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Friday, September 22, 2006

the Undiluted Voice of the Customer

Businesses are spending their money on "the voice of the customer", trying to hear what it is their customers want.

But do they want to hear it?

Not really because it can expose their phony practices being deployed in expensive marketing and sales campaigns.

Look at the recent article on the link above: Distorted medical testing

"The results from all the (medical) tests GAO purchased mislead consumers by making predictions that are medically unproven and so ambiguous that they do not provide meaningful information to consumers," says the report, without naming the sites. The tests range in price up to $400. Some companies also offer personalized prescription treatment plans costing nearly $2 grand along with the tests.

The lab test business is booming (especially for diabetes), and one of the likely factors is Big Pharma's megaspending on drug advertising. The bottom line is, talk anything over with your doctor first, and if you're trying to educate yourself, use sites like the AACC's Lab Tests Online, one of the first signatories to WebWatch's credibility campaign."

WebWatch is Consumer reports "unsponsored blog" and its one of the channels for the Undiluted voice of the customer that is publicized by Consumer reports, published by the US consumer union, evaluating products, services and websites from the point of view of the consumer.

Webwatch has great stuff that is valuable to those businesses who want to hear the real voice of the customer, who are looking to truly satisfy customers, to attract and keep them. In an area of interest to all us Internet users, Consumer Reports' State of the Net 2006 tells us: "The risks associated with using the Internet remain high." After a national survey and follow up investigation by the Consumer Reports National Research Center the worse offenders are:

SPAM - Just as bad as last year! With 50% of those surveyed experienced high levels of spam

Viruses - no better, just as hazardous and just as many problems even though fewer hit the news. 25% experienced a major problem and incurred average $109 in damage/fix costs. Estimated national cost of virus: $5.2 billion

Spyware - fewer incidents, still epidemic. One million households replaced their computers in the last 6 months because of this. 12.5% encountered the problem and spent $100 to fix, for a total national spyware damage cost of $2.6 billion

phishing - no reduction in frequency, cost increased 5 times. 1 in 115 lost money from an account that had been "phished" at an average cost of $850, totalling
$630 million in the US.

I ask myself why aren't businesses tapping more into the undiluted voice of the customer? Why spend money when Consumer Reports gives it to you for $26.00 a year.

Then the lame excuses (or answers) flow....

* Most businesses sell to other businesses, so "its not about my products or services"

my response: If you know what your customers' customers want, then you can sell better to your customers!

* We don't look at our products/services that way

my response: yep, that's why you have to pay for "voice of the customer" research so that you can be gently coaxed by therapists disguised as consultants to do what you should be doing "looking at your products and services from the point of view of the customer"

* Our management bonuses and MBO's are not based on Consumer reports ratings.

Don't you think business management Management objectives, Key Performance Indicators and bonuses SHOULD be based on customer ratings of the product and services? And if they are not, think about how that happens. Compensation games that distort rewards for true competence.

Too many KPI's and MBO's are set as part of the "compensation game" where the employee proposes (to their manager) as low as possible targets that are as reachable as possible in order to win the bonuses and promotions. And managers commit the sin of omission, mostly due to not being trained in how to set performance goals, and just accept what the employee proposes, because "they know their business best".

We have a great responsibility to competently set management performance indicators.

And we are failing today.

This is evident up through the CEO and Board levels, think of the Sarbanes Oxley law.

Do you know if your performance indicators will cause customers to trust you to perform competently and with integrity?

You should, because those are the factors that lead to customer retention and advocacy (fancy word for telling friends and colleagues).

Beware of the Voice of the Customer that has been subject to "Management Spin".

Look always for the Undiluted Voice of the Customer.