Get Inside Your Customers' Minds by Ken Bernhardt Regents' Professor of Marketing and Assistant Dean for Corporate Relations  Robinson College of Business, Georgia State University Atlanta Business Chronicle - September 28, 2007 In the blockbuster movie What Women Want, Mel Gibson plays an advertising executive who has a fluke accident giving him the ability to read women's minds.  Marketers would love to have the power to read customers' minds, and there is a method that comes close to enabling this result, the Customer Advisory Board (CAB). Customer Advisory Boards, when used correctly, can provide an intimate understanding of customers' needs, the ability to see your company through the customers' eyes, and a mechanism for strengthening your relationship with key customers. A 2006 CMO Council survey of 550 companies found that 75 percent did not have a customer advisory board or council. Yet a study published in Marketing Management magazine this year reported that the return on investment from a CAB can be up to 10 times what a company spends on it. What is a Customer Advisory Board?  It is a group of typically 8-12 customers who have agreed to meet quarterly or semi-annually to give you advice.  They serve terms of from 1 to 3 years, with people rotating on and off at regular intervals.  The kinds of questions you typically would present to the board include: Where is the market headed?  What is the next big thing?  What are the trends going on in the industry that worry you the most (and that therefore we need to respond to)? What do we do well and what do we need to improve? What could we do to increase retention rates? Which of the following new product concepts should we focus our efforts on?  What do you wish we did that we don't do (or don't do that you wish we did)? How could we be easier to do business with? CABs are especially valuable for business-to-business companies where a few large and/or influential customers can have a big impact on a company's success. CABs are very effective for businesses facing emerging or rapidly changing markets, where buying decisions are complex, or where new technology is having an impact on the marketplace. So how do you create a CAB that works effectively?  First, you need to understand the mission for the CAB and the results you hope to achieve. It is not to get customers together to sell them your products; that is a sure way to fail to get the potential benefits from a CAB.  It is a way to get customers personally and emotionally invested in your business success. It is a way to learn about the competitive landscape and of emerging trends. It can help you identify new market opportunities and prioritize your new product offerings.  A second key to success for your CAB is to select the right people to participate.  Included should be major customers, key distributors and wholesalers, and those who have particularly good insights into the market and are influencers.  You must be careful, however, to not select only happy customers; this could just reinforce current practices rather than revealing weaknesses and new market opportunities. Of particular interest are smaller customers who have the potential to become big ones.  To summarize, you need the right companies and the right people from those companies.  Because people tend to give their best ideas at the first few meetings, it is important to have a rotation policy to bring new customers onto the CAB on a regular basis. This needs to be balanced against the fact that people will be more open with you as they gain your trust over time. Another key success factor is giving the CAB feedback on the ideas they give you.  A danger is to collect lots of ideas and then to keep the CAB in the dark regarding what you did with the ideas.  There is no way you can implement all of their ideas, so getting a sense of their priorities at the meeting is important.  Then you need to communicate what you did with their input (including the reasons why you ignored some of their suggestions). If negative comments are made, it is important to get the group to focus on the solution, not dwell on the problem.  An independent, professional moderator, who as an outsider can avoid being defensive, can help keep the discussion positive. Key executives from the company should attend, but listen rather than talk. Why would customers agree to be on your CAB?  They have the ability to influence your company's strategy, which is a big benefit when your product is a key factor in their company's success.  It allows them to have a direct voice in what products your company brings to market.  The CAB provides a chance for them to interact and learn from other customers, particularly regarding where the market is headed.  Often there is some fun time involved in the meeting, but it is important to keep the work to fun ratio at least 75:25 or else it can appear to be a boondoggle that will reduce the likelihood of their attending future meetings. Maybe you can't read minds like Mel Gibson was able to, but asking the right questions of the right people and listening carefully can enable you to become more pro-active and gain considerable competitive advantage.