Case studies of successful small & medium enterprises and how they have or have not used market research
Founded in Singapore in August 2006, Xmi Pte Ltd started with the simple objective of trying to create the smallest pocketsize speaker with the fullest sound possible. Their creation was the X-mini Capsule Speakers – the vision and brainchild of the founder of the business, Ryan Lee.
With the introduction of smart phones and the general convergence of small devices in mobile consumer electronics, Ryan saw an opportunity in ‘sound innovation’ to complement these products. People wanted sound systems with their mobile devices, and this ranged from students sharing their music with friends, to business people needing sound in their presentations, to retirees using mobile devices while doing Tai Chi in the local park.
But sound needs size to perform well, and with miniaturisation sound quality diminishes. Nobody had produced good quality speakers that were convenient enough to bring along with their mobile devices. The unique feature of the X-mini Capsule Speaker system is that they can expand like an accordion, and in resonance it produces a base and hence a much better sound system.
While the technology was not new, the success of Xmi Pte Ltd was partly in how the company had cleverly designed and trademarked the X-mini Capsule Speaker, and nurtured a highly effective global sales and distribution network. Today they sell into 80 countries worldwide, with annual sales of S$30 million.
Xmi Pte Ltd markets a range of X-mini products from more basic models retailing at around S$28 to Bluetooth models at about S$140. While Xmi Pte Ltd’s dependence on just a single product line might seem a weakness, this can also be a strength. Xmi Pte Ltd can be more dedicated to the innovation and further development of the X-mini system, and with it have built an entire eco-system that ensures that their company and products will be successful even with stiff competition from larger competitors and copycat designs.
Xmi Pte Ltd has an advanced R&D system that in many ways is superior to that of larger corporations in terms of being a more systematic and thorough approach to new product development research. Their ‘Thought -to-Touch’ system is an internal process that allows employees of the company to think very freely about new product ideas, and has various steps along the product development cycle that helps the product reach successful commercialisation.
Someone in the company might come up with an idea, and say “What do you think of this?” The heads of each department will sit down, focus group style, and will volunteer their various perspectives. Often the departments have different opinions – Marketing might say ‘I don’t think this is such a good idea, I’m not sure if consumers will buy this’, but Sales might say ‘No, this is a great product, this is what we need in our product kamagra online wholesale range, and we need to add more products to make the range look fuller’. To manage these opinions a project manager is assigned, who works very closely with the senior management to manage the innovation cycle.
When the idea is passed through to the design stage, it is sent it to the engineers to be dontevaluated. They might say ‘Visually this looks great, but technically, this can’t be done’, so they have another round of exchange on to how to put in the best functions and make it look nice.
To reach commercialisation, the sales teams say ‘Now among these seven products, where should we put them (the new product) in the stores? For example, are they going to be put with the multifunction or wireless range?’
The marketing and the sales are working very closely together at this point on how to position a product to the consumer. The sales people will speak with the distributors to gauge their opinion on pilot products. The sales teams has a fixed number of distributors they work with; so sales guy ‘A’ might work with distributors in Croatia, Germany, China, Russia, and will gather feedback on the new product from each of them. If the response from the market is positive, they will then go to full production.
The ‘Thought-to-Touch’ process is all conducted internally, and this is partly the company philosophy where very little is outsourced – the design, the research, the engineering, the manufacturing, the packaging is all done in-house. Xmi Pte Ltd states “If we outsource it to someone, for them it’s just a project. We are happy to do everything ourselves – we go to distributors and ask them ‘what do you think of this? Even if a stranger walks by, we would ask them ‘look at this prototype – what do you think of it?’”
However, Xmi Pte Ltd does see a role for external market research firms, specifically for bigger picture analysis such as knowing the size of markets, the potential of new markets, etc. But currently they are not ready to engage external firms, partly due to the cost.
Xmi Pte Ltd’s success is not just in a great product that also looks great, but similar to other successful companies – the people do what they love and do what they are good at. They have also developed a set of corporate values that includes ‘People before Profit’. With it Xmi Pte Ltd states “Profits come naturally when you value the relationships with people you work with.” and they such as donate 10% of profits from the sale of the X -mini HAPPY Capsule Speaker to charity organisation, Children International. While the company is not yet of a size to engage external research firms, their “Thought-to-Touch” innovation process demonstrates that research is at the heart of successful businesses.