VoC Research & the Cloud
It used to be easy to identify your customer. But today, it’s more complicated than ever.
Once upon a time, a tech marketer’s customer was the tech buyer alone. Gauging this group’s opinion seemed to be easy. Metrics like revenue and churn revealed how the buyer felt about the product. Still other organizations realized they needed more insight. They conducted Voice of Customer studies, including NPS and direct client feedback sessions.
But times have changed. With the advent of the cloud, SaaS marketers can no longer depend on the limited feedback they get from a closed ecosystem of tech buyers.
It’s Not Just the Buyer Anymore
Product marketing teams know that closing the sale now means reaching more than IT. Instead they need to reach a committee of individuals from different functional groups (an average of 7 people according to CEB). Closing the sale depends on reaching and convincing all these people with the right messaging at the right time.
In a recent a16z Podcast, a panel that included John Hennessy, current chairman of Alphabet and former President of Stanford University, discussed this topic. On the podcast, Hennessey stated that companies used to build a product that solved an end-user’s unique problem. But, as the buying committee has grown and diversified, “…it’s very hard thing to predict [a customer’s pains].” There are too many individuals involved.
The other panelists agreed. The trend towards “departmental buying” is only growing within cloud-based SaaS companies. According to Hennessey,” the real decision is now “coming from the bottom up.” A committee considering a SaaS solution now includes far more than the tech buyer.
Voice of the Customer vs. Voice of the Market
Apple is one of the most customer-centric companies in the world. Steve Jobs once said, “Get closer to your customers than ever, so close that you can tell them what they need before they realize it themselves.”
Jobs knew his stuff, but now even that statement seems limiting.
If your Voice of the Customer research ends with your immediate ecosystem, you’ve in-effect enclosed yourself in an echo chamber.
This can only provide biased results as it merely reflects the opinions of happy customers. Instead, you need to break outside your ecosystem. Talk to prospects, ex-customers, competitor’s customers, and developers at competing companies. Listen to the full voice of the marketplace.
Making Smarter Decisions
In the podcast, Hennessy stressed that “in complex organizations, all decisions are grey. You have to get comfortable making decisions in that environment.” Informing those decisions is what Voice of the Customer research is all about.
But not everybody is doing this yet. According to recent GLG research of product marketers who conduct VoC research, 98% said they collect research solely from their own customers. This data doesn’t seem to move the needle when it comes to strategic decision making. According to the survey, 53% of researchers want to hear the voice of prospects, and 41% want to talk with former customers, two crucial segments. In other words, for at least half of those we surveyed, VoC work is not leading them to act with confidence.
Knowing that there is a problem is one of the first steps towards solving it. As Hennessey says above, it’s impossible to predict how your product or solution will fare in the marketplace. Predicting, guessing or assuming doesn’t cut it. You need to make decisions based on what all customers need and want. To do this you need to collect that information from the decision-makers and influencers both inside and outside of your client base.
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Elizabeth Grausam serves as Head of Corporate Markets at GLG, overseeing Research, Sales, and Strategy within the Industrial, Technology, and Life Sciences sectors. She began her career as a sell-side equity analyst at Goldman Sachs covering the technology sector. Prior to GLG, Liz was the Head of Corporate Strategy and Investor Relations at Amdocs Limited, a leading software & services provider to the communications and media sectors. Liz received her undergraduate degree in physics from Harvard.