Nine out of ten new products fail because so many companies launch them without conducting adequate consumer research. Or they fail to ask the right questions, show a concept versus a finished product; or rely upon a few non projectable focus groups. When you launch a new product without investing the right amount of time and resources; you are doing so without a permission slip from your current customers or potential prospects. Using five or six focus groups to determine consumer behavior is akin to a drunken man using lamp-posts for support rather than for illumination. Showing a rough concept versus a finished or adequately mocked up sample product gives you highly unreliable results. The rougher the concept the more apt people are to give misleading statements.
Asking the right questions is extremely important too. When Coca-Cola launched a new cola to replace their existing one they failed to ask consumers how they would feel about this major change. Instead they only tested reactions to the new cola. While the new cola tested well when Coke pulled the old cola off the shelves sales plummeted. The old cola was quickly reinstated but after a major market share loss.
Many companies have tons of sales data, market share numbers, etc. very few know how to separate information from facts. Actionable information provides new customer insights. This occurs only by asking the right questions at the right time and on an ongoing basis.
Several important questions any company needs to ask itself are: Are we getting hung up on short-term numbers and missing long term trends? Do the survey results truly tell us what our customers want? What can we specifically do to attract new revenue and customers? What do we need to do next to make this happen? Bear in mind that it's easy to get caught up with data that measures what your customers do instead of what your customers want.
The saying expects the unexpected applies to consumer research as well. It's important to look for surprising data or unforeseen numbers that can improve your go-to-market strategies and make you aware of an opportunity long before your competitors realize it's there. Perhaps even more important, surprises can serve as early warnings, when there's still time to do something about a potential major problem.
Beware of only focusing your ongoing surveys results on either your highly satisfied or highly dissatisfied customers. Your best potential customer base is often those who occupy the middle ground i.e. "Swing Voters". Rather than focus on the extremes, those highly satisfied or dissatisfied the real potential is in capturing the much larger middle segment.
Knowing what is the one vital piece of information you need to move forward is critically important. Too often meaningless data overload occurs that only confuses or bores top management. Sad to say too many researchers have no feel for the real life implications of their calculations. Key business questions need to be the objective of any consumer research. For example, what one vital piece of information is necessary to move forward? The rest of the data may be interesting, and sometimes even important, but the real benefit occurs by focusing one actionable finding.
The question used to be "How do I sell more cans of Coca-Cola?" The question now needs to be "How do I meet my customer's needs better, so I can sell them more?" Interpreting data only in terms of your business needs, not your customers' wants - accounts for many of the train wrecks that follow new product launches. It is important to remember that customer satisfaction isn't based solely on price.
Lastly, when making long-term decisions it is extremely important to capture ongoing long term survey numbers. Weekly sales numbers rise and fall. Quarterly sales numbers indicate trends. Short term movements, while interesting, are often misleading. Your consumer research needs to be ongoing so that it can be accurately trended over time.
Steve's most recent book You Can't Fall Off The Floor - The Insiders' Guide to Re-Inventing Yourself and Your Career chronicles his 50 year career working for over 25 different companies with 189 lessons learned and insider tips from Gayle King, Cathie Black, Chuck Townsend and 28 others; Blacker is still going strong today as a partner in Frankfurt & Blacker Solutions, LLC. His web site is blacker-reinventions.com and e-mail address is email@example.com
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