By Felix Bennien
There is a common phenomenon, that more and more companies implement ‘Voice of the Customer’ platforms, but then get overwhelmed by the data they collect – not really knowing what to do with it.
There are a couple of reasons for this. First of all, I tend to compliment the big VOC platform providers for their extremely successful marketing strategies. They seem to do an awesome job in convincing companies to buy and implement their solutions in their endeavors to better understand their customers and manage their experiences. And, although the effort needed to implement a full-scale VoC platform on a global level is widely underestimated, it is the easiest part in the quest for providing better customer experiences.
Secondly, and although I praise every business for starting to take their customers’ experiences seriously, many companies just don’t understand that investing big bugs in a VoC platform is just not the solution, but only the starting point to understand their real issues as a business in providing a value-adding customer experience – both, from a customer point of view and for the business itself – but let’s come back to this later …
On a side note, some cynics might argue that the former is inevitably linked to the latter and that those SaaS companies need to be careful to not slaughter the golden lamp they created by neglecting the need for putting the data they produce to good use. But I believe they are pretty much aware of this problem, building networks and alliances to address the issue (see below).
So, what’s the problem, and how can it be cured to avoid analysis paralysis?
#1 // Businesses need to understand that the business model of a SaaS company is providing software as a service – as the name says. It is not to consult businesses on how to improve or innovate their customer and/or employee experience – and all the necessary steps, processes, resources, etc. to achieve this goal. Businesses need to build these capabilities internally, as well as using additional external partners (i.e. cx consultants) who focus exactly on this task – which made SaaS companies recently change their sales approaches, with more and more of them building partner networks to make sure their platforms are put to better use and produce more tangible business results …
#2 // Businesses need to understand that data is meaningless if you get overwhelmed by it, don’t understand how to interpret it or can’t make it actionable to achieve the change that you envisioned when getting on a cx improvement journey in the first place.
#3 // Businesses that do not master #2 will never see a real ROI on their cx initiatives as they more or less get stuck after the first lap – and never make it to the finishing line where the real merits are won. However, not producing tangible business value will be the ultimate killer for any cx improvement effort that your CEO made a decision to invest in. Or like a famous quote put it:
„The road to failed customer-experience programs is paved with good intentions.“McKinsey
So, what to do?
Three levers to avoiding analysis paralysis and creating real impact through your customer experience management
Focus | Today’s VoC platforms are getting so powerful that there is a tendency to ‘over-measure’ by including every possible micro-moment and creating very sophisticated approaches to segmentation and targeting (including personas, journeys, etc.) And there are new tools and modules being added almost every day. This increases the data points and complexity to a level that starts to get difficult to comprehend, manage and keep track of. Especially, as a lot of businesses don’t know which of these data points are really important to them, if not crucial, and which ones simply aren’t. Moreover, a lot of businesses struggle to link those data points to business objectives and outcomes, or value creation. Thus, there is a huge lack of focus on how the abundance of data available is being leveraged in a useful way.
Plus, there is a second issue here on the customer side that a lot of VoC managers tend to ignore: Every customer feedback requested by a VoC system is generating a new customer touchpoint. So, the more often you ask for feedback, the higher the danger to create ‘feedback fatigue’ amongst recipients and – more importantly – new customer pain points (!)
Thus, it is utterly important to first link customer behavior and feedback to value creation and business outcomes and then focus on those data points that are really key performance indicators for the former.
Note, you can still monitor the full end-to-end journey of customers to have an early-warning system to anticipate any changes well in advance of them turning into business risks, but be careful in what data you use to drive internal customer experience management (aka CEM or XM) and/or any cx change initiatives.
Meaning | The second lever to make sure you concentrate your CEM efforts on the right priorities is to provide context and give meaning to the data you collect. Often times you will identify patterns of WHAT a customer does and how he/she perceives his/her experience, but not WHY. And although open-ended questions and open box feedback already became a gold standard in VoC design, it is in many cases still quite difficult to understand the full picture of a customer’s experience and his/her perception of it. In a way, most of these VoC systems can be described as quant tools – with a little qual add-on. However, the richness of qualitative data pretty much depends on the willingness of customers to provide that feedback, plus relevant tools like text analytics to analyze it.
Nevertheless, to fully understand your customers’ needs and expectations it is important to compliment VoC platforms with other forms of more qualitative feedback and research (ethnographic, co-creations, etc.) to give meaning to the phenomena that you can identify in their more transactional, touchpoint-specific data and feedback. This is the only way to derive real insights beyond the observations you can make via VoC.
Action | The third, and at the same time most difficult and most important lever is making your data and insights actionable. In the cx world, the key phrase being used for this is ‘closing the loop’. However, in many cases, this approach jumps way too short, as it is often just focusing on how to deal with negative customer experiences and feedback – i.e.: “Should we call a customer who leaves a negative comment after i.e. completing his online shopping? What is the process of triggering this call? Who is calling? What should we offer as a compensation, if at all?” Etc. Obviously the aim here is to reduce dissatisfaction and negative word-of-mouth as well as to rebuild trust, drive loyalty and avoid churn.
However, the real deal is to use the data and insights you gain to drive structural process changes as well as to transform your business’ culture to become customer-centric. Otherwise, you will just continue to cure symptoms instead of getting to the root causes of the problems you get feedbacked – and changing them for the good. This is the true heavy lifting of making any cx initiative pay off. Unfortunately, it’s a messy process that will normally take years, but it’s also the only way to achieve sustainable improvements and some real ROI over time. The starting point for it should always be value creation – for both parties, your customers and your business. In theory, the cadence is very simple, yet not as easy to achieve in the real world:
- How is value created within the different areas of your business?
- Which customer behaviors result in a (higher) value creation for/by your business?
- Which impact has the customer experience and customers’ satisfaction with the experience on their value perception, and subsequently their behavior?
- Which customer experience changes offer the biggest lever to achieve a desired change in customer perception or behavior, and where should investments be focused accordingly?
If you manage to tick all three boxes in your customer experience management approach, you will be getting maximum value out of your VoC platform, achieve tangible ROI on the change you create, and set yourself up for real cx improvement success!
Felix Bennien focuses on customer-centric business transformation and business model innovation. He founded beta is the new normal, to help companies accelerate their business transformation and adapt faster to new technologies, business environments and customer needs.