Customer Advisory Boards

Market Research: Listen Live or Wait For the Report?

One of the real strengths of focus groups – in person or online – is the opportunity for a bunch of people to see a live discussion, and even ask a few additional questions. (Yes, Dimensional Research always leaves a few minutes at the end of a focus group session for the observers to ask a follow-on question or three.)

It can be extremely powerful to expose people who work in corporate roles and don’t get out into the field – marcom managers, R&D, developers, etc. – to direct customer and prospect feedback. Often operational people (finance, legal) pick up something important by watching their target market discuss their jobs.

Dimensional Research always encourages as many people as possible to listen into focus groups, or to watch the videos that we record when they’re done.

However, sometimes “listening in” is a bad idea. It basically boils down to this: If you only see part of a project, don’t assume that’s all there is. There is a reason why you conduct 8 focus groups, not just one. Or why you conduct 25 interviews, not just 3 or 4.

Don’t let these scenarios happen to you:

Attend two focus groups in New York and project that experience onto Chicago, Paris, Singapore, and Tokyo.
Listen in on only one call of a 20-call interview project.

If you decide to listen in on market research, I strongly recommend the following:

Do read the final report and attend the presentation of the report. You might as well enhance your limited experience with the full power of the overall project.
Don’t attend just one focus group or listen in on just one call!

Real life example

We recently conducted a series of 15 customer interviews about a client’s new initiative. It has been progressing for about a year and they wanted to know what messages their customers had absorbed. We spoke to 15 of their very best customers – the kind who spend lots of money every quarter, attend the user groups, and give references. It was a good study, and very helpful in finding out what parts of the new initiative were gaining traction and what parts needed even more evangelism.

There was one of the 15 interviews where the participant absolutely “got” it. He could have given the company’s pitch, including now and vision, with no problem at all. It was delightful. However, he was the ONLY one of the 15 participants who did that. The rest of the participants clearly struggled with some of the visionary aspects of the messaging. As luck would have it, that was the only interview that one of the project stakeholders listened in on. Unfortunately, during the report presentation he kept interrupting to talk about how the market “really got it.” We had to very strongly emphasize that the whole project needed to be considered – not just this one guy. The company had plenty of work to do to reach their entire customer base. They were not done.

Online Focus Groups: How Do They Work?

by Diane Hagglund

Online focus groups are a highly effective market research tool. My clients love them. They save the time and cost of travel while making it easier for participants and observers.

Most importantly, these benefits don’t require you to tradeoff for lower quality research. Online focus groups still facilitate the “brainstorming” dynamic that you get at an in-person focus group, where one participant’s comment sparks a comment by another participant and so on. The brainstorming dynamic enables the group to dig deep into an issue, so that the client can get a very clear picture of market acceptance of their product and of any issues they need to deal with.

Participants love online focus groups too, because they give them an opportunity to listen to the feedback of others in the industry. This is an important benefit for participants, especially in customer advisory boards, which encourages them to join.

Online focus groups are conducted using conference calls and Web-based meeting technology such as WebEx, GotoMeeting, etc. In many ways they’re similar to traditional face-to-face focus groups, except you’re not in one room. We recruit participants in the same way, set a time for the meeting, and prepare a moderator’s guide. If relevant, we can review a presentation with the participants. Just as in a traditional focus group, where the client can listen in through a one-way window, the client can listen to an online focus group on a muted phone line. And we can use Web technology to poll participants similarly to a visual “show of hands” or “nod of heads” in an in-person group.

Despite the many similarities between in-person focus groups and online focus groups, there are also a few differences. The most obvious one is that you don’t get the non-verbal clues from the participants. Because of this, the moderator needs to make an extra effort to draw out all the participants and balance the input. To facilitate this, we typically have a smaller group (4-6 participants per group rather than 6-8 for an in-person group) for the same amount of time. We may do more groups as a result – 5 instead of 4 for example.

Of course, there is also the option of conducting video online focus groups. As technology evolves, these are becoming more common and are easier to set up.

Another major benefit of online focus groups is that they reflect the majority of real-life interactions with customers. When selling to Corporate IT buyers, more and more meetings are being conducted online rather than in person, so online focus groups reflect that same scenario. If your messages work in an online focus group, they will translate well into an online sales call or a Webinar.

Market Research: Ensuring Honest Feedback

by Diane Hagglund

I’ve sat through many advisory board and sales meetings with customers who have just been wined and dined. Then, during the formal part of the meeting, a product manager presents a new roadmap presentation and wraps up by asking, “what do you think?” with a face that clearly shows how proud they are of their work.

