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The iceberg theory of customer feedback

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Silence isn’t always golden; there’s an abundant source of feedback about your business hidden just beneath the surface. We uncover ways you can dig a little deeper into the valuable opinions of your quiet customers.


The iceberg theory

It’s important to give your customers a voice and let them know that you listen. However, most customers don’t share their experience — more specifically their complaints. According to customer experience magazine CXM, only one in every 26 customers complain – the rest churn and silently take their business elsewhere.

The tip of the iceberg theory suggests that the complaints you actually receive are only portion of those held by your wider audience. The “underwater” portion of dissatisfied customers who don’t complain is of vital importance for small business; it holds the opportunity to evolve.

But are customer complaints examples of unique business blunders – or are they indicators of ongoing patterns in processes, products, and services that need to be addressed? Any feedback you gain is useful. By analyzing the “visible” portion of customer feedback, you’ll gauge the temperature on hidden problems and will be in a better position to plan improvements.

Encouraging feedback will lead to an increase in complaints — but in turn, decrease negative word-of-mouth behavior. We look at strategies you can implement to uncover the valuable thoughts, feelings, and experiences of your customer base.


Silence isn't always golden 

There’s a huge number of unhappy customers who avoid making complaints. What do customers usually complain about? During a case study conducted by TARP, a market research and analysis company, of the individuals who encountered an average loss (approximately $142), 31% did not complain. Comparatively, when facing a minor loss of a few dollars, only 3% of customers complained — the rest did nothing or discarded the item. No matter the value lost, we're all likely feel frustration and disappointment at a similar experience.

Why customers avoid complaining

Some forego complaining to avoid more negative feelings. If they have already had a bad experience, making a complaint is confronting and can rustle up discomfort. Others may assume that other dissatisfied customers will complain, so why bother? Maybe their complaint will be met with lack of interest, even blame? And if it’s a difficult or long process to log a complaint, why waste more time?

How to uncover dissatisfaction

Try talking to your customers more, asking them about their experiences, and encouraging open communication. Let them know you value their thoughts, especially if you have a brick-and-mortar storefront and can interact with your customers personally. If your business is online, try sending a ‘How did we do?’ follow up email after every purchase. Add an incentive, such a discount, or an engaging call-to-action link to drive activity back to your site.


Make it easy to give feedback

Seeking feedback is a smart and proactive move. Increasing the number of registered feedback responses and complaints will grow your business knowledge.

Unhappy customers who don’t complain tend to talk about bad experiences with friends, teammates, and acquaintances — who then pass it on to others. What’s better than spreading good news? Spreading bad. It’s human nature. Over time this can seriously damage a brand’s reputation.

Avoid this by digging deeper into how your customers experience your business. You’ll gain more control over how customers process mistakes by giving yourself the opportunity to intervene with solutions.

How to encourage more feedback? Reach out and make it as easy as possible to respond. Here are some tips to increase your inflow of useful feedback data:

  • Make it fast the average person can become distracted in just eight seconds. To catch your customers’ attention, try quick and simple survey questions that get to the point. Presenting your feedback surveys digitally, such as an online poll, is the way to go.

  • Be online — research by Sprout Social shows that 47% of people have used social media to complain about a business. Increase your chance of receiving feedback and resolving issues by maintaining a strong online presence across multiple platforms.

  • Add humor — encourage engagement by adding colour, images, and a light-hearted tone to your feedback surveys. Injecting humour may not always be appropriate for your brand, but creating a fun, visually appealing feedback experience will go a long way.


Create a positive turnaround

When customers complain, they’re seeking to balance the losses sustained during a bad experience. It can even be a buying signal; a customer complaining is often a call for help so they can maintain their relationship with you.

Losses vary, depending on an item’s value or the service type but resolving the issue usually includes two categories: economic and social. Economic recovery usually includes a refund, discount, or replacement product. Social recovery means the customer receives emotional support in the form of an apology or explanation.

Acquiring new customers is expensive. If you can resolve a complaint, you’ll retain the customer 70% of the time. With such a high ROI, it pays to acknowledge — and attempt to solve — every complaint that crosses your path. Take complaints as an opportunity create a positive result or feeling for your customer. If the turnaround is good, it can even feed positive word-of-mouth. Here are some easy strategies you can apply:

  • Empower employees — share details of your operations with employees; they’ll be empowered with the knowledge and confidence to effectively respond to problems and be better able to suggest solutions.

  • Be timely — it’s vital to respond promptly to complaints (within 15 minutes is ideal) and prioritize responses above other tasks. If more time is required, ask the customer for 24 hours to investigate further.

  • Show empathy — admitting the mistake combined with a sincere apology and explanation shows empathy and respect and will go a long way to alleviating feelings of frustration.

  • Make good — offering tangible compensation in the form of discounts, replacements, reimbursements, or repairs will help to satisfy unhappy customers and reduce the chance of recurring complaints.


Build a better customer experience

Feedback is a valuable resource that you can use to evolve and make positive changes to your business. As the number of customers who complain is small compared to the total number of dissatisfied customers (the tip of the iceberg), analyzing complaints gives only a partial understanding of your customers’ feelings — and buyer expectations are only increasing.

According to research shared by Tech Jury, businesses who focus on improving customer experience can expect up to 80% more revenue — while 86% of customers say they would pay more for a better experience. To improve customer experience, start by defining and scrutinizing the interactions customers have with your business at all touchpoints. The aim is to improve a visitor’s first contact with your brand through to the final purchase — and beyond. Continue to nurture people and you’ll build a happy and loyal customer base.

It seems complaints are rare in relation to the actual number of dissatisfied customers. We recommend taking a proactive approach by building a brilliant customer experience first. It’ll be well worth your time and attention. The customer feedback you can gather in the meantime will be a valuable tool to help you get there.