increase profits through feedback - a practical guide to measuring customer satisfaction (ebook)

A practical guide to measuring customer satisfaction

INCREASE PROFITSTHROUGH FEEDBACK

1

Each week, Garrett Smith contacts

customers personally to see how their

purchase experience went, if their

products have been installed correctly,

and also to understand if there are

opportunities to earn new business. As

the CMO of VoIPSupply.com, he finds it

essential to engage one on one with

customers.

KISSmetrics, an analytics platform,

makes sure everyone in the company

routinely talks directly to customers.

According to their blog, customers like

hearing from someone besides a

“customer service rep.” Some people

like talking to the CEO, an engineer, or

a marketing person. Each worker can

give their own perspective.

Superior customer service is not a

“we’ll get there someday” goal. It is

something that each and every

business can provide immediately. As

we’ll explore in this short ebook,

customer satisfaction is the path to

increased profits.

Bain & Company studies have shown that a 5% increase in customer retention canincrease a company’s profitability by 75%.

According to an American Express survey, 7 in 10 Americans said they werewilling to spend more with companies they believe provide excellentcustomer service.

“Customer service shouldn’tjust be a department; it should be the entire company.”

Tony Hsieh, CEO of Zappos

/ / Increase Profits through Feedback |

WHAT YOU WILL GET OUT OF THIS EBOOK

Two concise steps to increase profits through

customer feedback. You will learn that:

1. Listening well matters; interacting with customers

will help you form deeper relationships, increase

loyalty and promote your brand & identity.

2. Asking for specific feedback will help you find out

what your customers care about most: quality,

support, performance, price, etc. and give you

actionable items to improve your product and

operations to give them what they want. Gathering

feedback, and acting on it, is one of the keys to

achieving superior customer service.

On the first point, listening seems obvious, but doing

so

takes time. We’ll talk about how today’s tools for

listening, monitoring, and tracking what is said about

your company make it a lot easier, less time-

consuming, than ever before.

On the second point, we want to make it clear that

customer

satisfaction is not an intangible, indirect path to

revenue. When you create a customer satisfaction

process, your profits will increase directly because:

• You will catch people, your customers, before they

fall through some proverbial crack in your sales

cycle or customer service process.

• Your team will uncover functional areas, problem

spots, where you can improve.

• When you listen to what a customer says, you find

ways to properly up sell, cross-sell new products

and services. More importantly, you build a

relationship with your customer that allows them to

affect your business in new ways.

VoIPSupply.com sends out a survey each year to all

customers to understand what the customer feels they

do well, what areas they need to improve upon, and

how likely they are to recommend, refer and return as

a customer. The company sees this feedback as

mission critical. That’s not just a catchy marketing

phrase, but a way to ensure that customers return.

When customers return, profits increase.

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WHAT DO THOSE TWO ITEMS REALLY MEAN?


LISTENING MATTERS: MEASURING CUSTOMERSATISFACTION IN A MOBILE / SOCIAL WORLD

24%Customer service experiences have a deep impact: 24% continue to seek out vendors two or more years after a good experience.Dimensional Research, April 2013

Customer service is rapidly changing because of social

media. With these changes, however, come advanced

tools that allow you to monitor and track what

customers are saying. Customers expect that you are

listening, and more so, participating in social media.

“Social Listening” is important and is a new aspect of

the customer service platform.

In fact, this desire to be heard and listened to extends

to surveys in a surprising way. The Harvard Business

Review

reported on a field study of 2,000-plus financial

services customers where 945 customers

participated in a survey and a control group of 1,064

that did not take the survey. After the survey, neither

group was contacted for one year.

“A year after the survey was conducted, the

customers we surveyed were more than three times

as likely to have opened new accounts, were less

than half as likely to have defected, and were more

profitable than the customers

3/ / Increase Profits through Feedback |

People want this level of engagement from the companies with which they do business… even the best of what formerly passed for good customer service is no longer enough. You have to be no less than a customer concierge, doing everything you can to make every one of your customers feel acknowledged, appreciated, and heard.

You have to make them feel special, just like when your great-grandmother walked into Butcher Bob’s shop or bought her new hat, and you need to make people who aren’t your customers wish they were. Social media gives businesses the tools to do that for the first time in a scalable way.

