Remember the last time you purchased a product that didn’t meet your expectations? If you can, then try to think of what you did with the product. Did you manage it as it was, did you tuck it away somewhere, or did you return it?

Also, did you decide to attach a note about your dissatisfaction to any of the above actions - maybe on the product website or a regular review forum online or at the front desk of the company that manufactures the product? 

What you did with the unsatisfactory product and whether you expressed your dissatisfaction or not are the two primary considerations that make up the iceberg theory of customer feedback. Follow us as we take a deep dive into this theory. 

What is the iceberg theory of customer feedback?

Typically, the number of people who speak up about an unsatisfactory experience with a business product or service is just over 10 in every 300 or 1000 dissatisfied customers.

Another striking statistic is that much of these 10 feedback received by a business would have been submitted to a middle man or a retailer rather than directly to the company, and, also, most of this feedback would have been offered once as opposed to making a reiteration. 

The iceberg theory which is more precisely referred to as the “tip of the iceberg” theory is, therefore, an assertion stating that the feedback which a business receives from its  customers represent only a very small part of all the available or existing customer feedback. 

The iceberg theory compares the feedback which a company typically receives to the small visible part of an iceberg. While the larger underwater part of an iceberg is compared to the feedback that customers never share with the company. 

Due to the expectations from businesses, customers tend to make more complaints than they make regular feedback or opinions and so the above theory is sometimes also referred to as “The Customer Complaint Iceberg”

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Key points about the iceberg theory 

For those who do not still have their heads wrapped around this whole iceberg theory thing, we will break it down further by listing and explaining the basic points about the theory. 

• The theory focuses on customers:

The iceberg theory of customer feedback strictly focuses on customers. It points out the feedback behaviour of the average user or consumer and since it is only a theory, it doesn’t go as far as mentioning how businesses could deal with the feedback or complaint iceberg. 

• It is a theory:

As much as this is already very evident, we still have to resonate that we are dealing with a theory here. The reason why we need to do so is because theories could be disproved or rejected.

A theory is an explanation for what is known to be a fact. The major difference is that facts have to be verifiable, sound, and true on all counts and from all angles, whereas the explanation of such facts - which is a theory - might just happen to be off course or partially unsatisfactory. 

• It refers to feedback about dissatisfaction:

Customers do not always have a negative experience and so it’s impossible that they always express dissatisfaction with a product or service. Nevertheless, the iceberg theory of customer feedback specifically refers to feedback arising from an unpleasant experience with a business’s product or service. 

Why should an entrepreneur care about this theory?

Why should an entrepreneur care about this theory? Let’s start by saying that 21st century founders ought to be well versed on the intricacies of good customer relationships.

First off, this is more or less an obligation since users and consumers are increasingly aware of their rights and also actively express such rights in the event of an infringement or a poor service delivery. 

Secondly, and to answer the question asked at the beginning of this section, founders who understand the essence of customer relationships will appreciate and care about the iceberg theory of customer feedback for the simple reason that it exposes a game changing element of customer behaviour. 

This uncovered element in customer behaviour is their natural unlikeliness to express themselves. Users and consumers, rather than always speaking out, tend to keep silent or to say very little, and would just go ahead to make purchasing decisions based on their observations. 

Customers may keep silent over unsatisfactory services. They may also keep silent over malfunctioning or completely faulty products, and more rarely even say or do anything about complaints made by other customers - especially when they haven’t experienced a similar issue. 

Therefore, by knowing about the iceberg theory of customer feedback, founders can better understand customer behaviour, properly grade and utilise the feedback they receive, and also constantly implement strategies that help their businesses to get regular and high-quality feedback from customers. 

How to tackle the effect of the iceberg theory of customer feedback 

Some of the ways of tackling the iceberg theory of customer feedback in your business are really easy to think up. Examples are;

- by hosting opinion-sharing competitions that offer prizes to participants

- by mentioning active or interactive customers in your newsletters, membership platforms, or social media pages

- by giving beautiful membership platform badges to customers based on their consistency at offering feedback and the quality of their feedback.

There are other interesting ways to do it too and we’ll explain all of it here in this section. 

Hosting opinion-sharing competitions that offer prizes:

One of the best ways of getting customers to give feedback beyond the “surface level” is through an opinion-sharing competition. Let’s explain what this is.

An opinion-sharing competition is a competition in which a business asks for review or opinions from their customers (such as newsletter registrants) or the general public (including potential customers) concerning a specific and often controversial topic.

And attach a prize reward for any user who offers the most useful contribution. 

After making the discussion topic crystal clear to the audience (through social media, email newsletter, or physical ad fliers), businesses utilising this strategy will then go ahead to reveal that there will be a prize to be won for the most relevant or outstanding feedback.

The prize could be anything. It could be a discount on the winner’s next product purchase, a cash gift, or any other attractive incentive.

Celebrating active and interactive customers:

Company newsletters and social media platforms are another medium through which businesses can get their users to improve their feedback attitude. This works by celebrating the people who are already doing so.

For example, a mobile phone manufacturing company could create a shoutout post on its Facebook page to an active user who has been consistently commenting about the feel and function of their product since after purchasing it. 

Issuing beautiful membership platform badges for user feedback:

Membership badges are an interesting part of many online and physical communities. Badges are also a great tool for improving the number of customer reviews or feedback which a business receives.

They could be designed for users based on very specific feedback contributions. For instance, members could be issued a particular type of badge when they prove to be consistent at providing useful feedback.

Similarly, another unique badge could be issued out to members when they provide buzz generating comments on a business’s social media posts.  

Of course, the idea of tackling the iceberg theory of customer feedback cannot be implemented unless a company has a well functioning community. However, it doesn’t matter whether the business is operating a physical or virtual community as membership badges could be printed or created in digital form. 

Issuing different amazing badges to highly responsive community members will prompt other members to step up on sending feedback. With this, you can be sure of going beyond the tip of the iceberg in the customer feedback theory. 

Educating users about self care services:

Putting a self care service in place makes it possible for users to perform basic or automatic product troubleshooting or complaint resolution without needing to reach out to a business’s support service.

This means two things. The first one is that it reduces the amount of traffic which the business receives in terms of help services or complaint resolution since customers get the help they need before even reporting an issue.

Needless to say, this adds up to a positive experience for the user and it is typically easier for them to provide feedback for this kind of an experience. 

Secondly, through a self care service, businesses can track processes that result in customer frustration and amend such processes thereby reducing the need to even troubleshoot in the first place. 

Conducting surveys:

Conducting surveys will help any business get to know more about its customers. Interestingly, surveys can also be used to ask what a user sees as a hindrance to offering their feedback.

This could turn the tables for founders by revealing specific obstructions to getting feedback from users whether about a product or a situation and, thereby, fast tracking the resolution of such issues. 

Conclusion

The iceberg theory of customer feedback - on its own - is only useful for understanding that customers don’t say enough. This article has, however, gone beyond to explain that the theory is majorly relevant when a customer feels discontented about a service or product.

Being so, it is possible that businesses would receive a lot more feedback than they typically do if they can manage to maintain a positive user experience.

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