Together with Markus Schweers

As a product manager for industrial goods, you are constantly on the lookout for new ideas and solutions for your customers. You want to develop products that meet the needs and wishes of your target group and stand out from the competition. In short, you always want to generate added value for your customers in order to stand out from the increasingly intense international competition. This presents you with the challenge of ensuring that you meet the needs of as many customers as possible, or better still, your partners. 

But how do you find out what your customer partners really want? How can you be sure that your products meet the market conditions and needs of your partners? How can you continuously improve and optimize your products?

A recognized method, albeit one that is used far too rarely, is conducting customer surveys. You ask your customers for their opinions on your products, their problems, their expectations and their suggestions. You hope to gain valuable information and feedback that will help you to adapt and further develop your products. 

The immense speed of new product developments due to global networking (including through social media) also means that you are now in a global competition and should adapt as quickly as possible. 

Now the question arises: As a product manager, how many customers do you need to survey in order to obtain meaningful results? Do you need to select a representative sample that reflects all the characteristics of your target group? Do you need to reach a certain number of participants in order to be able to make statistically valid statements?

The answer is: no. In this blog post, we explain why product managers shouldn't have to conduct representative surveys and how they can gain valuable insights quickly and easily with a small customer community instead. Your goal is not actually to confirm an assumption. Rather, you want to learn what should be adapted or improved. A small sample is usually enough for this. Jakob Nielsen says that just 5 respondents are enough to obtain a sufficient statement on the improvement potential of his products.
The statements are basically that no respondent generates no knowledge. However, a single respondent has already identified almost 30% of the problems. The second respondent will generate further knowledge, but will still "copy" some of the behavior of the first respondent. As a result, the knowledge of the third, fourth and fifth etc. becomes less and less and the curve becomes flatter. This is because the users use the product in a similar way and fewer new things can be learned. 

Figure 1: Illustration of the learning curve from usability tests as a function of the number of respondents. (Nielsen Norman Group 2023)

But first, let's go back: What is a representative survey?

A representative survey is a survey that aims to capture the opinion, knowledge or behavior of a specific population (e.g. all electricians in Germany). To achieve this, the sample of respondents must be selected in such a way that it reflects the characteristics of the population as accurately as possible (e.g. age, gender, region, experience, etc.). In addition, a certain critical number of respondents should be reached in order to achieve representativeness. Very time-consuming, isn't it? How many electricians are there actually? 

A representative survey usually requires a larger number of participants than a qualitative survey in order to ensure high accuracy and reliability of the results. The larger the population and the more characteristics that need to be taken into account, the larger the sample must be. And you should also make sure that you ask valid questions and that the questions are also reliable. Certainly helpful in a scientific context. In the context of the real business world, however, we want to gain insights in order to adapt products or business models. To do this, we need a certain degree of flexibility and not the rigid measurement of an issue using constructed questionnaires. For example, we also want to find out the emotional view of customers. I can't do that with a standardized question.   

As product managers, however, we do not want to confirm or refute knowledge that has already been created. We want to learn how our customers/users work with or use our products and what we can adapt accordingly. However, if you want to investigate further using this data, you can of course do so. However, this is often not very helpful in the context of your work. Why? 

A representative survey is particularly useful if you want to confirm qualitatively determined data with quantitative data that relates to general facts or trends (e.g. market shares, customer satisfaction, purchasing behavior, etc.). A representative survey makes it possible to carry out statistical analyses and make generalizable, more specific statements. In the context of a product manager's activities, however, we believe that this is overstepping the mark and is not always immediately necessary. 

At the heart of a possible innovation process are well-foundedcustomer insightsor the ability to learn from the insights of my customers - by getting closer to them. Uncovering this core customer view of my products is a matter of qualitative research. Unfortunately, in practice this process often only takes place when there are certain requirements. For example, when sales are not right or when you realize that the market is developing in a different direction. Then you should quickly find out how you can do better based on quantitative past data that may already be available. However, this data alone is usually rather superficial and does not allow for detailed insights. 

However, if you are in constant communication with your customers, you can make this process so efficient that you are basically always in a position to turn the constant and in-depth knowledge into a new starting point for innovations.
Of course, existing data is also helpful. But through an active dialog with users, you can obtain information about "things not said" or determine the motivation behind certain statements. You can sound out the blind spots. This allows you to identify any problems much earlier and drive forward new innovations more quickly. 

