What is the Voice of the Customer?
Voice of the Customer activities give you a comprehensive look at the customer – you want to ask for feedback in several different ways. Qualitative methods include:
- Surveys
- Interviews
- Focus Groups
- Listening Tours
- Customer Advisory Boards
- Testimonials
Use Voice of the Customer research to inform executive decision-making – bring the customers’ voice back to the leadership team so that executives can make confident decisions based on what you’ve heard from the customers.
How does Voice of the Customer data help with churn?
To learn from churn, directly ask “what has led you to this decision to leave?” – part of Voice of the Customer research is following up with churning and churned customers. You can ask what led customers to decide to leave through surveys or interviews. Figuring out why a customer has left becomes an opportunity to make a change within the company, product, or service to prevent future customers from leaving.
Use sentiment analysis to prevent churn before it happens – by tracking how customers engage with you and the language they use, you can categorize customers’ feelings as “positive, neutral, or negative.” “Neutral” can be a warning sign. Counterintuitively, it’s often better to have customers that are upset and negative because they’re emotionally involved, which usually means they’re willing to participate with you to fix whatever is causing the problem.
Why is it important to go beyond quantitative data?
Usage data is just observation – usage data can be helpful, but since it’s all observation, it doesn’t provide you with any content around why the customer is behaving the way that they are.
You end up making stories up for usage patterns because you don’t know the context – without the narrative, you can’t know why the customer is using the product the way that they are. You need to reach out to customers to get context around why they’re behaving as they are and why their metrics are trending in the direction they are.
What are surveys and when should you use them?
Short Form – e.g., Net Promoter Score (NPS), Customer Effort Score, Customer Satisfaction (CSAT). These are global measures that provide data in aggregate but are not very specific. These are appropriate to use transactionally, or as pulse checks in between more substantial touchpoints.
Longer Form – to provide more insight (especially at key stages in the journey), use longer, more in-depth surveys. For example, if you want to know what a customer’s onboarding experience was like, create a 4-5 question survey around that specific experience.
Tips for surveys:
- Mix qualitative and quantitative – add a text box or a comment box to short-form surveys, so you can gain qualitative information about why the customer chose the answer that they picked. If you don’t, you’re left guessing why the customer picked a certain answer.
- It’s okay to send long surveys (occasionally) – especially if you want to deep dive into understanding something. Some of the surveys we send out are 25 questions long.
When to use a survey:
- Send a long survey once a year – you don’t want to send long surveys all the time because people won’t fill them out.
- Use surveys post-onboarding and at renewals – these are two of the best places to have a small survey to see what customers thought of your processes.
- Survey a specific segment – whenever you don’t have enough information about a specific type of customer (stakeholder type, market segment, etc.).
- Use transactional surveys more continuously – quick surveys are great for benchmarking and trending over time. They’re good because they’re easy to fill out and they show if things are trending up or down. The negative side is that they’re missing context. Even if you have a comment box, people will usually only put a few words.
What are interviews and when should you use them?
Interviews are valuable because you really hear the customer’s voice – you’re able to get a lot of in-depth data. This is especially great for driving change up the ladder and supporting whatever points you’re trying to make to the board or the executive team.
Dialogue vs. monologue – surveys are a monologue whereas interviews are a dialogue. With interviews, you have the opportunity to dig deeper if someone gives a surface-level answer to a question.
Tips for interviews:
- Invest in structure and standardization – interviews are very different from listening tours. A listening tour is very informal, often isn’t recorded, and you might just write down your thoughts afterward. On the other hand, interviews are standardized because you’re recording them, transcribing them, and then you’re analyzing the data. Interviews need to be standardized so you’re able to compare answers over time.
When to use an interview:
- When you just don’t know why something is happening – e.g. if you have numerous customers leaving. They might all be citing price as the reason, but you have a gut feeling that there’s something else going on. Interviews can help you find out the real reason they’re leaving.
- When you’re looking to make a major change – if you’re considering a change that might affect customers negatively, and you’re not sure how they feel about it.
What are focus groups and when should you use them?
A group dialogue on a specific topic – focus groups allow you to get many people in one place and gain their opinion vs. having to do several one-on-one interviews.
People can bounce things off each other – it creates more of a brainstorming session format. This allows for different ideas to pop up that might not come up in an interview.
Tips for focus groups:
- You need a strong moderator – a good facilitator can get people to open up and give you the kind of answers that you want.
- Invest in structure – like interviews, the questions need to be standardized so you can track trends over time.
When to use a focus group:
- When you want feedback on a product or process – if you want to gain a lot of people’s opinions on a product at once, or if you want to dial in on a process like onboarding, focus groups are a great choice.
