And you don’t notice. And you don’t, because he doesn’t.
Average sales growth for our customers
Completed project
Internationalisation project in the Nordic countries and Europe
This story is true.
The sales manager called me in the middle of Thursday. He was delighted: he had had lunch with three of his biggest customers that morning. All three had said they were very happy with the cooperation. One had even said that your team was the best on the market. The sales manager was reporting this upwards and wanted a review: would it be sensible to propose a price increase to the management team for next year’s contract round?
I asked one question.
Silence on the line. Then: “Why would I ask that?”
Because, I said, that’s the only question you haven’t got an answer to yet. You’ve got the answer to the question “are you satisfied with the service”. That question doesn’t measure anything. It measures whether the customer is polite. A Finnish customer is almost always polite. A Finnish customer would rather change the whole supplier than tell them directly that the price is too high.
Two weeks later, the sales manager called back. He had asked. All three had responded in the same pattern: they would read the email to the end. They would probably ask for a quote. They wouldn’t necessarily switch, but they would certainly take a challenger to test alongside the current one.
There was no price increase. One question saved the sales director from the other question he would otherwise have had to answer: why did we lose three key customers in one quarter?
This is not a lie in the sense in which the word is usually understood. Your client is not sitting over a coffee thinking about how to mislead you. He’s lying in the same way we all do: to protect the relationship, his image and his moment of comfort.
In psychology, this has a name: social desirability. It is one of the most studied phenomena in all of behavioural science. It explains why no one tells you what they really think in a self-administered survey.
But that’s just one of three reasons. The other two are not about the customer, but about you: your psychology and the psychology of your team, the glass through which you look at your business. They are so powerful that even academic researchers fall for them when the research subject is your own employer.
These three distortions together make do-it-yourself customer understanding more dangerous than not doing it. Why? Because not doing so leads to uncertainty. Internal research leads to false certainty. And false certainty is the most expensive thing a manager can build a strategy on.
The first distortion is so obvious that it is missed. Who does the internal team ask?
From existing satisfied customers. Those with whom you have a good relationship. Those who answer the phone and whose contact details are in the CRM.
Who is left unasked? Those who left. Those who never bought. Those who considered but chose a competitor. Those who desperately needed your service but thought it was too expensive or too complicated. In other words: the very people whose understanding would transform your growth.
In statistics, this is called the survival bias. During the Second World War, American engineers analysed returning bombers and found that bullet holes were concentrated in certain areas. They decided to armour those spots. Mathematician Abraham Wald pointed out a simple fact: you were studying the wrong planes. These made it home. The ones that were hit elsewhere are lying in the fields of Europe. Armour those other spots.
You examine the returning planes. Not the ones that never came back.
The fan club is a pleasant audience. They’ll tell you you’re great and give you five stars. The problem is that fans don’t buy more because they already are. The growth comes from those who are not fans. And those are the ones you don’t interview.
This is more dangerous: amplification bias.
When a person with a ready-made view examines a subject, he does not examine it openly, but in order to confirm it. He frames the questions in such a way as to attract certain answers. Then he hears the answers filtered through his own vision.
This is not a weakness, but a default setting in the brain. Psychologist Daniel Kahneman wrote a whole book on the subject (Ajattelu, schnell ja slutasti): decision making is based on quick intuition, which should be corrected by slow reasoning when necessary. But slow reasoning is expensive, and it does not start when you feel confident. And management teams tend to feel secure.
In practice, it goes like this. You have an idea for a new product. You ask an internal researcher to see if there is a market for it. He doesn’t ask “would you buy such a product?”, he asks “do you see potential in such a product?” The first is a check. The second is an invitation to be polite.
He writes a report on the answers: “60% of customers see the potential of the product clearly.” The report doesn’t say what the other 40% said, what the 60 actually meant or how many would have paid a cent.
An internal investigator does not lie. He does exactly what he was asked to do: tell the boss what the boss wanted to hear.
And you’re building a €2.8 million product development programme on the back of a 60% that doesn’t exist.
The last one is the cruelest, because it cannot be circumvented by any form or interview frame.
When you sit opposite your client, you are both bound to the relationship. Your client is paying you, has paid you or may be about to pay you. He will need your help in the future. He is playing a game whose rules say: let’s be polite.
When an external interviewer is sitting in the same seat, the situation is different. He or she has no relationship with the customer and no sales objective. He or she is neither won nor lost based on the answer. That’s why the customer says things to the outsider that he would never say over coffee with you:
These are not things your customer says to you. These are things he says when you are not in the room. And it’s on knowing these that your strategy depends.
Three professions that are not usually thought of together. They all have the same core competence: getting people to tell you things they didn’t intend to tell you.
You talk to the therapist about things you don’t tell your spouse. Not so that the therapist will listen better, but so that you can talk to him or her without consequences. This is precisely why the therapist cannot treat his or her own family member: when there is no role, the method breaks down.
The journalist gets the source to talk, because the role involves a contract: the information is published, the source is protected. A good police officer does not coerce during questioning, but creates a situation where it is psychologically easier to tell than to remain silent.
The same happens in an in-depth interview with the customer. The outsider gets information that the insider doesn’t get because the role is different. It’s not your team’s fault or lack of expertise. It is a limitation built into the role that cannot be circumvented.
This is precisely why an external partner is not an extra cost on top of internal work. It is access to a class of knowledge that the internal team does not have access to, no matter how talented the team is.
When a manager calculates the price of an external customer survey, he or she compares the quote with the theoretical price of an hour of internal work and calls the difference a saving.
The correct calculation goes the other way. An external study costs X. Internal research of the same scope costs about half that, but the information it produces is partly biased (fan club), partly corroborated (echo chamber) and partly polite but not true (tacit agreement). A strategy built on this information invests in the wrong direction. The cost of the wrong investment is typically tens or hundreds of times the cost of the research.
Everyone knows this. Few people calculate this way because the cost of the wrong investment does not show up on the budget form. It shows up in the operating margin three years later, when no one remembers what it was actually for.
We will return to this in the third part of the series, because insight without action is worthless and customer insight without action is just a more expensive way to produce a presentation that will remain in a filing cabinet.
But before that, two questions.
First: when was the last time you sat with your client for an hour without having anything to suggest? If you don’t remember, I’ll ask you another way: when was the last time your client told you something that really surprised you?
Second: when you read this, whose customer’s face comes to mind first? The one you should have spoken to a few months ago. The one you know deep down that the relationship is thinner than CRM looks. The one who hasn’t complained, but whose silence is starting to feel different than before.
Write his name down.
The third part of the series shows how the three perspectives of management, creators and customers are put in the same room to produce three concrete actions in six weeks. Not a report, not a shelf warmer. Three actions.
Before that, you call the one customer whose name you just wrote down.
The final section shows how the three voices of management, creators and customers are juxtaposed to produce three concrete development paths, not a report that sits on a shelf.
