In some companies, the CEO may feel the furthest away from the buyer, save for some distant investor or board member. But in the consumer age, it’s more important than ever for CEOs to be close to the buyer.
One way for them to achieve this is by monitoring product reviews. Consumers buy products and then write reviews on the performance of those products. They broadcast, via e-commerce sites, to the 90% of the shoppers who read reviews. So, reviewers have massive leverage, not only for potential target markets but also as a valuable intelligence tool for the C-Suite.
Surveys, focus groups and social media data claim to give CEOs the Voice of the Consumer (VoC), but they’re flawed. The real actionable information is from people who have purchased. We call this the Voice of the Buyer (VoB).
5 Ways CEOs can Usher the Voice of the Buyer into a Company
1. Buyers as Major Influencers on the Inside
Buyers who write product reviews will influence decisions in every major department, including Sales, Marketing, Product Development and Customer Service. Most of us know the old saying, “follow the money”. These days it’s “follow the buyers and they will lead you to the money.” Direct reports should understand what potential buyers are reading. This actionable information guides your teams and adds gravitas to the decisions. More importantly, it makes a company better, more competitive, and more profitable.
2. Buyers as Justification for Major Corporate Decisions
Capital markets analysts, with their research, often catch CEOs off-guard and it becomes apparent during analyst calls. However, when the VoB justifies a change in strategic direction and the CEO can point to large buyer datasets as justification, then analysts know the CEO is operating with strong data – data not available to analysts.
3. Buyers Provide Critical Information for the Board
Boards are hungry for customer feedback. Outside of revenue, it is often considered the most important performance metric. The Voice of the Buyer is powerful stuff when the C-Suite is considering a pivot, an increase in spending behind a category, or exiting a business showing early signs of weakness. Importantly, the VoB adds relevance to the strategic planning process.
4. Buyers Help You Understand the Competitive Landscape
Boards, investors and the public expect CEOs to know the marketplace – and this means knowing the competition. Buyer comments about competitors’ products help identify competitors’ strengths and weaknesses. From there, senior management can develop a comparative baseline of performance.
5. Increasing Valuation
We’ve already addressed improved sales and competitive position, but not cash flow. VoB data can help reduce inventory levels, and other working capital needs. Accounts Receivable and Payable will improve if the company’s products become popular enough with consumers for the company to dictate terms with dealers and vendors.
The Voice of the Buyer can support CEOs in creating competitive advantage, communicating with constituents, and in developing strategic plans based on reality. Every consumer products company can benefit from this powerful database.