Are You Listening to Me?: Communicate With Customers
ClickZ.com - August 19, 2004
To learn what customers really want, ask them!
Communicate with customers. That includes your best customers, your squeaky wheels, and the great silent majority. In the wired world, word of mouth spreads faster and carries greater clout than any marketing. Over 20 percent of consumers will contribute over 1 billion unique pieces of content to discussion forum posts, online reviews, and blog entries in 2004, according to Intelliseek.
Consumer-generated media is projected to increase 30 percent annually, and blog content at an even higher rate. Intelliseek's Pete Blackshaw, chief marketing and customer satisfaction officer, believes "feedback and customer service are the new marketing opportunity."
"Consumers rule" isn't just a mantra, it's reality. Engage customers in a dialogue using on-site feedback and real-time conversations to determine what they want. Don't assume you can guess what they want. Each customer contact is an opportunity to extend the relationship and increase lifetime customer value.
Responding to customer feedback within 24 hours is policy at WeatherBug,. The company is dedicated to listening to the "voice of the consumer." According to Senior VP and General Manager Andy Jedynak, "The real value of our business is in pervasive customer relationships and making them last."
When consumer desire for an ad-free environment surfaced in e-mail correspondence as a reoccurring message, WeatherBug used customer input to develop and test a paid-subscription product. WeatherBug monitors key customer feedback indicators with a page-and-a-half report issued weekly to senior management. For hot, new areas of concern, WeatherBug's CRM system quickly delivers raw feedback, categorized by topic.
A senior executive at an online travel startup with limited resources regularly spoke to a cross-section of his customers. Without significant costs, these conversations yielded valuable feedback. The firm adapted its Web site and offering in ways that would never have surfaced in focus groups or market research surveys.
For example, the firm originally assumed the flight schedule was business travelers' primary driver. Customer interviews revealed frequent flier programs' interaction with different travel options was a stronger, yet unknown, preference driver. By providing customers with the ability to search for travel services that maximized their frequent flier awards, its heaviest business travelers were converted to loyal customers.
Communicate with customers to:
Discover how they feel about your offering and brand. Know if your brand delivers on its promise in customers' eyes.
Determine what they want from your company. This is one way to gather early input on where to direct new initiatives and how to modify marketing.
Extend your relationship with your best and most influential customers. Tied to your brand, these customers have strong feelings and insights into the strengths and weaknesses of your offering and want to help you.
Test ideas for quantitative research. Tap into your customer base to test planned market research. This can save you headaches down the road.
Ways to reach out to customers:
Ask users for input. Place a "feedback" text link in the footer on every Web site page or in the site's navigation bar. Collect customer input at every touch point. Depending on your offering, you may want to solicit customers, visitors, or both.
Monitor and respond to non-customer service feedback. Responses should be timely and go beyond automated, preformatted answers when you're confronted with non-routine requests.
Randomly select customers and request permission to talk with them. To get input from visitors who aren't customers, use a pop-up window or a box on the home page. Consumer time is precious; send a personalized e-mail or call to arrange a time to talk at the consumer's convenience. Only a small percentage of customers contacted will talk to you. Consider using a special e-mail address for these communications.
Talk to customers. Consider creating a list of questions to ask. The online travel executive found allowing customers to verbally direct the conversation where they wanted was most valuable. Ask customers for their stories about using your product.
Take good notes and record each conversation. You'll want to verify what was said and, over time, detect consistent themes in the comments. Notes will help create a sense of the true importance of an issue after the conversation fades.
Leverage customer service. Gather additional information from and about your customers. Talk regularly with customer service reps about what they see as emerging issues.
Follow up customer contacts by:
Thanking customers for their time. This will build goodwill and extend your relationship. If you plan to use customer stories publicly, request permission.
Maintaining ongoing contact with these customers. Having initiated the connection, consider ways to enhance it.
Analyze consumer input:
Compile customer feedback, good and bad. Break out input by categories relevant to your business and brand. Cull direct quotes to illustrate points. Use this input as the basis for business changes or quantitative research.
Track and include feedback indicators. Track items such as the number of e-mail messages received per day and average response time. The aim is to surface issues quickly. Even a lack of customer response may be an important sign.
Add a commentary section summarizing feedback themes. WeatherBug's weekly report includes a "What the numbers don't tell you" section.
Distribute to senior management, marketing, product, technology, PR, legal, and investor relations. Get management's input as to what they need to help better steer the business.
Monitor cost and benefits of the ongoing, proactive customer communication program. Although this process generally leverages existing resources, so incremental costs are minimal, benefits can be difficult to directly quantify. To illustrate its value to management, maintain a list of notable improvements that result from collecting customer feedback. Where actual costs don't exist, use a proxy, such as the cost of a focus group.
