Customers as consultants: is anybody listening?

By Amy Yoffie | July 1, 2001

Reading time: 5 minutes

Abstract

Customers want businesses that understand their needs and desires and are responsive. This article discusses using online focus groups and Web-based surveys to learn from customers and ultimately make important business decisions.

Research Topics:: Bus.-To-Bus. Research | Online Research | Qualitative Research | Quantitative Research
Industry/Market Focus:: Business-To-Business
Content Type: Research Methodology

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Editor’s note: Amy Yoffie is vice president and general manager of LiveWorld Research Services, Westfield, N.J.

I know you think you understood what I said, but what you heard is not what I meant.”

When I hung these words on my wall in college, little did I know that 30 years later this ’60s slogan, directed at any and all authority figures, would turn into the marketing cry of the new millennium.

Blame it on the Internet.

In today’s Digital Age, customers are aggressively seeking businesses that can understand their needs and desires and respond to them. No longer content to be talked at, they are insisting on two-way communication, some form of regular ongoing dialogue, some form of making you understand what they need.

The question is, how can your company meet this “revolutionary” demand? The answer will probably surprise you.

Over the years, market research has gotten a bad rap. It’s been seen as stodgy, rigid, error-prone, and expensive. It’s been criticized for creating layers between decision-makers and customers. And, maybe in some instances it has. But the real issue is companies’ failure to recognize that its value depends on how it is used.

For market research is about listening to your customers. In fact, successful companies are those that don’t pay lip service, don’t “sort of” pay attention, don’t operate in a vacuum; they really and truly want to know what is on the customer’s mind. Their ultimate goal, not surprisingly, is to ensure that each customer’s purchase is not his or her last. But they know that the way to maintain loyalty is to be flexible and in tune with individual needs.

And, there are two types of market research, formal and informal. While formal research provides a periodic mechanism for rigorous, in-depth data collection, informal research is the means for qualitative feedback on a more ongoing basis. A market research study gathers information you need to know about your customers, while informal research is information your customers want you to know.

Disciplined way

Companies should look to formal market research - online focus groups and Web-based surveys - for a disciplined way of learning from customers, in order to make crucial business decisions. These methods constitute rigorous, high-quality research that yields truly actionable data. What can be learned?

Know your customers: Most companies have no clear idea of who is visiting their Web site and why. They have tracking data, but have failed to leverage the Internet to get closer to their customers. An effective Web-based visitor profiling survey gains an understanding of the people who visit and utilize the site; the areas of the site they use, the reasons why, and the frequency of use; the degree to which visitors’ expectations have been met; visitors’ experiences and evaluations; and how the site compares to those of its competitors.
Understand buying habits: Beyond understanding who visits their sites and why, companies that want to engage in e-commerce have to develop an efficient purchase process. A surprising 80 percent of those who start a Web-based purchase abandon their virtual shopping basket. Few companies know why this happens, and most think that it is impossible to get the data they need in order to reverse this trend.

In fact, formal market research can survey both the shopper who bails out and the one who completes a transaction, to yield data that can mean the difference between making sales and losing them. The immediacy of this type of research is unparalleled in its ability to determine rapidly what is working and what is not. And, results can be provided in real-time to get instant data on what is happening while your customers shop. Both in the early stages of developing an e-commerce solution, and in the actual implementation, the purchase process can be refined to convert customers from shopper to purchaser.

Meet your customers online: Of course, not all consumers come to a Web site in order to buy something; sometimes they are simply looking for information or activities to do. “Eyeballs” and “stickiness” generate the sources of revenue for many sites, so making sure that the site content meets visitors’ needs is crucial.

To truly evaluate whether a Web site is reaching its target audience, companies can conduct online focus groups to gather a great deal of data. Online groups allow for geographic dispersion, deeper levels of participation than traditional focus groups, and are more cost-effective. Meeting your target audience online can help you test advertising, concepts and new products.

There is a second kind of online market research, which is informal, ongoing and also yields valuable information. Informal research includes always-open chat areas, discussion boards or online events. And while these methods do not yield serious, statistically valid data, they do provide indispensable information straight from the mouths of customers.

Informal research builds two-way communication by letting customers initiate conversation. These activities can be the key to a successful e-business, by guiding companies to heed three rules of the Web.

Always be open, 24/7: We are in a world where people are knocking on your company’s online front door 24 hours a day, seven days a week, so you must always be ready to listen. There are many informal ways to give customers a forum where they can provide feedback. Discussion boards and always-open chat areas are two important ways to increase dialogue.
Give your customers a say: The Internet itself provides a vast network of consultants, who happen to be the taste-makers and opinion leaders of your products. This group that consistently interacts with your offerings is priceless for helping solve difficult design, branding and positioning problems. By inviting them to make their opinions heard, and showing them your new product first, you can learn how things sit with your most passionate customers. For example, an informal forum, such as a virtual auditorium meeting with customers, can establish a two-way communication system to obtain feedback on product design plans.
Get and stay interactive: The Internet provides not only new technologies, but its interactivity creates a new culture, new ways of doing things and new rules to go with it. Your TV talks at you. So does your radio. The Web does not. It talks with you.

The Web is your best platform for developing two-way communication and building your customer relationship management activities. While you will still want to offer your customers toll-free numbers and snail mail, you can greatly broaden your reach via discussion boards, online events, e-mail, and chat areas.

Listen to them

The best way to turn your customers into your consultants is to listen to them - using a combination of formal and informal research. Both will let you reach consumers on a personal level, in unprecedented numbers and at uncommon speed. Both will provide the data you need to identify the best means for evolving your brand, not to mention involving your customers.

Online research is more than gathering data on your customers. It is more than selling them on any specific product or service. The purpose of formal and informal online research is to get to know your customers intimately and to develop lifelong relationships with them. This is how your customers become your very best consultants.