How small businesses can collect feedback from customers while respecting privacy

It’s crucial for businesses to gain insight from the customers who support them. By gaining valuable insight, business owners can see how customers perceive aspects of their company, such as their products, customer service and website. Additionally, they can use data collection methods to understand how their business can improve and connect with customers through feedback.

However, small businesses may be discouraged from data collection since it is mainly associated with large companies. For instance, Apple and Snapchat are both known to collect a substantial amount of customer data compared to smaller businesses.

According to a 2020-2021 survey by the Privacy Commissioner of Canada, about seven in 10 Canadians have refused to provide an organization with their personal information due to privacy concerns.

Instead of relying on invasive data collection techniques, small businesses can use inexpensive digital tools and in-person data collection methods to gain customer insights.

Small businesses can easily collect three out of the four different customer data types. Small businesses can collect engagement data, which shows how consumers interact with a business’s website and social media pages. Small businesses can also gather behavioural data by talking directly to customers and looking at purchase histories. Lastly, small businesses can evaluate attitudinal data, including customer satisfaction and other purchase criteria.

Small businesses should use customer data collection because they can use their findings to learn more about client preferences and satisfaction. They can apply these insights to switch around customer service techniques, reduce operational costs and expand inventory for products that consumers like best. Small businesses can also learn more about how customers prefer to shop and the issues most important to them.

Moreover, by examining customer data, small businesses can increase revenue and customer satisfaction while decreasing unnecessary costs.

While some customers find data collection invasive, some can see past privacy concerns because they realize that their input can make a positive change or receive compensation for their feedback. The same survey by the Privacy Commissioner of Canada states that 38 per cent of Canadians will provide personal information to businesses for discounts or incentives on a good or service.

Small businesses that collect customer data should do so in a way that ensures the customer that their feedback is appreciated and will be used to benefit their shopping experience. Customers also want to ensure that providing their feedback will not inhibit their privacy, so it’s important to uphold strict privacy practices.

Here are some non-invasive customer data collection methods that small businesses can use to learn more about their customers while respecting their privacy.

Surveys

Business owners can use surveys to collect customer feedback and identify improvement opportunities. For example, surveys can ask customers about their satisfaction with the business’s products, customer experience, pricing and promotions.

Small business owners should keep surveys short by asking specific questions. Additionally, they can send them to customers digitally to avoid confusing handwriting and potentially losing physical copies. To send out online surveys, business owners should ask customers for their email and inform them about filling out surveys for rewards, like a small discount.

Interviews and focus groups

Interviews and focus groups allow small business owners to get face-to-face feedback about new products, logos, website design and more. Before asking questions, small business owners should explain what they are inquiring about in interviews and focus groups so customers know what to expect.

Although this method requires time to recruit willing customers,  small businesses can receive feedback immediately rather than waiting for survey responses.

Focus groups have been shown to significantly impact businesses and their future direction. Twitter founders Biz Stone and Evan Williams used focus groups to learn about Facebook users’ dissatisfaction with the platform. They discovered that the biggest complaint was that the news feed was too cluttered and difficult to keep up with. Using this feedback, Stone and Williams developed Twitter to allow users to share articles, news and opinions in 140 characters or less, later bumped up to 280 in 2018. Interviews and focus groups allow for honest feedback on important elements to help reinvigorate or launch businesses.

Social media monitoring

Every small business should have accounts on social media channels to market their products and services. Monitoring activity on these accounts can tell business owners what content customers are drawn to, what products they are excited about based on likes and shares and what motivates them to purchase from a particular small business.

Using a third-party social platform that monitors and organizes a business’s social media can cut down on time and clearly show what posts get the most engagement on multiple channels.

Businesses can use this information to understand what posts customers are drawn to and why. For example, engagement has been found to increase significantly when businesses post about their commitment to sustainability.

Furthermore, social media marketing can pinpoint what customers value, leading to more brand recognition and a more ethical brand reputation.

Online tracking on the business’ website

 Online tracking consists of tracking users’ behaviour across websites. Small business owners can use online tracking tools to gain insights into customers and their online activity. For example, small businesses can track users’ behaviour on their company websites, including how long they spend on the website or whether they’re confused while using it. This information can help businesses enhance their website design if they don’t have the time to conduct interviews or focus groups.

One of the ways to do this is by implementing CRM software, which organizes and tracks the number of visitors and stores emails and other personal information that customers willingly give when they enter the website.

Small businesses need to recognize that customers have great ideas and can provide the feedback necessary to strengthen a business’s operation and brand.

However, collecting customer data should be rewarded with a better customer experience rather than punished with a lack of privacy. It is up to small businesses to prove that customer data collection can be ethical and benefit both sides.