By communicating with customers directly, you open a channel that allows you to tap into customers' feelings. If you know there's an issue with your offering, technology, customer base, or competitors, you can deal with it. The sooner you identify a problem, the more quickly you can respond to it.
This isn't the time for an ostrich approach to marketing. In addition to building old-fashioned relationships, listening to customers directly provides a mother lode of information to help improve your offering, Web site, and marketing.
Emerging Brand Marketing
The purpose of any business is to sustain the process of profitability in the long term. That process ultimately being marketing—and, more specifically, creating a sustainable brand. Which areas do emerging brands need to rethink to specifically manage the costs of the entire marketing process? Which principles can reasonably ensure that your brand’s marketing efforts can gain share from established players?
Emerging Brand Marketing (PDF)
Digital Marketing Survey
Nearly two-thirds of marketers now see digital marketing as having a very high or high level of strategic importance within their organizations, according to a December survey by the CMO Council.
75 percent of the survey respondents said they planned to increase their digital marketing budgets in 2004. Nearly 40 percent said they would spend more than 20 percent of their marketing budget on digital marketing.
Digital Marketing Survey (PDF)
Web Buyers & Catalogs
At a product workshop in London recently, we were asked, "Since so many people seem to be buying online, why are you (Home Port) still insisting that it's important to get your product in the marine catalogs?"
The short answer is, not everybody is buying online. The long answer, however, is more complicated. Online sales are expected to pass catalog sales by 2005. But web buyers still use catalogs extensively - they just use them differently than offline buyers.
According to a Forrester Research report released late last year, the Web isn't replacing catalogs, but online shoppers increasingly use print books more as desk references than as points of purchase. In a survey of 8,000 households, 29 percent of Web buyers said they go online to get more information about a product they saw in a catalog, compared to 13 percent of consumers overall. The report added that 82 percent of Web buyers still look through most catalogs they receive, and only 6 percent said catalogs are not valuable.
Trade Show Booth Tips
We're in the midst of helping several clients prepare their booths for MAATS (Marine Aftermarket Accessories Trade Show) July 9-11 in Las Vegas, so this seems like a good time to review how to get the most out of an exhibit. Three seconds is about all you get to grab someone's attention on the show floor, so booth design and the marketing message are critical.
Your booth should be uncrowded and easy for visitors to navigate. Step out into the aisle yourself - do you find your booth inviting to enter?
Keep the marketing message simple, concise and to the point. Don't overload visitors with information. If you have a new product or service, that's your message!
Use graphics and signs to focus attention on the message.
If you're doing a demonstration (or a giveaway), make sure it's consistent with the message.
Plan To Get More Publicity
A few weeks ago, a friend of Home Port COO David Pilvelait called to congratulate him after seeing the trade news reports on the opening of Home Port's office in the UK. "It seems like I'm always reading something about Home Port in the trades," the friend said. "That's the plan," David replied.
A little while later, on a plane to a client meeting in Miami, David thought more about that brief phone conversation and the topic for this tip (and upcoming column for Boating Industry) was born. To get consistently valuable publicity for your marine business or organization, you've got to have a plan. There's just no other way to do it. Nearly every business day, Home Port executes at least a small part of a publicity plan we developed a couple of years ago to help build awareness of who we are and what we do.
Here's how you can go about it.
Define your target audience - customers, prospects, employees, media, vendors. If your resources are limited, focus on those groups with the highest potential to impact your success.
Develop key messages. Depending on your business goals, key messages can be related to your core values, a product launch or major initiative, etc.
Develop story topics. There are hundreds of opportunities to make news. (Examples: new product or service, reports issued, Web site launch or overhaul, significant company milestone, personnel appointments, company angle on an industry or consumer news story, speeches by management, awards received or given, community service). Make a list of all the possible ways you can publicize your company or product(s), then narrow it down to the best ideas.
Create a timeline. Take your best story ideas and develop a calendar for the next year. Start with ideas tied to specific events, milestones, or seasons and then add "evergreen" ideas (those that can be done at any time, such as case studies). Routine activities and piggybacking on industry/consumer news will fill in the calendar. Review and update your list quarterly.
Put together a media kit. This can be simply a folder with a few fact sheets or brochures - basic information about your company, product or services, facts and figures and contact information.
Build a news media list. Find out which print, broadcast and online journalists cover topics relevant to your target audience(s). You'll want to find out key journalists' interests, deadlines and how they prefer to receive information. Getting to know these people and providing useful information to help them do their job will go a very, very long way.
