Branding 101 – make your business what your customers want it or need it to be. In my opinion, it doesn’t get much simpler than that, and in my experience, research consistently shows that businesses listening – and aligning their activities – to the needs of their customers, measurably outperform those that don’t have such customer-centric capabilities. If it were a formula, A would equal an organization’s offerings, B would equal a market’s needs, and C would equal a successful brand, so that when A=B, A+B=C. Somehow, though, some organizations get it in their heads that A can equal C – that their offerings will make them a successful brand – without factoring in customer needs or preferences at all. It just doesn’t add up. As it really shouldn’t be an option for businesses to consider the voice of the customer, here’s an overview of the three primary approaches firms take when implementing VoC programs.
A. Reactive: Act After Customers Raise an Issue
This is pretty much the most deliberate way to cater to the voice of the customer. Companies use numerous technology tools ranging from online surveys to IVR surveys and direct interviews to capture customer feedback data. This data is then integrated within relevant technology systems such as CRM and marketing automation to help employees and executives with insights into customer needs. Savvy organizations go beyond simply reacting to issues raised by customer feedback. They also use analytics to identify trends and correlations to identify recurring issues among different buyer groups. This helps them take necessary actions to alleviate problems. Companies that excel in reactive VoC programs also provide employees with real-time reporting and alerting tools in order to notify relevant stakeholders of customer issues in a timely manner. By doing so, they reduce response time to customer issues – a key metric used to gauge the performance of VoC activities.
B. Proactive: Act Before Customers Raise an Issue
Brands not only listen to what customers are saying at present, but also benchmark these trends over time in order to identify or even create developing or new needs within the market. Until Apple created the iPad, for example, no one really knew they needed a tablet; however, it’s pretty safe to say that launching a tablet wasn’t just a shot in the dark. Effective brands also aim to use the voice of the customer to cater to customer needs before customers even know they have a need. Similar to Apple analyzing customer behavioral and preferential data to determine the market opportunity for tablets, companies that excel in proactive VoC initiatives analyze historical and real-time data and proactively notify their customers. A common example used to describe proactive VoC programs is utility service providers alerting consumers of a service outage in their area. While a utility firm that uses reactive VoC activities would wait until consumers contact the business to acknowledge a service outage and provide updates on its resolution, a proactive one would rather alert consumers via different methods (e.g. text message or email) that it is aware of a service issue and working on resolving it. This helps reduce customer effort in contacting the business to seek insight into issues, but also establishes a firm as a trusted advisor of its client-base. Companies that successfully implement proactive VoC activities enjoy greater customer satisfaction and retention rates, compared to those that fail to recognize the value of these activities or execute it well.
C. Consultative: Balance Reactive and Proactive
Tuning in to the needs of empowered customers is very much like a “crawl, walk, run” process. Reactive compliance would be crawling, getting proactive would be walking, but once brands start balancing the two, then they’re really running. And unlike what babies experience, companies can implement all components of this process at the same time. Companies that establish and nurture consultative VoC activities enjoy the best of both worlds of reactive and proactive programs. They reduce response time to customer needs, but also achieve superior levels of customer satisfaction. The secret helping these firms establish a consultative approach is using reporting, alerting, analytics as well as process management activities coherently so they can alert relevant stakeholders when clients have an issue, but also proactively reach out to buyers to let them know of issues they might face, even before the customers might know they have an issue.
Our upcoming research on Voice of the Customer, scheduled for publishing early April, will identify how companies move beyond capturing feedback and sentiment data and rather operationalize these insights to enable a consultative VoC framework. As we’re working on bringing this research to you, we highly recommend you to read our latest related report on the topic.