What are listening tours and when should you use them?
Call up customers more informally – have a 20-minute conversation where you ask each customer the same 4-5 questions. It’s usually not recorded and the facilitator will write down a few notes about the conversation.
Great for connecting, not for comparing – customers have the chance to feel like they’re impacting the product and you have the chance to talk to them, but it’s difficult to compare responses in a formal way because you’re writing down notes instead of transcribing and analyzing as you do with an interview.
Tips for listening tours:
- Keep it light – no recording, take light notes and make it conversational.
When to use a listening tour:
- When you’re new to the company (as a leader) – it’s a great idea for a newly hired executive to talk to some customers, but you don’t want to have an interview where you’re doing a whole deep-dive. Listening tours are good for quick learning.
What are testimonials and when should you use them?
An interview with a focus on telling a positive story – they’re still a type of Voice of the Customer, but the customer is giving very positive feedback to the company about their experience. It’s formal and should have standard processes associated with it.
Tips for testimonials:
- When asking someone to do a testimonial, just be direct – ask after a meeting has gone well. Tell the customer what the benefit is for them to provide you with a testimonial.
- Don’t lead the witness – have a standard set of questions. When the customer is talking, you have to be quiet and listen. At the end of the conversation, ask if you can come back with clarifying questions–sometimes if you ask a clarifying question in the middle of the conversation it leads the customer too much.
When to use a testimonial:
- Use snippets from testimonials internally – to get buy-in within your company for a certain project or product. A clip of a recording lets the team truly hear the customer’s voice in a powerful way.
- Pick customers who’ve just had a big milestone or a “win” – you want the customer to be feeling good when you ask them for a testimonial.
What are customer advisory boards and when should you use them?
A formal, hand-picked, small group of customers – this group will agree to meet a certain number of times a year to help the company have a better understanding of the customer. They’ll help guide the company from the customers’ perspective, instead of the company/executive’s perspective. They provide a customer lens on the product.
Tips for customer advisory boards:
- Pick customers who are advocates and willing to commit – customer advisory boards could be meeting once a year for one or two full days, or maybe quarterly for an hour and a half, so you want to ensure the customers are committed, have had success, and have a desire for advocacy for a longer-term relationship.
- CABs function best when they’re formal – it’s appropriate to formalize term length, position responsibilities, and have governance rules around it.
- The board should be made up of senior people, and not too big (6-8 people) – ideally, the group is composed of senior decision-makers because what they’re going to share is going to influence other senior decision-makers. Recruit a group that’s representative of your customer base, but keep it small.
What are some specific moments when you should seek out Voice of the Customer insights?
You should always talk to churning customers to understand why they’re leaving – whether you’re doing this once a week, month, or quarter depends on the maturity of the company. If you’re a startup, it’s essential to talk to everyone who’s leaving to understand why they aren’t buying from you anymore.
Talk to customers during and immediately after onboarding – to help your company understand the positives and the negatives of their onboarding experience. Onboarding often sets the tone for future retention.
At least annually and go deeper than NPS – ideally, you’re looking into the Voice of the Customer continuously, but if you’re only collecting information once a year, it has to go much deeper than NPS for you to gain the bigger picture.
How does Voice of the Customer research evolve as a company scales?
At <$1M in ARR, interview customers directly – the interview doesn’t have to be big. Talking to them for even 15 minutes will be extremely helpful. At this level, you’re looking for: “What did you like? What didn’t you like? What did you expect, that didn’t happen?” Normally the founder or someone from Product is conducting these interviews.
Caution on NPS for early-stage companies – NPS is popular, but it’s not great at the early stages because it doesn’t provide enough information about why people responded as they did. Instead, I recommend a short-post onboarding survey.
At ~$5M in ARR, segment and standardize – you’ll want to continue conducting interviews for churns and customers who just finished onboarding. The most important thing at this point is to segment the different customer groups who are exiting to understand the reasons for each segment, and not just churn overall. You can also start to think about focus groups and interviews for specific research questions. You want to become much more specific and much more standardized in terms of what data you’re collecting over what periods.
At $10M-$20M in ARR, formalize processes and make Voice of the Customer more comprehensive – there are more products and services available at this stage, so the overall process becomes a lot more complicated. To gain a fuller picture, you’ll need to have more feedback touchpoints with customers. This includes using a greater mix of collection types, such as using listening tours, special-purpose interviews, social media comments, call transcripts, and more. You want a more comprehensive view of the customer by mixing quantitative and qualitative test types to add to your analysis and reporting. At this point, your Voice of the Customer program should be cross-functional and formally owned by one executive or team.
