Transactional Vs Relationship Customer feedback: Are you using the right one?


Share on LinkedIn

From the first day of primary (or grade) school most of us compete. “I bet I can beat you to the fence/jump higher than you/hold my breath longer than you,” it doesn’t matter what the event; we’re ready to see who wins. If you are a CEO, or you report to one, and want to show that your company is the best you might choose to compare Relationship NPS® but that may be worth less than you think.

When starting a Net Promoter® or customer feedback process every organisation has the opportunity to perform the survey process in one of two ways: Transactional and Relationship. Each approach offers its own pros and cons but deciding which one is best for your organisation can be difficult.

what is transactional and relationship feedback?

What is Transactional Feedback?

Transactional customer feedback is generated when you survey the customer after each interaction or transaction with your organisation. Typically this will be at one or more of your customer touch points and can include: order entry, product delivery, website interaction, account payment, sales contact, and visit by a service technician.

Normally in this approach you will directly reference the transaction in the survey question. e.g.

Based on your recent product delivery, how likely are you to recommend us to a colleague or client on a scale of 0 to 10?

What is Relationship Feedback?

In contrast, Relationship customer feedback surveys occur at regular intervals in the customer relationship and ask about the customer’s overall satisfaction with the company in question.

For instance

How likely are you to recommend us to a colleague or client on a scale of 0 to 10?

Pros and Cons of Transactional Feedback


Catches customers when they change

Generally a customer’s perception of your company will not change as they are merrily walking down the street. It is much more likely that their opinion of you will change when they are interacting with your organisation: a contact centre, invoice, using a product.

If you survey them shortly after that interaction then you are much more likely to get a good understanding of exactly what drove that change in sentiment and thus how to leverage the opportunity or fix the issue.


Because transactional feedback carries with it rich information on the transaction (if you measure it correctly) and detailed information on the feedback from the customer, you are often able to directly link an issue with an action to resolve it.

NOTE: when you run a transactional feedback process the survey response should include a wealth of transaction information such as product line, location, transaction value, person with whom they interacted, customer segment, etc.

That combination of data (customer response and transaction details) makes transactional feedback a rich vein of relevant data in which to mine for actionable customer insights.

Initiate Service Recovery

Service recovery can be easily and effectively initiated from transactional feedback. Once again there are specific actions that the company can undertake based on the feedback they receive. If a customer has a problem with a product or delivery it is clear how to take action to recover the situation.

It is also the case that service recovery implemented correctly can immediately drive up customer loyalty.

Drives cultural change

When you publicly display live customer feedback information (comments and scores) and quickly initiate service recovery actions you will generate an intense focus on the customer that can be difficult to replicate in any other way.

Service recovery stories can be particularly impactful because they are generated from the front line and tell how “we really are focusing on the customer”.

If you want to see how powerful this can be check out this video from CCH Asia Pacific. Skip through to the 2:31min mark to hear the CEO of this company tell how he personally contacted a customer and performed service recovery. This is a very strong customer focus message directly from the organisation’s leadership.

By the way after you’ve seen the CEO section wind the video back to the start and see the whole video for a great example of how to engage employees in your Net Promoter program.

The diagnostic for determining where to focus

You may have 10 or 15 customer touch points in your business but where do you spend your time and effort? What is the most important touch points on which to focus?

By aligning your feedback process to your customer journey you can measure which touch points are performing and which are letting you down. Now you have a customer satisfaction or NPS rating for each touch point you can do a simple Pareto analysis; find the lowest rated touch point and focus on improving that. When that improves move on to the next lowest score. Rinse and repeat.

Great for front line coaching

Providing front line staff with understandable and actionable feedback on what they are doing well and what they are poorly is critical for their ability to improve and provide the best customer experience. Because you have included the front line persons details with the feedback to can report on the customer feedback for individual transactions for each front line staff member. Used correctly this is invaluable coaching and training material for your staff.

NOTE: With great knowledge comes great responsibility — it is possible to misuse this information and treat it as a stick rather than a coaching device. You need to ensure that your team leaders have been coached themselves with the positive way to use this information not the negative ways.

Census based data collection

Typically when you gather customer feedback you work on a sampling system. You might survey 5% of your customers every 6 months. While that is a good start, transactional surveys allow you to use a census approach and survey all of your customers. This greatly increases the volume of feedback that you will receive, increasing validity and the ability to extract useful customer insights.

**Short, quick surveys- low customer impact.
As a corollary to the point above, because you are surveying all of your customers, a bigger sample set, you can dramatically reduce the number of questions you ask each customer. This reduces the length of the survey, increasing response rates and reducing the impact on your customers.

Cons of Transactional Feedback

You will need automation

Without an automated customer feedback and reporting system the sheer number of moving parts in a transactional feedback process becomes very difficult to manage. Daily uploads of data, sending surveys, collating responses, reporting, etc. all become complex and time consuming if you do not have an automated way to run the process.

