By Kathy Burnham, Senior Vice President, Padilla Speer Beardsley, www.psbpr.com
Customer research gives businesses a vital tool for reaching goals, measuring success
Your customers can tell you a lot about your business. They know how your company – and your competition – is perceived in the marketplace, and why. They have first-hand experience with your products, services and sales team, giving them unique insight into your company’s operations and offerings. Most promisingly, they are intimately aware of the challenges within the industry and inside their own companies – which could mean more business opportunities for you.
Tapping into this reservoir of information is more important than ever for businesses, as tough economic times force customers to scale back and otherwise alter their buying habits. But to become truly “customer-centric,” companies shouldn’t rely solely on executive intuition or sales-staff speculation.
You need the facts, and that means research. Using a proven arsenal of tools and scientific methods, market researchers today can help manufacturers use the power of knowledge to make sound decisions and navigate the competitive business landscape. Well-run businesses have learned that investing in research upfront can result in big returns, preventing costly missteps in nearly every department, from product design to marketing.
Feedback Shapes Success
Rockwell Automation relied on this wisdom when it prepared to launch its then-new generation of Allen-Bradley® AC drives. The company commissioned five focus groups around the United States in which engineers were asked about their current use of AC drives and their future needs. Without divulging that Rockwell Automation was sponsoring the focus groups, researchers also shared the proposed design of the new drive with the participants and asked them to critique it.
The feedback heavily influenced what happened next. Rockwell Automation slightly modified the design of the drive based on the focus-group responses. The research also shaped the campaign for the product launch, helping marketing managers hone the most effective messaging and communication tactics to drive sales. The bottom line: Rockwell Automation’s $35,000 research investment saved it many more thousands of dollars in potential product design changes if the market didn’t adopt its new drive. Moreover, the investment netted information used to craft messages and marketing strategies that were aligned with market needs.
Research Comes in All Sizes
You don’t need to be a big-budget company to afford market research. For instance, focus groups, which can cost as little as $6,000 each, are an effective tool to deeply explore what people think about a topic and why. Focus groups usually include eight to 10 participants (customers, prospects or other influencers) in discussions led by a trained moderator. On the other hand, surveys are a good way to quickly gather a lot of information from hundreds or even thousands of people about a well-defined topic. With a comprehensive list of e-mail addresses, researchers can conduct a brief online survey for as little as $10,000. (Even surveys more complex in nature can be done for less than $50,000.)
Before embarking on any research, a company should precisely define its objectives with the help of experienced research professionals. These experts can then recommend the best method to gather the information, whether that’s through focus groups, one-on-one interviews or a number of common research methodologies. Besides conducting these and other types of “primary” research, experts can gather valuable information from existing sources such as databases, Internet searches and industry publications.
Once they arrive at the findings, researchers can then advise companies about how to put the results to work to attract new customers and keep existing ones happy. The goal of every company should be a steadfast customer base because research shows that loyal customers stick with you and drive your bottom line. They will pay up to 10 percent more to buy from a supplier they trust, and they’re the best source of new business referrals.
Smart companies like Rockwell Automation recognize that research puts companies ahead of the learning curve in the marketplace – and that advantage is more important than ever in today’s turbulent economic climate.
In short, research is an invaluable tool to help reach many business goals, including:
- Truly delivering what the customer wants.
- Enhancing the development of new products and services.
- Arriving at more accurate pricing.
- Developing more productive market and communications strategies.
- Improving overall organizational performance.
Allen-Bradley is a trademark of Rockwell Automation, Inc.