Hosting customer roundtables for market research and R&D.
Putting customer feedback to work can be as natural as shifting gears -- if you tailor your information gathering to meet specific objectives. Weeding out unappealing products was the aim of three customer roundtables that Specialized Bicycle Components, a Morgan Hills, Calif., mountain-bike company, held before introducing its 1992 line.
There's more to a customer roundtable than assembling customers in a room. "You have to decide what you want to come away with, and then build the process to get you that far," explains Barry Breede, marketing director at Specialized. Here's what he considers when planning a customer session:
Before: You must do a lot of planning before going to the customers. Do you want input on potential new products, for example, or feedback on existing ones? How you answer those questions should help shape the format of the roundtable.
During: To review its 1992 bike line, Specialized held sessions with 15 or more of the dealers who make up its customer base. Lanny Vincent, an Oakland consultant, moderated the roundtables. He cautions that in groups of more than seven, people don't speak up as much. To counter that, at each roundtable the company set up smaller units of customers and people from Specialized who took notes. In a written survey, each dealer ranked the color and overall look of some 40 bikes on a scale of one (low) to six (high), keeping in mind Specialized's image. Then the whole group discussed the scores.
After: Do an immediate debriefing back at headquarters, urges Vincent. If too much time passes, "interpretations start to creep in." Breede believes many companies don't take into account how group dynamics can affect feedback, so he also puts great stock in the individual dealers' written surveys. Based on feedback, Specialized winnowed the 40 possible bike designs down to 26. Also, Breede says, by listening to customers' observations -- some said, for example, that fluorescent colors clashed with their perception of the Specialized image -- "we got a clearer vision of who they thought we were."
Hosting roundtables isn't cheap. Specialized spends $800 and up per customer. But president Mike Sinyard figures, "if you fix just one direction, you've saved about $100,000 in R&D costs" -- plus millions more in inventory.
Those on a tighter budget might consider the approach of the Fox Valley Spring Co., an Appleton, Wis., spring manufacturer with about $1 million in sales. Each year the company sends to key customers and prospects a detailed questionnaire, according to co-owner Kay Krebs. The results of Krebs's most recent survey told her that some key customers were having service problems; they also told her how those customers ranked the competition, and what they thought of Fox Valley's products. Total cost? About $5,000 to design, mail, and tabulate the survey. Ultimately, Fox Valley plans to use the results as fodder for in-person roundtables.
The benefits of any well-planned approach to gathering customer feedback are clear. For Specialized, preseason orders for 1992 bikes outpaced any previous year's. And that's for a company whose sales have already grown by more than 200% since 1986. -- Susan Greco