See this blog post for more information on automation options.

Difficult to compare with other companies

While the feedback you receive is very actionable it is difficult to compare or benchmark your scores with other organisations. This is partly because you are surveying touch point interactions, which may be different to other organisation, and partly because your overall survey process may be very different to other organisations.

Need to make sure that you don’t over survey

With an automated system set up the tendency can be to survey every customer at all touch points. This is generally not a good idea as it can lead to the situation where you survey the same customer several times in a short time period.

One web service vendor, no names not pack drill, would pop a survey every time I used their application. After receiving 3 requests in 3 days I stopped responding.

To avoid this issue you need to implement hold-out periods. Perhaps you only survey each customer every 90 days.

Need to ensure a low cost per survey

As you are initiating a survey for potentially every transaction you will need to ensure that the cost per execution is very low. Luckily the rise of smart phones and email has meant that text/SMS and email invites to online surveys can be implemented at a very low cost per transaction and a high response rates.

Pros of relationship

Comparable to Competition

The key benefit of Relationship survey is that they can, in some circumstances, be used to compare your company to your competitors. When the survey is based on Net Promoter Score that comparison can be very valuable because if you lead your competitors in that metric you are likely to be leading them in revenue growth as well.

Cons of Relationship Feedback

In Practice Benchmark data is hard to come by

While in a properly constructed survey approach you can benchmark yourself against your competitors that a “properly constructed survey approach” is neither trivial nor inexpensive to execute.

This can work in some large B2C market places where there are few competitors and an omni-bus style survey can be used to collect enough data about key players. However if you are in a small or specialist vertical market (consulting companies, software vendors, all most all B2B organisations) this is not likely to work for your organisation.

Typically you will need to go a wide subset of your total market in order to get a large enough sample size of responses from your customers and your competitors’ customers in order to get valid information. The alternative is contacting your competitors and having them share their customer lists with you: this is not likely to happen.

To make matters worse you can’t even compare a score that a competitor may publish in a press release or company report with your score because the score can be impacted by so many variables. For instance:

  1. Telephone based surveys have higher scores than email surveys
  2. Where you put the critical “Would Recommend” question in the survey (first, middle, last) will impact on the score.

And then there are other skewing factors to consider.

If not done correctly there can be few Actionable Insights

Ask anyone who has used relationship feedback surveys and they will tell you that the biggest issues they faced was turning the data into action. When you survey a customer about their overall impression of your company, unless the survey is very carefully constructed, it can be very difficult to convert that feedback into specific actions.

If you use the standard Net Promoter question and just one qualitative question, as many organisations do, your ability to derive meaningful and actionable feedback will be very low.

To have any hope of deriving actionable feedback you need to extend the survey to a larger number of questions (10, 20, 30 or more) which can be expensive to implement.

Staff lose interest

Relationship surveys are often period based (3 monthly, 6 monthly, annual). Typically each round of the survey incites a lot of action and interest in the customer and their feedback but between rounds interest can wane.

If you are going to run relationship surveys try to run them as often as possible but not so often that your customers stop responding.

Customers may not remember you very well

Unless customers are actively interacting with your organisation in some way it can be difficult for them to be precise in the feedback that they provide. This is unlike transactional responses where the customer has very recently experienced your organisation.

Which is right for you?

It may seem like I’m not a big fan of Relationship feedback and in some ways that is true. Transactional surveys provide so many advantages that it is often difficult to recommend that a client use a Relationship approach but not always.

When to use Relationship Surveys

Gathering Benchmark data in concert with Transactional feedback

If you are in the right industry (B2C generally, large markets) and can purchase data or afford to run a large scale omni-bus style survey then Relationship surveys offer an excellent way to track your performance against your competitors. In this case I would still recommend that you use a transactional style survey as well.

You can then use the Relationship survey to benchmark your industry performance and the Transactional survey to give you the actionable insights and cultural change impetuous to drive ongoing improvement in your business.

You have a small number of high value customers or transactions

For businesses that have only a few very large customers with many contact points then Relationship surveys can work very well. These tend to be industry with large and long running projects: large IT contracts, project management, government supply contacts, etc.

In this case you will need to expand the question set and probably use a high value B2B survey technique such as face to face and/or telephone interviews. You will also probably interview several different contacts in different parts of the organisation. This will give you the score you are looking for but, with the right analysis and design, actionable insights to drive change within your business.

When to use Transactional Surveys

If you don’t fall in to one of the above situations then you can probably revert to focusing on Transactional feedback approaches surveys.

So do you use Transaction or Relationship surveys and are there any pro or cons that I have missed? Let me know by commenting below.


Please enter your comment!
Please enter your name here