to Your Customers
times of slow or stagnant sales, getting in touch with your
current, past and future customers can be source for generating
about it. When sales are strong, we are too busy to stay
in touch with our customers. When sales activity is slow,
it should remind us of the basics that we have temporarily
forgotten. Do a reality check. When was the last time you
gave your customers quality time by simply listening?
FORCES OF CHANGE
businesses are being threatened with major changes. First,
the economy is impacting manufacturers and service providers
very differently this business cycle than in the past. Second,
products are lasting longer, often skipping a complete buying
cycle or introducing new competitors. Third, channels-of-distribution
shifts have removed or changed selling outlets. Finally,
financial pressures have reduced margins. These are challenging
the positive side, changes cause opportunities to emerge.
The weak businesses cannot help but strain the relationship
with their customers, hence a potential opportunity for
new business. Lean manufacturing (removing non-value added
effort) is generating substantial cost savings for manufacturers.
Process mapping is helping everyone.
not all geographic and product segments have been impacted
the same; there are pockets of solid growth. Finally, businesses
are introducing new strategies to a low-growth market and
are taking market share because they have changed the rules.
point is this. Despite the current atmosphere in the industry
today, there are opportunities for those who listen and
dream. There are businesses that visualize beyond today
and are creating different business models. Are you one
of those businesses?
ARE RIGHT IN FRONT YOU
you want more opportunities to pursue? Do you want to impact
both revenues and margins? The answer is probably yes. To
do so, you are required to both listen and observe the market
place. It is creating a dialogue with your customers.
can transform you from where you are today to how things
can be tomorrow. What are the customers' needs? How do they
want to be served? What are their issues (sources-of-pain)?
Where is there waste or non-valued added effort? Address
these questions and you will be a valued supplier.
are many techniques to get customer insight and even test
out solutions. Business owners and senior managers should
look at the following as ways to listen to their customers:
Review historic operating data: When you study data in a
time-series (i.e.: five continuous years), patterns "jump
right at you". Data forces you to see tangible changes,
whether it is the addition or loss of customers, shifts
in product demand or changes in the cost curve. These changes
will lead you to ask other questions until you understand
the true cause.
· Interview your customers or prospects: When was
the last time you had an in-depth conversation (several
hours) with your customer/s, where selling was not a topic?
Do you understand your customer's business, strategies,
concerns, motivation and willingness to innovate? Knowing
and understanding customers is essential.
· Understand the emerging needs: What is occurring
outside your immediate market that may impact customer product
usage. Longer lasting product life and extended warranties
have been an issue for decades; they may be just reaching
you. What is next?
· Draw similarities from other industries: Shifting
channels-of-distribution are impacting rebuilders today,
but the trend to "category killers", worldwide
sourcing, e-business and lean manufacturing and Six Sigma
have flourished for years in other industries. Are you keeping
up-to-date to the world around you?
personal favorite is personal interviews, whether one-on-one
(intense interviews) or in small, single-topic discussions
(focus groups). When properly planned and facilitated, both
techniques produce "rich and insightful" customer
you actively listen to customers, understanding their perspective
becomes very clear. While listening, your immediate wants
should be secondary. What does the customer want? How does
he want to do business? Listening will provide the answers;
you have to be smart and insightful enough to develop the
appropriate strategies and programs.
is not an easy task; it requires preparation, listening,
observing and focused concentration. Using open-ended questions
and non-threaten mannerism allow you to create a trusting
atmosphere, where the customer will share their deepest
thoughts, issues, decision processes or whatever information
you are seeking.
teaches that people will naturally talk about the most important
issues impacting them. By using clarifying statements and
follow-up questions, deep understanding is achieved. During
interviewing, pre-testing and evaluating potential solutions
can often be accomplished.
interview notes and writing complete personal notes and
observations ensures capturing the essence of the interview.
This is an important discipline. Unfortunately, it very
easy to get caught up in an interview discussion and not
capture all the thoughts on paper. You pay the price later
when you cannot remember the details.
groups are "common theme" sessions, led by an
independent facilitator who keeps the discussion moving
forward. What is different from one-on-one interviewing
is the broad array of comments from eight-to-twelve people,
rather than just one. There are advantages to this technique.
has demonstrated the tremendous value of focus groups. For
example, one facilitator was able to clarify customer service
issues with a group of distributors. In that session, the
group generated solutions, which were implemented by the
manufacturer. The distributors even committed to growing
sales because of the changes introduced.
another group, understanding customer product specifications
enabled the supplier to expand tolerances and drop costs
dramatically. By understanding how the component was being
used, the supplier found he was providing too much quality.
Customers wanted first-quality parts, but not OE-quality.
The focus group led the supplier to make the necessary adjustments
to satisfy the market segment.
enough, one focus group discovered customers did not want
a new product that was ready to be launched nationally.
The group did, however, suggest improvements to the existing
product lines, which the manufacturer adopted. This prevented
a major snafu.
A COMPETITIVE ADVANTAGE
businesses improve the quality-of-listening to their customers,
success will follow. Open and honest dialogue will uncover
underlining thoughts, preferences and wants that never surface
when you are selling.
business is slow, whether due to the economy or seasonal
demand, take the time to visit your customers. Ask them
about their business and then just listen. Managers and
owners need to do this several times a year, if not more.
You will learn more visiting customers than staying in the
shop. Second, your customers will appreciate it. Finally,
your competitors are most likely not making the same effort,
so you have gained something just by showing an interest
in your customer.
is also suggested that you invite three groups of 8-to-10
non-competing customers/prospects to your facility. Have
a professional facilitate the focus group. Discuss the customers'
feedback among your management team and then make the appropriate
conclude, the solution to your current woes lie right in
front you. Ask your customers, listen, digest and plan to
leapfrog where you are today into tomorrow.
Associates is a consulting firm focused on industrial market
research and facilitating strategic change. Drew Hill, principal
consultant, is a certified focus group leader and management