Customer Insight Conduits™
Gaining Critical Insight to Grow Your Business
by Curtis Bingham
Declining prices & margins. Decaying sales. Unprofitable customers. Lackluster
market performance. Does your company suffer from these maladies? The solution
to these may not be spending more money on advertising, replacing the VP of
sales and the rest of the sales force, or further cutting costs. No, the answer
may lie somewhere else entirely - and if recognized and addressed, may resolve
all of these symptoms.
The problem may actually lie in the way that your products and services
are designed, developed, delivered, and refined. Who drives these activities?
Is it Engineering? Management? Support? Sales? If the customer is not in the
driver's seat, your revenues, profits, and even your company may be at risk.
The problem may well lie in the fact that companies don't understand their
customers - what they need, want, and most especially, what they are willing
to pay for. Without this understanding, companies do not know what products/services
to offer, or how to market and sell to prospects.
The only way to guarantee increased revenues, stronger, longer, and more
profitable customer relationships is to center strategic decision-making on
actionable customer insight.
Some of the symptoms that companies face that are operating without sufficient
customer insight include:
- Declining margins and prices - Price and margin are excellent measures
of a company's ability to make its value proposition successful in the market.
Too many companies do not recognize when the market no longer values its
offerings and resort to price cuts or other margin-cutting promotions.
- Decaying Sales - A company out of synch with changed customer
needs will suffer as sales decay. When customers are harder to find and sales
are more difficult the reason is often that a company has not driven customer
knowledge far enough into the company processes. Adapting everything a company
does from product development to core metrics of business health to customer
value is a key strategy to re-invigorate a company's economic engine.
- Unprofitable Customers - Often companies, particularly those that
have been successful, do not know what a good customer looks like. Many companies
grew in different economic times by taking the business that 'came in the
door' but have not yet invested in insight about what kind of customers are
- Lackluster product/service performance - Lack of market adoption
clearly means the product or service missed the mark and does not adequately
solve customer pain. Customer knowledge needs to pervade a company's management
of its innovation in product, markets, and business extension. Every company
has to be alert to opportunity in these areas because growth is a broad based
challenge-simply doing one thing very well is no longer enough.
Most companies have only two communications channels with customers: sales
and complaints. Both of these are important - companies need to sell and customers
need ways to seek redress - but neither tells a company what the customer
needs to make them successful. To ensure success,
you must continuously deliver what you know your customers and
prospects need, want, and are willing to pay for.
There are four steps to success in this process:
- Proactively listen to customers in an organized, meaningful fashion;
- Make customer data actionable;
- Drive customer-valued change throughout the organization;
- Measure effects of the change.
The first step is critical for the success of the remaining three.
2. Customer Insight Conduits™
The fastest way to overcome the problems described above and gain real insight
into what customers need and want is by establishing Customer Insight Conduits™
These Conduits help bridge the gap between company capabilities and market
or customer needs.
Customer Insight Conduits™ are defined as channels through which information
passes primarily from customers and the marketplace to a function
within the company that is able to make data actionable and drive customer-valued
change throughout the organization. These conduits provide an early-warning
system for problems. As problems are recognized, the Conduits serve as a diagnostic
tool to help fully understand issues and determine the efficacy of solutions.
In addition, the Conduits are a measurement vehicle to assess overall customer
value and other metrics.
- Customer advisory boards - Ensure that these are composed of economic
buyers of your products/services from an appropriate sampling of the customer
base. Some companies rotate the membership every 1-2 years to ensure fresh
- Technical advisory boards - These should be comprised of the "use-buyers",
or those who are actually going to be using your products or taking advantage
of your services. From these, you obtain valuable, on-the-street insight
helpful to develop/refine products.
- Customer conferences - Traditionally, customer conferences are
actually sales conferences where companies roll out their new products, hoping
to convince customers to upgrade. Garland Hall, the Chief Customer Advocate
of webMethods, a company that provides enterprise integration software to
major companies, uses customer conferences to gather customer insight and
further cement customer relations. webMethods invites customers to present
ways in which they are using webMethods' products, share insights and issues
with product managers, etc.
- Guest Customers - webMethods uses "Guest Customers", where customers
present info on themselves and how they are using products to groups within
the company who don't normally have customer contact (ie. accounting, operations,
- Product or service "proving grounds" - LL Bean invites outdoor
guides to a special weekend escape where they try out new products and give
focused and even harsh feedback.
- Host/Monitor chatrooms and discussion boards - Mercury Interactive's
VP of Services, Patrick Saeger, does an excellent job of gleaning ideas and
identifying problems through the company's product discussion forums. Significant
"thought-leaders" can be identified and used to gather insight and ultimately
champion products and services.
- Customer Hall of Fame - Laurie Long, the Sr. Director of Customer
Success at Unica organizes a Hall of Fame to reward customers for innovative
use of their products. Winners are chosen after review of applications by
outside analyst community. This offers the customer recognition from the
vendor, other customers, and from the analyst community.
- On-site assistance for a day - Companies with a strong service/consulting
component should send an engineer, consultant or other appropriate person
to a customer's site for a day to simply help them gain the full benefit
of your product/service. They can glean huge amounts of insight in doing
- Sales and support channels - Send the sales people out to find
answers to specific questions. Have the support or call center representatives
poll their callers with a 1-2 question survey. Leverage these channels to
gain answers to specific questions as part of an overall information gathering
These are only a handful of Customer Insight Channels™ that could be leveraged
as a key component to help gather customer data that is then converted to
insight, made actionable, and used to drive strategic, customer-centric change
throughout the organization.
The only way to overcome the maladies discussed previously is by listening
to customers, making insight actionable, effecting change, and measuring change.
Using Customer Insight Conduits™, companies can gain critical insight and
when made actionable can:
- Develop successful products and services;
- Differentiate from competitors effectively;
- Improve prices and margins;
- Attract & retain more profitable customers;
- Identify & implement appropriate success metrics and incentives.
Curtis N. Bingham, President of The Predictive Consulting Group, helps companies
appreciate their true growth potential vs. their actual growth and helps them
close the gap to grow more dramatically. He uses principles of Demand Chain
Management, Customer Insight Conduits™, and other best practices to help companies
glean customer insight, make it actionable, and drive change throughout the
organization. As a result, customer insight becomes a competitive advantage
that leads to increased revenue, shortened sales cycles, better products,
and improved business health. Curtis can be reached at email@example.com
. Visit www.predictiveconsulting.com
for additional information.
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