Gary Vaynerchuk Author of The Thank You Economy

“Gartner predicts that by 2014, refusing to communicate by social media will be as harmful to companies as ignoring phone calls or emails is today”

Gartner 2012

who hadn’t been surveyed. These differences reached

their maximum levels several months after the survey

was done and persisted throughout the year. Even at

the end of the year, surveyed customers continued to

open new accounts at a faster rate and defect at a

slower rate than the people in the control group.”-Drs.

Paul M. Dholakia and Vicki G. Morwitz in the Harvard

Business Review-

One can conclude that customers simply want to know

that you care. They want to know that you are listening.

Social media may be changing customer service, but it

is not changing human behavior: People want to know

you are listening and acting on their concerns,

requests, and feedback. As the Harvard Business

Review highlighted, the mere presence of a survey

changed customer behavior. HOOTSUITE, TELLAGENCE, AND YELP…

There are many tools to help you listen and monitor

today’s social stream. No one tool does it all, so it’s best

to have several: HootSuite or Tweetdeck, to listen and

monitor on social media. You’ll want to consider tools

like LittleBird or Tellagence to help you determine who

to listen to (LittleBird) and how to extract context or

meaning from social media posts (Tellagence).

Finally, despite many business owners who despise Yelp

or another citizen review site, these communities are

here to stay and one needs to maintain keeping up with

those sites. Links provided in the resource section at the

end of this ebook.

So, can “social media listening” to the customer

increase


profits? Take a look at just two results from the

Aberdeen Group 2012 study called Social Media and

Customer Service: From Listening to Engagement:

• 36% have won back a customer due to a positive

support experience on social media.

• 33% of organizations indicate that positive

mentions on social channels have driven new

business.

On the flip side, this same study found that 17% of

organizations have lost a customer due to a negative

experience on social media.

Google Analytics provides some insight into social

platforms that drive traffic to your website, but it

doesn’t specialize in helping you understand the

conversation. It also does not help you on a real-time

basis as some of these other tools (HootSuite). Still, it

is an important tool to use to know where your

website visitors are coming from and their platform

auto-tags the source of traffic, such as, Twitter or

Facebook.

There is an interesting layer beneath the surface of

social

media and it comes via analytics tools that study the

specific data stream from Twitter, Facebook, and

LinkedIn. Tellagence works mostly with Twitter data

and helps you figure out the context or user intent

from keywords you are interested in. Most of the

listening platforms allow you to search for keywords,

but Tellagence is building analytical algorithms on

top of the data that help you make sense of it. You

can do some of this sort of analysis manually, of

course.

Yelp and other customer review sites can be a

sensitive subject with many owners in the camp that

“Yelp is the enemy.” Our goal is not to comment on

that, but simply to recommend you consider it as a

social channel, monitor it, and try to do a similar

level of customer service so that you can generate

new business from it as well as to retain existing

satisfied customers.

In social media, the key takeaway is that you have to

use any and all channels to keep the conversation

going. Weave survey landing pages into your social

media responses, when appropriate and relevant.

Ask for feedback so that you can learn more about

what your customer wants and needs.


In a recent Oracle survey, 51 percent of executives

reported that they use customer satisfaction scores to

measure the overall customer experience. They report

accomplishing this by investing in analytics tools to

better understand the customer (survey published

May 2013). Oracle also found that almost 25 percent

of executives cite technology obstacles as the biggest

hurdle to overcome. One of them includes “an inability

to track performance and customer feedback.”

THE ART & SCIENCE OF CUSTOMER SATISFACTION

That’s what research firm, Forrester, reported on how

Barclaycard helped employees who did not interact

directly with customers.

Non-customer-facing employees at Barclaycard “didn’t

have a clear idea of what customers were calling or

emailing about.” Forrester initiated what they call

“Voice of Customer” to get critical customer

information in front of employees. They started a “daily

listening program” to share a randomly

chosen customer interaction via voicemail to all

employees. The customer feedback has driven a more

customer-centric culture, which has helped increase up-

sell and cross-sell efforts, that stays focused on solving

a customer’s problem.

