Where does feedback fit into the growth marketing stack? We sat down with serial entrepreneur and marketing guru Sujan Patel (Mailshake, Web Profits) to get his thoughts on feedback. It was a wide-ranging discussion, touching on customer-driven growth, building good routines around Net Promoter Score, and the opportunity cost of not investing time and resources into customer feedback.
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Short on time? We’ve got the full conversation recorded here.
“I think about it [feedback] like this – what if people hate our experience, and then don’t tell us? That’s worse than hating our experience and knowing what it is. Because one hurts our feelings, the other one kills our business”
The C-Factor: customer-driven growth
You’ve set out of a methodology called C-Factor around customers-centric growth strategies. What does that mean for you as a marketer?
Growth-oriented marketers spend a lot of time thinking about this, so for me it’s all about finding the best ways to grow. It goes back to the age-old saying of “It’s much cheaper and easier to keep and expand your existing customers than it is to get new ones.” That’s where I started this from. I look back at my career in marketing the last 14 years and to my most successful strategies and tactics. The best things I’ve done have come from me engaging customers. In early 2016, I shifted my focus as a marketer to being customer-first.
That’s not just from my company perspective, or a marketing perspective, but really thinking about looking at things like how a customer goes through a flow using a product or service. How does the person go through this? What’s their journey? Starting to go through that, I found there’s a lot of holes in how marketers, product managers, CEOs approach this. C-Factor is a play on the X-Factor. Customers are really the one thing you can leverage in several ways to grow a business. It’s most effective because you’re actually helping them get a better experience and helping them solve their problems, right? So education is a big part of that, as well as content marketing.
There’s a lot emphasis in marketing these days on velocity. It might seem counterintuitive to some people to take a ‘slower’ approach: more face-to-face meetings, making time for engagement. It does take time to have a conversation, and not everything can be easily digested from- or divined from an analytics dashboard.
The question for me is: How does this approach keep up with growth? What are good practices for making sure that customer centricity keeps up with the growth that you’re trying accelerate?
Yeah. So first and foremost, everyone thinks like, “Oh man, talking with customers is hard. It takes lots of time and it’s going to take away time from other things, or money away from other things.” But engaging with the customers is fairly cheap, right? That’s a customer success role. Again, as a marketer: Compare that to your advertising budget and the CAC (Customer Acquisition Cost). Engaging with the customer for one hour or 30 minutes or 15 minutes is much, much cheaper than it is to go and pay hundreds of thousands of dollars to get a new customer.
The whole point is to give your customers a wow experience, right? And so, this wow experience could come in many different ways and it doesn’t actually need to have anything to do with the product. I’ll give a very, very straightforward example. With our agency, Web Profits, we’re working with CMOs or a VP of Marketing. They often have all these challenges in their business like, “Hey, how do I make projections for the board?” or, ” I’m hiring, what are some interview questions?” Senior people may not just say, “Here’s the interview questions.” It might be things like, “When you’re hiring, I’m happy to help you. Somebody from my team is happy to be one part of the interview process,” And that’s like, Wow!” That’s one thing that most other agencies don’t do.
My software company Mailshake is an email platform, so we can send personalized emails in bulk. The hardest part of using our software isn’t going through the flow and sending out an email, it’s actually, “What the heck should I say? What should I write to these people?” And so, we found we can do all these tweaks in the product but if we just simply help our customers write better copy, they’re going to be the most successful. And so, that’s exactly what we do. We review campaigns, we give feedback, we create a ton of education around how to write these emails, so you as a user can get a better response.
These two experiences: from an agency services side that’s selling $100,000 a year contracts, plus on the Mailshake side, our average price is $30 a month. Very, very different average contract value LTVs, but the wow factor works the same way. What the results of this wow factor are is – one, talking to your customers so you keep them longer, high LTV, more revenue if you’re finance-minded. Number two is actually, this is hard to measure but it is possible: you get happier customers, you train them and it’s the first step to turn them into advocates. This works at both of our companies, and actually provided most of the success I’ve had in my marketing career. Engaging customers and the C-Factor resulted in customer-driven growth.