Now back to the topic: Why product managers don't need to conduct representative surveys now 

As a product manager for industrial goods, you are or should not be primarily interested in quantitative data. You want to collect qualitative data that relates to specific problems or needs of your customers (e.g. requirements for a new product, suggestions for improving an existing product, etc.). You want to understand why your customers act or think the way they do. In the end, most of your customers buy an investment good or a service with which they also want to work profitably. So it's about creating value - added value! 

You do not need a representative survey for this type of data. On the contrary: a representative survey can even be counterproductive. Why?

• A representative survey is time-consuming and expensive. You have to invest a lot of time and money in selecting a suitable sample, recruiting and motivating participants, conducting the survey and analyzing the data. This can delay your product development and tie up your resources.

• A representative survey is inflexible and static. You have to decide in advance which questions you want to ask, which answer options you want to offer and how you want to analyze the data. You cannot react spontaneously to new findings or queries. Nor can you proceed iteratively and test and improve your products step by step. In the worst case, your questions can even "measure" the wrong thing 

• A representative survey is superficial and imprecise. You can only ask standardized questions that relate to measurable aspects. You cannot go into depth and explore the background or motives of your customers. Nor can you directly assess the quality or design of your products. You have to rely on indirect indicators such as satisfaction or purchase intent, which are often biased or unreliable.

How product managers can gain valuable insights with a small customer community

So what is the alternative to a representative survey? With EVOLUTE, we recommend that you build up a small customer community and survey them regularly. A customer community is a group of selected customers who are willing and even happy to give you feedback on your products by taking part in your surveys. The result is an active dialog! A customer community can consist of 50 to 150 people, depending on how large and heterogeneous your target group is. On the one hand, you have created a system in which you can reach many partners and create collaborative value through active participation. Quite apart from the fact that customers feel more closely connected to you, you are now in a position to stand out from the crowd because you are no longer selling products, you are creating added value for your partners! 

A customer community offers you many advantages over a representative survey. Here are some of them:

• A customer community is simple and inexpensive. All you need to do is create a group of customers who are interested in your products and trust you. You can then survey these customers using suitable feedback software such as Evolute, which was developed for surveying craftsmen and achieves response rates of over 50%. You save time and money in planning and conducting the surveys.

• A customer communityEVOLUTE is flexible and dynamic. You can ask questions that interest you at any time without having to stick to a fixed questionnaire. You can also use different formats, such as free text questions, multiple choice questions, images or videos. You can react to your customers' answers and ask follow-up questions. You can also test and improve your products at various stages of development.

• A customer communityEVOLUTE is profound and precise. You can ask your customers about their problems, needs, wishes and expectations without limiting yourself to predefined categories. You can also have your products evaluated directly by showing prototypes or sketches, for example. This gives you qualitative feedback that helps you to adapt your products optimally to your customers.

Conclusion

By using EVOLUTE, you as a product manager and your organization are now in a position to create added value together with your partners. You learn to participate in customer ideas and at the same time your partners understand your product better. You also recognize potential new trends more quickly, as the partners who use your products are also exposed to these trends. 

As a product manager for industrial goods, you do not need to conduct representative surveys to gain valuable insights for your product development. Representative surveys are costly, inflexible and superficial. In addition, the very detailed focus often does not really lead to helpful insights. Instead, you should build up a small customer community and survey them regularly. A customer community is simple, cost-effective, efficient, flexible, dynamic, in-depth and precise.

If you want to learn more about how to build and survey a customer community, we recommend our Evolute Connect software solution. Evolute is a software developed for product managers and their companies that enables you to easily survey a small customer community from your day-to-day operations. With Evolute, you can quickly and easily gain valuable insights for your product development. And thus enable active dialog with your partners.

Evolute is a software solution for product managers in the industrial goods sector that makes it easy to survey a small customer community from within day-to-day operations. You can find more information here: evolute.app/product

If you want to learn more about the difference between quantitative and qualitative surveys, here are some good blog posts on the subject: evolute.app/industrieblog

(Nielsen Norman Group 2023; Harvard Business Review 2022; Collaboration 2020)

Image by https://exob2b.com/en/marketing-research-quantitative-vs-qualitative/, last updated on 28.11.2013, last checked on 23.09.2023.

Harvard Business Review (2022): Stop Selling. Start Collaborating. Available online at https://hbr.org/2022/05/stop-selling-start-collaborating, last updated on 11.08.2023, last checked on 23.09.2023.

Nielsen Norman Group (2023): Why You Only Need to Test with 5 Users. Available online at https://www.nngroup.com/articles/why-you-only-need-to-test-with-5-users/, last updated on 07.08.2023, last checked on 23.09.2023.