response questions. Open-ended questions leave more room for unexpected responses; these types of questions don’t work as well in surveys because they tend to require too much typing. This allows for immediate “drilling down” at a level (and immediacy) not generally obtainable in written form. Connecting directly with customers builds empathy, deeper understanding, and a greater concern for their needs
As with live interviews, focus groups involve person to person interaction, and are similarly geared toward in-depth, nuanced insights about perception more so than data points. However, whereas interviews tend to involve customers who have made a purchase, focus groups are well-suited to that non-customer category discussed at the beginning of this guide.
While surveys and interviews do involve a fair bit of planning, strategizing, and finessing, they can usually be carried out relatively well by an untrained team. Focus groups, on the other hand, tend to be more complicated and difficult to pull off, so an experienced focus group consultant is usually hired on to help plan and execute the process. That person must fill the important role of moderator during focus group sessions, which requires strong leadership and interpersonal skills.
A focus group often involves participants observing or using your product alongside other similar products from competitors. In many cases, company staff observe participants through one-way glass so that they do not feel inhibited in giving harsh opinions. Participants may then be asked to discuss their reactions to each product in relation to the others, and to rate them on various scales. In order to keep responses unbiased, participant likely are unaware of which brand is responsible for the focus group session.
The bottom line is that focus groups are a uniquely powerful way to understand how potential customers view your product or website and how you stack up in relation to competitors, especially from a first-impression perspective.
3. What to Ask
Net Promoter Score
Net Promoter Score (NPS) revolves around a simple 1 to 10 rating system and is probably the most common type of survey in use today. It is recognized for its simplicity, effectiveness, and ease of interpretation. The core concept of the NPS score calculation is as follows: responses are segmented into three groups based on how they rated you—Promoters (9-10), Neutrals (7-8), and Detractors (6 and below). Your company’s overall score is determined by subtracting the percentage of detractors from the percentage of promoters (example: 40% are promoters, 10% are detractors; your score would be 30).
Since NPS is used so widely, industry benchmarks are available. Accessing benchmarks would help you understand whether a seemingly low score is actually high for your industry, or whether a seemingly high score is actually low.
Key Purchasing Criteria
Another important tool to have in your survey belt is key purchasing criteria (KPC). These types of questions aim to uncover what customers care about most when looking to purchasing the types of things you provide, and how well your offerings hit those key criteria. KPC exploration can be done through a fully KPC-devoted survey, or through just a few questions woven into an existing survey. Understanding your target customers, or segments of those customers, will be invaluable for your marketing efforts. Can your organization confidently list out what factors are important to a customer’s purchase, and also rank those factors on their relative importance? If not, a KPC survey could be a game-changer.
Other Types of Questions
While NPS and KPC surveys may seem minimalistic, they are surprisingly effective and can encompass much of the groundwork for understanding customers and even competitors. That said, there are other questions that can be extremely useful for addressing specific blind spots in a company’s awareness that customers might not naturally provide feedback on. As each additional survey question tends to lower the response rate, you will need to consider what knowledge is most lacking or pressing, and whether your current lineup of questions might already address those issues. You might consider combining the NPS question set with additional objectives, such as:
- Crowdsourcing new ideas on how to improve your product or service offerings (this can come through NPS responses, but can also be asked more directly)
- “What changes would most improve our new product?”, “What do you wish we would add or change?”
- “What do you like most about competing products currently available from other companies?”
- Finding out if a specific aspect of the product, service, or buying process is working smoothly—this often comes through NPS detractor responses (or by following up with them), but there may be cases where direct probing may be necessary because customers might not notice something that is important to your business. Example: “Did our sales staff follow up with you about additional services?”
- Feedback on a specific new product or design change soon after launch
- Customer demographics questions
- Identifying/measuring unique market segments (example: “do you buy our product more for yourself or as a gift?” or “who in your business/family makes the purchasing decision?”)
- Crowdsourcing decisions (i.e. voting on a set of potential new offerings or changes)
4. Processing and Managing Feedback
This might sound obvious, but someone (or a few people) need to actually read any and all written feedback… with an open mind. Some responses will contain comments that are directly actionable—things you can do now to avoid customers saying goodbye forever. You might even find a breakthrough new idea every now and then; you never know! More generally, these insights help you better understand your business. The danger is that the complexity of responses could render them lost to analysis. Written responses and interview notes need to be cataloged and tagged by topic or type of feedback. This allows you (or team members later on) to go back and find categories of responses when you need them, or to simply remember which responses need to be funneled to specific staff. Reading and cataloging might not sound like fancy analysis, but if it doesn’t happen in a systematized way, there is a high chance that valuable insights will fall through the cracks.
Once you have the information in a digestible format and have started to take everything in, you may want to run through this checklist:
- What are 2-3 positive themes that are recurring?
- What are 2-3 negative themes that are recurring?
- Are there any customer profile themes arising?
- Are there specific words that pop up a lot?
- Identify high priority issues, decide whether to contact respondents.
- If necessary, contact high-priority respondents—take notes or record if interviewing.
- Has everyone at least been thanked for their valuable feedback?
- Communicate with relevant staff about feedback and set a follow-up date if possible.
Also, don’t forget to share positive feedback with staff. Consider posting positive comments in a place where staff can read them in passing.
Net Promoter Score Analysis
NPS scores are meant to help you improve over time. The goal is to steadily increase your NPS score. That may mean responding immediately to low-rating respondents or initiating longer-term improvements to move the needle on your average score.
When analyzing NPS, it is important not to take overall score increases or decreases at face value. Scores tend to fluctuate, especially depending on the size of your sample. One rule of thumb is that if the score goes up or down seven times in a row, you can be fairly certain that an actual change has occurred. Another way to evaluate the statistical validity of a change is to use statistical analysis. A free statistical analysis tool for NPS scores is available from Genroe.
Key Purchasing Criteria Analysis
With a detailed KPC survey, you would be finding out what customers’ top criteria are, and how they rate you vs. your competitors on those criteria. While one should always remain skeptical about data, especially at a small scale, it should at the very least open up discussions. Moving this data into graphical form is very helpful for understanding and having conversations about it. In working with the data, remember that the purpose of the analysis is to better align your team by 1) supporting clarity on what your customers value most so that you can focus more on providing and conveying those qualities (should you so choose) and 2) allowing for the prioritization of improvements based on your weaknesses in relation to customer values.
Responding to Feedback
In general, each respondent should at least be thanked for their response. You might want to have a few response templates, such as a general thank you, and something along the lines of “Sorry you’re having difficulties, we will try to use your feedback to improve”. If you identify a key issue coming up in a lot of surveys, you can create a template response to probe deeper with those respondents who mention it. Depending on scale and feasibility, you could simply make it protocol to follow up directly with any unhappy customers.
In relation to low NPS scores, you can directly ask for more feedback with detractors if you aren’t crystal clear on why they gave a low rating. Even better, there is nothing stopping you from asking to set up a phone interview with a detractor or someone that has a view you want to better understand. Perhaps they like your product but had a fluke bad experience—you might be able to make it up to them.
Reflecting on all these types of feedback has hopefully stoked the fires of curiosity. As you can see, feedback can provide an array of insights. It helps you create and communicate more value. The communication side can be tricky for employment social enterprises. We often hear the question “should we lead with product or mission?”. In the next article in this series on market orientation, we will use this question as a jumping-off point to explain how a customer-orientation (and all the feedback you’re now getting!) helps clear up the confusion.