- 1.Fix Sales: Knowing Buyer’s Journey is like Creating a GPS for Your Sales Process
- 2.Fix Sales Problems With The Power in the “Voice of the Customer”
- 3.Leverage Customer Voice into “Explosive Sales Growth”
- 4.Who Owns the Voice of Your Market and Voice of Your Customer? ..Hint (not sales!)
- 5.Voice of Market Identifies “Roundabouts” in your Sales Process
- 6.Voice of the Market Identifies Key Buying Triggers
- 7.Increase Sales: Key Buying Seasons Surface in “Voice of Market” Work
- 8.“Voice of the Customer” Increases Profits…Lesson from a Christmas Ham
- 9.Voice of Customer Finds “Sales Secret Weapons”
- 10.Voice of Customer: Understanding the Entire Iceberg of Purchase Decisions Today
- 11.Improve Sales Productivity With Voice of the Customer Research
- 12.What is The Biggest Threat to Customer Voice Research? (It may surprise you!)
- 13.Give Salespeople More Time to Sell With Voice of The Customer Research
- 14.Customer Voice Research Identifies Content Buyers Need Today
- 15.Identify Purchase Influencers with VOC
- 16.The End Of The Greatest Show On Earth and What We Can Learn About Training
- 17.Voice of Customer Identifies New Markets and New Product Applications
- 18.17 Benefits Of Voice Of Customer
In my last post I shared how market-leading organizations provide their sales teams a repeatable sales process with tools that resonate with their buyers. Understanding the voice of your customers has power. Why do your buyers buy? Why don’t they buy? What process do they use on their buying journey? What criteria must your buyers have to make a buying decision today? Once you have this information you can design a business development plan that creates explosive sales. In this post I will share an example of a company that grew $38 million in 18 months using the voice of the customer.
In the 1990’s I was the VP of sales and marketing for Alpha Enterprises Inc. We were a plastics injection molding company that provided plastic packaging and mechanical security devices for the music retail industry.
In the mid 1990’s the music industry experienced a significant shift in how music on compact discs were going to be distributed. Prior to this time music on compact discs were distributed to music stores and other mass merchants in a 12” cardboard package. This cardboard package was designed to be easily merchandised in what were once record album fixtures. Secondly it added size to prevent and or slow down retail theft. Alpha Enterprises manufactures mechanical security devices in plastic for audiotapes and videos at the time. We had a design for a compact disc package, but we had very little sales.
Recognizing this large shift in how compact disc music was going to be distributed, we hit the road meeting with as many music retailers, mass merchants and other companies that provided music to locations like book stores and so on. Our competitor also had a security package design and did a mass mailing to all of the retail stores with a product sample, prices, and asking for a commitment. We met with music companies like Sony, music retail accounts like Music Land and Tran world Music. We met with mass merchants, bookstores, warehouse clubs and other retailers that sold music. In these meetings we were capturing the voice of the customer and voice of the market.
In our meetings we discovered a number of people in each organization that influenced the purchase of mechanical security products:
Operations (specific to companies to provided music to stores and they used automated machines that loaded the compact discs into packaging)
We met with purchasing at each of the accounts we identified that could use our help due to this big shift, but also all the other people who helped influenced the purchases.
We found each influencer was also primarily concerned with theft, since compact discs could easily be hidden in someone’s clothing. We also found each influencer had specific requirements and criteria they were looking for pain and problems they needed to solve.
Merchandising – ability to use current fixtures, new market entering music retail at the time were bookstores. They required a package as small as possible but protected the security tag from being removed by a consumer.
Loss prevention – reduce theft, re-use security tags, speed at check out
Store design – maximum inventory in the smallest foot print, customer flow, particularly speed at check out
Purchasing – availability, a supplier that could guarantee to meet their volume needs and grow as their inventory grew. Devices that could use the current keys to unlock audiotapes at check out. Material the product was made of, for example mass retailers wanted consumers to take the package home and cut it to remove the music disc where music retail wanted a durable and reusable package. Price, price was important, however the biggest pain point buyers had was the promise of availability.
