Why Listening to Your Customers Isn’t Always a Good Idea

Repost of Accelerate Marketing’s  post on Excell Puget Sound (http://excellpugetsound NULL.blogspot NULL.com/2012/08/why-listening-to-your-customers-isnt NULL.html),  August 27, 2012
Sounds counterintuitive, doesn’t it? You should always listen to your customers, right? Actually not always
Many companies have a group of customers that are informally contacted for feedback when considering development of new products or to validate changes to their marketing approach. Other companies have customer advisory boards deliberately composed of a diverse set of customers to solicit feedback in a more structured manner and reconcile conflicting views and priorities. When developing add-on or complementary products and services, focusing solely on existing customers may be appropriate. But don’t make the mistake of confusing needs of your existing customers with the needs of the market.
Customers have an inherently biased perspective of your company and its product offerings. Existing customers are accustomed to the current product’s capabilities and give feedback in the context of that experience. Feedback from existing customers tends to be more evolutionary than revolutionary, and focuses on incremental improvements based on their familiarity with the current offering in existing markets. Existing customers are much less effective at identifying new product offerings and new potential markets. If the voice of the customer overwhelms that of the market, you run the risk of being TOO tailored to one section of the market (your existing customers). Companies need to keep their eyes on the whole market or new offerings won’t sell as well as expected limiting revenue growth potential.
I once worked at a software company where our flagship customer was collaborating with us on the next version of our main software product. Just as we were about to move into a key phase of development, we shared detailed development plans with a very large prospect. That prospect had a different set of needs and priorities for the next product version. After further research, it turned out that the customer’s needs were not only different but incompatible with much of the market we were moving into. The company almost made a mistake that would have cost us a number of prospective customers and delayed us expanding our market share. It was a tough situation that could have been avoided by making sure that we better understood the voice of the market as well as the needs of our current customers upfront.
So, while listening to your customers is very important, don’t fall into the trap of assuming customers’ needs are similar to the needs of the whole market. A customer isn’t fully representative of the market. Invest time in an ongoing basis to really listen and understand the voice of the entire market. And remember, customers are not always right.

 

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