When the economy is failing and businesses are closing, why do some seem to just get stronger? Sometimes it’s because their leaders know how to listen to their customers and invest in ways to give the customer what they want.
Proctor and Gamble offers an example of what NOT to do. In the 1970s, P&G wanted to break into the potato chip market, but found that national distribution was a problem. Potato chips did not fare well on long road trips because they broke too easily. They also didn’t have a long enough shelf life to taste good when they finally arrived at their destination.
P&G’s solution: Pringles. They were of uniform shape and size, stacked neatly in a tube so that hardly any of them would break in transport. The recipe included plenty of preservatives so that they could make long treks and still taste the same as when they left the bakery (aka, the manufacturing plant). P&G believed they had a sure winner. The chips cost a bit more than traditional chips, but surely the consumer would love the new concept.
As it turned out, the newness of the chip was fascinating when first launched, but soon died out. Consumers reported that the chips looked at tasted artificial. The very characteristics that P&G was so excited about – shape (for less breakage) and preservatives (for longer shelf life) were the cause of consumers’ dissatisfaction.
Proctor and Gamble made changes to their product to solve their own distribution problems, not to address any customer-driven requests.
Edward Slinin, founder and CEO of Corporate Transportation Group, is an example of how to do things right. Corporate Transportation Group operates car services in 450 cities in 39 countries, but it’s still a family business, run by Ed Slinin, his wife, and his brother. While other companies falter, CTG continues to grow because they are willing to make changes to their business to accommodate the changing needs of customers.
When larger numbers of clients started asking for eco-friendly vehicles, Edward Slinin took note. The company has started buying hybrid vehicles. Currently, 15% of the company’s fleet is made up of hybrid vehicles from Toyota and Lexus. They may not be as luxurious or status-oriented as the limos and town cars, but they are a direct response to customers’ requests.
While these vehicles are higher priced, CTG was willing to pay the price, banking on the fact that customers are more likely to use a company whose values are in alignment with their own.
Customers also have an expectation of advanced technology. Corporate Transportation Group drivers all carry Blackberry smartphones with GPS positioning systems. Customers can easily make reservations online. Edward Slinin sees his company as not just a car company, but also a technology company.
Corporate Transportation Group continues to grow and prosper as a result of listening to the needs and desires of its customers. That kind of business model can’t fit in a Pringles can.