You are very, very fortunate if you have customers that will actually give real, honest feedback in a scenario like that. They want to keep things positive and upbeat – they just saw pictures of that product manager’s kids or heard about their latest adventure trip. They don’t want to get all negative, even if that is what they really think.

One of the things that market research does really well is to intentionally CREATE an environment for honest feedback and for uncovering information you haven’t anticipated. To create such an environment, you need to:

1) Make sure the conversation is not about the personal relationship. Of course you want the relationship, and you want to leverage that. But the feedback can’t be influenced by whether someone likes you or not. Of course they like you – you’re a tremendously likable person! But the feedback must be about the topic, the market, and the pain points, not about what they think about you.

You need to use verbal and non-verbal cues to set up the discussion so that it is open, non-judgmental, and the client is never aware that what they’re saying is bad news for you. You need to get the bad news now – not after you’ve been through a long, involved sales cycle that ends because there is “no budget,” which really means “not enough pain.”

2) Dig for negative feedback. Don’t just ask, “what do you think?” Encourage people to talk about what they DON’T like. You can’t make it better if you don’t know what’s wrong. Ask, “What do you LIKE about what I just showed you?” then ask “What DON’T you like about what I showed you?”

3) Put feedback in context. It’s not enough for a user to connect with the pain you solve – it has to be a priority! I recently was in a focus group where a participant described a situation troubleshooting a particularly elusive problem in a complex application. It was a dramatic story with dozens of IT staff from different technology groups getting on bridge calls, pointing fingers, escalating issues, and finally getting the CIO involved in a 48-hour saga that ended up to be a rather minor configuration issue. I could feel the client behind the glass get excited because this was exactly the type of problem they envisioned their solution solving.

But then we asked how important it was to solve this kind of issue so it didn’t happen again. The participant explained that it wasn’t important at all. It was the first time in 15 years it had happened and they had solved it. They had moved on. The pain wasn’t a priority. Fortunately that group did express other pains that the client could solve, and they learned important lessons on ways of positioning their product that matched the most important pains.

Employing these techniques a great way to encourage your customers to give you real, honest feedback and to help you uncover pains you were unaware of.

Market Research During Recession

by Diane Hagglund

Is the market research industry recession-proof? Ray Poynter thinks it’s not. He says, “I have been blogging, reading Tweeting, and engaging in online discussions to try and estimate where research is heading, and I think the story is depressing.”

Mr. Poynter goes on to say that the only reason Market Research has been doing OK so far despite the recession is that companies are still using what’s left of their budget, but this will dry up in April; and that companies are cutting the heaviest expenses first and have not yet reached the stage of cutting smaller expenses such as market research.

I disagree, especially when it comes to Market Research for technology companies. In the sub-market of companies who sell to corporate IT, we’re seeing a very different trend:

Market Research can be a huge cost saver. Instead of spending $250K on a marketing program, our clients see the value of spending $20K on message validation so they can spend $150K on a marketing program that delivers four times the results of the more expensive one – because the messages are hitting exactly the right buttons. I just completed a message test that included evaluating four possible lead benefits. We found that three of the benefits were incredibly compelling to all audiences, but to 3 out of 4 of our target segments the fourth benefit was actually off-putting and offensive. Just by deleting that one “bad” bullet from outbound programs their click-through rate on emails went from .5% to 2.0 %.
It is now more important than ever to stay close to customers and build customer loyalty. A Customer Advisory Board clearly shows the participating customers that their voice is being heard – an important factor in instilling loyalty. Done right, it also gathers key information to ensure every functional area of your company is acting in a way that increases customer loyalty – from the product itself to messages from the marketing team, service offerings and ideas for improved support. In a recent customer advisory meeting we ran, the customers came up with a way to administer licenses that was more convenient for the customer and less expensive for the vendor – a win for all groups. Customer Advisory Boards can increase customer loyalty and drive more business to your company, even during the toughest times.
During a recession, ROI is more important than ever. Prospective customers with tight budgets need credible and unbiased information on your products before they buy them. You will need to give your sales team reliable, third party validation of ROI. Turning that ROI into collateral to prove ROI to prospects is highly valuable. And, technology companies have the unique option of getting more for their buck by combining the market research and collateral budget items.

As Mr. Poynter says, “I have been in this industry for 30 years, and I have seen plenty of people lose their jobs and companies go bust. But I have also seen some companies do well, under any circumstances. Some research companies will grow, despite the next two years.” I believe that technology market research companies are in an excellent position to not only survive the recession, but to grow and flourish despite the rough economy.

