Businesses spend a lot of time and money trying to gain insights into how customers perceive their product or service offerings. This might involve conducting surveys and focus groups to hear directly from customers. Or, it might involve efforts to ascertain customer preferences based on online behavior and purchase decisions. And yet, despite the general accessibility of this type of information, so many businesses still misread customers. That lack of awareness limits their ability to improve the customer experience.
Common Challenges When Seeking Feedback
In an article for Forbes, Jeremy Stine—Chief Innovation Officer for SAP North America, discusses three common challenges business face when it comes to acting on customer feedback.
- A mechanism to separate the signal from the noise
- The ability to see the “View from the Balcony”
- The ability to actually drive operational change based on the feedback
Or, stated differently, businesses often fail to both gain meaningful insights from their customers and to act on those insights when they do have them.
Failure to Gather Insights
Let’s start with the first. Stine’s first point is that businesses sometimes have information overload—the noise—and fail to appreciate the relative significance of feedback from different groups: the signal. He gives the example of Kmart. “They measured customer satisfaction but, in the aggregate, everything looked fine,” he says. “What they didn’t see was that the customers who were the most satisfied spent the least. The customers who would have spent the most were dissatisfied.”
Conversely, companies also sometimes focus too much on details and end up missing the broader picture—the “view from the balcony.” He suggests that some customers might have many positive experiences in interactions with an organization but see the entire relationship as disappointing. Companies too focused on these one-off interactions fail to accurately evaluate the broader relationship.
Failure to Act on the Insights
So, let’s say you don’t suffer from the challenge of failing to gain meaningful insights from your customers. You’ve got a lot of customer feedback from a wide range of sources and you gather it regularly. Are you in the clear? Definitely not. This information is only as good as the concrete steps you take to act on it.
Stine says: “Context matters. Companies need to understand three things: WHAT happens, WHY it happens, and HOW to either make it stop happening or make it happen more frequently.”
Data collected from customers can be extremely valuable to any business, but it has to be used effectively. That means not only collecting it but drawing meaningful insights and conclusions from it and taking effective action based on those insights and conclusions.
How are you doing with that?
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Tags: acting on customer feedback, conducting focus groups, conducting surveys, customer feedback, customer input, customer survey, marketing research