I want to ask a question about survey response rates in B2B. No one else seems to want to talk about them, which makes me feel that this is the elephant in the room.
First of all, please let me make some assumptions about the market we’re in.
- Most organisations that I come across in B2B have only a limited number of customers.
- Most organisations agree that having good long-term relationships with their customers is essential to the welfare of their business.
- Most organisations have some form of key account management going on – perhaps using sales reps or agents or distributors, perhaps using lots of levels within the organisation to interact seamlessly with customers.
- Most organisations have an 80:20 customer profile (see Choosing the Most Important Customers on the Downloads page – www.infoquestcrm.co.uk).
- Many organisations do not have activity based costing (ABC) and can only make assumptions about which customers are their most profitable (again, see the chart from the link above).
- However, most organisations, with a bit of help, can identify their most important customers, as a mixture of largest revenue, most profitable and greatest potential.
So why would any B2B organisation be satisfied with, and make strategic decisions based on the feedback from, a customer survey where the response rate was less that 50%?
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John, interesting question which I’ve been pondering for a few days. The answer or, at least, an answer came to me when I read Bob Apollo’s latest blog posting “7 reasons why most B2B CRM systems get forecasting badly wrong…”
The opening paragraph is the key one: “How accurate are your sales forecasts? According to the latest research from CSO Insights, less than 50% of deals close as originally forecasted. A significant number never close at all. Think about it – the average sales forecast is no more accurate than tossing a coin.”
The majority of companies make strategic decisions based on low survey response rates for the same reasons that they set spending budgets based on poor sales forecasts – it’s the way it’s always been done and it’s been good enough so far.
Now, there are enlightened companies that understand the need for more rigorous data gathering in order to make informed decisions and their numbers will grow.
However, data gathering and analysis can be an expensive process both in time and resources required. A BERR report of January 2009 indicated that 85% of all UK companies have 10 or fewer employees and that 61% of all UK companies have 3 or fewer employees.
My guess is that these micro companies cannot afford to gather and analyse the data, either internally or externally, so they will continue doing what they have always done.
It’s sad but true: all things are possible given sufficient time and money, both of which are often in short supply.