labels: industry - general, marketing - general, market research
Turning the tables: Customers tell companies why they buy and how to behave news
24 May 2006

Mumbai: A just released customer research study, titled Customers Say What Companies Don't Want to Hear, throws a bucket of ice water in the face of some core business management tenets — plus a number of keystone principles of the marketing, advertising and customer relationship management (CRM) industries.

Freed from the editing and selectixve hearing businesses often invokes to avoid hearing unpleasant truths, customers dish out an earful to companies about what they want, what they don't want and what they ignore — and how they really make purchase decisions.

The new study is co-authored by long-time research partners Dr David J. Mangen of Mangen Research Associates and Richard A. Lee of High-Yield Methods. Commenting on the findings, Paul Greenberg, author of the industry best-seller CRM at the Speed of Light: Customer Strategies for the 21st Century, says, "Lee and Mangen have verified and amplified with hard data the growing perception that the new breed of customer is here to stay and businesses need to react — or risk their very existence. Moreover, there are lessons in this study for customers, marketers, advertising agencies and CRM practitioners as well."

Greenberg adds, "Customers Say What Companies Don't Want To Hear proves a mission-critical strategic point. Businesses need to rethink their logic and develop new operating models based on customer centric behaviors and valuations."

Among the study's key findings are:

  • The presence of a growing gap between customer expectations and company behaviour, which creates opportunity for some companies and increasing risk to others.
  • After 50 years of seller's markets, buyers are taking widespread control of buyer-seller relationships, and many companies don't know how to respond.
  • At a high level, a company's degree of customer focus was the most important purchase decision factor for customers, and by a very wide margin.
  • In terms of specific company behaviour — delivering customer-relevant quality products, as expected, was the most desired factor; very closely and unexpectedly followed by companies empowering their employees.
  • Despite the billions of dollars spent on brand advertising, customers rate brand-strength as a weak influence at best on their purchase decisions.
  • Despite its increasing use by companies, customers rate online customer service as even less of a positive influence than brand.
  • Research data along with empirical evidence point to customers developing "group think" and a "group mentality" capable of damaging or in extreme cases potentially eliminating out-of-favour companies such as Ford, GM and Northwest Airlines.
  • Customers globally rate the most customer-centric behaving company — and Wal-Mart's the least.

Asked to describe the potential impact of the study in real world terms, co author of the study Lee, notes: "If Wal-Mart's senior managers grasped the implications of what customers say in the study, they'd stop their initiative to add more upscale merchandise dead in its tracks. Without doing major repair work in relations with upscale customers before making such a move, Wal-Mart is going to stub more than its toe."

Customers Say What Companies Don't Want to Hear is a 151-page report including over 70 data charts and tables plus extensive commentary. The full-colour report, which sells for $195, is available at

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Turning the tables: Customers tell companies why they buy and how to behave