At $50-$100M, dedicated specialists take over – at this point, Voice of the Customer is a formal team of business analysts, data analysts, and members from many departments like Product, Marketing, Sales, and Customer Success. The team’s focus is dedicated to collecting and analyzing customer feedback data.
How should you manage the data?
You need to define:
- Who owns the data? – if the Customer Success team is collecting the data, it makes sense for ownership to stay with Customer Success.
- Who can access the data? – this depends on how data is shared within the company; it might be shared cross-functionally across departments, such as Marketing, Product, Support, and Sales. The information gathered in Voice of the Customer research helps other teams with their roles.
- Who will analyze the data? – this could be someone within Customer Success when the Voice of the Customer program is still small. As the VOC program grows, a data analyst or the Business Intelligence team can take over analysis. Many companies hire a third party for 2 reasons. First, analyzing qualitative data is largely still a manual process (assisted by AI). Analyzing qualitative data is still time and resource intensive. And the second reason is to keep the data from being influenced by a bias within the company toward positive data. Hiring a third party gives the distance needed to prevent this type of bias from creeping into the data.
- Who’s responsible for executing on the data? – someone senior, e.g., the Customer Success leader.
How should you segment customers when conducting the research and analyzing the data?
The persona matters the most – their title, position, and how involved they are in the decision-making process.
Firmographics – the easiest place to start is with your current sales and marketing segmentation based on firm size, industry, etc.
Sentiment – look at their health score and look for representation of positive, neutral, and negative sentiment. You need all three of these sentiments to be represented in your Voice of the Customer respondents.
How should you package and present the data to get buy-in from the executive team?
Pull out verbatim quotes or recorded snippets – you’ll want to represent positive, negative, and neutral feelings to make the point.
This works because humans love stories – stories will help to humanize the data to your senior team. It’s one thing to see NPS numbers trending up or down; it’s a whole other thing to hear a customer’s experience in their own voice be tied to those numbers.
The actual words are harder to refute or misinterpret – before you attach a customer’s voice to the numbers, there’s no context to go along with those numbers. It’s much harder to make presumptions, refute or misinterpret the data when it’s supported by the customer’s voice from an actual interview.
How is Customer Success’s Voice of the Customer research different from customer research conducted by the product team?
Product is focused on what they’re building, so they tend to go deeper – to gain a better understanding of a specific feature or product. Product is very focused on one aspect of their product at a very specific time.
Customer Success research covers the whole post-sale customer journey and is broader – Customer Success can take the whole experience into account (e.g., support experiences, billing experiences) and how the relationship is growing between the customer and the company over time.
What lessons can teams learn from academic human behavior research to get better insights?
Bring in professionals to avoid bias – sometimes you should use a third party to conduct surveys or interviews to help cut down on the amount of bias, especially in exit interviews. I’ve heard founders say they don’t want to hire a third party because “anyone can write a survey,” but this is the same thought process as “anyone can cut hair.” While they aren’t “wrong”, a trained professional has valuable experience and perspective that can prevent you from making mistakes.
You need to create, standardize, and follow a process – you have to have a very rigorous and standardized process and follow it for every single person to minimize bias. Otherwise, you end up with poor data that won’t help your company make necessary changes to retain customers and make them happy.
What are the most important pieces to get right?
Start collecting customer feedback now, in a standardized way – this could be an NPS, a survey, or a series of interviews.
If you’re already doing it, ask the four “w” questions – this will help you have efficient processes in place early on in your company.
- Who owns the data?
- Who can access the data?
- Who will analyze the data?
- Who’s responsible for executing on the data?
Start with “what are we trying to find out?” – think about what you’re missing insights on or where you’re lacking information that you want to learn. From there, choose the method for how to best collect that data (survey, focus group, interviews, etc.).
Segment out different types of stakeholders – for B2B, you should be looking at different stakeholders: users, champions, and decision-makers because the sentiment will be different across those groups. I often see these different groups lumped together for the Voice of the Customer when they should be segmented out. Decision-makers have very different thoughts, feelings, and outcomes than end-users do.
What are the common pitfalls?
Failing to question your data – assuming that all of your data is equal and it’s all good in terms of its quality. In reality, certain pieces of data from specific collection methods are better than others.
Never analyzing and reporting the data – too many companies go through the whole process of collecting this data, but then never analyze and report on it. You have rich customer feedback data that’s sitting there unused. It’s like having a goldmine that you never mine for gold. Use your customer feedback data to help you make confident decisions that positively impact your customers.
