Customer satisfaction: getting it straight from the best source

Black Enterprise, August, 1998 by Carolyn M. Brown, Gerda D. Gallop

Focus groups help you zero in on what your customers are thinking

Loyal customers who feel good about your company and its products or services will reward you time and again with repeat business. One of the best ways to measure the extent to which your customers are satisfied is to talk directly to them, using both quantitative and qualitative methods. A quantitative measure would be gathering information through a written or telephone survey (as we discussed in last month's installment of this series). The best way to collect qualitative input is by conducting focus groups.

Typically, a focus group consists of six to 10 people who are brought together to share their opinions about your product or service by itself or in comparison to those of your competitors. Because it's normally best that the business owner remain anonymous or at least hidden from the participants to maintain objectivity, you often get to witness the focus group proceedings through a two-way mirror or view them later on a videotape.

For unbiased and more accurate results, you'll need to hire an independent market research firm to advise you about how to select the group (e.g., based on demographics, psychographics and conflict of interest issues) and hire a facilitator who will recruit the participants, devise your questions, find a suitable location, as well as moderate the group discussion and furnish a report based on the findings. Costs can run anywhere from $3,000 to $6,000 per group for the facilitator's services and, if applicable, may include compensation for participants ranging from $40 to $150 per person.

"Any time you do market research with people, you need to divide them into two groups-potential and existing customers," says Gene Fairbrother, lead small business consultant for the National Association for the Self-Employed in Dallas. "It's important to look at both, because their buying decisions are different. Existing customers will base their decisions on historical experiences with your business," he explains, "whereas those who have never bought from you will base their decisions on experience with similar products or your competitors."

In conducting a focus group, it's important to provide an informal atmosphere with real people asking real questions and giving real answers. You don't want customers to simply tell you what they believe you want to hear or to be less than truthful about their real feelings for fear of what the rest of the group might think. Some industry experts argue that a more accurate technique is to get customers to share anecdotes--true-life stories about their experiences with your products or services. This candor can be especially important if, for example, you plan to use the input to help determine whether or how to launch a new product line.

"You never want to make any major decisions based on the outcome of what 10 or 20 people have to say," advises Nancy Opoczynski, president and founder of New York Focus, based in New York with offices throughout the country, "But what a focus group does do is to give your company some direction or guidance." Opoczynski, who employs 12 people to run the group facility and another 25 as recruiters, facilitates 40 to 50 focus groups a week.

How often should you bring together groups of customers? Frequency will depend on the type of business, says Fairbrother. "For instance, a restaurateur ought to have a roundtable with customers once every few months. The owner can buy the group dinner and sit down and talk to them about items on the menu and service. If you have a boutique, then you will want to talk to your patrons a couple of times a year."

Size is another consideration, he adds. A large national company might conduct focus groups in different cities four or five times a year and do a written market survey every month. Fortunately, no matter what your size or budget and how often you choose to survey, the good part about focus groups, says Opoczynski, is that for "fairly little money you can obtain a lot of customer information."