Most of our customers come from word-of-mouth or referrals. The simplest way to measure this is in the signup flow. Ask, “How did you hear about us?” The age-old thing, most companies have been doing this for a while. And ask them when they answer “friend or colleague” – ask for their name. It’s another field that can add more friction, but ask for the name. Mailshake gets around like 500 to 700 new customers a month. 250 people put in a person’s name and we take it even one step further – we send those people a thank-you note and we find them if we can on social media, find their emails, and what have you. So we’re engaging with our advocates. This is a big part of the cycle of engaging with people and really adding that human factor. Not all of this comes down to time-intensive engagement like phone calls. You can do something simple like send a thank-you note on LinkedIn or by email.
Net Promoter Score: how it’s done
Advocacy and referrals is a good place to jump into NPS (Net Promoter Score). How useful is NPS for you and in the companies that you’re running?
The NPS score is a part of our playbook in getting feedback from our customers. Now, in terms of a score itself, I’ll be honest, I don’t use it much. As in, I don’t necessarily care about what the score is. What I care about is that it’s trending upwards, and the quantitative and qualitative balance of feedback.
Here’s an example of quantitative side. Let’s say our score NPS is 50. I’m just giving you a random number. I’m looking at how many people have reported and given feedback that there’s issues like bugs [in the software]. And so, I’m looking at how many bugs there are, whether they’re blocking and causing a bad Network Promoter Score. That’s feedback auto-tagged to the software we use. We use this information in talks with our devs to think through the product. So we could take an approach like, “Okay, looking at our product – even though we’re releasing new functionality that customers have requested, it’s getting more and more buggy. Let’s make sure we reduce that.”
“My Sunday morning ritual is reviewing the last week of feedback. […] I want to get a general pulse on the company.”
The other side of this is the qualitative stuff. Most of the time people who have had a really good experience are giving you more fuel – it’s open input for more detail that oftentimes is a testimonial. So that goes straight to your website, we have a slash testimonial page on Mailshake and it can go straight there. We review NPS once a week, usually every Monday. You can dive in deeper by contacting the people who provided feature and functionality requests along with their feedback. Anyone who kind of gives a detractor or the passive score we actually email them as well and we send them an auto email saying like “Hey, what’s going on? Tell me more.” And that response is an automated email that gets sent out from our support team, and responses go back to the support team.
I’ve found that from doing customer interviews and just continually talking and engaging customers that it’s not necessarily solving their problems, it’s showing that you care, right? Some problems are not solvable or a customer might say something like, “I just sent a campaign out and I got horrible results. It’s not your fault but I’m glad you reached out and tried to do something about it.” It’s turning those detractors into advocates in your community. I think one part of what I’m talking about here is a brand, right? When you talk to startups, brand is not necessarily a marketing tactic, a growth tactic, it’s a part of marketing and frankly only larger companies or later stage companies start to focus on brand. I think building a brand is a big part of how you can stand out in today’s market. There’s at least a dozen products for every problem. You can stand out by building a brand with values. In this case it would be that you show you care.
If you make this kind of human-centric claim, then there better be a person on the other side of communication, right? That’s what feedback has not done well traditionally. It tended to feel like a black hole with people thinking “what’s happened with my feedback, and is there someone actually on the other side reading this?” I guess the advantage of using software and reviewing on a weekly basis, like you said, is that it starts conversations with people that actually builds good faith.
