Editorial
The Gist
- Voice matters. Listening to customer feedback drives brand loyalty and retention.
- Metric mastery. VoC metrics like NPS and CSAT are crucial for gauging brand loyalty.
- DEI commitment. Implementing DEI standards in VoC ensures diverse customer insights.
The Voice of the Customer (VoC) is a collection of customers’ experiences, feelings, and expectations about a business, and it’s largely based upon customer feedback, reviews, surveys, interviews, and the metrics that are obtained from them. This article will look at the ways that VoC can improve customer retention.
Dennis Shirshikov, head of content at Awning, a real estate investment company, told CMSWire that the Voice of the Customer is a critical tool for understanding what a brand’s customers need and expect. "By collecting and analyzing VoC data, we can identify patterns and trends that help us improve the customer experience and drive retention."
Vital VoC Metrics for Customer Retention
VoC metrics are used to gauge the customer experience, brand loyalty, customer satisfaction, and more based on the feedback that is obtained. Typical VoC metrics (which we have previously covered in depth) include:
- Customer Effort Score (CES) – The effort that a customer has to make in the process of doing business with a brand.
- Customer Satisfaction Score (CSAT) – Determines whether a customer is satisfied with the overall brand experience.
- Customer Loyalty Index (CLI) – Determines a customer’s loyalty to the brand.
- Customer Lifetime Value (CLV) – A measure of how much potential revenue is attributed to a customer.
- Repurchase Ratio – Determines if a customer is likely to do business with a brand again in the future.
- Would You Miss Us? (WYMU) – Determines if a customer would miss the brand if it no longer existed.
- Net Promoter Score (NPS) – Determines if a customer would recommend a brand’s product or service to others.
Each of these metrics contributes to a fuller understanding of whether or not a customer will be retained by a brand. A low score on any of these metrics would be indicative that a brand has work to do in that particular area. For instance, a low CES would indicate that customers have difficulty in the process of doing business with a brand. When customers are forced to make more of an effort, they are more likely to go to a competitor. On the other hand, the easier it is for them to make a purchase, the more convenient and quick the transaction is, and the more likely they are to continue to do business with a brand.
Likewise, a low CSAT score would indicate that customers are not as satisfied with their overall experience. Although it may not be as important as the CES, an unpleasant or negative experience does not lend itself to brand loyalty or customer retention and tends to direct customers toward a brand’s competitors.
Tory Gray, founder and CEO at The Gray Dot Company, an SEO consultancy, told CMSWire that for her, the Net Promoter Score is the most vital VoC metric to determine if customers will return. “The NPS measures how likely a customer is to recommend your business to a friend or colleague, and most customers tend to be pickier with their standards,” said Gray. “It’s not only their experience with your product on the line but something they value even more — their reputation with the people that matter to them. If they give you a high NPS score, you’re giving them an experience worth sharing with others. If not, it’s time to shift your strategy.”
Gray isn’t alone when it comes to recognizing the importance of the NPS metric. David Ciccarelli, formerly the CEO at Voices.com, a voice over marketplace, told CMSWire that his VoC program began as an initiative after reviewing customer satisfaction survey results. "We felt that our CSAT scores were merely reflective of how an individual handled a support case and didn't encompass the overall experience of the customer." Ciccarelli determined that they needed a new metric and a new program to capture the sentiment of their customers and their likelihood of referring his brand.
Ciccarelli landed on the Net Promoter Score, which is a widely adopted measurement of customer loyalty. "To begin, agree on the definition of what is NPS and how it is calculated. Next, we decided the frequency for how often the NPS survey would be sent," Ciccarelli said, adding that once the NPS is defined, surveys can be sent on an automated basis providing your company with a real-time score and insight into the perception of your brand through the eyes of your customers.
Related Article: Voice of the Customer: What Is It and Why Does It Matter for CX?
Serving the Needs of Customers by Listening
VoC is all about not just hearing what your customers are saying, but actively listening to what they’ve said — and then applying the insights that have been gained to improve the customer experience.
