Not For Sale: Loyal Customers

By Heather Baldwin

How do you build loyalty with customers you can’t see and touch? Just ask eBay, says Rod Lehman, vice president of marketing at Mountain View, CA-based Satmetrix Systems, a company that helps enterprises measure, analyze and improve customer loyalty. The online auction site, he says, has become a leader in customer loyalty by using customer feedback to improve its processes and by quickly identifying and addressing unhappy customers.

How do they do it? Each month they sample and talk to about 10% of the customers who complete transactions on the eBay site. With more than 40 million members, that’s 50,000 surveys a month. Customers tagged to complete a survey will receive one of two versions – General Support or Trust & Safety – and they’ll receive it in their local language. Still, eBay’s real success comes from what they then do with those surveys – they follow up. “They immediately follow up on customer feedback, whether it’s good or bad,” says Lehman. “They contact customers within four hours of the customer’s purchase or sale on the site. And they have internal goals for how fast they want their employees to follow up and resolve issues with customers.” At the same time customer service reps are rewarded for getting top rankings from customers. As much as 60% of their bonuses have been tied to loyalty scores.

eBay has relied on technology to accomplish these improvements. About a year ago the company invested $100,000 to put a customer feedback system in place. Since then, satisfaction and loyalty has increased more than 30%, according to Lehman, who says the system helped eBay retain customers who might otherwise have defected to other auction sites.

But the basic principle behind eBay’s success remains very simple – listen to customers. “Collecting the data is not enough. You have to then do something with it to change the way customers view you as a vendor,” says Lehman.