Before plunging into what is voice of customer, let’s first talk about customer feedback and customer experience.
In this digital age, where companies rely on email, social media, chats, videos, and newsletters to hear from their customers, the entire dynamic of customer feedback has transformed drastically, and that too for good.
This is because different social media platforms open a lot of doorways for active two-way communication between businesses and the people. This has also resulted in helping businesses deliver exceptional customer service, the kind that is tailored by the exact needs and desires of the people.
In this blog, you will understand what is the Voice of Customer, how to collect the important data that showcases the needs and desires of the customers and prospects, and also how to tailor your services and according to the data gathered?
Let us start with the definition of the voice of customer.
In simpler terms, Voice of Customer is an in-depth analysis of a customer’s wants and needs.
VoC is a research methodology used in businesses and IT to describe the process of capturing customer experiences, preferences, and dislikes.
The customer’s voice seems like a basic term that includes collecting mere feedback from your regular customers.
But when observed closely, it is a broad concept that could have a lot of significance over how your customers perceive your products/services.
This concept becomes vital to gain a competitive advantage for your company since customer experience plays a significant role in your business’s growth/loss. It allows you to understand your customers’ experience better and map out your next steps to enhance this experience in the future.
Etymology and History
The term Voice of Customer originates at the Massachusetts Institute of Technology (MIT).
It was first used by Abbie Griffin and John R. Hauser in a 1993 MIT Marketing Science paper, titled “The Voice of Customer” who described VOC this way:
[VOC] provides a detailed understanding of the customer’s requirements, a common language for the team going forward in the product development process, a key input for the setting of appropriate design specifications for the new product or service, and a highly useful springboard for product innovation.
You can read the archived 1993 paper here.
For a business to convert a buyer into a customer, it needs to ensure that the product/service is so flawless that the buyer would continue to invest his time and money. And this can be done only when the business understands a customer holistically.
To do this, one needs to collect and interpret all kinds of data in an unbiased manner.
Voice of Customer or VoC helps you with just that.
What separates VoC from regular feedback is that it thoroughly evaluates all the user’s interactions with your company.
"Imagine you are paying a guitar teacher to help you build expertise in playing guitar. Now, as you pay them, you expect them to tell you your positives, but at the same time, you'd expect them to point out your mistakes as well."
This kind of constructive criticism is essential for your business to do well, something that VoC helps you figure out.
Rather than just focusing on the pros of your business functioning, the Voice of the Customer allows you to analyze your business’s entire workings and how you could improve it for good.
As important it is to keep your existing customers and prospects happy by listening to what they want and desire. To stay ahead of the curve, it is a best practice to do this creatively.
The reason to do this is because you also want to position your brand or business as a people-centric brand. How is it wise not to shout out the values that your organization internally holds to the world when it will only make your stakeholders/prospects or customers trust you more?
Here's a heartwarming as well as the smart voice of customer example:
Legos, a popular toy production company, perfectly illustrates how brands (even the big ones!) can listen to their customers (even the youngest ones!).
A 7-year old boy, Luka, wrote to Legos in sorrow, claiming he had lost his Jay ZX Ninjago on a trip – a Lego ninja toy that he bought after spending all his Christmas money.
So, he emails Legos with the request to send him his favorite toy, promising never to lose it again. The reply he got from Legos was nothing less than excellent!
Isn't this a great voice of customer example?
Now, let's understand how does VoC impact a business by understanding a VoC program first.
A VoC program translates the idea of listening to the needs and desires of your customers and prospects into a systematic tool for businesses to use.
A Voice of Customer program helps you measure the experience of a customer.
Understanding what your customers prefer about your business, what they want to be changed, and what needs to be eliminated altogether are the key factors to enhance your customer experience.
The basic framework of a VoC program consists of three steps:
Step1: Collection - Using different methods like surveys, interviews, observation, etc., to gather information from your customers.
Step 2: Analysis - Studying obtained responses to figure out underlying patterns, commonalities of customer expectations, and pain points.
Step 3: Implementation - Acting on the insights gained to improve the required services and products of the business.
As per Gartner, customer experience is the main competitive advantage for two-thirds of marketers.
A research by Brian & Co. has found, Voice of customer programs result in up to 55% greater client retention.
Knowing what your customers think about your customer service, your products, and how you can improve them are the fundamentals of running a successful business.