STARTING THE DAY WITH AN ACTUALCUSTOMER’S VOICE


Barclaycard cut customer complaints in half and reduced

customer churn by almost one third. They expect these

improvements to deliver $10 million in annual benefit –

fueling a 35 percent gain in profits, according to the

report. Not bad for a customer satisfaction project. Sure,

this is an enterprise-level example, but the same

process and success can be achieved by a small or mid-

sized business with today’s affordable web-based tools.

With satisfaction as a top priority, many marketing and

sales teams are often in the same boat as Barclaycard –

trying to figure out what the customer wants. One of the

best ways to do that is with a survey, but listen to what

Sarah Robinson, author of the book Fierce Loyalty, has to

say about it:

“Surveys are tricky. They have to be executed

exceptionally well…

THE RESULT OF LISTENING TO THE CUSTOMER?

I like seeing companies make it really personal rather than

a huge blanket mail out. Some even issue invitations to be

part of a special team.”

Sarah’s comment reminds us that if you are just beginning

a business conversation with a customer or prospect that

it is super important to keep your surveys short. There’s a

time and a place for a longer survey type conversation,

with the right customer at the right time – but do that

when the relationship is strong.

As we will continue to explore, you have to do more than

tune in to social media. You have to also solicit direct

feedback. In many cases, it is preferable to catch someone

that is about to give unsolicited feedback in social media

and drive them to a page on your website where they can

leave feedback or into a live chat environment where you

are handling the issue in private.


Customer satisfaction is a rapidly rising and high-ranking corporate priority: 8 out of 10 organizations reported that customer satisfaction is a top-three business issue. In multiple studies dating back to 2005, executives surveyed said that improving the customer experience is one of their top three priorities in the coming years. And 97% said they believe that delivering a great experience is critical to their business results (e.g. increasing customer satisfaction will increase profits).

The earlier-mentioned Oracle study highlighted how

internal hurdles are created, partly by entrenched

company cultures that lose sight of serving the

customer, and that these hurdles block people and

processes from working together. In the Barclaycard

example, it is possible to shift culture by making

customer satisfaction and service a top priority. Not

just lip service, but a top priority.

There is no point asking customers about a particular

service or product if it won’t or can’t be changed,

regardless of the feedback. Customer satisfaction

surveys take time, effort, and company resources.

Thoughtful effort will yield relevant and important

information.

Before starting any customer satisfaction survey,

you will

GATHERING CUSTOMER FEEDBACK: WHAT YOU SHOULD KNOW

want to answer these questions for your own internal

process improvement:

1. What are the goals for the survey?

2. What / how / where will this be measured?

3. How will the results be acted upon?

General questions are not that helpful in customer

satisfaction measurement, at least not without other

more specific questions attached. Without the right

tools, designing an effective customer satisfaction

survey is more difficult than it might appear. It requires

more than just writing a few questions, designing a

questionnaire, calling or mailing some customers, and

then tallying the results. As we’ll see in this section,

understanding customer satisfaction involves

determining what you want to measure.


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The real focus should be on the most important metrics

to cover:

OVERALL SATISFACTION

This measurement it self-explanatory – you are seeking

to measure in a general way: “Overall how satisfied are

you with our company?”

ATTRIBUTE-BASED SATISFACTION

With this type of measurement, you are looking into the

past to understand specific variables: “How satisfied

are you with the quality of the service you received,”

for instance.

Other examples explore attributes, such as:

ATTRIBUTES RELATED TO THE PRODUCT• Product quality• Product benefits

THREE MEASURES OF CUSTOMER SATISFACTION

ATTRIBUTES RELATED TO SERVICE• Guarantee or warranty• Delivery

ATTRIBUTES RELATED TO PURCHASE (OR

TRANSACTIONS)• Courtesy• Communication

LOYALTY

Loyalty is our third category of satisfaction metrics and

is forward-looking. It seeks to understand what a

customer is planning to do or might do. There are a

number of loyalty questions you can ask, here are a

couple of examples:• Do you plan to purchase from us again? • How likely are you to switch to another provider?

But one of the best-known loyalty metrics is the Net

Promoter Score (NPS), developed by Bain & Co.

Consultant Frederick F. Reichheld. The Net Promoter

Score question is: “How likely are you to recommend

Company/Product to your friend/colleague?”