Exactly, and it’s action too, right? So look, honestly. It’s rare that when somebody requests a feature or functionality, do I email them saying, “Your features is added, it’s live. Check it out.” But what I do is proactively, weekly, we reach out to customers, proactively talk to customers, create webinars. We create content based on problems. A few dozen people in the last two months have requested videos, and I’m not going to email them saying, “Hey. Videos are live.” But we’re working on creating walkthrough videos. They’re not product demos, but actual videos from our marketing team and sales team using our product. And so, when this goes live, maybe not all those dozen people who gave that feedback will notice but a few people who do will know that we actually did it for them. It’s this repetition of actually taking action and showing that you’re doing something with that data on a proactive basis. That’s really the key there.
It’s funny because when I think of NPS or getting product feedback or customer feedback, I always have to think of banks and car rental companies. They all ask, “Tell us about your experience.” My thoughts are always, “Are you really going to do anything with this?” Because I’m pretty sure if I tell you, you suck, you’re not going to do anything about it. Unless I talk about a banker or specific person, you may have that conversation. But if I’m talking about the bank as a whole, you’re not going to change your practices because of anything I say. However, I think that stigma doesn’t have to be the same for software companies or any other company really.
Yeah, especially if you’re looking at things in terms of a growth mindset where you’re able to process information a lot quicker and bring things into action a lot quicker.
Is NPS always the right question to ask? How often should you be asking?
So I think Net Promoter Score is something that should be done on a regular cadence. 90 days, 120 days, and that number really depends on your product and company and usage, right? So for example, if you’re a pizza company, you probably don’t want to have your NPS scores go out every 90 days. What if people don’t eat pizza every 90 days, or what if they order pizza all the time: then it might not make sense to do it every single time. If you’re Airbnb, they ask about experience and get feedback on every single trip because that’s really, really important. So if you’re Airbnb, NPS every 120 days is maybe irrelevant because of how often people use Airbnb. You have to figure out that cadence for yourself. But just think about it in terms of say a dozen or so usages of the product in between the times that you ask. I found that if you ask too frequently under 90 days, it’s overkill. Frankly, you can’t do enough in that timeframe to implement the feedback. You’re going to get people saying, “Well I’ve already told you. Stop emailing. Stop talking me.” They might get a little annoyed. So you have to take into consideration the annoyance that it brings or the actual extra steps.
There’s something that I fear has crept into feedback now, this culture of over-asking. Does every customer touchpoint or activity need to be evaluated? To give an example – I just moved house and my cable provider asked me would I recommend them to friends or family on day 2.. For me this doesn’t make a lot of sense, because you simply don’t know at that stage if it’s a good service. It’s about finding the right question at the right time.
Feedback reaching the right stakeholders
So, in terms of feedback culture, how do you bring feedback to life? Beyond the stats, how do you make sure it reaches the right people in your teams?
So we integrate all of our feedback. We have some in-app feedback. Like we ask customers for feedback after they sent a campaign [in Mailshake]. We have product specific feedback- so that product teams use specific feedback, knowing that we asked. We have NPS scores. We have “how’d you hear about us” forms and sign up. For most data, it goes into this channel on Slack called ‘the feedback channel’. Pretty much every weekend, my Sunday morning ritual is reviewing the last week of feedback. I don’t have a document or spreadsheets that my notes go into at this point. I truly take a qualitative view on that week and I just look through what people are saying. I want to get a general pulse on the company. Later I jot down notes. I have this running Google Doc that I share with the whole company. At Mailshake and on Ramp Venture’s side, all of our SaaS companies, I’m the one that’s closest to the customer. Because for us, customer success, customer support rolls up into marketing because it’s a function of marketing for us.
