Everyone has heard the old adage that the customer is always right. Recent years have challenged that fact, arguing that maybe customers don’t have the best insight into the future of the product over, say, your product team.
It’s true: your customers won’t always be right. There’s a whole study by Bartlett done in 1932 where it was proven that theory is fallible. That’s right: even if customers take the time to leave you a review, it might not even be accurate or appropriate for your product.
With all that information, it’s tempting to dismiss all customer insights and try and make all decisions based on internal data.
But ignoring your customer’s feedback is risky business. Even if customers aren’t always right, the dangers of refusing to listen to them are high. Customers want to feel like the companies they choose to do business with care about their opinions. Not only that, even if what they are saying is a hard pill to swallow, they are likely giving you critical insights that you need to improve your product, offer better service, and boost your customer loyalty and revenue.
In this blog post, we’ll be breaking down a few of the ways that making decisions and moving forward without customer insights is risky, and puts your team in danger. Read on to learn more!
You’ll Lose Trust
Trust is a hot commodity in our new product landscape. With so many similar products, and more being created every day, it can be difficult for consumers to distinguish one from the other. The one thing that truly differentiates one company from another is their customer experience, and how they cultivate trust within their user base.
Just like in any other relationship, one of the best ways to lose trust and create discord is to close your ears. In their book, Turned On, Roger Dow and Susan Cook breakdown a research study that Marriott conducted to identify which guests were likely to stay at their hotels again after their first stay.
They divided guest stays into 3 groups:
- A group were people that had nothing bad happen during their stay.
- B group were individuals where something bad happened, but Marriott fixed the problem.
- C group was made up of people to whom something bad happened, but Marriott did not fix the problem.
Out of those three groups the percentages of likelihood that they would return to stay at the Marriott were as follows:
- A: 89%
- B: 94%
- C: 69%
Do you see that? It’s called the service recovery paradox. The individuals that had something bad happen to them, but also had it resolved by the hotel staff were more likely to return to Marriott than the people who had a stay with no issues. That customer group is more loyal than they were prior to having any problems.
It’s because Marriott showed that they were listening and committed to fixing the problems. They built trust.
Listening to your customers gives you the opportunity to quickly address issues with your product or service.
You take advantage of the service recovery paradox, build loyalty, and create stickiness for your product. It also makes for much more successful customers, as you have the opportunity to course correct and guide your customers towards best practices for your product.
You’ll have a crumby product
Is anything that is truly great created in a silo? Can you assume that your product is best-in-class if you aren’t listening to the people that use it most? Probably not.
“Crafting a truly delightful user experience requires a cross-team commitment from the organization to keep users’ needs and feedback in mind during every step of the product life cycle,” says Phil Dahnke of UserZoom. “A successful Product Manager will champion the user and strive for a shared vision amongst the UX, UI and design teams based on their customer and user research.”
While lots of teams have influence on your product, your customer experience team (the keepers of all of your customer insights), should have the largest say.
It can definitely feel good to make product changes and create a roadmap based on things like:
- What will make you the most money
- What will show up your competitors
- What fits in your co-founders’ vision for your product
- What is the easiest to maintain
- What is the simplest to build
With those guidelines, though, you are serving yourself, not serving the customer. Listening to the customer gives you better direction to build a product that your users will love to use. Without basing your product changes on the data about what people actually care about, you miss out on the opportunity to make something truly impactful and meaningful for your users.
You’ll lose money
People that don’t care, churn. People will care less about your product if they feel like you don’t care about them. If customers take the time to reach out to you about an issue or concern and you ignore it, you run a high risk of losing them.
This Customer Experience Report had a lot to say about the impact of ignoring customer insights:
- 50% of consumers give a brand only one week to respond to a question before they stop doing business with them.
- 89% of consumers began doing business with a competitor following a poor customer experience.
Here’s a great example: in 2011, Netflix conducted consumer focus groups to ask their users what they found valuable and useful in their service. They then went on to ignore their customers' opinions by splitting their DVD and streaming businesses. Not only that, but making this choice increased their prices for existing users by about 40%.
They lost a whopping 800,000 subscribers, their stock price fell dramatically. Not only did they lose money, but they lost the value of good word-of-mouth marketing as well—they became one of the top 10 most hated companies in America (by Daily Mail, so we're not sure if that actually counts!).
Your customers will give bad word-of-mouth reviews
People are always going to trust what others say about a company more than what a company says about itself. In fact, studies have shown that when choosing between similar products, 87% of customers choose to use products from the company with the better reputation.
Further, 4% of customers that were offered poor service by a company will complain.
The other 96% will churn silently, stop buying and tell 9 to 10 others within a week about their poor treatment. Holy moley.
So, for every one person you get that reaches out to provide you constructive insights, there are 25 that are churning and telling anyone who will listen about how bad your product or service is.
By ignoring your customers and making decisions without considering their feedback, you are effectively giving the best gift to your competitors: your customers.
Why give away the one thing that truly keeps your company in business?
When your customers give you constructive insights on how to be better, track them and forward them along to the team that they pertain to. Keeping those thoughts to yourself, away from the rest of your team, does nothing but serve to aggravate and antagonize customers to talk poorly about your company.
Customers might not always be right, but that doesn’t mean that they should be ignored. Listening to your customers helps you formulate a better product roadmap, boost your marketing team’s effectiveness, and even grow loyalty within your user base.
Responding to constructive insights about your product in a timely and effective manner helps to make customers feel even more loyal to you than they would have had no issue occurred. While it’s never good to provide a poor experience, capitalize on the service recovery paradox to gain long-term, loyal customers that love to talk about and advocate for your product.
With the Kapiche platform, customer insights teams are finding success with the discovery-led approach. They aren’t spending weeks manually coding datasets with hundreds of thousands of pieces of feedback or waiting for vendors to update their code frames. They are getting time back time to understand the behavior drivers and reporting actionable insights across the business. And this is happening because their text analytics solution is doing all the heavy lifting for them.
Curious to see how it work with the Kapiche platform? See this demo video.