NPS basically involves asking respondents to respond

on a 0 -to- 10 point rating scale question - “How likely

are you to recommend Company/Product to your

friend/colleague?” - The scale is then divided into

three sections:• Promoter - Users who gave a 9 or a 10• Passive - Users who gave a 7 or 8• Detractor - Users who gave a score between 0

and 6

Most survey tools will then calculate the aggregate

responses of each of the three categories as well as

the “Net Promoter” -- i.e. Promoters minus the

Detractors.

There are pros and cons to asking only this question–

the main pro is you get a solid reality check that you

have earned some level of trust and appreciation that

demonstrates that a customer will recommend you to

someone else.

The con aspect is that you only have a simple answer

– the “net” responses to just one question: would

they

HOW DOES NPS WORK? recommend. There are no details as to why or what

happened to inspire it, or what worked or didn’t work in

your sales and service efforts. The customer simply

states they would refer you to a friend or family

member. That’s it.

COLLECTING FEEDBACK ANYTIME, ANYWHERE

Just a few short years ago it was enough to simply send

an email survey to your customers and let the responses

roll in. While email is still an important vehicle for

gathering customer feedback, it is no longer sufficient to

solely rely on email. In today’s mobile social world you

need to be equipped to capture customer feedback

anytime, anywhere. This includes:• Web• Email• Social Networks• QR codes• Point-of-sale: kiosks, links on receipts, hang tags• Field surveys and customer intercepts• And last but not least: Mobile, mobile, mobile…


According to Survey Practice, an e-journal resource for the survey community, “Survey respondents are increasingly attempting to take surveys on their mobile devices, whether researchers intend for this or not.”

Mobile is becoming the dominant way for people to

access the internet. Careful consideration should be

made for how your feedback will be accessed on

mobile devices using multiple methods to access the

web.

Your customers are using tablets, smartphones, Google

Glass

THE RISE OF MOBILE connecting through Wi-Fi, native mobile apps, mobile

browsers and more. No doubt, you have seen or read

about Facebook or online promotions that encourage

users to play a game or enter a contest – these

methods, often called gamification, are meant to make

a survey more interesting and fun. The goal is to make

sharing information painless.

For example, in an Entrepreneur article, Nike+ is

successful in a combination of mobile and Facebook

app “where users could set running goals, earn

rewards for reaching milestones and get

congratulatory messages from world-renown athletes.”

The magazine reported that Nike+ membership

increased by 40 percent. Most importantly, as this

ebook points out, the company attributed a 30 percent

boost in revenue, in that product category, to the

effort.

Starbucks does a great job on their in-store mobile

survey promotion. They use point-of-sale staff to ask if

“you would like to save $1.00 off your next drink.”

They then explain how your receipt has the link to a

web survey which gives you a code upon completion

for that $1.00 savings. Nearly every major retail brand

does this today: Home Depot, Rite Aid, and Safeway,

just to name a few. The cost to do so is incredibly low

and you’ll get helpful data in the process.


41%of consumers expect an email response within six hours. Only 36% of retailers responded that quickly. --Forrester Research Inc, 2008

One point-of-sale survey method is to provide a QR or

barcode on the receipt, which the customer can scan

with their smartphone. Rather than have them type in a

long survey link, they can simply scan with whatever

app they use.

As a quick aside, if you are going to use a barcode or QR

code to present your survey, make sure that landing

page is something you can keep active later. You don’t

know how long a code like that can float around the

internet and it gives you an opportunity to connect with

someone long after your survey is complete. Don’t let

your QR codes lead prospects to dead webpages. Why

waste an opportunity to redirect someone to your main

website if they reach an inactive survey?

TAKING ACTION ON SOCIAL MEDIA AND SURVEYRESPONSES IN A TIMELY FASHION

Regardless of what you are measuring, you will want to

plan for how you will respond. The Forrester statistic

about a “six hour email response is expected” is five

years old. Twitter, Facebook, and other social networks

were really just coming into the mainstream and getting

useful as customer service channels. As you see in the

second quote, Social Media Today found

36%

of businesses using social media for customer service believe customers expect an answer in one hour or less.

that 36.3 percent of surveyed companies expect that

customers expect a response in an hour or less. 32.5

percent believed responding within one day is

acceptable.

