A hosting provider had built a solid business over a few years and was excited about the future. The provider had ten employees responsible for servicing two dozen accounts with various needs. From Quickbooks and website hosting to data backup solutions, they offered a wide range of services and took pride in customer service. Last August, their very first customer called and abruptly cancelled their contract. The cancellation was difficult for the hosting company; this customer represented one-third of all revenue. The owner, service-manager, and sales director met in the conference room.
“What in the world happened?” asked the owner. “I thought the service log showed we were always attentive to their issues?”
“We were. Never missed an SLA with them in all the years we worked together,” replied the Service Manager.
The owner turned to the Sales Director. “What did they tell you in their recent Quarterly Business Reviews?”
“They gave us high scores on everything. The CIO told me they were very happy with our offerings.”
The three of them stared at each other for a few moments, unsure what to think. Finally the owner broke the silence, “Is there something we missed? Some sign we didn’t pick up on? Something they were trying to tell us that we didn’t hear?”
Many business owners make the mistake of thinking that customers that pay their bills on time and don’t complain are happy customers. Similarly, many business owners think that positive feedback from a customer is a sign that the customer is happy with the relationship. In reality, these two signals only tell you one thing: the customer has not yet found a reason to leave you for someone else. That is the entirety of information that you can deduce from that kind of feedback, and confusing it for affirmation that your business is doing a great job is a mistake.
The reality is that changing from a current service provider to a new one can be painful. There may be expense and a learning curve with a new provider, and with the daily needs of running a business, it is often easier for clients to deal with the pains caused by the current provider instead of moving to someone new. As the saying goes, “Better the devil you know then the one you don’t.” But every client – even the one that has been with you the longest or the one you pay most attention to – will leave you if you fail to impress them each and every day. However, if their direct feedback isn’t a good barometer of their attitude towards your business, how can you know what they are thinking?
Simple: you listen to what they are telling other people about your business. And since you don’t have a way to hear those conversations directly, you are left with only one true measure of client satisfaction: referrals.
Referrals are the compass by which to navigate your customer service map. Referrals are the best way – the only way – to measure how happy your current customers are in their relationship with you. The process is simple:
- Unhappy customers will dissuade colleagues and friends from doing business with you. When you hear that Company X chose a different vendor because of something Company Y told them about your company, then you are about to lose Company Y as a customer (assuming you haven’t already).
- Satisfied customers will neither dissuade nor promote your business to others. And when someone comes along that is less-expensive then your organization or offers more service for the same price, you will lose these customers, too. They view you as a vendor, not a partner in their success, and will only stay with you until something better comes along, which it will, eventually.
- Happy customers will sing your praises to other businesses. They will talk about you to their clients. They will talk about you at family picnics. They will hear of a friend or colleague having an IT problem and pick up the phone to call them and suggest your company as a solution. People love talking about the things they love, the things that make them happy, the things that make their workday better. Happy customers will talk about you to everyone they know.
So, how do you evaluate whether your customers are happy or not? It’s actually quite simple and doesn’t require any guesswork whatsoever.
Happy Customers will provide your business at least one new paying customer each year. Their enthusiasm may result in them sending you twenty leads that turn out to not be a good fit. Or perhaps they are more cautious, choosing to recommend you only after they have verified for themselves that you can absolutely help the company they are referring. But if you can’t tie an existing account to a new account in the last year, then you need to get in front of that customer as soon as possible and find out why.
Nothing a customer says to your face will ever be as important as what they are telling people when you aren’t around. Providing a solution that helps a company save or make more money or save time is worth talking about. If you are truly doing a good job, they will do the talking for you and your business will increase as a result. And if they aren’t talking about you this way then anything else you hear is meaningless. So, what are your customers saying about you?