Advertisement

To Align Businesses, First, Align With Customers

Customer feedback is essential for a business to grow and survive.

Elon Musk says ‘’having a feedback loop is important, where you’re constantly thinking about what you’ve done and how you could be doing it better”

Customer feedback to businesses can be positive or detrimental. Bad reviews and negative word-of-mouth publicity can destroy brands (according to a marketing firm Moz, online reviews affect 67 per cent of customers and one negative article about a poor product/customer service can churn away as many as 22 per cent of customers). Serenity Gibbons describes in her article ( Forbes- Sep 20, 2018) that when a company assures their dissatisfied customers it’s taking their issue seriously, they prevent about 75 per cent of them from venting out their frustration online, thus proactively avoiding a scenario of brand reputation ruin.

On the other hand, a positive customer comment may be the spark for new products, eye-catching marketing campaigns, or tech solutions that company leaders had never considered before. Constructive customer feedback reinforces trust and enhances the brand image, and thus increases the likelihood of the organization’s ability to charge a price premium or even up-sell/cross-sell... 

So how do organizations master the art of customer feedback? A simple way -Listen to customers. Let’s look at some examples where businesses have benefited from listening to their customers periodically:

DELL’s Ideastorm (see image) a dedicated website just for Dell users to post reviews and complaints, was launched in 2007 after a bitter customer review about the brand. As per Ideastorm, whichever review/complaint gets the most votes and comments is prioritized and acted upon first by the company. Ideastorm not only served as a platform for resolving complaints but also garnered a lot of product improvement and service improvement ideas. Over 5 years, Dell received nearly 15000 suggestions and made around 500 refinements based on those suggestions. (Source: Shel Israel, Forbes - Mar 27, 2012)

Source: MyFeedBack

Ideastorm positioned Dell as a forward-thinking company because in 2007 this was a unique concept. Dell was one of the very few companies that implemented this crowdsourcing concept which was eventually adopted by many other businesses. 

Another Consumer electronics company that takes customer feedback very seriously is Apple. (See Image) .Instead of the traditional feedback or survey methods, Apple uses Net Promoter Score (NPS) as a way to capture customer feedback.

Source: Retently

Apple uses NPS on a daily basis across all its stores globally. The results from the NPS survey help employees and store managers to prepare for either corrective action or continue doing what works best for them. Store Managers call the detractors within 24 hours and prepare for service recovery. Apple soon realized that by following up with detractors quickly they were able to generate additional revenues-as much as $1000 per hour spent on call. The feedback received from the detractors is passed on to store employees for training because Apple’s customers become promoters or detractors depending on the way their employees treat customers. 

Shop assistants are encouraged to form relationships with customers. When an employee creates more promoters and detractors, they are recognized by their Managers. The direct result of the commitment to NPS is a significant increase in revenue/square footage. In the US, the average sales/sq. Ft for a consumer electronics store is around $1200, whereas for Apple it is $6000 which is the highest productivity for any format of retailing. Some of the best performing stores have an NPS of about 90 per cent. (Source: The Ultimate Question 2.0 by Fred Reichheld)

How Technology plays a role to get closer to customers:

Leveraging technology can be a great way for businesses to align themselves closer to customer needs. In a recent global survey conducted by NielsenIQ, global customers listed AR (Augmented Reality) and VR (Virtual Reality) as the No.1 technology that they would like to use to assess and evaluate products, especially consumer durables. A/VR technology has truly transformed the way customers engage with a brand. A well-known pioneer to use this technology was IKEA. IKEA enabled customers to virtually place their furniture at home through the lens of their mobile camera (accessed through their app) so that customers can have a visual sense of how the product fits into their real estate without the need to purchase it. This is a great opportunity for IKEA to collect customer feedback through this interactive app. 

Apart from using traditional surveys, brands can obtain feedback by using Social listening tools and Text mining to understand customer sensitivity on social media platforms. Brands can have an online community, which can be an extension of their website. Online communities encourage participation and drive valuable discussions which can be a great source of learning for businesses. Companies can even offer a small gift or reward to incentivize customers to post or comment daily.

Customer feedback is the backbone of businesses and organizations need to chase this consciously. As seen from the examples of this article, both positive and negative feedback can help businesses in meaningful ways. Throughout history, great brands have been built by obtaining the ‘voice of customers’. Feedback-driven growth is a constant in marketing and it applies to small and large businesses across industries. A brand that is closely aligned with the needs and priorities of its customers will enjoy great customer satisfaction and continue to prosper.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house


Tags assigned to this article:
customer feedback business growth mba

Around The World

Our Publications

Advertisement