Wednesday, October 27, 2010

The Best Source of Market Analytics in the World: Customers (And how to use them)

It's funny, when I started LandAndFarm.com I never expected to be talking with customers about their kids or the weather in Tulsa, but when you do customer service and you do it right, you talk.  And if you can steer the conversation the right way, you can gain a fount of information from customers.

The customer service team is the best source of market analytics available to any company.  No complex funnel analytics report, no consultant, no website or blog will give you more valuable information than talking directly to customers. (OK, maybe exaggerating a bit, but seriously...do not ignore the customers...)

Whether the customer has called to complain or congratulate, they have equally good information, and a case can be made that complainers actually are more valuable than satisfied customers.

Let's talk about what kind of information customers have;

1.  Customers have information about the product.

Both satisfied customers and complainers have information about your product. They bought it. That means they've done more QA on your site than you have because they put real cash money through your site and actually bought something.

If it all worked out, great. So ask them what else they want. If you sell cars, ask them why they bought it (color, make, model, price, etc.) This will give you an indication of what your competitive advantage is.

And if they are calling to complain, you've hit an information gusher.  DO NOT LET A COMPLAINER GET OFF THE PHONE WITHOUT A CLEAR UNDERSTANDING OF WHAT WENT WRONG. 
 
2.  Customers have information about the market.

When I talked with brokers selling land (my customers) I always asked them how the market is. And brokers love talking about the market. Now, you have to know a little about brokers to know that they will rarely say, "The market sucks." But they might say, "Things are getting better" (translation: the market sucks).  Get trend information from them.  And if you hear one thing from Frank in Tulsa, you might tell Bobby in Austin that "Someone in Tulsa just told me..." And then Bobby might give you some more market insight.

Get it?

3.  Customers have information about competitors.

Even though my biggest competitor at the time was run by guys I really respected, that didn't stop me from agressively asking my customers if they used them and how much they paid and what they did that I should do or what I did that they don't do.

I bought eLandUSA.com because of a customer told me it was for sale.

4. Customers have information about pricing.

Pricing is key in most businesses. Too cheap and folks think it's not worth anything. Too expensive and everyone flies off to the competition. 

I always asked customers if my price was fair.  And I was the most expensive site in my business for a long time because rarely did customers say it was too expensive.  Of course, some did (and I could give a discount on the phone immediately to those that asked...)

My crazy recommendations:


1. Everyone in the company from the CEO to the janitor should listen in on a few customer service calls or read a few custom service threads every month. Calls and live chat are better for obvious reasons.

2. And senior executives should actually sub-in for customer service every so often (quarterly at least) to stay in touch with customers.  I answered CS calls until the day I left Loopnet.

3. Customer service staff should prepare regular weekly reports that summarize major CS issues, particularly repeat issues.  These reports should be no more than 1 page and cover the 5 most common CS issues and one unusual one (to keep the mood light).  These issues should go into your bug/work tracking system you are using company-wide and should be re-summarized in a monthly report that explains whether the issue is ongoing (we are too expensive but we have not made a decision on it) or resolved (customers no longer get logged out randomly, thanks engineering!).

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