Thursday, March 22, 2007

The Benefits of Having a Customer Advisory Council

It's a cliché that successful businesses listen to their customers. To that end, companies use tools like email, blogs, and live chats to glean actionable intelligence. All of those methods have their place, but successful companies know that nothing beats a Customer Advisory Council (CAC).

The company’s CAC is a valuable part of the ongoing communications mix with established and potential customers.

Just what is a Customer Advisory Council? It is a representative group of customers that offers a regular, systematic and coordinated method of gathering customer feedback. CACs can potentially be involved in every step of the sales cycle and in the subsequent product deployment and end-user phases.

What does a company get out of a CAC? If a CAC is done well, the answer is a lot. For starters, a company can get information about:

· Features and use cases for present product offerings

  • Pricing
  • Packaging
  • Positioning
  • Demand for new products
  • Partners and channels
  • Marketing communications
  • Competition

This information can help a company drive sales, move to a practical solutions business model, and realize operational efficiencies ultimately leading to greater profits. When executives are in close contact with customers, they begin to think like a customer, and that should lead to greater satisfaction for customers and greater profitability for the company.

But there's no just-add-water approach to establishing a proper CAC, especially as a startup or emerging company. It is really hard to ask the right questions, establish a winning format, and share and act on the information coming out of a CAC while other market forces are taking up all of your time.

Fear not, though: the situation isn't hopeless. Experiment to get a CAC that works for your company. Look at it like a Board of Directors meeting, and treat all attendees equally—even if some customers are bigger customers than others. Assign the moderator duties to officers who have that talent to ask the right questions. Then start planning your first CAC, with input from attendees, six months in advance. And don't be a cheapskate: spend the money on great food and facilities. In short, make the CAC part of your company’s priorities.

Here's the bottom line: Startups or emerging companies need a CAC to stay on the cutting edge, but they have to be prepared to invest a lot of time and effort in getting a CAC right. Take my word for it, though: A CAC is well worth the effort.

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