So whatever your industry, product or service you need to ask for and then listen to your clients' feedback. Understanding if your clients are satisfied or not is critical, but furthermore, there are additional and tangible business benefits to asking for feedback.
When was the last time you made a meaningful purchase? A product like a new car or TV? Or services like renovations to your home or a new kitchen? Did anyone from the product or service provider ask for your feedback afterwards? Did you get an email, phone call or a face-to-face visit to check that you were a satisfied customer? Personally, I would say it's more 'no' than 'yes'.
I recently bought a new push bike and, a few days later, I was pleased to get a personalised email from the shop asking if I was happy. After completing their short questionnaire, highlighting a small but annoying issue that I probably could have fixed myself if I had the time, I got a call from the shop within 24 hours. They asked me to bring the bike in and within 48 hours they had fixed the issue with no fuss. Job done. Issue solved and customer (me) happy.
Where do you think I will I buy my next bike? Where was the first (and only) shop I visited when my son needed a new bike a few weeks later? You can probably guess - that one!
One simple act on their part, which cost them almost nothing, got them a second purchase from me. I didn’t shop around at all. They had my trust. Why? Because they asked for my feedback and then listened to it.
A study conducted by Paul M. Dholakia of Rice University’s Jesse H. Jones Graduate School of Management and Vicki G. Morwitz of New York University’s Stern School of Business supports a ‘halo effect’ theory and concludes that merely conducting satisfaction surveys enhances client loyalty and profitability.
The study was highlighted in the May 2002 Harvard Business Review. Researchers studied "Over 2000 customers enrolled in the customer relationship programme of a large U.S. financial services company." Approximately one-half of the customers participated in a ten to twelve minute telephone satisfaction survey; the other half did not.
The two groups were tracked for one year after the survey was conducted. Participants received no other direct marketing materials during that time. Researchers measured purchasing behaviour, defection rates and profitability
At the end of the year, the customers surveyed were “More than three times as likely to have opened new accounts, were less than half as likely to have defected, and were more profitable than the customers who hadn’t been surveyed.” The most positive effects were observed within the first few months following the survey.
The consumer psychology behind this ‘halo effect’ is that “Measurement- induced judgments can influence later behavior.” In other words, if a client is asked to make a judgment about a product, service, provider, etc., and his or her assessment is positive, the client is more likely to purchase that product or service in the future.
So whatever your industry, product or service you need to ask for and then listen to your clients’ feedback. Understanding if your clients are satisfied or not is critical, but furthermore, this study shows that there are additional and tangible business benefits to asking for feedback.
Personally, I think there are more benefits that just those outlined in the study. If you get positive client feedback, you can:
- repeat the good stuff either for this and/or other clients
- share it with your team and celebrate it! Reward the team!
- ask for referrals from those loyal and happy clients. A happy client could be happy enough to introduce you to someone in their network. Don’t be afraid to ask!
- tell future clients what your current client satisfaction levels are. Imagine how your client may feel when he reads your next proposal which proudly states the fact that “95% of our clients rate us 9 out of 10 or higher for service?”.
And even if the feedback (like the bike shop) is not so great you may have the chance to fix an issue and regain precious credibility and trust.
In a nutshell though, good, bad or indifferent – you would rather know than not! The simple act of asking is a potential differentiator and by doing so you may be boosting repeat business and profitability.
So, to increase your profits – all you have to do is ask!