How to generate customer insights without another survey!

starbucks_ideas

While surveys are useful at collecting information on customers and how they feel about certain interactions, products or services there are other ways to gain meaningful insights.

First let’s define what we mean by customer insights:

Customer Insights Defined: a deep understanding of a customer’s needs and behaviors—both known needs that the customer can identify, and the latent needs that they cannot.

It also helps to begin by framing the type of customer insight you are looking to uncover. There are 4 main categories of customer insights that are useful to driving business performance.

1. Strategic Customer Insights – these are used to inform the company’s strategy by understanding what unique market segments exist in the marketplace. For example in the telecommunications industry there are a wide range of different types of customers with unique needs. Some customers now use smartphones as their primary internet device, their needs will be different from customers that still use cell phones primarily for phone calls and text messages.

A deep understanding of the needs of different market segments allows a company to determine which segments are most attractive. This customer insight also allows a company to identify where it needs to improve its own value proposition in order to attract and retain customers from each segment.

2. Program Specific Insights – these are insights specific to a component of a business strategy. For example, a manufacturer looking to roll out a training program to its retailers would need insight into the most effective methods to educate retailers. Should training be conducted in person, via a webcast or through a self service portal?

3. Product and Service Insights – these are direct inputs into how products or services could be improved. A great example of this in action is “My Starbucks Idea”, an online brainstorming tool driven by customers. Customers share ideas and other customers can vote on them so the best customer driven ideas rise to the top.

4. Insights for Marketing Communications – understanding what media and mediums customer’s use to get information informs how companies can more effectively reach and communicate with potential customers. For example if the customer group in question is predominantly focused on using social media, understanding which social media platforms they are most engaged in will help direct communication resources.

So now to the question of how to generate insights without surveys…

Customer insights can initially be generated from reviewing existing publicly available research and data as well as data internally available to the company. This often involves internal interviews with experts in markets and front line people that interact with customers on a regular basis. While this is useful it is secondary research, a review of what already exists and while it can generate new insights it is more useful for gaining alignment around what the company already knows about customers.

To gain deeper unique insights an ongoing process should be implemented that involves primary research. This doesn’t need to be complicated or only handled by marketing research profession in fact it is more impactful when people across the organization are involved.

Customer Immersion Activities

The most time and cost effective way to generate insights is to simply talk with customers. In today’s world this can include a range of mediums from one on one interviews to focus groups to online forums like the one Starbucks runs or Ideastorm, Dell’s equivalent.

Now I realize that technology products and coffee are highly engaging products with many willing participants, what if you sell toilet paper or a product that inspires less passion?

For these less inspiring categories a great source of insight can be customer complaints. Barbara Buchanan has written a great article titled “Mining Complaints and Negative Social Media May Have Positive Consequences” including some examples from the banking and manufacturing industry. The key is making it easy for customers to complain and provide feedback in real time, in the moment. For example a Hospital in California installed posters around the hospital with a QR codes. Patients can scan the QR code on their phones and immediately send a manager a message about an issue. Managers receive these in the form of text messages and commit to responding immediately and resolving issues as fast as possible. Patient satisfaction has doubled in the past several quarters as a result.

qrcodes_feedback

Going Deeper by Observing Customer Behavior

Ethnographic research can provide deep insights into people’s behaviors and unmet needs by taking a holistic view of customers in their own environment.

This is a more expensive technique but can yield unique insights. A great example comes from a day in the life analysis of  women cleaning their homes in Italy. A US company after failing to gain success with an all purpose cleaner for the home in the Italian market, undertook ethnographic research to understand why the product was failing. It discovered that Italian women spent 4 times as much time cleaning their homes than US women. They were fastidious and extremely house proud. They used specific cleaners for specific jobs as they believed an all purpose cleaner simply would not get the job done. These insights allowed the company to reposition the cleaner to focus on meeting a more specific need – benchtop cleaning. The repositioning resulted in a much more successful launch into the italian market.

Piloting New Products or Services

This involves putting new products or services in front of customers to gain direct feedback. A modern version of this can be seen on websites like Kickstarter, where entrepreneurs and intrapreneurs can essentially describe a product or service and raise funding for the idea. This is really the ultimate way to test concepts, will customers pay for it? One of the most successful products launched on Kickstarter is the Pebble Watch. It launched 18 months prior to Apple announcing their own iWatch. It is now raising funding for its second version and has raised almost $10 million to date.

