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Tracey E.Schelmetic

[October 20, 2004]

Beyond References: How Reference Program Intelligence Can Inform Product Development

By Promise Phelon


Does your company create offerings prospects want to buy? Ask your reference customers.

If you touch customers after a sale, this article is for you. You might touch them through your company’s reference program or its support organization. Perhaps you touch customers through marketing to uncover, capture and tell their stories. We believe that the intelligence gained from customers post-sale represents critical assets that impact not only tools for sales and marketing, but overall corporate strategy.





While reference programs are chartered to deliver very specific tactical tools to support sales and marketing, in reality the path to creating those tools represents an immense opportunity to foster a deep relationship with that customer and extract critical intelligence that has the power to impact your company’s future.

Traditionally, the impact of customer intelligence gathered through reference program activities ends prematurely with individuals in marketing or in the reference program—the people who typically foster the relationships and make the customer calls. Many companies are missing a ripe opportunity to elevate that relationship and the resulting intelligence beyond reference activities – to product management, product marketing, and future corporate growth.

Why should you care? Well, as a good corporate citizen, you’re supposed to contribute to the success of your company. More pragmatically though, a) it’s easier to build a solid reference base if customers are satisfied and successful with their solutions; b) customers (and your reference accounts) want to influence your company’s roadmap; c) you can elevate the value of reference programs to your company when you share the fruits of your relationships and the intelligence those relationships are presenting.

How Intelligence Informs the Product Roadmap
The responsibility of building solutions your prospects want to buy usually rests with the product management and product marketing organizations. In case you don’t know the key players within these groups, product managers are best likened to lobbyists or negotiators. They assess the market for competitive, industry and technology trends. Product managers work with customers to gain perspective on near- and long-term business requirements, and evaluate internal resources to meet market, customer and competitive demands. They also act as brokers for and partners of your engineering organization and sales executive team; collaboratively, these groups make significant product feature, pricing and packaging decisions.

Product marketers, on the other hand, ‘define’ and position a solution in concert with product managers. They identify the messages that best describe a solution’s unique value to prospective customers. A director of product marketing at a large enterprise infrastructure company said it this way: “Product marketers often act as translators, mapping product features and functionality to solved business problems. While a successful sales cycle eventually gets down to features, what’s compelling to prospective customers is how you can solve the problems they have today.”

To make pivotal product decisions, product management and marketing groups crave and depend upon one critical element that can impact everything from the direction of your company’s products to its sales strategy—intelligence.

The Right Customers Are in the Reference Program Now
If you touch customers, you regular tap into the customer intelligence your product development people crave. The first step to using this intelligence intelligently is in recognizing it. Customer intelligence is more than static facts—number of employees, annual revenue, industry growth. It’s insight into why customers bought, why they didn’t buy and what would encourage them to buy again!

"Intelligence about a customer—knowing why they bought a solution or how they use a certain technology—is key to understanding business drivers and market advantages,” said Gus Maldonado, Product Manager at Wave Systems. “From a product management perspective, the right customers give you the insight you need to build a market-winning solution."

“Beta is too late!” echoed an enterprise software product management veteran. “I have worked with several companies and watched innumerable products evolve. From my experience, the best products are borne from the customer idea; enthusiastic customers line up to buy them before release.”

The Right Intelligence is Already Being Gathered, and Lost
The answers to the following questions strongly influence product direction decisions:

  • How did the customer discover the need for a technical solution?
  • What paths did the customer follow to address this problem?
  • What internal and buying processes did they follow?
  • What criteria led them to choose your company’s solution?
  • What other options were available?

Do these questions sound familiar? If you’re a reference program manager, you probably recognize at least a few of them from your success story customer interview script. If you publish more detailed case studies, the questions you ask customers are probably much more technically detailed.

Phelon Consulting recently released Success Sells, a report about developing compelling customer content based on proven models and elements of our firm’s methodology. During 2002-03, we spent quite a bit of time testing those models. And because the interview is of vital importance when it comes to gathering usable customer intelligence, we seriously considered and emphasized that area during our testing.

We learned much from this process, but one atrocious intelligence loss bears mentioning: information gleaned during interviews is rarely stored or translated from notes or e-mail strands into news and insight that people can use. More often than not, transcripts or notes from interviews don’t exist at all. So rather than quickly becoming an asset, insight and intelligence from your valued customers are no more than fleeting or random thoughts in interviewers’ heads…interviewers who may not even be employed by your company.

Using Customer Intelligence—Intelligently
Where does your company store the intelligence gleaned from customer interviews and other customer touch points? Who owns the translations and analysis? How do you share gathered intelligence with senior management? We’re not talking about forwarding one-line e-mails that contain what might be useful information from customers or sales reps—that’s not customer intelligence.

Customer intelligence is

a) systematically captured and stored,
b) collected, assessed and analyzed,
c) accessible to multiple audiences or organizations,
d) and auditable.

At this point, most of you are probably not tasked with collecting customer intelligence for the wider organization, although you are in fact doing so. What’s missing is a process for storing and sharing that information throughout your company. The following recommendations come from our research with reference customers, our experience with companies that rely on them as influencers, and the perspective of those who drive your company’s product direction:

  1. Treat intelligence as a finite asset. Don’t allow contractors, writers and other people tasked with qualifying customers and capturing their successes walk away with your company’s crown jewels. Develop a process that ensures the intelligence you get is of the right quality and level of detail; one that ensures those who need to know can easily and readily access that information.
  2. Give customers what they want. Current reference relationships are exceedingly 1-sided. References want to participate in activities where they can influence solutions to meet their own needs. Inquire about their willingness to participate in customer advisory boards and councils, and to speak directly to product marketing.
  3. Communicate intelligence with care. Consider how internal organizations will perceive the intelligence you uncover. It’s tough for people to talk about losses—and depending on how you position and use the information and who delivers it—losses may de-motivate sales teams and put engineers and developers on the defensive. If you do have to communicate bad news that might affect how a specific team or organization is perceived—like a product failure or an implementation from hell—get a sponsor or senior manager to deliver the message for you. One seemingly harmless “How to Avoid Losses” e-mail to a team of s ales reps could cost you not only cool points, but internal credibility.

Elevate Your Function’s Contribution
The benefits of intelligently managing intelligence are clear; Steven Bannerman, Chief Marketing Officer at Tarantella, summarized them nicely:

"Existing customers are an excellent resource to help understand the actual problems that need to be solved. Their intelligence, aggregated insight and specific 'why I bought' detail are invaluable data points for making strategic corporate and product decisions. Add to that the ability to continue these ongoing discussions with your customers during the actual product development process, and customer intelligence becomes one of the quickest paths to generating and sustaining revenue."

Customer intelligence not only helps your company make better decisions about product features, but it also changes the way your company looks at its unique selling proposition or how it delivers solutions to customers. Intelligence equips your company to make marketing, product development and go-to-market choices that transform even the best bets into more calculated and educated decisions. Not to mention that it also elevates your function’s contribution at the strategy level when you share valuable information that informs your company’s roadmap to success.

Promise Phelon is the founder and Partner at Phelon Consulting, a consulting firm focused on enabling enterprise software companies to shorten their sales cycles by leveraging sales and customer successes. She may be contacted at promise.phelon@phelonconsulting.com
 


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