As an entrepreneur, you have to lead, but sometimes you have to listen as well.
July 12, 2018
5 min read
Opinions expressed by Entrepreneur contributors are their own.
"If I asked people what they wanted, they would have said faster horses."
While Henry Ford probably never said this, the quote is often cited to support the idea that innovators create new markets and solutions that people don't even realize they want. Another example is how Steve Jobs revolutionized music and mobile technology by following his own vision. The Apple co-founder rarely, if ever, asked customers what they thought.
But, even Apple doesn't always get it right. The continuing unpopularity of its decision to remove the standard headphone jack from its phones is an example of something they could have consulted people about.
As an entrepreneur, you have to lead, but sometimes you have to listen as well. And you won't know when to do which if you never hear what your customers are saying.
How businesses lose touch with customers
It's easy for businesses to lose touch with their customers. Most people buy my company's products in stores like Whole Foods or online from Amazon. And while this is great for my sales, these retailers don't share much information about these customers with us.
A lot of business-to-business services, especially software, have a similar barrier. Their client is a company, which typically prevents vendors from having any meaningful contact with their real customers — the users that actually log in to their products every day.
Every business will have a reason for why it lost touch with its customers, but there are always ways to break down or work around those barriers, and it's critical to find them. Here are five reasons why your business must always engage with its customers.
1. You need the data.
Because Amazon doesn't share customer data, my company decided to develop our own director to consumer online shop. Now our biggest fans buy directly from us, and we get to know them better. The insights we've gained helped us get our products stocked in the canteens of large tech firms because the data showed that a lot of our customers worked at places like this.
2. Satisfied customers will be your champions.
According to a survey by Dimensional Research, 88 percent of respondents said online reviews influenced their buying decisions. That's why shoe retailer Zappos prioritizes customer service over everything, as it results in great reviews. The brand has even started using customer stories in its latest ad campaign. Staying close to your customers will help you keep them happy so they can become your biggest champions.
Related: 25 Tips for Earning Customer Loyalty
3. It gets you out of your bubble.
When his business was unexpectedly struggling, the CEO of Foxy's Pash frozen yogurt belatedly discovered that his target market didn't like his product's packaging. It had been designed based on assumptions about the audience, but he never asked them for feedback.
It's easy to become so immersed in running a business that you lose perspective. Talking to customers gets you out of your bubble and helps you recognize what's really important.
4. You'll learn where your brand is misunderstood.
Even when your business is clear about its purpose and values internally, it doesn't mean your customers are. I often share our companies values publicly on my social media channels, but customers don't always respond positively to things I say. This recent debate about using plastic bottles vs. cans helped me realize that customers may not understand things that your brand does, but reaching out directly via social media it's a great opportunity to educate them.
5. You'll be better prepared for change.
Adobe's successful shift from selling big box software to providing software-as-a-service (SaaS) only happened because the company knew its customers. Both the data and customer insight showed that people were no longer upgrading their Photoshop and Illustrator packages with every annual release. The big box model was on its way out, so they decided to switch to SaaS. Understanding how customers act and why will help you anticipate their future needs.
Staying close to your customers is critical to the success of your business. And with so many ways to do it — from social media and surveys to data analysis — there's no excuse for not making that connection.
Nor should it just be a job for your customer service team. Everyone from the CEO down should get involved. A PhoCusWright study found 78 percent of TripAdvisor users thought a hotel brand cared about them more if management responded to online reviews. I regularly reply directly to customers on Facebook and Twitter, so if you have any comments or suggestions for me, I'm always happy to hear them!