Mining Social Media

The last incredible source of rich customer insight exists within a wide range of social media including Facebook, Twitter, LinkedIn, Yelp, Pinterest and other online communities. There are a range of different companies that can help mine this online data and distill sentiment and feedback in a meaningful and actionable manner. A great list of the top 50 tools is provided here by Pam Dyer.

While surveys remain a great way to elicit direct feedback on specific topics of interest to the company, there are many other ways to generate insights that should be incorporated into every company’s way of doing business.

Is Telstra Australia’s Amazon? – Its Customer Centric Strategy is Paying Dividends

Making Customer Connections

While some may argue you cannot compare a telecommunications company with an online shopping mega star like Amazon, I beg to differ.

There is one core element both companies now share – their absolute commitment to being customer centric.

In 2009 when David Thodey took over as CEO of Australia’s largest telecommunications company, Telstra, he was asked what would differentiate his tenure from his predecessors. He said:

“I want to be an agent for the customer”.

It was a time when Australia’s highest profile company was being criticized on all fronts for its arrogance, poor customer service, unjustifiably high prices and monopolistic practices.

Thodey set about changing the culture at Telstra to a customer focused culture and invested heavily in defining and communicating internally a vision, values and strategy that had the customer at its center and customer service as its catch-cry. It included intense training of its 5,000 people leaders in Australia, India and the Philippines as well as new systems and processes that empowered customer facing staff to provide much better service to customers and solve their problems with least fuss. A new division was set up that enabled staff who heard of a friend’s problem at a barbeque to give them a direct line to a solution if they were having trouble getting it solved. Telstra embarked on a program to create advocacy with its customers and its staff. Use of the net promoter measurement system with daily feedback from thousands of customers fed to the areas in Telstra responsible was a trigger for focus on customers. Other customer feedback measures and progressive culture assessments have supported Telstra’s customer-centric journey.

Telstra: Improving Customer Advocacy

Now it is paying dividends. The company has posted seven successive half years of earnings growth to AUD$2.1 billion for this latest half – up 21% on last year. Dividends have been steady, but are now set to increase. Telstra is on a roll with its customer-centric strategy and stronger customer culture proving Thodey’s stance. Stock price is at an all-time high at around AUD$6.50 per share with steady and continuing growth up from around AUD$4.50 two years ago.

Telstra posts 22pc net profit rise

David Thodey is the first to say that Telstra still has some way to go. But his leadership of a strategy and culture in which the customer is at the center of decisions and service delivery is creating a highly sustainable profitable business.

If you want to see how it all began you will find it was originally initiated first in the Finance Group at Telstra and described in a case study about the CFO’s value service culture initiative. See Case Study Highlight: Telstra Transformation.

Telstra’s transformation story can also be found in “The Customer Culture Imperative: A Leader’s Guide to Driving Superior Performance”

3 reasons why customer centricity’s time has come

the_time_is_now The world of business has rapidly transformed over the past 15 years. From a world where businesses controlled supply, controlled the message and could dictate terms to customers to one where customers have a much louder and more influential voice.

While we have always been advocates of businesses that act in the best interests of their customers, it seems market forces are now compelling all businesses to behave this way.

So why do we believe 2015 is the year for Customer Centricity? 3 reasons.

1. Customer Feedback Systems are going enterprise wide.

Companies have been measuring customer satisfaction levels for many years. Often these surveys have been conducted once a year, presented and then forgotten about. This type of survey methodology is rapidly changing, becoming real time and supported by great technologies to get the right feedback to the right person at the right time. In fact technology is enabling enterprise wide feedback mechanism that were never previously viable.

While this is a great positive trend for companies that realize they must become more customer centric, it is not enough for these to remain only the domain of customer service or marketing.

Being customer centric is a way of doing business that is not only about sales, marketing and customer service. It involves every department understanding their role in creating a great customer experience. Many forward thinking CEOs recognize this fact and are working on transforming their organizations to meet this challenge.

