Responding to a popular survey, liking an inspiring post or availing an irresistible offer– these are just a few of the ways customers express their thoughts after their interaction with a product. Forums, social media, groups, blog comments and events are the most common channels where customers usually voice their opinions and air their grievances. But the biggest challenge for a business is to decipher meaningful insights from these common actions. Known as the Voice of Customer (VoC) in customer service parlance, these expressions can mean a lot to a business that is looking to offer products that are acceptable and commercially viable.
According to the Six Sigma Institute, “Voice of Customer is the customer’s voice, expectations, preferences, comments, of a product or service in a discussion. It is the statement made by the customer on a particular product or service.”1 This one-line definition also accentuates the increasing role VoC plays in today’s customer-centric business world.
That said, let’s delve into the three overarching roles it plays in an organization where customer experience is at the top of the agenda.
Strengthens Loyalty
When customers see value in a product, and experience joy while using it, they continue to patronize it. Delighted customers buy more and talk more about their preferred products. As a result, more and more businesses are continuing to chase the elusive goal of customer loyalty.
The thrust of a best-in-class VoC program is on drawing insights from every single customer interaction, updating them on the status of their feedback, and analyzing the impact on business. The expected outcome? Higher Net Promoter Score (NPS), a sought-after loyalty metric that is derived from one simple question: “On a scale of 0 to 10, how likely are you to recommend us to a friend or colleague?” Gartner Group found that 89%2 of companies expect to be competing primarily on customer experience going forward.
Enhances Product Design
While addressing developers at a worldwide conference, Steve Jobs said, “You’ve got to start with the customer experience and work backwards to the technology…”
Great products are a result of great thinking. But a product that’s built around customer feedback occupies pride of place in the customer’s mind space. A well-structured VoC program aims to gather both qualitative and quantitative inputs, which in turn help improve products and experiences. Smart businesses make the most of customer feedback while introducing new features or thinking up brand/line extensions. Even the most talked-about concept of Design Thinking draws inspiration from VoC.
“Smart businesses make the most of customer feedback while introducing new features or thinking up brand/line extensions.”
Raises Profitability
VOC data is a treasure trove of lucrative opportunities. When it is tapped well, it’s possible to know what customers want, when they want it and how they want it to be delivered. The task of tailoring the right solutions for their specific challenges also becomes simpler. What’s more, it uncovers new avenues for cross-selling and upselling. Though there is a host of ways to grow a business, what the customer says about the experience has now become more relevant and useful. But yes, the timing and accuracy of questions also play a pivotal role in the success of a customer feedback collection exercise.
It doesn’t require a rocket scientist to tell us that selling to existing customers requires less effort and resources than selling to new customers. That’s because an existing customer has already reposed his trust in the brand; so the resistance is lesser. The revelation of a study by Bain & Company startled many: An increase in the customer retention rate by 5%, increases profits by 25% to 95%.
The task of listening to the Voice of Customer (VoC) has become an imperative in today’s business landscape. Trends like AI, machine learning and in-app & chat-based feedback are definitely making it easier for marketers to understand their customers better. But it is the right mix of strategy, technology and transparency that will be instrumental in retaining customers and increasing their lifetime value for the business.
Conclusion
This beautiful quote by Mahatma Gandhi says a lot about why a business is not what it is; it is what customers perceive it to be: “A customer is the most important visitor on our premises, he is not dependent on us. We are dependent on him. He is not an interruption in our work. He is the purpose of it. He is not an outsider in our business. He is part of it. We are not doing him a favour by serving him. He is doing us a favour by giving us an opportunity to do so.”
Your customers are talking. Are you listening?
References:
https://hbr.org/2014/10/the-value-of-keeping-the-right-customers
