What is the Voice of the Customer?
Here is everything you ever wanted to know about Voice of the Customer (VoC) and didn’t dare to ask. This is a long scrolly page, with lots of information. I have created a table of contents, so you can dip in to the subjects that interest you. Or you can read from top to bottom, it takes around seven minutes.
What is the Voice of the Customer?
The Voice of the Customer (VoC) is a vital customer experience tool. We use it to map customer journeys, understand customer needs and improve customer experience.
Businesses use the Voice of the Customer in one-off projects and continuous improvement, we can summarise the steps:
- Gather data – identify the richest sources of data for your business. They include surveys, review sites, social media, website analytics, customer services (people and tools), emails and SMS. Pull the feedback into one place with the metadata you need (e.g., customer name).
- Analyse data – find patterns and trends using numerical scores and qualitative feedback (words). Where possible, combine with customer and business data to understand how the feedback reflects customer behaviour and business performance.
- Present and use data – share the data to gain agreement for action. Decide what to do either embedding good practices or improving low spots in customer experience. Then do it!
- Confirm and celebrate success – continue listening to customers to confirm your action has changed perceptions, look to business and performance measures to understand benefits. Thank your team and celebrate success or learn lessons.
The Voice of the Customer can resolve individual customer issues, called the inner loop and prevent re-occurrence of issues by improving performance, called the outer loop.
Voice of the Customer tools help businesses gather, analyse and present data, taking the administrative strain from you and removing bias. Some platforms also help choose the best actions and show the impact your changes have on customers.
Why listen to the Voice of the Customer?
Whether you want to increase focus on customers or are already customer-centric, listening to customers is the only way to know what they think and need. By responding to feedback, you can rapidly improve customer experience.
You’ll know you have done an outstanding job when customer experience measures like NPS, Customer Satisfaction (CSAT) and Customer Effort Score (CES) improve. But the benefits go beyond these numbers and quickly show up in Customer Churn, Cost of Sales, Customer Lifetime Value and Cost of Operation.
After that, board papers and accounts show greater revenues and profit.
Three key capabilities
If you are thinking about investing in Voice of the Customer, you might wonder what capabilities you need to get a return on your investment. You are might be starting from scratch or have some VoC activities going on and just want to get better at it. Like all business activities we need to walk before we can run – that is why I tend to recommend VoC Workshops or Projects before investing in more systemic change.
For me, this suggests there are three key capabilities that you need to make the most of the time and money you spend listening to customers:
- Data Analysis
- Organisational Engagement
- Delivering Benefits
Let’s explore them one by one.
If you are listening to customers, then you have data around you. It might be in the heads of call centre teams, on review sites or in the responses to surveys. All this data is worthless unless you analyse it. But that sounds scary. Analysis can be straightforward if we break it down.
Put feedback into categories
Every piece of feedback is talking about something (or multiple things). Count the number of times each topic comes up and whether the feedback is positive – the delivery driver was lovely – or negative – my deliver was late.
Consider the impact on your customer
Did their experience encourage them to buy more from you or seek a competitor? Have they recommended you to friends and family or left a scorching 1 ⭐ review?
Consider the impact on your business
Does the customers response to their experience make it harder for you to sell, give you an opportunity to sell more, result in high call volumes?
And in three simple steps you know what feedback you need to act on. You may wish to further divide the feedback by the cost of action. If VoC is new to you, you can start with some quick wins (see image). If you are adept at change, you may take on a larger project.
NB: The big risk in analysis is thinking we understand our customers and acting with bias. It is hard to hear that your customers are unhappy or that the things you work so hard to deliver do not meet their needs. Find a friend to go over your analysis, they should bring a fresh perspective. Even better ask your customers if you have understood them correctly.
Well, I can’t do justice to this subject in one or two paragraphs – if you want to learn more, hop over to my Change and Project Management site.
We need to engage our people to make change and to deliver a compelling customer experience. As a minimum:
Share your vision and case for change
You know why you want to use Voice of the Customer and that you are committed to it. But do your people? Share your vision and your reasons for investing in VoC. And then behave congruently (walk the walk).
Listen and shape your activity
Because of their proximity to customers and the way your business operates, your people know what will work and where risks lie. Listen to them and shape your VoC activity to take account of their knowledge and experience.