We took all these requirements back to our engineering team and decided the best way to serve the voice of the markets we heard was to design and develop three security products based on the market and customer’s requirements.
When our competitor mass mailed a sample and a cover letter bound with a rubber band ( really I saw it on buyers” desks) , we spent the time clearly understanding the pain this market shift would cause. We segmented customer types by similar pain and requirements. We designed and manufactured three unique products with specific size, material and locking mechanisms. We added a compartment in our devices to house a security tag. We even went as far as to create an Excel tool that calculated how many retail transactions needed to occur and reuse the security tags so the reuse of tags paid for our devices. When buyers challenges our prices, and they did, particularly one device made of lexane, we asked them to complete the Excel sales tool to use with their supervisors and owners to show how the devices would be free after so many retail transactions.
There is a power in capturing the voice of your customer and voice of your market.
Most companies’ launch with what I refer to as mullet marketing. They “think” they know what the customers want and need, and how they buy, what they need to buy today…and they launch. About six months into the launch and the CEO is asking why sales is failing to execute to the sales plan, they decide to do market research and find out why. Our competitors in this example did the same thing. They thought they knew the market since they served it for over 10 years. They thought they knew how their buyers would react and how their buyers would buy. They failed to ask; they failed to do the market work gathering the voice of the customer, the voice of the market. After we secured each key customer that matched our ideal customer profiles, we heard our competitors were asking for meetings to understand why they lost the sale and determine what they could do to possibly win the orders. The trouble was, since the top pain of purchasing was a guarantee of orders shipping on time, we had all the key accounts tied to a multi year purchase commitment.
What was the result of gathering the “Voice of the customer”?
What was the sales growth impact from gathering the “Voice of the market”?
What impact did the “voice of the customer” have on our bottom line?
We experienced a $38 million dollar sales increase in 18 months!
We sold our products at a market competitive price but we were not the cheapest.
Two of the new products we designed resulted in gross sales margins exceeding 55%. (Unheard of in the plastics market at the time)
Did we see any other unforeseen benefits of the voice of customer work?
- We established strong relationships of trust with leading US retailers that eventually led to our launch of a line of consumer storage products that grew to over $69 million in 5 years. They accounts knew us, trusted our ability to execute.
- We started receiving international inquires for our new product designs and this led to an international product expansion and additional revenues
- The video game industry was watching and eventually approached us for security packages for video games and software games resulting in additional sales revenues
This is just one example of the explosive sales power when you understand what your buyers want, how they buy, and what they need to buy today. I emphasize “today” because how buyers buy and the criteria they use to buy changes as your market changes.
So how about your company….
Do you understand the voice of your customers today? Are you Sure?
Recognizing in most companies your customers represent about 30% of your market….
Do you understand “the voice of your market” today?
Is someone on your team asking questions and listening for buyer pain? Who?
What impact would an incremental $38 million have on your bottom line at over 55% margins?
What sifts are your markets experiencing right now?
Capturing the voice of your customers and the voice of your market is a powerful tool that many companies fail to utilize. The voice of the market becomes the foundation for your business development and new product development plans and strategies.
Without a current understanding of how your buyers buy and what they need to buy, your sales will not reach the explosive sales growth they could.
One last question…lets say I have not sold you on investing time and resources into understanding the voice of your customers and markets….
What if your largest competitor is doing this process right now?
If so you are about 24-36 months away from a sales and profits death spiral many companies never recover from.
PLEASE take the time and dedicate the resources to clearly understanding what your buyers want and need to buy today, and the process they use. Once you do.
PLEASE create a repeatable sales process that mirrors what your buyers want and need to buy today.
That is the No Smoke and Mirrors process I have used for over 30 years and it has always driven profitable sales growth.
Do not “sell” buyers I help them buy!