When I talk to the individual teams, or in a weekly founders meeting, or an executive meeting it’s one of the points I always hit on: “Okay. Here’s the pulse for the week of what people are saying.” It’s not qualitative. It’s like, “Look guys, we had a really buggy week. We need to fix this and share the Google Doc and it’s a recurring thing this quarter. Let’s make sure we do a bug sprint or let’s make sure we resolve this.” Lots of features that are coming to light, so when I look at features, I always take every week as a new week. Completely from the perspective as if I didn’t know anything about this company, what are the things people are requesting? And then if people are requesting it over and over and over again, then I can say, “Well, we’re actually ready to build features, prioritize based off of the requests.” But also with things like the impact and the ease of use and whatnot. Same thing with support. We raised our prices a few weeks ago. It went from $19 a user to $29 on Mailshake. We’ve done this before and what we learned was that it’s going to affect people in the current buying cycle negatively, so let’s make sure that we honor that old pricing for people who are evaluating our software. So, we learned from last time that people got pissed because we forgot about it. It was an oversight. This time around, we proactively solved that and that was just the information we got from our NPS. Not NPS, but like all the feedback mechanisms.
Yeah. The comments that come rolling in with it.
Not investing in feedback? Extremely costly.
On the ROI side of things, feedback software and investing in feedback tooling is often a tough sell because proving the ROI is quite difficult versus something like a comparable sort of mechanism in sales, for example. In the latter case you can answer against the amount of SQLs, leads to customers that you’re bringing in. With feedback, as you’ve noted, it often comes down to qualitative output and it’s quite hard to prove the ROI in direct or convenient ways. What’s you’re thinking on that? Has feedback been ROI positive?
Oh, absolutely. I mean, the cost of the feedback software, time and the investment we put into this is pennies compared to the impact if we didn’t have the tool. So here’s an example, imagine we didn’t talk to our customers or have this feedback mechanism for our company. We would build the wrong thing. Maybe not all the time. But maybe that goes from like 100% accuracy of building the right things to like 75%. That 25% for our three-person dev team, how much time would that be? Like let’s just quantify it, right? The three devs, they’re over six figures salary. If they each spend one week every month building the wrong thing, and that’s not even considering opportunity costs, we’re talking about thousands of dollars every single month because we don’t want to pay a few hundred dollars for software or we don’t want to spend a few hours a month taking time to really talk to our customers. So I think I look at this in terms of: what happens if you don’t have it and you don’t have these mechanisms? The other thing is when you do have these things, you also get laser focused building things that people want and you get ideas for product, for marketing, and advocacy that you probably wouldn’t get elsewhere. We had a customer that was like, “I’m a big fan. I’ve been referring you business and I run a podcast. I want to mention you guys on our podcast. Can you give us a deal for our podcast listeners?” And that was just a low-hanging marketing opportunity. We gave him a little coupon code and he ended up bringing us like a hundred and something customers from three podcasts episodes.
That’s just free revenue for me. So there’s these opportunities that come around from getting feedback from customers. I think about it like this – what if people hate our experience, and then don’t tell us? That’s worse than hating our experience and knowing what it is. Because one hurts our feelings, the other one kills our business.
TL;DR: Key takeaways.
Customer-driven growth is surely one of the most effective growth strategies.
Why? It’s cheaper to retain existing customers than to acquire new ones. Engaging with customers isn’t just beneficial for you -you’re actually helping people get a better experience. Education and content play a huge role.
Checking in on your feedback weekly gives the ‘pulse’ of your business.
Feedback should be rolling in on a continuous cadence, the timing of which should be designed intelligently around your customer journey touchpoints.
Net Promoter Score (NPS) is an engine for referrals.
NPS is a vital tool in the Growth Marketing stack. It aids in identifying possibilities for referrals in your customer base. ‘9’- and ’10’- scoring customers are very likely to recommend you to others – make sure to follow up with them and thank them.
Be sure to follow up negative feedback.
Automation is a big help here: send an automated email to ask what might be going wrong. Have your customer service reply to these emails. Build a dialogue. You won’t be able to fix 100% of issues – but you can ensure every customer feels respected and listened to.
When thinking about the ROI of working with feedback (software), consider the opportunity cost.
What if you built the wrong things even 25% of the time?
- Say you have 3 developers, at over six figure salaries each.
- Imagine the cost to your business of them spending one week of the month working on the wrong thing.
- Compare that cost to a few hundred dollars for software which helps you keep your finger on the pulse of your business.