The first stage, development, starts when the product is first seriously considered and continues until it is ready for selling and distribution. Most activities in this stage are in research and development and product design.

The relatively short period in which a product is introduced is the introduction stage. The product pipeline is being filled and positioning and brand image are being established and the target markets are being confirmed.

Once distribution has begun and brand awareness is established, the product enters the growth stage. The growth period is the time when a product can dominate its category. Profit per unit usually runs high because there are few competitors. To ensure that the product can compete with new products coming into the market,, product improvements are important in this stage.

The period during which the sales curve begins leveling off is called the maturity stage. Maturity is generally the longest of all stages. Most potential customers have already been identified and competitors established. Brands with significant shares are now getting repeat purchases. Profit margins may be high at established firms that have refined their operations to lower production, distribution, and selling expenses, or they may be reduced in an effort to compete on the basis of price.

The decline stage is the reverse of the growth period – sales begin to decline. A category or a brand can decline for many reasons, including technological changes, changes in consumer wants, or changes in economic conditions. As category sales decline, competitors drop out.

As a product category continues to decline, each brand in the category needs to decide when production and marketing activities should terminate, the final stage of the cycle. Note that a product category at one stage of the life cycle in one country may be at a very different stage in other countries. In addition, according to Warren Keegan, co-author of Marketing, product categories and specific brands each have their own life cycles. It is not unusual for each of these to be at a different life cycle stage at the same time.

The methodology for conducting the surveys is primarily telephone surveys supplemented with some on-line and mail surveys. Feedback ranges from companies with as few as 50 customers to those with over 5,000 customers. A typical survey consists of approximately 25 questions using a scale of one to ten with one representing extremely dissatisfied and ten representing extremely satisfied. For more information about our proprietary database, please send e-mail to info@spg-consulting.com

Customer Satisfaction Index (CSI): SPG High 9.2; SPG Average 7.9; SPG Low 7.1

Sales Process: SPG High 9.1; SPG Average 8.0; SPG Low 7.4

Product / Service Quality: SPG High 9.2; SPG Average 7.8; SPG Low 6.9

Customer Service: SPG High 9.2; SPG Average 8.0; SPG Low 7.3

Administration: SPG High 9.3; SPG Average 8.1; SPG Low 7.5

-What are the objectives of the survey, e.g. customer satisfaction, key buying decision factors, customer value, loyalty, etc?
-Do we know what we are going to do with the information when we get it?
-Are we planning to do surveys often enough to give us the kind of trend data we need?
-Do we know when it’s best to do surveying by mail, online or telephone?
-Are we working with accurate, up-to-date contact lists?
-Are we planning to pretest questionnaires?
-Have we been thorough in comparing the merits of outsourcing versus doing it inside?
-If using an outside resource, do they have the credentials, not only from a research perspective, but also from a business perspective, to ask the right questions and provide actionable interpretation of the results?
-Can we be assured of a statistically valid level of confidence in the results?
-Do we know how to reduce sample size and cut costs by getting a high response rate on surveys? How many responses are required?
-Do we have the processes in place to validate and crosscheck the information we expect from the survey?
-Do we have the discipline to keep survey questionnaires to a reasonable length? How many open-ended vs. closed-ended questions form the right mix?
-Is the cost of the survey inconsequential compared to the information that will be received?

Regardless of which positioning strategy you use, it is a subjective evaluation of the product and must be used in terms of how consumers will see the product.

For nearly forty years, J.D. Power & Associates have been measuring customer satisfaction and helping businesses understand what customers really want by listening to them. But hearing the voice of the customer is easier said than done. This book explains how great companies deliver consistently high customer satisfaction and translate that satisfaction into profitable growth. The authors explain how to understand the financial link between satisfaction and profits, turn customers who are simply satisfied into vocal advocates for your business, build a culture of customer satisfaction from the top-down, empower frontline employees to do the right thing and use problem resolution as an opportunity to make new fans.

Satisfaction offer tactical advice for companies large or small, for product manufactures, service providers, and retailers alike. The chapter on turning bad customer encounters into winning propositions is especially useful. The book contains many fascinating stories about companies that don’t just talk the talk but walk the walk every day.

