In business, we often focus on the competition or our bottom line, while assuming that we already know all we need to know about how our customers feel about our services or products. But, according to an article in Inc., two of the most common mistakes entrepreneurs make are:
The article advises that, "Your customers should love your product. If not, then you have a real problem. You need to find out why. The only way you can do that is by really listening and responding to their needs.”
So how do super busy entrepreneurs and business owners carve out time to understand their customers better? It starts with developing an ongoing customer intelligence system designed specifically for their business.
A simple but strong system should include these four components:
This can be as basic or sophisticated as your budget and time allow - but leaders of successful organizations will tell you: put something in place.
To start a program, keep it simple at first. For front-line gathering of customer insights, consider ways customer-facing employees can ask key questions and record those answers. For example, a retailer may have its cashiers ask customers about which aspect of their store experience they enjoyed most and then quickly record each answer on a tablet. When it’s too busy to stop and ask each customer, then ask every fifth or tenth one. But don’t ask customers only when it is slow. Their experience could be very different from a customer visiting during a busy time.
If you have a small business where people stay for a while, like a restaurant or hair salon, consider asking patrons to complete a short survey (no more than a few questions) while they are waiting for service or when waiting on their credit card to process.
If you are in a service industry, such as financial services, health care or home remodeling, ask each client what they are most satisfied with or what could have been improved about their experience. As long as you keep it brief (1-2 questions), most people won’t feel the questions or a short feedback form are an imposition. You can vary the questions by customer or calendar if you want to gain insights on a larger set of questions.
If your business sells to other businesses, make sure your sales representatives, customer service staff, dealers or independent agents gather ongoing feedback from customers. The feedback obtained can be rolled into prospecting or sales/service call reports and then incorporated into product development or customer service initiatives.
All businesses already collect some data on customer and prospect behaviors. Examples include sales, service calls, merchandise returns, customer referrals, contract renewals, complaints, social media posts, review site comments, website traffic, email open rates, inbound phone calls, online contact forms, return appointments, conversions of proposals, and more.
It’s not enough to simply collect data. You must have a consistent method for analyzing and applying this information in a way that actually helps you create better products, improve service and boost sales.
Analyzing back-end data (called data analytics) is most helpful if you can link customer characteristics to the other data you collect. Then you can connect data about behaviors with customer demographics. Who should evaluate and interpret this data? Creating a strong customer intelligence system requires a good business software system to create automated reports. If you have someone on staff who has an analytics background, you can go beyond these standard reports for real insights. Or you may want to consider hiring a consultant or firm to assist you with data analytics. These specialists can help you get a system up and running for less than you might expect.
Truly knowing customers involves more than analyzing their behaviors and gathering quick front-line feedback. It also requires a deep understanding of their preferences, needs, and attitudes as well as the motivations driving their actions. Customer research activities that deliver this type of information are more time-intensive and therefore best conducted quarterly or monthly. You can start out small with your own staff and bring in outside research partners as your needs or resources grow.
Here are a few ideas for activities you can do yourself:
It is also wise to gauge your customer satisfaction levels on an annual or bi-annual basis. We recommend doing this at the same time of year for more reliable trending of results. Choose the most convenient time of year for your customers to provide feedback. For seasonal businesses, it’s important to avoid their busiest months to obtain good participation and thoughtful responses.
If you have a limited budget, start with getting answers to these three questions:
If you have the funds to bring in a professional research firm with advanced analysis capabilities, you’ll benefit from deeper insights. For instance, a professional market research firm will often uncover the drivers of customer satisfaction and provide segmentation analysis that reveals the different satisfaction issues among various groups or types of customers.
Knowing everything you can about your customers is the key to successful product innovation and highly satisfied customers who bring repeat business and referrals. Businesses that invest in a smart, effective customer intelligence system will always have the information they need to innovate, excel and grow.
At Vernon Research, we love discussing market research, no obligation. If you’d like specific ideas for your customer intelligence system, please get in touch. Contact Linda Kuster at 319-364-7278 or lkuster@vernonresearch.com.
