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Voice of the Customer Tools & Techniques Continue to Evolve With Customer Intelligence, Convergence is the New Operational Situation

Originally published December 7, 2010



Voice of the customer (VOC) as a market research technique is defined as the process of capturing a customer's expectations, preferences and aversions. Ideally, voice of the customer analysis produces a detailed set of customer wants and needs that is prioritized by company objectives or strategic goals. Additionally, VOC typically consists of both qualitative and quantitative research processes.  In a soon to be released 2010 research study (Operationalizing Voice of the Customer: Maturity Models, Benchmarks & Best Practices ) of more than 430 enterprises, Hypatia Research found that the majority of VOC initiatives are designed to address four distinct business issues:
  • Customer Service & Support

  • Product Pricing, Quality, Innovation & Ideation

  • Customer Analysis, Profiling & Segmentation

  • Brand Reputation Management

Not surprisingly, more than 20 vendors are now racing to add social media intelligence (SMI) capabilities to these solutions (CRM, customer experience management, survey tools, customer verbatims, enterprise feedback management, customer analysis tools, etc.) so that the ability to perform unified quantitative and qualitative customer analysis1 (holistic customer intelligence) becomes a part of this EFM + CEM + VOC = CI equation.

Bottom-line: Customer intelligence is now a ubiquitous2 process of how organizations capture, manage, analyze and apply insight to enhance performance and to accelerate growth.3

This blending of the quantitative with the qualitative customer feedback is nascent still at most B2B industries such as manufacturing, process industries, energy & utilities, and professional services firms. In B2C sectors inclusive of retail, financial services, banking, consumer goods, hospitality, travel, entertainment and telecommunications, maturity levels in operationalization of VOC processes are more advanced. However, less than 4% of all companies surveyed have attained a visionary level of maturity as defined through our primary research.

In creating our maturity model, benchmarks and best practices, we found a wide range of procedures, organizational structures and techniques in use among the 400+ companies interviewed and surveyed. Nonetheless, we identified four main maturity categories that fit a majority of organizations.
  • Level One: Nascent VOC Processes

  • Level Two: Limited VOC Processes

  • Level Three: Operational VOC Processes

  • Level Four: Visionary VOC Processes

Fragmentation is the Norm

Currently, VOC practices are a collection of highly fragmented efforts/initiatives that encompass a wide range of methodologies, internal expertise, analytical techniques and enabling technologies that have two things in common, Each point of customer interaction has potential to be utilized as an:
  1. Opportunity to either satisfy and/or enhance a customer’s experience, or

  2. Occasion to gather customer intelligence on the quality of a customer’s experience with a company’s brand reputation, products, services, pricing and support
With many companies competing on razor-thin profit margins (courtesy of global sourcing practices and the resulting price pressures), customer perception of brand quality, product or service category ranking and quality of customer service are now critical to maintaining market share. In fact, a majority of C-level executives surveyed cited customer retention and customer acquisition as key reasons for investment in VOC initiatives. However, the challenge experienced by a majority of organizations in turning customer voices into customer choices centers on creating a measurable strategy combined with an operationally executable plan for leveraging VOC across customer-facing roles/functions. These strategies and plans should encompass issues such as:
  • What strategic, operational and/or tactical goals will VOC address for our organization?

  • Which customer data source(s) should we utilize for VOC?

  • How often should we capture VOC information?

  • Which role / function should manage this customer information?

  • Which role / function should be accountable for analysis of VOC information?

  • How will we leverage VOC as decision support to apply this customer intelligence?

  • What business processes, performance metrics and rules of engagement should we deploy?

  • How often should we disseminate key findings and to which key stakeholders?

  • Which role/function should be accountable for taking action on customer intelligence gleaned from VOC initiatives?

Turning Multi-Channel Voices into Customer Choices

Figure 1 emphasizes the nascent impact that social media currently has on VOC initiatives.  Many organizations are in “listen” or “understand” or even “categorize” mode, but at best, utilize the following 5 VOC information sources in a siloed approach.



Figure 1: Voice of the Customer: Most Valuable Information Sources

For example, customer satisfaction and loyalty surveys are largely quantitative in nature, and are analyzed and reported on via numbers or percentages. Contextual information such as survey verbatim, online content and emails between organizations and their customers are seldom analyzed or even shared with the same job functions/roles that perform quantitative customer satisfaction and loyalty survey analysis.  Moreover, mapping unique customer identities from quantitative data with unstructured information is either performed manually or is nearly impossible at present.

Our Assessment

Economic realities such as low cost country sourcing, product commoditization and multi-channel competition challenge organizations to significantly invest in improving the experience provided to customers.  All things being equal, an organization’s key differentiator is the level of customer support and experience supplied at each point of customer interaction.

While each industry has its unique challenges to address, investment in VOC is increasing. Whether an organization has point solutions, outsources to a services provider, or creates an internal customer intelligence center of excellence team,4 the need to select, integrate (inclusive of processes and best practices) and utilize various enabling technologies to capture and leverage a holistic analysis of customer experience exists.  In short,  companies will need to develop multiple VOC competencies and business processes, as well as deploy technologies that empower them to source, classify and route and act upon this type of customer intelligence.  Moreover, organizations that seek to establish greater customer intimacy with an end goal of retaining and growing market share should review our research findings as part of their internal due diligence.

For more information on vendor selection criteria, research products (Upcoming 2010 research study Operationalizing Voice of the Customer: Maturity Models, Benchmarks & Best Practices) or scheduling an analyst briefing, contact: ZGR@HypatiaResearch.com or Research@HypatiaResearch.com.

References:
  1. Defined as multi-source data acquisition for the purposes of performing holistic customer analysis with a goal of creating and applying customer intelligence.
  2. Use of the term ubiquitous coined by the Yankee Group circa 2006-2007.
  3. Customer Intelligence defined © 2001 Hypatia Research, LLC
  4. ©2008, Hypatia Research, LLC “Decision Science & Customer Analysis: Competitive Advantage of Necessary to Compete?

  • Leslie AmentLeslie Ament

    Leslie Ament, Senior Vice President and Principal Analyst at Hypatia Research Group is a customer intelligence management thought-leader and industry analyst who focuses on the business value of technology in regards to how organizations capture, manage, analyze and apply actionable customer insight to improve customer management techniques, reduce operating expenses and to accelerate corporate growth. Her research and advisory services include: Customer Analytics & Interaction, Advanced Analytics, Business Intelligence and Big Data Analytics, Social Media Intelligence/Text Analytics, CRM, Digital Marketing Automation, Customer Data Management/Data Quality and Governance, Risk & Compliance.

    Editor's Note: More articles and resources are available in Leslie Ament's BeyeNETWORK Expert Channel on Customer Analytics & Insight. Be sure to visit today!

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