Customer Engagement in the Product Planning process
I came across an interesting article in last week's Economist, one that supports my contention that customer engagement is the route to creation of a sustainable advantage over one's competitors as well as mirrors Microsoft's notion of creating a community engagement program with an aim to, among other things, involve customers in our product development process. One of my follow-on thoughts is that in such an approach lies a unique threat to the open source initiative, in that instead of creating products based on the joint efforts of a disparate community of users -- and with inconsistent and unpredictable results --, corporations that embrace the philosophy and approach of opening their processes up to customers to the extent possible tap into an unparalleled source of innovation and product knowledge in the process while forging a singular bond with those customers.
It's a simple fact that corporate transparency promotes customer retention while obstruction of the flow of information inhibits customer loyalty. We see this in numerous examples in everyday life. What's all the more more intriguing is a statement from a manager in publicity company Saatchi & Saatchi contending that brands have ceased to be property of corporations and now belong to that sector of the public which consumes them:
The less control a company has over its marketing message, the greater its credibility, says Pamela Talbot, an expert in consumer-product marketing and chief executive of the American side of Edelman, a giant public-relations firm. Indeed, Saatchi & Saatchi's Mr. Roberts thinks marketing departments must accept that brands no longer belong to them, but to the people who use them. The most valuable users of a company's brand are what he describes as “inspirational consumers”—people who are closely associated with a company and its products. It does not even have to be another company. Some of the most successful agents for generating a buzz—and plenty of free publicity—can be the people who run the business.
As The Economist states, and I agree, "this is a clever move." The notion that customers exist as statistical "markets" and "segments" is one that, while it has its place in market research, is also becoming increasingly dated to the extent that it shapes a corporation's view of their customers as numbers. It's still a relatively new phenomenon to engage customers in product development, although it's possible to surmise the value of this practice via real-world examples, among them Burger King's creation of a Web site that allowed its customers to control the design of the fast-food company's next menu offering. In an era of increasingly constrained resources, the threat of global competitors' lower cost structures and the ubiquity of information via the internet, it's hard to find an angle that will lever a corporation above its competitors. It's my thought that if companies seek to survive in future, getting customers closer to the product cycle will become a requirement, rather than the best practice it is today.
Source: "Crowned At Last", The Economist, 2 April 2005.