Strengths are what your company is really good at. Some strengths can be viewed as core competencies. Strengths may include industry leadership, management capability, technological advantage, employee expertise, etc. Leveraging strengths can lead to sustainable strategic advantage. Weaknesses or limitations are areas where you might be vulnerable in the marketplace or to competition. Sometimes, weaknesses are the inverse of strengths, e.g. the technology that you are employing may be coming obsolete as competitors are investing in more state of the art technology.

Opportunities present themselves based on changes in the competitive environment, market place, changes in regulations, patents, etc. Likewise, threats may surface as a result of increased government regulation, a soft economy, new entrants in the marketplace with substitute products, etc.

Conducting a SWOT analysis on a periodic basis as part of your planning process will ensure that you are formulating strategies that will make you a long term player in the marketplace.

How Smart Companies Use Environmental Strategy to Innovate, Create Value, and Build Competitive Advantage
Companies are facing an unavoidable new array of environmentally driven issues. Like any revolution, this new “Green Wave” presents an unprecedented challenge to business as usual. Organizations that do not add environmental thinking to their strategy arsenal risk missing upside opportunities in markets that are increasingly shaped by environmental factors.

In Green to Gold, the authors identify three main reasons for adding the environmental lens to core strategy: the potential for upside benefits, the management of downside risks, and a values-based concern for environmental stewardship. Green to Gold highlights the key strategies, tactics, and tools that are needed to establish an environmentally based competitive advantage.

Source: Business Book Review

With a score of 7.2 the management team congratulates each other, interpreting the overall score as very good. Before making that conclusion it might be helpful to understand exactly what a score of 7.2 really means. Based on the surveys completed by SPG, the average CSI in our database is 7.8 based on the 100 most recent companies for whom we have conducted surveys. In other words, a score of 7.2 indicates that there is significant upside potential to further increase customer satisfaction.

Other organizations also benchmark results. For example, the University of Michigan calculates their American Customer Satisfaction Index (ACSI) scores by major industry based on percentages. For 2008 companies in the food manufacturing industry posted an average scoreof 83 out of 100. By contrast, the airline industry posted an overall score of 62 out of 100.

Understanding the true meaning of customer satisfaction ratings and having the capability to benchmark against other companies provides meaningful comparisons and allows management to establish realistic goals in order to generate continuous improvement.

Collaborating with the client, SPG will start by establishing a profile of the likely target audience for the product or service. Some of the more frequently used consumer panel segmentations include:

-geographic location, e.g. local, regional, national or international

-gender

-age group(s)

-income levels

-education attainment

-interest categories

-purchasing information

Once the profile is established, the next step is to send out an email invitation to the target audience based on the specific requirements that have been selected. Depending on the level of precision required, we typically survey from 200 to 400 respondents. A questionnaire based on client objectives and information requirements is designed by SPG with client input.

Once the questionnaire is designed, we are ready to launch the survey and research panelists meeting our criteria are invited to participate. A recent example of an online survey we completed will provide some insight into the process and outcomes.  Since we usually sign confidentiality agreements with our clients we cannot divulge the specifics of the particular case. The client was seeking to gauge interest in a novel service that they were considering introducing in a large metropolitan area of Texas. They were interested in learning from females whether this new customized service would be of interest to them, and more importantly, the likelihood of purchase at specific price points. We targeted females, ages 25 to 54, with household incomes above $75,000 that had an interest in clothing fashion.

We received responses from 350 panelists meeting our selection criteria. Respondents completed the survey consisting of 24 questions of which a few were open-ended. Questions about buying habits, level of interest in the new service ranging from definitely would buy to definitely would not buy, and pricing considerations were an integral part of the survey. Open ended questions such as reasons that would prevent them from purchasing were also probed along with their suggestions on how the proposed service could be further improved.

After analyzing the data obtained from the online market survey, SPG prepared a report of key findings and recommended that the client move forward with the business venture. Using an online survey to assess the market feasibility of the proposed service permitted our client to make decisions based on hard data. Furthermore, spending a few thousand dollars before committing several hundred thousand dollars gave the client the confidence they needed to move forward with the venture. Once the service is introduced in the designated metro area they plan to rollout the service into other larger metropolitan areas throughout the U.S.