2. Convergence of customer experience and employee experience.

Today there is a recognition that employee experience impacts customer experience. If employees are not given the opportunity and tools to change the way they work, the customer experience will suffer. Being customer centric means understanding that every interaction with customers allows them to form an impression, good, bad or indifferent. It truly requires everyone in an organization to be engaged in delivering great experiences.

The bottom line here is that you cannot create truly engaged customers without truly engaged and passionate employees.

3. Recognition that Customer Centricity is a Leadership Competency. 

Being customer centric, requires leadership that is customer centric. Leaders need to be engaged with customers first hand. Leaders need to immerse themselves in the customer’s environment and experience what customer’s experience. I wrote about Telstra’s (A $20billion telecommunications company) Executive team engaging in this practice previously here. We are seeing this become the norm in many other large businesses around the world.

There is also increasingly a realization that leaders of all disciplines need to develop their customer centric thinking and leadership competencies.

We were recently honoured that our Book, the Customer Culture Imperative  was nominated as one of the Top 20 and later short listed after a public voting period to the final 5 for the Marketing Book of the Year – 2015. Perhaps some further proof that Customer Centricity’s time has come!

Great places to work create great customer experiences

5starrating

An interesting study from my friends at Software Advice (an HR & workforce management technology research company) leveraged data from the employee reviews website, GlassDoor.com.

What caught my eye was the fact that only 37 companies from 147,071 received a 5 star ranking from their employees. While this is an extremely high bar, I expected there would be more companies achieving this top-level status.

Of the 37, almost half (16) are headquartered in our region of the US, the Silicon Valley. I believe there are a number of reasons for this:

  1. Silicon Valley is still the benchmark for innovation, new ideas and disruptive business models. That mix can be an intoxicating environment for the right type of people, people that really want to change the world. From my experience working with companies to become more customer centric, one thing that is often lacking is a compelling vision and strategic alignment around that vision. In general people are interested in being part of something bigger than themselves and certainly the powerful entrepreneurial visions in silicon valley fit the bill.
  2. A second reason is the valley has always been ahead of the curve in how work actually gets done, the tech companies were the first to introduce remote working (although some have since reversed this trend as the right levels of social bonds among workers does need to be in place for remote working to be effective “See Yahoo”). Regardless the underlying theme behind this is empowerment, flexibility where getting things done matters more than politics and busy work. People respond well to being given flexibility and the tools to get their work done.
  3. Thirdly, by there very nature start-up businesses are customer centric, they are solving a problem that either no one has solved before or doing it in a way that is 10 times better that the current options available. This creates alignment with customers and a compelling value proposition that excites and motivates people.
  4. Finally, Silicon Valley is collaborative by nature, there are diverse pools of talent with different cultural and social backgrounds coming together with a single purpose to solve difficult problems with technology

These factors combine and attract world-class entrepreneurs, which through their vision and leadership create insanely exciting companies.

These companies by their nature have to create unique and valuable customer experiences around their core product or service to stand out and be different. This drive to do this requires teamwork, personal development and hard work, some of the attributes cited by employees as reasons they like working for these firms in the chart below:

 

Top-Listed Attributes of Five-Star Companies Source: Software Advice

Top-Listed Attributes of Five-Star Companies
Source: Software Advice

The bottom line is without passionate, engaged and excited employees you cannot have passionate, engaged and excited customers.

Why smashing hierarchy and driving collaboration is essential to customer experience

Source: BRW Australia Photo: Nic Walker

Dr David Cooke, MD of Konica Minolta Australia.  
Source: BRW Australia Photo: Nic Walker

When Dr David Cooke was appointed managing director of Konica Minolta in Australia he was faced with a culture of strict hierarchy, strong silos and task oriented behavior.  He realized this was the first thing that had to change.

Why? Because the market for multifunction copiers and printers was changing. The market for these products was declining and the demand for outsourced solutions and services was emerging. The hardware was less important than it was in the past, customers just expected the devices to all work well and be built with high quality engineering. Quality products did not differentiate, customers wanted more, they wanted more sophisticated services and solutions to help them manage the costs of running their fleets and value add solutions that would streamline workflows and improve their operational effectiveness.

