The balance of power between companies and customers has shifted now that social media gives all customers a public platform to make themselves heard.
Whether it’s cable providers, retailers, or their favorite TV shows, increasingly consumers use social networks to air their opinions about the companies and brands they patronize. In fact, according to a recent LiveOps survey, 34% of consumers said if they have a problem with a company, the first place they'll take that complaint is to the company’s social media channels.
This makes social media a powerful channel to mine for customer feedback. Millions of people use social to express their opinions on everything, and much of this data is public and accessible for analysis. That said, social media may only convey part of the story. Can social media function as a focus group for brands? Can it even replace the traditional focus group?
How should brands use social media?
Brands often look for absolutes on social media—i.e., customers either love them or hate them. Don’t fall into the sentiment trap and look only at compliments or complaints; mine the entire conversations for trends. Are there hidden messages that might not even be directed at your brand that can tell you a lot about underlying consumer wants and needs? Sometimes there is a larger story in what customers are implicitly saying.
Retail giant Walmart uses social media to understand what types of products to carry. Recently, while evaluating whether to offer kits for making cake pops, they began a Twitter listening campaign around the topic. At the time, Starbucks had just introduced these bite-sized snacks and Walmart discovered that customers were buzzing about them. Seeing this enthusiasm, Walmart decided to carry the kits. They found that online excitement translated to offline sales, and the company plans to continue to carry cake pop kits in the future.
While listening to existing social activity is powerful, brands can engage customers directly to solicit feedback. This tactic narrows the field from "What’s the general feeling about a product?" to "How can we enhance this product and make it more appealing to you?"
Frito-Lay uses social media to puts its customers at the center of its product development. Instead of conducting a traditional focus group, which can cost thousands of dollars for a handful of interviews, it took its campaign to Facebook. Tapping into the site’s billion users, Frito created the "I’d Eat That" app, where customers could create their own flavors and vote on ones they like. In addition to generating lots of new ideas, the company was able to tailor its offerings based on preferences in certain regions. For example, they discovered hot and spicy crab went over well in Thailand and pickled cucumber was a hit in Serbia.
How much control should a brand relinquish to customers?
Most companies pride themselves on being customer-centric, so does that mean you are abandoning this ideal if you don’t agree to a customer’s every demand?
The short answer is no.
Steve Jobs famously said, "It's really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them." Innovative companies like Apple strive to see beyond the present and create products that their customers will want even if those customers can’t clearly articulate their needs. Research has shown that customer feedback during the product development cycle can actually be damaging to originality. When trying to create something truly new, soliciting feedback too early may actually be detrimental.
Not every company is Apple, of course. Companies should absolutely use research and feedback to drive incremental improvements in products and product lines (even Apple). For example, trends in social media conversations can help brands understand the strengths of a current product or where it might be falling short. And even if customers can’t always predict their future needs, don’t discount customer ideas. They can be an important source of inspiration when combined with brand expertise.
How should brands engage with customers on social media?
Customers want to know brands are listening, and the companies that take notice on social media are often rewarded with greater loyalty. Studies show that customers who engage with companies via social media spend 20% to 40% more money with those companies than other customers, and grant them an average of a 33-point-higher Net Promoter® score.
With appropriate training, your front-line social media team can often turn complaints into valuable feedback. Even if there’s no opportunity for you to engage directly, customer input on social media can and should be tracked to identify and address trends.
If you are actively soliciting customer feedback via social media, think carefully about how you approach customers. Your customers value their time, and while creative executions such as Facebook apps may help to generate responses, customers may either ignore your efforts or resent donating their time to "corporate crowdsourcing." Remember to make sure there is something in it for them.
Social feedback usually means public feedback. Are you prepared to receive and respond to customer responses in public? Make sure to have a plan in place in the event you encounter a truly unhappy respondent.
Social media offers an incredible opportunity to harvest feedback through listening tools and to directly solicit it en masse from customers. This creates an opportunity to gather data from a significantly larger sample at a significantly lower cost than the traditional focus group approach. While social media does not replace other forms of research and feedback, companies that successfully integrate social feedback into their product development processes will have a huge advantage over those that simply choose not to listen.
—Hayes Davis is cofounder and CEO of Union Metrics, a social media metrics service based in San Francisco, CA. He has more than 10 years of experience in designing and developing high-quality, mission-critical web software. Follow him on Twitter at @hayesdavis.
[Image: Flickr user Mika Andrianoelison]