Tips For Engaging Customers In An Ongoing Customer Advisory Board

by Diane Hagglund

Getting your customers to participate in a customer advisory board isn’t too difficult: customers love to sit on advisory boards. They appreciate not only the opportunity to be heard and to have a relationship with a key vendor, but also the opportunity to hear what’s happening with their peers and to make important industry connections with your other users.

However, ongoing advisory board programs do require a level of commitment in order to develop a great group dynamic. Typically we ask for a one-year commitment which includes four quarterly meetings. My personal favorite is to kick the year off with an in-person customer advisory board meeting and then conduct three online meetings.

The best way to keep customers engaged with such an ongoing advisory board program is to show them that their feedback is actually impacting the company and its products. One way to do that is to start all customer advisory board meetings, except for the first one, with a summary of how the feedback from the previous meeting has impacted the company and its products.

But you can go even further and engage your customers even more. When I ran marketing at Freshwater Software, we had a product-focused advisory board (the “ThinkTank”) that was held bi-annually. Participants were asked to come prepared with their top three product requests. During the meetings, we spent time reviewing those requests and prioritizing them.

We used to end the meetings by voting on the top three features the group wanted. We committed to customers that if they took the time to participate, we would guarantee that at least one of their top three features would get into the product. We were often able to get more than just one of their top features into the product. But the important point is that this kind of commitment drove active and passionate participation in the advisory board meetings.

Involve Your Customers In Market Research: They’ll Thank You!

by Diane Hagglund

“Thank you, I really enjoyed our conversation.” This is the typical way in which customers end a market research call or customer advisory board meeting.

It still amazes me how many people love being involved in market research – especially customers. They don’t see it as a chore or just another thing on the “to do” list. On the contrary, they love being involved and appreciate the opportunity to air their opinions. Even when I talk to unhappy customers or to participants who clearly don’t connect to the pain we’re testing, they often end a call with sincere gratitude for being given an opportunity to be heard.

This is particularly important because people are often worried about asking their customers to participate in research. Your company probably asks a lot of its customers already. They are asked to be sales references, PR references, and beta testers. Many companies are hesitant to add a research project on top of everything else they ask their customers to do.

But companies need to realize that customers LOVE being asked to do market research. Not all of them of course, but the ones that are not interested will say no quickly. Most customers feel that being involved is empowering. They appreciate the fact that they get to voice their opinions anonymously and that there is no preparation on their side and no action items. In fact, involving customers in market research is a great way to increase customer loyalty.

Another incentive for customers is the participant stipend or honorarium – the money we give participants in appreciation of their time. Cash is always nice of course, but Dimensional Research also gives research participants the opportunity to direct their stipend to a charity of their choice. Just in the past month I’ve learned about several great causes through the choices of our research participants.

Partners: The Secret Sauce of Customer Research

by Diane Hagglund

Every company knows that the more they understand the complex business issues behind their customers’ decision process the greater their chance of success. Any great technology company credits the way they listened to their customers as a key factor in their success. But how can you get all that great customer feedback you need when you barely have time to get to the bathroom between meetings!

Of course, you start by talking to your customers. A Customer Advisory Board is a highly effective tool for gaining important feedback from major customers while strengthening your relationships with them. A structured customer advisory board program brings consistent feedback throughout the product lifecycle.

But don’t forget your business partners. Partners are often ignored in market research, but I strongly believe that including partners is crucial. Partners, especially resellers and VARS, can provide you with a unique insight. In addition to being deeply familiar with your product and your customers (admit it, they often have better trusted advisor relationships than your own employees do) they are NOT employees of your company. This mix of deep expertise and external viewpoint often identifies issues that lie just under the radar for employees that are too close to them, or problems that are too vague for customers to properly communicate to you.

One way to get this valuable information from your partners is to add a panel of partners to your Customer Advisory Board. You should talk with partners separately, but do ask them the same questions you ask your customers and get feedback on the same topics. Another option is to start a dedicated Partner Advisory Board. A Partner Advisory Board gives partners a specific voice in your company’s strategy and has the added bonus of facilitating strong partner relationships.

WARNING: Reseller partners are very “real” with their feedback. They’ll put it all on the table – both good and bad. If you want to only hear the good things, partners are not the group to talk to! But if you resist the temptation to dismiss their negative feedback as “whiny”, you will gain important insight into what prevents them from selling more. During the best sessions, the partners freely and openly discuss issues, while the moderator encourages that discussion, makes sure any negativity is heard, and then leads the conversation into a dialogue on realistic steps to solve problems.

Really listening to your partners is absolutely one of the best ways to ensure your company’s efforts match the market’s needs.