Provision of need information

Abstract

The life-nerve of a company is viable products, i.e. profitable products that give the users what they want at a price they can afford. This contributes to customer satisfaction and customer retention, which in turn drive customer revenue and, ultimately, are key factors in determining profitability (Best 1997). In many companies the knowledge about the customers and their satisfaction is rather limited. This is clearly brought out in a study of 28 hotels, which also shows that the market oriented companies are best informed (Sandvik and Gronhaug 1998). In depth studies in five Finnish companies point in the same direction. Even if the determination of new needs is critically important for long- term success, and most of the companies aim to be market leaders, there are no systematic procedures, and enough resources are not allocated to need assessment (Karkkainen et al. 1998). Other studies show that lack of a strong market orientation in product innovation, an unwillingness to undertake proper need assessment, and neglect of the customer, spell disaster (Cooper 1998).