Over the past few years, companies of all sizes and across all industries have put a Customer Advisory Program into place with a defined process for gathering and evaluating customer insight and injecting that insight into their business strategies.
While these companies are putting their voice-of-the-customer infrastructure into place, other customer-centric organizations are building on existing programs to support changes in their businesses. These more mature customer focused organizations are now reevaluating their Customer Advisory Programs and identifying program extensions that will take them into desired new directions.
Customer Advisory Program Changes
Most companies begin offering an Advisory Program with a small group of customers in focus-group-like meetings, usually with the same set of customers each time. As their business and competitive landscapes change, the more forward-thinking companies change their Advisory Program by creating new councils focused on priority customer segments and expanding their program to encompass additional selected participants and research activities.
Key changes:
New Councils
When they originally designed their Customer Advisory Programs, companies recruited a cross-section of customers to learn about their differing needs. As the business environment constrained their budgets, management realized the need to prioritize their target markets and become more relevant to those customer segments. To accomplish this objective, they created separate a Customer Advisory Council for each priority customer segment under one Customer Advisory Program umbrella.
Following reorganization, one business services company grew from one council to three councils. It created two councils based on customer size (Small & Medium Business Council, Large Business Council) and one council based on customer vertical (Healthcare).
Other businesses have added new councils to collaborate with customers in different roles (buyers or users of the product) or in varying levels within their company (executives). For example, a large technology company decided to launch a new council of customers who are the buyers of their products to get more insight into the competitive landscape and to fine-tune their marketing messages to appeal to the evolving needs of this decision maker.
Businesses that are heavy regulated such as banking and healthcare organizations have designated their councils around their legislative boundaries by state, region, or country, since these customers share common ground on business issues and needs.
New Participants
Savvy customer-oriented companies have moved beyond the traditional 8-12 person council to recruit dozens of customers to join their program. They recognize the need to listen to more customer voices to keep their business strategies fresh, current, and compelling.
When planning an upcoming customer advisory activity, management first defines the customer insight objectives for that activity and then invites customers with appropriate profiles to participate. Although not all customers participate in every advisory activity, companies gain valuable insight when they hand-pick program participants based on what they need to learn.
For example, a company can tap a group of customers with more in-depth experience with a specific product to understand gaps in features and functionality, and select customers with a broader experience across a set of products to learn about integration issues and opportunities.
New Activities
True customer-centric businesses recognize the need to check in with their customers more than once or twice a year when they usually hold their Customer Advisory Council face-to-face events. These businesses need to make ongoing business decisions and cannot risk guessing how their customers will respond. To minimize their risk, they have added more research activities to their Customer Advisory Program calendar to connect with their customers on a more regular basis. This way they are validating their internal company assumptions about their products, partnerships, and marketing initiatives each step of the way.
Since it would be too resource intensive for companies and time consuming for their customers to have many face-to-face events within a year, management is turning to additional methods of gathering input and feedback between one or two physical gatherings. They are using tele conferences when extensive discussion is required, and web conferences when they need to show a product prototype or marketing campaign for example. Companies are also leveraging the Internet to capture preferences through online customer surveys or polls.
Often, the teleconferences are conducted with a small group of the council participants. A healthcare company ran a face-to-face event and found a few customers who were particularly interested in diving deeper into the discussion around a particular topic that was very important to them. With a filled meeting agenda, the customers did not have the opportunity to explore the topic more extensively but were invited to continue the conversation through a teleconference moderated by the company facilitator. In fact, companies are now using these calls to enable a small workgroup within the council to define potential action items for the company.
Another way that companies are remaining aligned with their customers' needs is through an online customer community, the benefits of which to a company and its customers are many. The company is able to stay continuously connected to customers, and the customers are given a venue for sharing information and ideas with other customers. By reviewing the online customer-to-customer discussions, companies also benefit from this insightful exchange, which helps fill in the blanks between their occasional face-to-face events. Some companies with internet-savvy customers have decided to invest in an online customer community instead of offline customer advisory activities (face-to-face events, teleconferences).
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Before adding more councils, participants, and activities to the Advisory Program, the more experienced companies recognize the need to first put the necessary resources into place. For example, they assign one project leader for each council to plan, manage, and run the activities and create a team for coordinating plans and sharing best practices across the councils.
Advisory Program Change Drivers
Customer-centric businesses know when it is time to change their advisory program. They remain attuned to changes in the marketplace and make adjustments to their program to ensure that they are listening to customer voices that represent business opportunity.
In some situations, companies can simply refresh the participants of an existing council with customers who have a specific profile. For example, a business-services company launched a Small Business Advisory Council and realized that professional services firms represented tremendous growth potential for its new suite of services. The company decided to recruit additional professional services firms, such as accounting and legal companies, to participate in its Small Business Advisory Council.
Changes in advisory programs occur when the company is moving in new directions, focusing on priority customer segments, and growing customer relationships:
Moving in New Directions
As management learns about new market trends, shifts in customer buying behavior, and increased requests for additional offerings, it evaluates different business scenarios. Having decided on these new directions, management reallocates its budgets to align with these opportunities.
As a result, management will often make changes to the advisory program. For example, one technology company realized that there were more growth opportunities in international markets and decided to expand its international council and conduct more information-gathering activities. It also changed the composition of the council to include more participants from selected countries.
Focusing on Priority Customer Segments
With limited budgets, companies can choose to do less across the board or shift a larger share of their budget toward more-lucrative customers. More companies are selecting the latter option and concentrating on those priority customer segments (e.g., companies that are a certain size or in a specific industry) after extensive analyses into their buying behaviors and needs.
A large software company selected its priority customer segments and launched one council for each segment (a Telecommunications Advisory Council, Manufacturing Advisory Council, and High technology Advisory Council). For each industry council, it is capturing insight to customize its products and services to appeal to the needs of users in that industry.
Growing Customer Relationships
Companies have many options to grow business with their customers. They can determine ways to do more business with their current customer contacts or expand farther into their customer's organization into new departments and new levels.
Companies pressured to identify new revenue opportunities have been increasingly putting their efforts into building relationships with the senior management in their customer's organizations. By partnering with these executives, they are able to collaborate with them on a business road map and validate key investment decisions.
To accomplish these objectives, companies are setting up an Executive Advisory Council to understand their customers' future purchasing plans and gather feedback on their potential product and partnership road maps. Unlike other customer councils in which participants evaluate company initiatives to support short-tem business decisions, these Executive Advisory Councils are designed to address long-term business decisions, which are often more than 12 months down the road.
These executive councils are especially important to companies that have a small customer base where there is a greater need to remain aligned with their customer companies at all levels of the organization.
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In the new world of Customer Advisory Programs, companies are making needed changes to their councils to support changes in their business strategies. They are reevaluating their program research objectives, participant mix, and planned activities to ensure that their program supports the decisions that need to be made. Companies are also putting the necessary organizational changes into place to support their program extensions.
Management knows that by leveraging the insight from the councils, it will make better decisions to remain a leader in the competitive marketplace.
