Customer feedback differentiates your business from your competitors, so in this issue, we speak to Guy Letts about why harnessing customer feedback will improve your customer relations and drive business success.
Guy is well placed to advise us, as he’s spent much of his career helping businesses improve their customer relations, including a spell as Head of Services at FTSE 100 company, Sage and now as founder and MD of CustomerSure.
Putting customers first
“How a company serves their customers and responds to feedback is an opportunity to create a strong competitive advantage. Doing the best job for your customers is seen as the route to commercial success in some sectors – but in others, this isn’t the strongest influence.
“Back in the 1980s, when I first started working, I was fortunate to join a company in which the common expectation was you did the right thing by your customers. A fabulous British technology company, they were known for their exemplary technical work and their great service.
“Yet we never used the term ‘customer service’ – we simply put the customer first and on the odd occasions that something went wrong, we fixed it at no cost to the customer.
“This customer-focused ethos was one of the company’s greatest assets and it gave me a good grounding, since then, I’ve specialised in helping companies be more successful by embracing customer feedback.”
Company culture is key
“Customer service is largely determined by company culture and changing that can be difficult – it has to be led from the top. A company’s leaders set the pace. Their behaviour, including what they choose to measure and reward people for, drives the culture.
“In an aggressively sales-focused environment, it’s difficult to champion service from a mid-level role as you’re going against the grain – there’s little hope of change unless the leadership want change.
“Conversely, where an ethos of customer service is set from the top, your team are empowered to take initiatives that deliver excellent service, knowing that if anything is challenged, their motives will be understood and they’ll receive support.”
Choose targets with care
“Targets are crucial, but often the wrong ones are chosen. Perhaps surprisingly, targets tied to service are particularly ill-conceived because they rarely reflect genuine customer satisfaction.
When people are incentivised to reach a target, they’ll find a way to reach it, regardless of what’s really happening. As Goodhart’s law suggests, when a measure becomes a target, it ceases to be a good measure.
“You should be measuring customer satisfaction, but better targets are those which directly relate to financial performance, such as:
n Are we retaining customers?
n At what rate are we acquiring new customers?
n Are we winning market share or is it declining?
n Are customers trusting us more and increasing their spend on additional services?
Welcome feedback
“Welcoming and responding effectively to customer feedback is by far the most effective way to have a positive impact on a company’s performance. What I’ve also found is that although customers love to give feedback, the bad news is they hate the way most companies collect it.
“Providing feedback must be easy for customers. Busy service professionals frequently fear that an easy feedback process will give them more work – but this is far from being the case – making the feedback process difficult is a huge mistake.
“The reason making feedback easy is so effective is that it takes away the guesswork. If you are successfully measuring and acting on customer feedback quickly, by definition you are doing what your customers want and you are providing investment where it’s needed most.”
Annual survey shortcomings
“Companies frequently run annual customer surveys, collate the findings but don’t act on the individual problems. We often find that companies have received cries for help that have been ignored, so issues that could have been resolved early on, escalate into far more significant and time-consuming problems.
“Annual surveys can have a place, but they don’t allow you to capture feedback or act on it when it matters most to your customers. Instead of running an annual survey, ask yourself, when do customers want to give feedback?
“You’ll find there are key moments when this is the case – for example when a customer has opened a new account, received a bill or when there’s been a problem. Enable customers to give feedback when they want to and make doing so a great experience.
“Have the confidence to abandon the traditional ways of doing things and simplify your processes – it’s dramatically effective. You don’t need masses of data. Provide customers with three or four scored questions focusing on the factors that are most important to them and a comments box – it’s as simple as that and you’ll know whether they are happy or not, and why.”
Act on feedback
“The reason responding to customer feedback often isn’t done well is that it’s typically led by market researchers – who are skilled at market research – but don’t hold the keys to improving services. Measuring satisfaction is less than half the job – what you do next is the magic ingredient – if you get it right.
“When you receive feedback, think through what the customer would reasonably expect you to do – avoid giving the standard reply about their feedback being important to you, instead act quickly and decisively to address their concerns.
“Avoid further calls on the same issue. If something has gone wrong on that day – resolve it on that day. By acting quickly, you’ll find that much of your work falls away.
You’ll make savings in terms of the time and resources taken up resolving ongoing issues. People fear that making the customer feedback process easy will increase the workload, but in fact, the opposite is true.
“Fixing the problems about which you receive feedback is the most effective way of improving customer satisfaction. Conversely, collating feedback but not acting on it defeats the purpose of collecting that data – you don’t fatten a pig by weighing it.”
Looking forward
“In order to stand out from their competitors, companies must improve their customer service and to achieve this, they need to listen to customer feedback and act on it swiftly.
“Giving feedback should be a good experience for your customers. Make it easy, make it pleasant and your customers will thank you – and you’ll reap the benefits of improved customer satisfaction and retention.
The key to high-quality insights and high response rates is to make providing feedback a great experience – that’s the principle that inspired our product.
“We have a 100% track record of our customer feedback software working for all of our customers – they find it liberating as it reduces their workload, allowing their efforts to be focused on what their customers need.
That’s why we’ve been voted the best customer feedback solution by 3,700 customer service professionals – the largest impartial survey of its kind.
“If you think there’s something in what I’m saying, trial our software in a small way – it doesn’t have to be all or nothing – just dip your toe in the water and see the benefits. We’re here to support you and we are not like every other software company you know.”