Wednesday, March 16, 2005

Co-create new products with your customers

There's an interesting article at Reveries right now, encouraging companies to approach their research-and-development departments in an entirely new way; instead of sending out marketers to find out what the general public wants, and then building the products in hermetic secrecy, they encourage businesses to actually invite their smartest customers in and help develop new products from the ground up. The article details a number of large companies who have done this already to great extent, although I think the most interesting one concerns BMW; a couple of years ago they put an online toolkit up at their website, allowing customers to suggest ways that BMW could incorporate new technology into future cars. Then the company identified the 15 smartest customers of the thousand who participated, and actually flew them over to Munich to participate in a series of meetings with BMW's engineers. The customers, of course, were thrilled to have such a direct experience; BMW, on the other hand, got millions of dollars' worth of cutting-edge ideas essentially for free (or, well, for the price of an airplane ticket, which when compared to traditional R&D budgets might as well be free).

I'm planning on doing this myself, in fact, with the arts center here in Chicago I'm trying to open right now; we're going to have both a formal way for customers to suggest new projects for the center (basically, a stripped-down version of white papers), as well as an informal way (namely, to buy a staff member a drink and talk their ear off, with staff members instructed to take these conversations seriously indeed). And hey, why would a small business not do this, frankly? It makes your customers profoundly happier, and therefore more loyal; you're getting a ton of new ideas for free; and most importantly, you know for a fact that these are things customers actually want, not necessarily your staff sitting around a conference table, hoping that maybe these are the things your customers want, or maybe not. I'd encourage all small-business owners to give the subject some thought as well. (Thanks to the always lovely Jennifer Rice for pointing this out.)