Why should startups think more about customer feedback than building new features everyday?

Why-do-startups-need-customer-feedback

Startup founders basking in the glory of their game-changing project, VC funds and the adulation of compliant employees often forget who’s the boss. It’s the customer that holds the power of life and death over every startup, and it’s usually a good idea to listen carefully to someone who’s capable of knocking your head off. Think of it as a navigational assistance system that provides direction based on where you are and where you want to be.

Feedbacks are required right from the beginning

In fact, the process of collecting feedback, analyzing it and implementing changes based on the feedback must begin when your startup is still a germ of an idea, and must be factored in at every stage thereon from pre-launch to early traction and the subsequent growth phase. The benefits of collecting feedback at each stage are different, and so are the methods used for collection and analysis of CSAT (customer satisfaction) data.

Why-do-startups-need-customer-feedback

Do not wait till launch date for reviews

Start by talking to a few close friends and family members about your idea. What you think is a killer application may be totally boring to someone who’s not a geek. Another mistake is to keep the whole thing under wraps until the actual launch date. On the contrary, it’s important to get a website up and running at the earliest possible moment. Some have a “Coming Soon” placeholder along with a basic outline of the company and project.

It’s-important-to-get-a-website-up-and-running-at-the-earliest-possible-moment

Build your online presence

More importantly, an online presence allows the company to start building a list of subscribers and potential pre-launch beta testers. There’s some debate over exactly when and how a startup needs to launch its initial product or version. The simple answer is that it’s best to get a bare-bones version out into the market as early as possible, as long as it is functional and bug-free to your best knowledge.

Launch simple and keep updating

Users don’t mind a simple product as long as it’s useful and works. You can add the bells and whistles with new versions, but every day a startup is in existence without a product in the market is a step closer to becoming obsolete before launch. Another advantage is that actual feedback from real customers will make you sweat and work harder to put out a better version faster than if you’re just tinkering around with it in your own lab.

We’ll get to the customer feedback tools in a minute, but the basic premise must be to keep all lines of communication open. Provide feedback mechanisms using all of the following methods:-

  • Web feedback form;
  • Email support;
  • Support contact number or toll-free call center support;
  • Live Help through web chats and/or support tickets, using services such as Zendesk and Olark that enable a conversation or web chat with a company representative; and
  • Social media for direct interaction with a company representative.
Feedback-mechanisms-for-customer-service

Be a rigorous follower of analytics

The best feedback is still obtained directly from traffic analysis. What do people do when they visit your site? What are the demographics? Which pages and keywords are attracting more visitors? What’s the bounce rate, click-through rate and conversion rate? Use tools such as Google Analytics and SEOmoz to read the tea leaves to see how you can improve site usability and monetization.

There are tools that enable you to be proactive and take it one level further, based on the industry sector and product offering. For example, application developers can use Intercom.io to find out what problems users face after signing up. Service providers can use Net Promoter Score (NPS) as a benchmark tool to grade the value of their offering.

Why-follow-analytics

NPS feedback is basically a score of 0-10, with customers categorized as Promoters, Passives or as Detractors. A score in between 0-6 means you have a detractor on your hands who will spread negative opinion of your brand and product/service. A score of 7-8 is for passive customers who are neither here nor there. A score of 9-10 means that you have a very satisfied customer who is going to talk favorably about your brand and his or her experience dealing with you.

Obviously, it doesn’t work just because you survey and grade customers. The benchmark has to be applied by comparing your overall NPS against that of other leading brands, and then by setting targets and figuring out ways to improve your NPS to match or lead the other brands. The company (netpromoter.com) has charts and tools to help you do this in professional manner.

Monitor your social media to avoid negative experiences

For example, one way to nip a negative experience in the bud is to monitor social media. Customers often post on social media, hoping to catch the company’s attention and get better service. It’s pretty much an established system now, with 81 percent of Twitter users expecting a same-day response to complaints or queries.

On the plus side, an AmEx survey showed that users will spend up to 21 percent more if the provider’s customer service on social media is good. You can enhance your customer service on social media using professional tools such as LiveOps Social or Salesforce.com’s Social Hub that can be integrated with an existing CRM system.

Monitor-social-media-to-avoid-negative-experiences

The fact remains that customer service at its core is about human interaction. All the tools and CRM software in the world is virtually pointless if your customer support representatives are not good enough or untrained. This is why you need to analyze the feedback data, unearth trends and implement strategies to deal with the situation.

Who are doing great in customer service?

Southwest Airlines and Zappos provide two great examples of very different companies that are nevertheless doing an exemplary job in terms of customer service. Southwest was listening when other carriers started charging customers for checked baggage. Turns out it’s one of the things passengers hate most about the airline industry. Southwest made hay not only by refusing to charge for checked bags, but by introducing the “Bags Fly Fee” marketing campaign that was in part responsible for Southwest’s growth while other carriers were going out of business during the Great Recession.

BagsFlyFree-No-charge-for-first-or-second-checked-bag

Zappos takes a high-tech approach by meeting customers on any platform they are on, instead of forcing customers to call. The result is that less than five percent of their customers call, while the rest are taken care of using web-based tools.

Regardless of how you approach customer service and what tools you use, here’s a checklist that all startups will find very useful.

  1. Set up a website with email list and subscription sign-up during the concept and design stage.
  2. Provide customer support training to all key employees.
  3. Be proactive and collect feedback from users through surveys.
  4. Open up all the lines of communication before launch.
  5. Use social media for both marketing and customer service.
  6. Benchmark customer service and set improvement targets.
  7. Improve products and services based on feedback.
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One Response to Why should startups think more about customer feedback than building new features everyday?

  1. Richard Houster says:

    Hi there, love the article. I cant agree more with this piece. I think start up companies should really rely on customer feedback in order to keep growing instead of just blindly adding more and more to their current features. I mean if you do not know what makes your customers happy how can you know what to add on right? Feedback solutions such as one that comes to mind called Eco which enables companies receive feedback thru mobile technology which i thought was quite cool and should be looked into for businesses who are looking to build their feedback from customers…thanks again for the great article. Cheers

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