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Research suggests that 75% of customer feedback
remains unread
Warwick Business School reveals that companies
are unable to manage increasing volume and
complexity of customer insight
20 October, 2009. Research by
Warwick Business School reveals that companies
receiving a minimum of 1,000 pieces of customer
feedback per month are unable to analyse it in a
meaningful way. The sheer volume and variety of
customer feedback prohibits its full use to help
provide better customer service and aid
management decision making.
3,000 pieces of actual customer
feedback in total from Asda, Audi and National
Express were used in the study, which was the
result of a £3000 academic award granted to
Rapide Communication by the INDEX (Innovation
Delivers Expansion) scheme.
With large multinational
companies encouraging feedback via multiple
sources, such as text and voice messages,
contact forms, letters and increasingly social
media platforms, internal marketing teams are
simply unable to analyse all customer feedback
received, due to time constraints and fatigue
encountered when reading and processing customer
comments.
Chris Worth, an associate of
Warwick Business School brought in as an
independent researcher appointed by Warwick
Business School's Dr Temi Abimbola, said: "Faced
with a mass of data, human beings will make a
rational choice: cut down the complexity to
something manageable. When dealing with
thousands of customer comments, that led to 75%
of the data being tossed and the focus narrowing
to a few key categories. That's dangerous,
because the most profitable opportunities are
often hidden in little gems of data hidden in
dark corners.... which companies appear to be
missing."
The research replicates the
situation within the majority of UK customer
facing companies where human analysts try to
understand and analyse customers’ feedback. The
research pitted three human analysts against
Rant & Rave, a sophisticated text analysis
technology, which has been developed by Rapide
Communication in association with The University
of Birmingham, to analyse customer feedback.
1,000 pieces represents the
minimum average amount of feedback a national
high street company can expect per month. When
companies are running special promotions
actively asking for feedback, the number can
even reach 100,000 pieces of feedback per month.
In a major company, the feedback would need to
be analysed, and used as the basis of concrete
recommendations to remedy any issues raised
within the feedback. The analysis is then
further collated to provide information which is
critical to improving the overall customer
experience from the company.
Each human analyst spent 30-50
hours (132 in total) looking at 750 pieces of
feedback (250 from each company). They all did
the same set of 750. i.e. a quarter of the total
(3000 comments) and had to discard 75% of the
data due to time constraints. Even handling 750
comments each was difficult to manage along with
other work responsibilities which they were
expected to handle to replicate a typical
customer feedback analyst’s role.
The analysts needed to sort the
feedback into 15 different categories and rank
each piece of feedback according to the positive
or negative sentiment expressed within it. The
analysts were also asked to provide suggestions
and risks related to the feedback. The humans,
however, were unable to spot trends or provide
meaningful recommendations or risks as the human
brain simply cannot process such large data
sets.
Rant & Rave, the customer
feedback analysing software processed
(categorised, ranked and made recommendations)
the full 3,000 pieces of feedback in less than
five minutes. The categories that the software
selected were similar to those selected by the
analysts. However, more significantly, the
artificial intelligence engine understood and
correctly interpreted the range of sentiment in
the feedback, while the human analysts tended to
use a narrower range in their interpretation of
feedback. The analysts regularly used 3 – 4
categories to tag the feedback, demonstrating
feedback fatigue and the creation of a comfort
zone. Rant & Rave used a broader range of
categories to classify the data. Rant & Rave on
the other hand took the unstructured text - in
this case, 3, 000 customer comments - and
reduced it to quantifiable form, "understanding"
the linguistics of each comment, "scoring" the
sentiment, and deriving relationships between
ideas. Its output, in addition to its analysis,
is a SWOT report that extracts sample comments
identifying Suggestions and Risks.
Nigel Shanahan, MD of Rapide
Communication: “Getting to the heart of what a
customer wants is critical today as high street
brands fight even harder to keep their customer
base loyal. By asking for and then failing to
analyse customer feedback, companies are unable
to create a complete picture of their
performance and their customers’ attitudes
towards them. 1,000 pieces of feedback per month
is a manageable number but human analysts are
facing increasingly complex feedback which is
not uniform, for instance a text message will
use different language to a social media entry
or a formal letter. As companies strive to gain
more customer insight, they will increasingly be
faced with a growing amount of unmanageable
data. This is where Rant & Rant can analyse the
data and leave the actual higher value activity
of recommending how to change a business to the
human analyst.”
Further findings from the research
The cost per unit time of Rant
& Rave was far lower. Human analysts took 132
hours in total to analyse 750 comments each;
Rant & Rave took a few minutes for the full
dataset of 3000+ comments. A business receiving
1000 comments a month would save 0.9 FTE of
human resources using Rant & Rave.
The opportunity costs of using
humans for large-dataset analysis are reduced by
Rant & Rave. All human analysts in this project
were university graduates with technological and
analytical skills better used in creating
business value. If the average employee on this
level contributes £100,000/yr to turnover, Rant
& Rave saves an NPV close to £1m for every
10,000 customer comments received.
Rant & Rave enables faster and
more accurate management decision making by
applying detailed analysis, avoiding human
variability, and providing quantitative support
for its output. This equips managers with
information required to optimise economic
"x-inefficiency", or the extent to which current
activities prevent more profitable activities.
The research was conducted by
Chris Worth, an independent marketing
consultant, together with Dr Temi Abimbola of
Warwick Business School's Marketing and
Strategic Management Group on behalf of Rapide
Communication.
For a full copy of the report,
please contact Yiannis Maos or Matthew Lakey on
02476 011911.
About Rapide Communication
Rapide Communication, based in
Coventry, is a specialist provider of tools to
facilitate effective two-way communication
between companies, employees and customers.
Whilst Rant and Rave helps customers communicate
their views to suppliers of products and
services, Rapide Communication’s messaging tools
enable companies to send communications such as
Voice Messages, SMS Messages, MMS and Video
messages or provide Mobile Internet services to
groups of customers and staff. Rapide
Communication was founded in 2000, and has more
than 400 customers, including a 1/3rd of the
FTSE 500.
About Redpump Ltd
Chris Worth is a marketing
director who creates and executes IMC
(integrated marketing communications) campaigns
and CRM (customer relationship management)
programmes for the financial, healthcare, and
tech/media/telecoms sectors. See www.redpump.com.
For further media
information, please contact Ranbir Sahota at Vitis PR on 0121 242 8048 or
email
ranbir@vitispr.com.
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