Enable your teams
In my experience most people want to deliver an amazing customer experience, but are held back by systems and processes that don’t work, a lack of training and support or just having enough time in the day. The reason I always say ‘invest in VoC’ is because you have to invest so your people can listen, analyse and act.
It’s quite unlikely that you will make changes and the money will start rolling in. As customers we are all focused on our lives and generally only pay attention to businesses when we need them.
To get a return on investment you will have to shout about your improved experience, encourage your customers to spend more and make the most of opportunities to direct staff from wasteful activities to creating great customer experiences.
You said, we did
Tell customers what you changed in response to their feedback. Newsletters are the obvious place, but how about using a transactional survey to ask people if they noticed and liked the change? Can you use a ‘new and improved flag’?
Upsell and cross sell
No-one likes those pushy emails that clutter up inboxes and smell of desperation. So don’t do that. Offer loyal customers special discounts and services. When you have a new product or service ask existing customers to be the first to buy and give feedback.
Improving experience will change how you operate, you may streamline processes, automate or reduce the volumes of calls. This is an opportunity to grow your capabilities in Voice of the Customer and other aspects of Customer Experience.
Structured vs Unstructured Questions
Using a Voice of the Customer platform to automate analysis lets us move from Structured to Unstructured questions – see the examples on the left.
And that means we let our customers speak for themselves. No longer do we have to second guess what might be important to build questions. Nor do we have to assume what drives scores. We can ask. And when customers reply in their own words we can find out what they really think and feel about our products and services.
While we can analyse unstructured text manually – and I have – automation lets us analyse many more responses. It removes our biases and stops our beliefs getting in the way – see the ‘wrong colour below’.
The Wrong Colour
In my first Voice of the Customer project, we had a lot of open text feedback saying ‘wrong colour’ when products came back from a UK catalogue shop. Over half of all returns had this problem and our relationship with the retailer was suffering.
But our product only came in one colour, so it was easy for the returns team to assess the returns as ‘no fault found’. They had a bias and didn’t know it.
Several months into the project, I visited an electronics store and noticed our product was on the bottom shelf. I spoke with a store assistant and she said ‘it’s quite dingy’. Heart pounding, I thanked her for her time and went to the catalogue shop. Sure enough, the photo showed a bright white product – not our light grey. Had I found the true cause of all those ‘wrong colour’ returns?
I wrote up my findings and sent a report (on paper!) to marketing, industrial design and the product owner. A few months later, I learnt the entire range was being re-coloured eighteen months early. Our no-fault found returns returned to normal and I was thanked for my insight.
Fix, improve, transform and create
You can invest a lot of time, money and emotional energy into understanding the Voice of the Customer. To earn a return on your CXM investment you must take action on what you have learnt.
There are four types of action fix, improve, transform and create. I wouldn’t get hung up about neatly categorising your actions using them as the first three overlap. However, they do show a growing capability or maturity of approach.
In the wrong colour (above) we saw an example of ‘fix’. While changing the colour of a range of domestic appliance is not straight forward, it is clear what needs to be done to prevent dissatisfaction.
But we need to do more than prevent dissatisfaction, we need to create satisfiers. Enhanced functionality and journeys which meet customer needs more exactly. The product in the wrong colour was a kettle. If we were to add a temperature controller that would improve the product for some customers (mainly coffee drinkers).
Transform is were we start to get disruptive. Rather than a kettle you might install a tap that boils water. In the world of services we see retail moving ever more on line and transport you can order with an app.
Create sits on a different scale, it is the use of Voice of the Customer directly in the design of our products, services and journeys. VoC is particularly important in design (aka product development) as it tells us what to keep as well as new problems to solve (needs to meet). For me, consistently opening the design process to the voice of the customer is the pinnacle of customer listening and a true indicator of customer centricity and employee engagement.
The benefits of listening to your customers
Retain more customers
Happy customers are more likely to stay with you. That means when you recruit new customers you can grow – rather than working hard to stand still.
Sell more stuff
Even better, those happy customers are likely to spend more through up-sell and cross-sell. They are also more likely to try new products and services than new customers.
Stand out from the crowd
The experience you deliver marks you out from your competitors. VoC helps ensure your difference is an advantage.
To delight your customers you must engage and empower employees. VoC is a quick and satisfying way of collaborating with your team to reach your goals.
Quick to results
VoC is the quickest way of improving customer experience. Start with quick wins and progressively tackle bigger opportunities as you learn.
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