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Few people call themselves "consumers." Consumers buy or use a product, service or solution. Period. The word connotes a one-way relationship between seller and buyer that fits poorly in today's connected marketplace.

"Customers," however, do far more than merely consume. Depending on their needs, experiences and desires, customers are more inclined to get involved in the marketplace.

Today's technology offers ample opportunities to start conversations with and among customers, fans, foes, competitors, and the press—any person or group who cares to listen and, perhaps, act on the messages received.

Every hour of every day, directly and indirectly, customers place calls, send emails, complete surveys, and talk among themselves online in blogs, product forums, and myriad social networks. They share their thoughts about products and services, their likes and dislikes, and their hopes for future offerings. Customers tell companies about product failures. They request help. And they offer opinions about their experiences that may contain valuable insights for organizations that listen.

However, customers aren't computers. They don't think like databases. And they rarely write with perfect grammar. More challenging still is the volume of all that freeform correspondence. By some estimates, 85% of the information companies collect is not in a form that they can access or analyze—it is unstructured. The Gartner Group reports unstructured data doubles every three months while seven million web pages are published every day. This cacophony presents the one of the biggest challenges companies face today.

This much is known by most large customer-facing organizations. The market is flooded with software that attempts to tag, sort, search, organize, and manage much of this unstructured data. But discovering the facts in this data—"who," "what," "where," "when," "how," and most importantly "why"—is a challenge that leaves most companies scratching their heads.

Companies conduct customer surveys, focus groups, and interviews hoping to capture some sense of it all, only to pass along the results to marketing, sales or research to develop a product, service, or response on the ideas.

How Are Your Marketing and CRM Approaches Faring?

Customer surveys and focus groups are a challenge to arrange and conduct in a method that gathers unbiased data. Though customers might describe some of what they want, the lack of detail in a coded answer or a limited discussion doesn't tell companies enough.

In traditional surveys and focus groups, customers give you answers only to what they're asked. The answers are literally "programmed," effectively silencing opinions and insights that don't fit the scripted mold. Merely knowing that customers like or dislike a product doesn't explain the reasoning behind their opinions. This lack of detail can mislead decision makers and in some cases even undermine product development and corporate initiatives.

Focus groups were designed to give companies greater insight into a representative sample of customers or prospects. The groups are designed to gather primary opinions about specific topics. Even the best focus group leaders, however, struggle to control participants' eagerness to give answers they believe interviewers desire as opposed to their actual opinions. This leads to biased results that often do not correlate well with the customer's actual purchases.

When asked formally, many customers do not know, or cannot communicate effectively, their actual needs and requirements. Moreover, companies often find there isn't enough detail in the data to understand the root cause of a problem or potential concern—let alone what to do about it.

However, outside the corporate-sponsored surveys, and away from the one-way glass in focus group studios, is a wild world where customers share exactly what they think in voluminous amounts. They tell their stories during service calls and write about their experiences online. They are usually truthful, albeit biased toward their own needs, and often detailed about the issue and what they want done about it.

In formal forums, customers are reactive and often leave out their true opinions, and when asked for detail they can't always explain their experiences faithfully because they are discussing issues in theory. However, in the midst of experiencing an issue, people are willing to share their thoughts with as few filters as possible. They'll call a help line. Or rant in online forums. Or rave on a social media site. It's as close to mind reading as companies are likely to get—if they can capture and analyze the data efficiently and effectively.

Tacit Voices Affect Markets

When asked to indicate their overall level of trust in different forms of advertising, customers admit what they trust most is not advertising—but rather what others say, according to a recent report from Forrester Research and Intelliseek. Based on 470 responses recruited from members, the top choice was a recommendation from other consumers and the fourth choice was consumer opinions posted online. Following feedback in all forms is critical because recommendations and opinions are some of the most trusted and important information a company receives.

Most large companies have a foundation of fact about their customers in their data warehouses and business intelligence systems in the form of structured data: purchase history, coded responses to surveys, service ticket types, and so on. This foundation, however, lacks critical customer information, which floats above the fact plane. Call-center notes, open note sections of surveys, emails, weblogs, chat rooms, online forums, product reviews—and more—must be incorporated into the intelligence-gathering and analysis functions of a company.

Many companies are learning that the only way to be customer-centric and to have a customer-driven business strategy is to leverage this feedback across the organization methodically, comprehensively, efficiently, and effectively.

To do this, companies are staffing senior roles in the organization that focus on customers and report to the CEO, the VP of marketing or other top executive.

With leadership, customer analysis becomes a strategic part of the business. The goal is to get beyond the information historically available in structured surveys or coded fields and instead yield statistically supportable findings from unstructured data for a new generation of quantitatively trained executives and managers.

As they begin to grasp the size and importance of analyzing their customer feedback, companies realize they need to do two things:

  1. Expand their analysis to the unstructured components of feedback that can answer such questions as why customers gave certain survey scores, why they report specific service or product issues, and what—at least in their opinion—might be done to improve or correct the situation.
  2. Build processes that automatically understand and analyze the detail of the information found in unstructured data, which they then can leverage throughout the organization to help make key business decisions by merging the results with those found in structured data.

How to Hear First-Person Accounts

The quantity of this unstructured data is sometimes challenging to imagine, but its importance is abundantly clear.

One small airline receives 500 emails per day, which totals approximately 65% of the company's direct, unsolicited customer feedback. Nearly every email tells a personal story about someone's flying experience—stories that can help the airline decide on everything from pricing to in-flight services to marketing programs.

Almost all this input is in first-person narrative, a literary technique in which a story is narrated by one character who explicitly refers to himself or herself using words such as "I," "me" or "we." The intensity of tales told in the first person can be striking, especially when the person narrating has something to say about your product or service.

First-person feedback is...

  • Focused on the personal
  • Constitutes the majority of input
  • Contains rich descriptions
  • Explores unexpected topics
  • Details the "why" of an event or opinion
  • Reveals opportunities
  • Expects responses
  • Provides early warnings
  • Affects, most likely, other people
  • Impacts revenue

Anyone scanning social-networking sites or popular blogs for an hour will likely find a slew of first-person narratives that meet all those listed criteria.

Analyzing Feedback to Achieve Intelligence

First-person feedback is not just personal. It is rich, honest, unprompted, unscripted, and often revealing. It contains the details behind successes, or failures. It harbors the truth about good intentions gone awry, or lucky breaks. It holds the key to future fortune, or crippling litigation. And it can help employees, managers and executives answer key questions such as these:

  • Is our product launch going well?
  • What marketing messages resonate most with customers?
  • Is there an emerging product issue?
  • Where should the product team focus its development dollars?
  • Are there more effective methods for positioning current products?
  • Which services have the best chance of surviving a turbulent market?
  • Is someone committing fraud?
  • Is there a product defect in the market?

First-person feedback provides rich, detailed narrative. The passionate give-and-take of online discussions or the constant stream of customer emails is simply impossible for databases and business intelligence software to parse, process, or package into any useful, actionable data without the capabilities offered by text analytics solutions.

Proper analysis of first-person feedback through text analytics enables enterprises to improve their products, services, reputations, and balance sheets. Once the facts are extracted, the tone categorized, the results structured, the data integrated, and the reports delivered, only then can companies claim to have "first-person intelligence" worthy of action.

Continue reading "How to Hear the Voice of Your Customers: Hone First-Person Intelligence From All Forms of Feedback" ... Read the full article

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David Bean, PhD is the director of data science and research at PayClip Inc., and an industrial adjunct professor at the University of Utah.

LinkedIn: David Bean