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Knowing
the reasons why
helps any organization make new sales or correct sales losses. Surveys are an invaluable tool for gaining this
information. Here's
an example:
HOME
MAINTENANCE PRODUCTS FIRM.
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Problem. A manufacturer of home
care products, in business for decades, couldn't pinpoint why they experienced a general sales
decline.
They tried different promotional campaigns and altered product lines - all to no avail.
The CEO reviewed their history with his T-21 Team Manager (TM) and, at
his request, forwarded sales and marketing reports, sample brochures, and
technical product information.
Action. His TM formed an Analysis
Team that saw no readily apparent reason for the decline,
from the information the company supplied. They recommended direct mail, Internet, and "street
interview" surveys of
existing and prospective consumers to determine the underlying cause of the
decline.
The CEO agreed and a Survey
Team was assembled. Survey results showed an unexpected reason for consumer
skepticism: about three years earlier, the company had imported and sold
a line of products that performed very poorly. This damaged
the company's reputation, making people wary of the quality of all the company's products. Word-of-mouth apparently had been very damaging.
The CEO said, "I've only been
here about a year-and-a-half, so I don't have first-hand knowledge of what happened
then, but I have heard several people mention it. I'm kind of
surprised that something that happened that long ago would affect what we're
doing today."
Results.
With
T-21's help, the company addressed these consumer concerns with a
straightforward, honest approach in their advertising, warranties, quality control, and customer support.
They contacted registered owners of the failed product line, explaining
the situation and offering remediation with new products. Over the next 18-months, the
company's
decline stabilized and sales started to gradually rise.
"I guess you're right," the CEO told his T-21 TM.
"It takes a lot longer to overcome
consumer caution from a mistake than we thought. But, we're
grateful to you for getting us on the right track." Annual
surveys of current customers show increased confidence in the company and
its products.
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It's hard to do what's needed when you don't know what that is. It's
risky to set out on a new, expensive venture without a good forecast of how
it's going to be received. This is one example of how T-21
helped:
SPECIALTY
PRODUCTS MAKER.
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Problem. A small, specialty
products manufacturer proposed the addition of a new, though expensive, item to their
product line.
The Product Manager estimated total costs to bring the product to market would be about
$2.9-million - a sizeable amount for a company of their size. They contacted
T-21 for help with a market survey for the proposed product.
Plan.
Their Team Manager (TM) established a Survey Team that suggested:
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A Survey be added to the company Web Site,
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Questionnaires be mailed to existing customers, and
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"Street interviews" be held near stores carrying similar products.
The company agreed and their T-21
Team designed survey instruments for the
Internet, mail-outs, and "Street" interviews. The company opted to
administer the surveys themselves, using the T-21 developed materials.
In all surveys, a description of the product and a proposed price was given, then questions
were posed about its usefulness and the probability of purchase.
Results.
Overwhelmingly, the
survey participants said that the product could be very useful, but over 90%
said that the price was too high. Most of the respondents indicated that they could
substitute less expensive alternatives.
The Product Manager said,
"I'm sad that the product wasn't
price viable, but happy that we didn't rush into production.
We'll have to see if we can find a way to get the production costs
down. But, the bright side is that you all apparently
saved us from a three-million-dollar mistake. We thank you for
that."
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