Brian Rowley, formerly VP of marketing at Panasonic Connect, a leading global technology provider, told CMSWire that customer retention is dependent on whether a product serves the needs of customers — and grows with those needs. “And listening is at the heart of this as brands develop consultative relationships. This means knowing the experiences and expectations of individuals, and the macro trends affecting the customer base.”
Panasonic Connect is a B2B brand, and as such, Rowley’s customers were themselves businesses, but when it comes to VoC, it’s still about gaining actionable insights derived from active listening. Panasonic Connect had established advisory councils across several major markets. The members of these councils were our customers, representing various organizational levels, Rowley explained. They set the agenda, offering us valuable insights. This allowed us to evaluate if our solutions fulfilled their needs and enriched our service offerings with pertinent information.
Related Article: What Are Voice of Customer (VoC) Tools?
Understanding the Customer Journey Provides Actionable Insights
The customer journey begins when the customer realizes they have a need, and then becomes aware of a brand that can solve that need. It extends throughout the customer lifecycle and includes every interaction that customers have with a brand. For success with VoC, CX teams must have a deep understanding of the entire customer journey.
Maureen Rhodes, chief revenue officer at Center, a real-time spend management platform provider, told CMSWire that for success using VoC to improve customer retention, brands must become their customers’ biggest advocates. "Know the customer journey from start to finish, and deeply understand what the day-to-day issues are from their perspective so that you know what it means for the customer to have success with the product," said Rhodes.
Besides the customer journey itself, brands must ensure that their CX team deeply understands their products and services and the value they bring to customers. “Enable your team to know the product inside and out," said Rhodes. “The best CX teams are those that build trust with the customer, know the problems they are trying to solve and intimately understand how your product can be configured to solve those problems.”
Finally, Rhodes suggested that the CX teams should consolidate customer feedback into actionable data. “Organizing customer feedback data must be a priority of CX teams, with a select few owning the process.” Rhodes explained that these “stewards of the data” are in a better position to evaluate trends and analyze inputs to find commonalities across the customer base.
Related Article: Customer Retention: Strategies, Key Metrics & Examples
The Challenges of VoC for Customer Retention
Diversity, equity and inclusion (DEI) play a huge role in determining whether a brand is taking action that will improve the customer experience for all of their customers, rather than just a specific voice. Gray told CMSWire that one of the most important challenges that brands face with VoC is implementing DEI standards to pull data from diverse customers so that a specific voice doesn’t dominate the data or insights.
"Gathering feedback from underrepresented groups was traditionally more difficult, but we can now harness the right technology to ensure we’re measuring diversity efforts and reaching every segment of customers, not simply those easiest to ask," she said.
The typical methodology from which VoC data is obtained may not be effective for brands today.
Jim Davies, co-founder and executive partner at Actionary, a provider of consulting and advisory services for CEOs and their leadership teams, told CMSWire that relying on traditional customer feedback surveys doesn’t always reveal true customer thoughts and emotions. “In fact, the customer likely didn’t respond to the survey in the first place, or their frustration occurred after the survey was conducted,” said Davies. “It’s well known that the customer experience is often what makes or breaks a customer’s perception of a brand and is a key driver of churn.”
Davies believes that expanding the VoC program from traditional marketing ownership and focusing on research to incorporate key customer insights — such as speech analytics to call recordings — is an important consideration.
Rhodes said that another challenge of VoC is that CX teams are traditionally focused on client-facing features and are not as deeply ingrained in the technical aspects of a product.
“As CX teams take greater ownership of the product roadmap, they must have a deeper understanding of technical product aspects in addition to the benefits to the customer,” said Rhodes, who emphasized that when the team is equipped with a comprehensive understanding of the product, they are able to initiate detailed discussions with clients and contextualize feedback for the product and engineering teams. “It is the CX team’s responsibility to organize and surface customer data in a way that accurately represents the voice of the customer.”
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Final Thoughts
The Voice of the Customer is literally an indication of the success or failure of a business to serve the needs of its customers. As such, actively listening to the feedback that customers provide and obtaining actionable insights from that feedback is crucial to improving customer retention. Brands must ensure that their CX teams have a deep understanding of the customer journey.
Finally, brands must listen to diverse voices, be willing to obtain feedback through unconventional methods, and understand their products and services — and the value that they provide — to customers.
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