Start Each Year With A SWOT
The beginning of the year is a good time to do a SWOT analysis - to evaluate the Strengths, Weaknesses, Opportunities and Threats to your organization.
Sometimes all it takes is a simple tweaking of strategy to produce significant cost savings and/or profitable increases in revenue. Your analysis should include market size, your market share, target markets, image in target markets and your value proposition per targeted market.
Strategic Analysis
Your total addressable market size:
Current size of market for your products or services
Expected growth rate based on historic or future trends
Your company's market share:
Current share (e.g., 2 percent) versus desired share (e.g., 10 percent)
Total number of competitive players
Dominate market players -- percentage allocation
Threat of new entrants (low or high barriers to entry)
Your company's target markets:
Primary (fast cash) versus secondary (lifetime customer value)
Contribution to profitable revenues (short- versus long-term)
Known decision makers and influencers
Demographic, social, and cultural factors, such as population trends, ethnicity, age distribution, lifestyle trends, mobility trends, level of education, and change in buying patterns -- evolving consumer tastes
Your company's image in targeted markets:
Reputation for quality (current versus desired)
Reputation for service (current versus desired)
Reputation for price (current versus desired)
Reputation for innovation (current versus desired)
Reputation for ethics (current versus desired) -- business, social, and environmental
Your company's value proposition per targeted market:
Alignment with market demand (problems solved)
Advantages of products or services (risk versus reward)
Expected economic benefit (cost benefit)
Key differentiators (unique qualifications/core competencies)
Competitive advantages (perceived or proprietary)
Your company's contact with targeted markets:
Domestic versus international
Messaging objective:
Awareness (attention)
Interest
Education
Trial
Conversion
Share of wallet (up- or cross-sell)
Referral
Delivery channels (on- and offline): direct versus constituents (salespeople, partners, or affiliates)
Cross-media allocation (percentage TV, print, and Internet)
Frequency of contact
Cost per interaction
Results of interaction
Return on investment
Customer Satisfaction Surveys
Customer satisfaction is a key to success. You want customers to be happy with the products and services you provide. If they feel they have received good value for their money, your business or organization will prosper. Getting your customers to tell you what’s good about your business, and where you need improvement, helps you to be sure that your business measures up to their expectations.
A customer satisfaction survey is one way to gather this vital information. There are any number of ways to get copies to your customers. Copies can be included with orders, mailed directly at regular intervals, sent and received by fax, posted on your web site, whatever is convenient for your particular business. Many won’t be returned, but those that are will make it worthwhile.
The customer satisfaction survey below is designed to get your customers to tell you what they really think. No ranking of quality on a scale of one to five, no lengthy questions, just a list of key business activities and space to respond. Limiting the choices to 'outstanding' and 'needs improvement' sends a clear message that you expect the products and service you supply to be the best available, period. Keeping the survey to a single page makes it more likely that customers will take the time to respond.
Be sure to follow up on the comments you receive. If you have to make changes, send thank you notes to the customers whose comments caused you to make a change. Let them know that you can do an even better job because they took the time to help you improve.
Sample Customer Satisfaction Survey
Please circle 'Outstanding' or 'Needs Improvement' and comment:
1. Products (or Services):
Outstanding
Needs Improvement
2. Services and Support:
Outstanding
Needs Improvement
3. Delivery (or Shipping):
Outstanding
Needs Improvement
4. Ordering and Billing:
Outstanding
Needs Improvement
5. Employees:
Outstanding
Needs Improvement
6. Additional Comments:
Reduce Risk When You Raise Prices
Ever wondered if you could increase your sales revenue by raising prices, but hesitated fearing revenues could actually drop? There is a way to test price hikes before putting sales revenue at risk.
If you've been selling the same product(s) for a number of years, HPC can use your past price and sales data, combine it with general economic data and predict how much your sales revenue will increase or decrease if you raise prices.
This process is a time-tested statistical process known as regression analysis. It doesn't take the risky route of looking into the future. Instead, it analyzes the past to determine how the market has reacted to a company's price and product changes.
This process as used by HPC under the direction of Research Counsel Rob Southwick analyzes all company products at once to assess how a price change for one specific product affects sales of the company's other products; and how the introduction of a new product affects sales of existing products.
"Looking at past data can really help us to reasonably predict the impact of price changes on sales in the future," Rob Southwick says.
"For example, working with two state fish and wildlife agencies, we found that several fishing licenses were overpriced. We correctly predicted that by cutting prices for the licenses, the agency would sell more of them and generate more revenue for department programs."
