Jumping into the Pool before You Know the Water Depth
Posted by Jeffrey Henning on Mon, Aug 31, 2009
People initiate satisfaction and loyalty tracking programs for one simple reason – they want to know what their customers think. Maybe about their company, their products, their services or their perceived value being delivered to customers. But, while they may suspect the answers, they are uncertain and therefore they seek the
Voice of their Customer. This represents real progress.
Once they decide to kick-off a survey program, they frequently begin to immediately craft the questions. This is where I get very concerned. The process owners acknowledge that they don’t know what their customers are thinking, but they consciously or unconsciously believe they know what’s important to the customer base. Sounds to me like a case of not knowing what you don’t know!
In my opinion, creating a survey program is a five-step process with the first step often skipped.
Step 1 – Identify your target customer’s most important interactions with your business.
Here are two ways to identify the main areas of interest (touch-points):
- The cheap and cheerful way – Identify a reasonable number of customers that you believe represent a broad spectrum of your target audience. Talk with them, either face-to-face or by telephone, explain what your company is going to do, and why, and gather their opinion of the most important touch-points that shape their relationship with your company. Make sure to discuss every interaction between the company and the customer.
- The rigorous and more expensive approach – Commission an external organization to conduct a series of focus groups with representatives of your target. The primary advantages of this approach are:
- Unbiased results
- “Better” answers
- All areas will be probed (the knowledge of what to question is a big part of what you are paying for)
- You show customers and employees how serious your business is about this initiative.
On the other hand, of course, it will take longer, and cost more, that doing it internally.
Step 2 – Identify the key drivers of customer loyalty.
Plan a survey program to obtain a
statistically valid analysis of the “key drivers” of customer loyalty by doing it yourself or with a company that specializes in satisfaction and loyalty surveys. Based on knowledge resident within your company, preferably at the operational level, identify the elements of each touch-point that your customers responded were important to their relationship with your business. And question the overall level of satisfaction and loyalty and likelihood of additional purchases (the real reason for the whole program).
Survey a statistically valid sample of your target segment or audience. When all results are obtained, perform a regression analysis to identify the key drivers of satisfaction, loyalty and additional purchases. Make certain that the results are valid by looking at the
R-squared. From this analysis, the company will have a very good idea about what is important for each key touch-point your customers identified. And it will be able can see which variable, if any, impacts more that one key parameter.
Step 3 – Identify the key drivers of satisfaction for touch-points identified in the previous step.
The objective is to identify the attributes of the selected touch-points that most strongly influence how your customers feel about their experiences with your business’ most influential interactions. Use the same techniques and rigor as in Step 2 since the results will be driving investments and actions. Do not let individual bias guide which attributes you include. Be as sweeping as possible since, once again, you may not know what you don’t know.
Then the fun begins!
Using the results of Step 3, plan a survey program that focuses on those areas with the greatest bang for the buck. As progress is made, begin tackling the lower impact items on the list. Remember to make sure you get enough completed surveys so that the results are statistically representative of your whole target audience.
Step 5 – Re-verify the key drivers identified in Steps 2 and 3.
Unless there are dramatic changes in the companies’ business environment it is unlikely that the key drivers will change drastically in a year. Yes, your company should periodically revalidate its key driver list but you have time to implement improvements first.
And remember, if it isn’t important then why spend the time and money to find out how the customers perceive your performance? So focus your ongoing survey efforts on the items your customers say are most important to their ongoing relationship with your business. Now, at last, you know what you didn't know when you jumped headfirst into the survey pool!