Measure — don’t assume

A further essay on the subject of perception surveying and why owners overate their business.


As a part of my business we maintain a large team of trained customer perception surveyors in Melbourne and Sydney. For those of you who are not familiar with the concept, customer perception surveying is a control system used to objectively measure the standards of a hospitality business. You may have heard them referred to as ‘mystery shoppers’ which is the name they go by in the retail industry.

The logic is simple. You probably have an accounting system to track money going through your business, a stock control system to keep track of your purchases, but do you have some objective system that controls the very thing that earns you your income? Put simply, the public vote for your business with their wallets and purses. What you think of your business doesn’t really matter — it’s the perception of the public that will dictate your ultimate success. Do you know what they really think?

A disturbing percentage of business owners and managers think they know and will argue till they’re blue in the face that they have their finger on the pulse — after all, they get direct customer feedback all the time, don’t they? We’ve no doubt that they do, but is this feedback accurate?

We originally started doing customer perception surveys because we were going into businesses and finding that they were spending large amounts of money on advertising and promotion, but were not showing solid business growth. This told us that all this marketing expenditure was either ineffective, or was effective but was only bringing in new customers to replace customers they were losing for some reason.

Often the reason they were losing customers was obvious to us as soon as we set foot into the business. We’d sit down and have a chat to the owner and politely suggest that they needed to lift their standards and become more competitive. This sometimes provoked a very defensive reaction and our relationship soured to the point where we were not invited back. They always seemed to throw a similar response at us: ‘That’s not right. I talk to my customers all the time and they give me really positive feedback’, or words to that effect.

To get around the problem we set about to create an objective measurement system whereby we wouldn’t have to make the judgement about the client’s standards and the result would be hard to argue against. We then sent teams of surveyors to assess the business rather than expressing an opinion ourselves.

Interestingly, we ask business owners how they think they will score before the survey period starts (the surveys are scored out of 100). They commonly rate their business 20–30% higher than our surveyors do. We have to ask ourselves why? Now, after 10 years I’m starting to understand why, and herein lies one of the big opportunities for hospitality operators.

It’s much more than just blind loyalty to their business that causes them to overate themselves, although this is certainly a part of it. It’s a combination of being that close to their business that they can’t see ‘the dirt in the corners’, and misdirection they get from a vocal minority of their customers.

The issue of being too close to your business to be objective is well recognised. The retail industry calls it ‘store blindness’. Many years ago, when I was in the fast food industry, we used to swap our managers around every three years or so to avoid it happening.

Misdirection from customers is something we have only recognised in the last few years. This is where a business owner or manager hears a disproportionate quantity of positive feedback from customers and falls into the trap of believing it applies to most customers (often because they want to believe it).

The reality is that only a very small percentage of dissatisfied customers will give accurate negative feedback. First, it puts them at risk of conflict — it’s safer to just say: ‘It was lovely, thank you’. Second, it involves an admittance of a bad personal choice (if they initiated the visit themselves), or a criticism of the host’s choice (if they are a guest). There’s some powerful psychology at play here. The dissatisfied customers want to extract themselves gracefully and not spoil the occasion any further, and the owner or manager desperately wants to believe they are all happy because to do otherwise forces them to confront personal and professional failings.

To add to the problem there are a percentage of customers who will deliberately ‘butter up’ the owner, manager, headwaiter, etc in order to gain personal recognition on subsequent visits — even if they are not particularly happy.

One way or another we can’t duck out from the facts as they have come to light — the average owner or manager seems to substantially overate the performance of their restaurant, cafe, hotel or other hospitality business. If you fall into the same trap and assume you are running at a competitive standard, and you’re not, you’ll shoot yourself in the foot, or at the very least cost yourself a fortune in advertising to maintain your customer base.


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