Here's how a VoC program impacts your business:
1. Allows you to dish-out better products and services
As companies start to understand the customer feedback and what they actually desire, the Voice of customer helps them figure out what they need to do next with their products/services.
Quite similar to learning from past feedback, the voice of the customer allows a company to figure out if the customers are having good feedback about their products.
Product development and product innovation are the essential results of Voice of customer programs. It helps you develop improved products for your customers and align with their needs/wants.
For instance, Airport architects at Gensler improve traveler experiences by interviewing around 30,000 travelers at top 100 airports to make better-informed decisions about planning and design.
2. Higher Customer Retention Rates
As customers provide feedback to a company, they expect it to be implemented. If their feedback isn’t considered or well-received, what are the chances they will buy from you again?
The voice of the customer is a powerful customer retention tool that helps you build a loyal audience. Organizations with a VoC program can help the customers realize that their feedback never gets lost in oblivion.
Customers love it when you consider their feedback. In fact, they would love it more when the same is implemented the next time they buy from you. The more loyal customers you have, the more they are to refer your business to others, and the greater your brand value will be.
3. Helps you dominate your industry
Some of the leading industry players also heavily depend upon VoC strategies to offer a great customer experience.
Conglomerates like Amazon identified they have a large customer base. To retain this customer base, they started a very exclusive program called Amazon Prime.
With a basic idea yet a powerful execution, Amazon Prime has 126 million members in the US alone, making it one of the best business ideas ever. The incredible transformation of data into action is what makes the voice of customer programs the best way to grow a business exponentially.
These two ways are dependent on how to gather information from people.
A best VoC program should include two types of feedback, both of which I have detailed below:
Direct feedback is handed over to organizations through open channels.
These could include surveys, writing in suggestion boxes, writing emails, or even mentioning the organization on social media. These types of feedback are usually directly solicited by the business.
I. Customer Interviews
Done usually in person, a customer interview is one of the strongest and fastest methods of connecting with a customer.
Customer interviews are popular in a lot of organizations and are considered to be the most effective methods of understanding how a customer perceives an organization. These types of interactions could also be made on calls or emails.
II. Live chats
As per 99firms, about 79% of consumers prefer live chats because they offer instant responses. Live chat could be one of the strongest instruments of a thriving business. Live chats are one of the most popular tools for e-commerce sites as it reduces the possibility of your customers feeling unsatisfied.
The use of live chat is very diverse and definitely not just limited to resolving customer complaints. It is a great tool to capture the voice of customers and address their queries (or learn from them).
III. Online customer reviews
Sites like Trustpilot and Yotpo play a significant role in making or breaking your company’s reputation. With an open platform, customers can be open about their experience with your company or its products/services.
With these sites being so transparent, it’s important to understand the kind of impact they would have on your business and how you could potentially use the same to earn your reputation online.
Being generally unsolicited, indirect feedback usually includes operational or transactional information.
Indirect feedback could also include comments or mentions on social media, reviews posted online, or even the data that includes website clicks or buying history.
Some of the popular indirect feedback examples are:
I. Social Listening
While social listening seems like looking out for mentions on your Twitter or comments on your Facebook, it is a lot more than that. Social listening includes exploring the posts or reviews a customer posts and understanding what they expect from you and how they are delivering on those.
Social listening also includes collecting feedback from forums, blog posts, or review sites, basically any place where your customer can vent his feelings.
II. Secret Shoppers
A ‘secret shopper’ is a concept that’s gaining traction over the last few years. Used by marketing research companies, this concept allows a customer to shop quietly and efficiently just to understand how their experience was and if they need to improve.
Secret shopping also allows companies to understand their competition and the right locations for their business to do well.
III. Customer Review Sites
Customer review sites are brutally honest. Depending on the customer experience, the reviews would be tailored. These review sites give you feedback from users that search engines value highly when choosing what results to provide.
If ranked higher and ranked positive, your customers would be able to see your website as an authority, leading to more overall exposure.
Customer experience and Voice of Customer go hand in hand. A good Voice of Customer program can help you enhance your customer experience multifold. As, by listening to customers, you can monitor the needs and wants of your business, to finally deliver your services in such a way that you appeal to the majority of your customer base.
And even though listening is great, it’s not always enough. What Voice of customer helps you do is implement these changes.
We hope this guide aids you to leverage VoC for customer success and help your business. Feel free to come back to this place to learn high rewarding ways to enhance your customer experience for growing your business exponentially.
Before plunging into what is voice of customer, let’s...
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