Are you listening to your customers? Are you really, truly, listening? As it turns out, many companies are falling short —including those who invest in market research! This reality has given rise to a new and powerful process called Voice of the Customer. Also known as VoC, Voice of the Customer “encompasses the process of gathering and understanding customer feedback so [it] directly improves the product and customer experience." But it isn’t as simple as it sounds. Here’s what it entails:
- Going beyond surveys: Don’t get us wrong – surveys are a vital market research tool. They are a cost-effective way to gather key, high-level insights. However, because the majority of online surveys are quantitative in nature, in-depth feedback is lacking. Thus, to fully understand customers, VoC research involves an array of data gathering methods both qualitative and quantitative: surveys, interviews, focus groups, customer journey mapping, website analytics, etc. It's also conducted both externally (with customers) and internally (with the sales teams, customer experience, marketing, and product teams). The result is rich, multi-dimensional information on how to improve products and customer experiences.
- Asking difficult questions: Everyone likes getting positive feedback, and businesses are no exception! This can subconsciously bias question design, resulting in glowing—but relatively useless—survey results. VoC demands that researchers push themselves to ask the challenging questions. While the responses may not be all smiles, they reveal insights that drive change. After all, it is hard to improve without first identifying your weaknesses.
- Taking action: With VoC, gathering data is just the first step. Companies must then focus on actually “extracting insights” and promptly “putting them to work in [their] customer lifecycles” (i.e. taking real action). Finally, to close the loop, VoC “stresses the importance of…responding to customers with proof that their feedback has been incorporated into the products and services." Customers want to know that they’ve been heard! McDonald's response to environmentally-conscious consumers is just one great example of this:
- Focusing on each customer: Market research often looks at the aggregate for a population (or segment thereof). VoC, however, takes a different approach. It “shifts the focus to…individual data,” analyzing the feedback of each and every consumer. In this way, companies can understand what success looks like for each customer and tailor their efforts accordingly.
- Involving the whole company: Following the VoC process is a team effort! All departments must buy in and work actively and in coordination to respond to customer input. To understand why, consider the many factors that contribute to customer satisfaction—the marketing, the customer experience (CX), the quality of the product, etc.—and the staffers responsible for each. It truly takes a village!
With all this work, is VoC really worth it? By helping companies develop superior products, services, and customer relationships, the VoC process, in turn, creates happy customers and assuages dissatisfied ones. For the best-in-class VoC users, this can translate into significant upticks in key metrics. We’re talking about a 55% increase in customer retention/brand loyalty, a 23% annual decrease in customer service costs, a 292% rise in employee engagement, and a 10-times greater increase in annual revenue! Evidently, adopting VoC can prove to be a key differentiator for companies.