Examining the top 2 customer feedback practices
Yesterday’s post from Guest Blogger, Bob Hayes, confirmed several concepts that we promote here at Clicktools and I strongly recommend you read his article, Improve the Use of Customer Feedback to Increase Customer Loyalty, if you’re looking to get even more mileage out of your feedback data. I’m compelled to expand on two of these concepts because they’re extremely important to the success of your feedback program.
In short, Bob conducted a study on the correlation between specific Customer Experience Management (CEM) business practices and customer loyalty by surveying 104 CX practitioners about their company’s CEM programs. From this research, he concluded that by adopting certain customer feedback practices into your CEM program, you do, in fact, statistically improve the probability of your business success.
What’s the top customer feedback practice?
I was very pleased (but a little surprised) to see that the number one practice that drives successful CEM is tying customer feedback to executive compensation. As I discussed in a recent post, Where’s Your C-Suite on CX, C-level executives are increasingly involved in managing and understanding customer feedback and its affect on overall customer satisfaction, loyalty, and experience.
Consider this statistic from the 2016 NGCX Report: “Fifty-five percent of brands now have a dedicated CX department focused on advancing a unified vision of a better customer experience. The creation of a department that works specifically on CX initiatives reflects the fact that the best experiences are woven into businesses on a holistic level.”
So, that means adding a C-level executive to the table to manage that department. It also assumes that that person’s compensation would be directly tied to customer-related measurements. But Bob’s study pushes this one step further, indicating that EVERY executive’s compensation should be tied to customer feedback metrics. Talk about having skin in the game.
This shift represents a powerful new commitment to customer success and the value of feedback. If you’re thinking about implementing this at your company, however, there are some important things to consider before you link pay to customer feedback. Among them are making sure you measure baselines, establish reliable metrics, and make clear connections to financial and strategic outcomes.
An article from Bain & Company articulates: “Your customer metrics must correlate with financial and strategic goals. Without such a link, it’s hard to justify differences in compensation. Your CFO and finance team can take a leadership role here. On the micro level, establish the economics of particular customer segments. For instance, you can calculate the value of turning a detractor into a promoter, or use differences in attrition rates to assess the expected lifetime values of different customer groups. On the macro level, you can estimate the value of achieving customer loyalty leadership in terms of market share gains or revenue growth.”
The second-most powerful customer feedback practice.
I was delighted to see that the second-most powerful feedback practice to drive CEM success, according to Bob’s study, is communicating feedback processes and goals to the ENTIRE company. We’ve been beating this drum for years. The Clicktools stance on this is to leverage the integration between your feedback platform and CRM solution in order to effectively share this information.
We’re huge proponents of centralizing enterprise feedback in CRM because we know the importance of building a single view of the customer, empowering customer-facing teams to act on customer insights in context, and automating the interactions that don’t require a human touch. Collecting and responding to feedback effectively is one of the most powerful ways to increase engagement, satisfaction, loyalty, and advocacy.
Plus, having one location for all customer data, including feedback, massively strengthens a company’s ability to deliver great customer experiences. Only with integrated information can you generate the analysis and intelligence required to drive process improvements. Otherwise, you’re forced to make inside-out guesses about what your customers want and expect. Usually these guesses are incorrect.
When teams across the company can access and contribute to the single view of the customer, they’re empowered to take action and make decisions that directly improve customer loyalty and experience. When the individuals within your company know that a customer needs attention, whether in the form of sales, support, or service, they have the context and data at their fingertips to provide high quality interactions.
In summary, “There are several ways you can improve the use of customer feedback in your attempts to better understand the health of the customer relationship. First, use customer feedback for executive compensation. Using customer feedback to incentivize executives ensures their decisions are based on customers’ needs. Next, be sure to communicate all aspects about customer feedback to the entire company” (Improve the Use of Customer Feedback to Increase Customer Loyalty).
Thanks to Bob Hayes for the above quotation and these fresh insights on customer loyalty!