These new market conditions required a more flexible, agile and collaborative culture that focused on the changing customer needs if Konica Minolta was to thrive in the future. So his vision of KMA as the “company that cares” for its customers and its community was a means to differentiate KMA from its large competitors, promote a unified company view of improved service and value for customers and one that he felt his staff could buy in to.

His view was validated by a staff survey that benchmarked the level of customer-focused culture in the business by measuring market responsiveness on a 7 factor index. It showed that there was some work to do, but that staff were overwhelmingly ready for change, wanted transparency of information across the organization and expected the senior leadership to lead it and show the way.

David immediately looked for tangible initiatives that would demonstrate a unified company with increased collaboration and communication. In the first few months of his tenure he made the following changes:

  • the large corner office that was originally the haven of the previous managing directors was re-purposed as a “quiet lounge” for all staff
  • he moved into a glass fronted office next to the lunch room where he could wave or nod to his staff as they used this heavily used walk-way.
  • he replaced several of the functional heads with new leaders to strengthen the cultural change program and break down the silos
  • he increased transparency in the HR function by moving it from closed office walls to join others in the open plan office and appointed a new leader to facilitate the change program
  • he promoted an external focus by encouraging all staff to work for non-profit community organizations by enabling them to take days off to directly contribute

David’s approach to creating a less hierarchical structure, sharing of financial results and customer successes across the business is leading to more engaged staff, better customer service and growth in revenues at a time when overall market revenue is declining.

What’s the secret? Customer Focused Leadership – leaders that genuinely care about creating value for customers, the business and the communities that operate in.

3 Traits a Company Culture must have to create great customer experiences

warning-you-are-being-watched The way customers are treated by your company is a direct reflection of your company culture. If you have a culture based on fear and mistrust, customers will experience the ramifications. Have you ever felt like you were being treated like a criminal for returning a product or complaining about a service? It is highly likely that employees are punished for not following the rules, as a result customers are also punished for mistakes or speaking up.

Company culture can be a difficult thing to define, but just about everyone that works for a company can feel it or describe it in some way.

Software Advice, an online reviewer of HR technology, recently conducted some interesting research that demonstrates the wide range of views from employees on what makes for an attractive company culture. The most cited cultural trait that would attract employees? Honesty and Transparency.

Source: Software Advise

Source: Software Advice

Transparency

This leads us to the first of 3 must have traits, Transparency. Employees want to know where they stand, if the leadership is opaque and vague about performance expectations or what success looks like this is a recipe for low morale and poor customer experiences.

Empathy

The second must have trait is empathy. Empathy is about understanding the other person’s position, in this case understanding the customer’s point of view. What do customer’s experience? What are they trying to achieve? What are their frustrations and how can we eliminate them? A culture of empathy extends to how employees work with each other, what are the other department’s goals and how do we help them achieve their goals as well as our own. Companies that lack empathy end up with unhappy customers that leave.

Trust

The final must have trait is Trust. This relates back to my opening point, a culture of fear results in employees not trusting customers. The customer is out to get them, scam them, take advantage of them just like everyone else in this place! Low levels of trust narrows our thinking, employees go into a survival mode that results in short term wins at the expense of long term relationships.

Have you ever had the feeling you are not welcome when you walk into a retail store? (See the image at the top of this post) Unfortunately in retail, theft is a major problem, however, as with most major problems it is subject to the 80/20 rule. In other words most people are not thieves but the signage and the retail staff’s attitude can make everyone feel that way – not good for business…

Are these cultural traits present in your company?

Why feedback is crucial to customer satisfaction

Managers aren’t the only people equipped to provide valuable feedback into your organization.

A corporate culture that encourages feedback will improve customer relationships. Why? If we don’t know what’s wrong we can’t fix it. If customer’s can’t easily provide feedback they won’t, they will simply leave or worse complain to other potential customers about their poor experience.

Employees are usually the first people customers encounter and frequently have insight into common customer complaints and concerns. What is important is that the leadership listen to, prioritize and act on this feedback.

By practicing a policy of transparency and never punishing employees for providing feedback, you will improve your customer relationships and often increase employee satisfaction in the process.

Just as customers want to be heard so too do the staff in your organization. So develop the practice of giving and accepting feedback, it is a shortcut to getting the right things done faster and more effectively for your customers and ultimately your business.

Do you encourage feedback in your company?