The main lesson here is to make sure that the social and

survey platforms you use have tools to alert you when

someone comments, or shares something on social

media, or completes a survey. You want an action alert

that is built-in to the technology.


As we opened with and learned from VoIPSupply.com,

their work seems like an ideal place to conclude. They

learned some painful facts in one of their annual

surveys: Their returns policy and return procedure was

broken. Customers found it difficult to understand when

they wanted to return an item.

What did VoIPSupply.com do? They listened to their

customers and solved the problem. They streamlined the

return process and created a new online service platform

to make it simpler and easier for the customer. Each

week, Garrett Smith contacts customers personally. Each

week, he gains incremental, but important, knowledge

that helps him provide a superior customer experience.

Without surveying their customers, they would miss out

on opportunities to fix challenging areas of their

operation that drive direct revenue and profits.

In this ebook, we built a case for leveraging new web

tools that allow you to listen to your customers and to

solicit direct feedback from them. In the process, we can

build stronger

CONCLUSION

relationships with our customers, promote our brands,

and

increase profits. Yes, the foundation requires superior

customer service, but regular communication helps

you to provide that top level of service and keep

customers happy.

The UK Institute of Customer Service found that organizations can increase profits by streamlining the customer experience process. Solving a problem within 24 hours has an average cost of $4.70. Solving a problem a month later has an average cost of $23.50.


RESOURCES CITED IN TEXT:

http://blog.kissmetrics.com/expectations-and-customer-service/

http://community.bmo.com/smartstepsforbusiness/articles/surprise-and-delight-your-way-customer-loyalty

QuestionPro provides a useful

resource page to help you build

multiple choice questions:

http://www.questionpro.com/help/116.html

Social media tools:

http://www.hootsuite.com

http://www.tweetdeck.com

http://getlittlebird.com

http://tellagence.com

IMPLEMENT A CUSTOMER FEEDBACK MEASUREMENT STRATEGY IN 30

MINUTES

In order to apply what we’ve learned, here are 3 action items to kick

off your new customer satisfaction process (following these 3 steps

should take about 30 minutes):

1. Plug-in to your social channels.

Update your social profiles and make at least one post on each,

and schedule time for this on your calendar (for example if you’re

not currently posting, set aside 30 minutes twice per week to

come up with posts and send them out).

2. Ask for feedback.

Setting up a customer satisfaction survey takes only a few

minutes. If you don’t already have a survey provider, go to

www.questionpro.com.

3. Make your survey as accessible as possible.

When selecting a survey platform, be sure they provide easy

access to all possible delivery mediums: web, mobile, offline

electronic submissions, QR codes, email, customizable URLs or

embedding in a website, social sharing, etc.

QUICK START GUIDE









http://www.hootsuite.com/

http://www.tweetdeck.com/

http://getlittlebird.com/

http://tellagence.com/

TJ McCue consults on content strategy for technology

companies and produces web content for entrepreneurs

and business owners.

Currently he writes for Forbes, Small Business Trends

and Yahoo! SMB.

In the past, he has put pen to paper for the Wall Street

Journal, Make, Sports Afield, the Pittsburgh Business

Times and many others. He is passionate about

technology and works to serve tech businesses and

startups.

You can reach him on email, circle TJ McCue on Google+,

or follow him on Twitter.

About the eBook Sponsors

With over 2.7 million users across 100 countries, we are a

leading provider of online survey software that allows our

users to generate the insights they need to make better

business decisions. Our software includes not only tools for

creation, distribution, and analysis of surveys, but also

provides a platform for polling and forms, tablet &

smartphone-based mobile research, and mobile data

reporting & visualization. We have provided reliable and

innovative technology to Fortune 100 companies,

academic institutions, small businesses, and individual DIY

researchers for over ten years.

QuestionPro aims to give you the best tools possible for

collecting and analyzing your data, and with live support

24 hours a day, we're always here for you. Customer

satisfaction is our top priority, and we take your feedback

to heart. Conducting research should be interactive, easy,

and dare we say it, fun.

17

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increase profits through feedback - a practical guide to measuring customer satisfaction (ebook)

Business

customer feedback

customer service process

customer service platform

good customer service

customer retention

customer concierge

customer service experiences

customer service shouldnt