It is widely believed that acquiring a new customer is five times more expensive than retaining an existing customer.
In this respect, high levels of customer loyalty and repeat business are desirable and it makes sense for every business to have some mechanism to understand and meet customer needs.In a more competitive global market with less product differentiation, where consumer power and social media channels can make or break a brand, many companies have customer satisfaction and loyalty programs and benchmark themselves against their competitors.
Whilst measuring customer satisfaction is more common place, there is also a risk that it becomes a tick-box exercise, rather than a genuine effort to understand customer needs and improve performance. Any successful survey program must have a clear set of objectives that can lead to improved performance. The key to success is not to measure everything, but only what is important to your customer in the context of your products or services, and therefore what can positively or negatively impact your business. It is not enough to take a generic approach. The many different survey tools and methodologies available can be overwhelming but, setting clear objectives and priorities, makes it easier to find an approach which best fits your needs.
Here are 10 of the main benefits of measuring satisfaction over the phone:
1. Quality of feedback
The level and quality of communication is better when it results from human interaction. Aside from the literal meaning of the words, lots can be learnt through tone of voice and the emotion, it conveys. A human can pick up signals and patterns more quickly and easily than will necessarily be conveyed through the data alone.
2. Call Recordings
Capturing a conversation on a call recording, which can be listened to and analysed after a call, gives extra clarity to the feedback provided and ensures it is properly understood.
3. Response Rates
As it is difficult to ignore the phone, response rates are generally much higher than those of other channels. If you need to reach a certain sample size, lower response rates from channels such as email can make this difficult.
4. Open Questions and Insight
Customer Satisfaction Indexes and Net Promoter Scores are useful for benchmarking but provide little insight into what issues are, or what to do about them. With open questions during a phone conversation, it is possible to identify patterns and develop a good understanding of the customer viewpoint.
The personal nature of a phone conversation enables the caller to build rapport with a customer. An experienced agent will make the customer feel secure so they are comfortable opening up and sharing their opinions, perhaps more so than with other, less personal, approaches.
6. Qualitative and Quantitative
Phone research can be both qualitative and quantitative, either combined or used in a staged approach, where qualitative research identifies key areas of focus for a broader quantitative survey. A phone conversation can be scripted; presenting a set of pre-defined options for consistency or include open questions that capture insight that may not have been foreseen, or a mix of both.
Be careful what you wish for…
We always advise our clients to include an option for open feedback. If you give the customer a set of pre-defined responses to choose from, that is what they will do. Allowing for open feedback ensures you will learn something you didn’t know already and get a true customer perspective.
7. Additional Value
A phone call can provide outcomes and value, in addition to the survey’s planned objectives. Additional information gleaned during the call, either as notes or through the call recording, can help with organisation and market mapping, or provide valuable competitor insight. Other outcomes such as database updates and email opt-ins can also be obtained in the same call.
8. Regulatory Compliance
For industries subject to regulation, including financial services, telephone research can be particularly effective in getting the right level of feedback in the format required for legislative compliance or to meet TCF (Treating Customers Fairly) standards. Aside from the call recordings as a reference point, a bespoke framework can be established within a specialist CATI system, which provides the paper trail and capture of verbatim response often required. Call recordings also help maintain interviewer performance and allow the correct behaviours to be incentivised where standards are critical.
As phone research is based on data, it is easy to control and target your survey according to your priorities and required criteria. You may, for example, need to target a particular geographical area or a specific demographic group. As it is data-led, telephone research enables you to focus your efforts only where they are needed.
Whilst it is generally accepted that repeat business is more profitable, it is also true that most companies have a broad mix of customers with varying costs to acquire and maintain, depending on their profile. Pareto’s principle or the 80-20 rule, suggests that on average 20% of customers provide 80% of a company’s revenue.
If Pareto's Law holds true, it makes sense to focus on understanding the needs and retaining those customers, that are most valuable. A data-led approach such as telephone research, means you can profile and segment your database to prioritise the most profitable segments based on potential lifetime value, and focus on ensuring their needs in particular are addressed.