Collecting feedback is only the first step in the journey to improving the customer experience. The act of gathering feedback from customers in itself raises the expectation that action will be taken. Many of the top companies are realising that there is a need to close the loop by getting back to customers to ensure any issues are resolved.
By consistently closing the loop on customer issues, a database of solutions to issues is built up. Analysis of this database will identify recurring issues. With this knowledge, efforts can be focused to allow similar issues and their cause to be resolved by a single improvement action.
Closing the loop is the first step to learning from customer feedback. By implementing improvements, past sins can be avoided and as customers start to see action being driven from their feedback, loyalty grows.
Keith, Your article is right on target and I agree with everything you say. However I have spent over 30 years in the furniture industry where nobody plays by your rules.
In all my years in the furniture industry I have never heard of a furniture company who proactively seeks direct feedback from its customers. Some of the major corporation hire outside consultants from time to time to poll a portion of its customers to get their opinions about their experiences.
But when was the last time you bought $1000 or $10,000 of furniture and then received a follow-up call to check that all the furniture arrived in good shape and whether there were any problems and what you thought of the furniture quality and the customer service received?
Why don’t furniture companies want customer feedback? Because there are too many things that can go wrong and the companies know that if they dared to ask a customer for feedback there is a 50% chance that the customer would complain about something which would have to be fixed, and the cost for that comes straight off the bottom line. Another problem is that correcting many of the problems that a retailer has to deal with involve the cooperation of manufacturers who have very little concern about individual customers.
In the entire furniture industry there is only one company that has confronted this problem and made customer service a prime focus of its operation. Simplicity Sofas is a manufacturer selling direct to consumers. That way the company has direct control over its production, marketing and distribution system and has direct communication with its customers. Its primary marketing effort is directed at providing products and service that are so outstanding it will induce customers to return and buy again while also making them so enthused they will recommend the company to all of their friends and family.
Simplicity Sofas contacts every customer within 24 hours after their furniture has been delivered and specifically asks whether there are any problems that need to be addressed. It also asks every customer to rate the quality and comfort of the furniture and their opinion of the customer service they received. When there is a problem it is taken care of quickly. Customers who initially have problems, even major problems, frequently become some of the most enthusiastic boosters for the company after seeing the lengths the company is willing to go to in order to resolve their problem.
The company maintains close contacts with its customers all through the sales, production and delivery process. The average number of contacts between the customer and the company during this period is more than 20. It is not unusual for a customer to have 40 contacts or more. Some customers record over 100 contacts.
Simplicity Sofas has a warranty program that is also unique in the furniture industry: “If you do not like our furniture for any reason whatsoever you may return it to us for a full refund including shipping charges for a period of one year after purchase.”
The company spends about twice as much per customer on customer service as the average furniture retailer, but where just about every other company treats customer service as a cost of operations, Simplicity Sofas considers customer service to be a revenue-generating department. By tracking the number of returned customers and new customers who have been attracted to the company by hearing of its superior customer service (and products) the department pays for itself and even returns a profit occasionally.
One other factor that also plays into the revenue-generating powers of customer service — Several of the most enthusiastic of the Simplicity Sofas customers are so astonished by what the company has done for them that they ask what they can do to help the company in return. These customers are invited to join the Simplicity Sofas nation-wide customer network. One of the biggest objections of prospective new customers is that they cannot see or feel the furniture before buying since the company does not sell to retailers. The nation-wide customer network is composed of former customers who volunteer to show off the furniture in their homes to prospective new customers. Although I do offer to compensate them it is rarely accepted. More than half of all customers who first see our furniture in another customer’s home end up buying from us.
So, does all this new-fangled craziness make any difference? Simplicity Sofas opened its factory doors in November, 2007, less than one month before the official start of the recession. Since that time hundreds (or thousands?) of furniture companies have closed down, particularly small businesses whose annual sales decreased an average of 20% to 40%. The furniture industry has been cited as one of the hardest-hit sectors of the American economy during the recession.
Simplicity Sofas started with $0 sales in its first two months. Less than 3 years later it reached monthly sales of over $100,000. Although $1 million in annual sales may not sound like much for a manufacturer, this was achieved one individual customer at a time, and it was achieved profitably.
Jeff Frank, Owner
Simplicity Sofas
http://www.simplicitysofas.com
800-813-2889