Insights Into Customer Insights

Insights Into Customer Insights

1. NUTSHELL

   • Insights often emerge from looking at a problem differently, and by being eclectic in research methods.

2. INTRO

   • Do you want to EXCEL in MANAGING your RELATIONSHIPS with CUSTOMERS?
     • Begin with DEEP CUSTOMER UNDERSTANDING
       • But this goes further than ANALYZING responses and TARGETED OFFERS for specific segments
         • Target marketing improves your marketing effectiveness, but does NOT lead to MARKETING BREAKTHROUGHS
           • TRUE breakthroughs come from customers who ARE NOT in your database with offerings that customers CANT even VISUALIZE
             • They are based on CUSTOMER INSIGHTS
               • Customer insights are CRUCIAL for success
                 • But they are HARD to come by
                   • That's where this article comes to the rescue

3. THE NATURE OF CUSTOMER INSIGHTS

   • Definition of 'INSIGHT' = act of INTUITIVELY seeing the INNER NATURE of things
     • Def. of CUSTOMER INSIGHT = a FRESH and NOT-YET-OBVIOUS UNDERSTANDING of customers that can become the basis for comp adv
   • A customer insight has 4 CHARACTERISTICS
     • 1) It is a not-yet-obvious discovery
       • Insights seem SUPER LOGICAL in hindsight.
         • But they are not obvious before they are discovered.
           • In fact, they are often not obvious to most people even after they are discovered.
             • EG Apple’s iPod was criticized as being overpriced in the highly competitive MP3 player market.
             • THUS, don't assume that the obvious is true or that the truth is obvious
     • 2) It is a unique and fresh perspective
       • Insights emerge from looking at a problem DIFFERENTLY and by being ECLECTIC in research methods.
         • To gain INSIGHTS, we must understand that we are PRISONERS of what we KNOW and BELIEVE
           • We must BROADEN OUR HORIZONS by using DIVERSE TOOLS and listening to DIVERSE VOICES
     • 3) It rarely emerges from quantitative research
       • companies SPEND MILLIONS on market research, using SURVEYS and QUANT TECHNIQUES like conjoint-, cluster- and factor analysis.
         • HOWEVER, it rarely produces a customer insight
     • 4) It is often rooted in an observed anomaly
       • In uncovering insights, you must ALWAYS ask:
         • WHY?
       • An anamoly = something that DEVIATES from what is EXPECTED
         • It is a VALUABLE STARTING POINT for uncovering insights
           • because it forces you to QUESTION and potentially FLIP generally accepted ASSUMPTIONS in a market.
             • THUS, DON'T look at what other companies are doing, cuz u will end up looking just like them
               • eg Rent-A-Car questioned why all cars are rented at airports, when most people don’t live near airports and people don’t rent cars only when they fly

4. THE TWO WAYS OF KNOWING

   • Qualitative research and quantitative research need to go hand in hand for true customer understanding.
     • Qual GENERATES insights, while quant VALIDATES insights
       • You need both research traditions, AND IN THE RIGHT SEQUENCE
         • 1) QUALITATIVE
           • 2) QUANTITATIVE

5. MAKING LIGHTNING STRIKE TWICE

   • Customer insights are like a lightning bolt
     • – illuminating, but rare.
     • While you cannot make lightning strike, you can make it more likely that you are at the RIGHT PLACE and the RIGHT TIME where lightning is likely to strike.
       • THUS, talk to the right PEOPLE in the right PLACES using the right set of TOOLS
         • 5 TIPS FOR GETTING CUSTOMER INSIGHTS
           • 1) Involve the whole firm
             • DON'T leave everything to the marketing department
               • insights can come from ANY FUNCTIONAL DEPARTMENT
                 • CONNECT customers with all FUNCTIONS, to capture customer insights WHEREVER they may emerge, and to SPREAD insights to WHERE they can be used.
           • 2) Expand your repertoire
             • ECLECTICISM in tools is CRITICAL for a deeper understanding of customers.
               • TRADITIONAL research techniques like FOCUS GROUPS, SURVEYS, and IN-DEPTH INTERVIEWS are better at understanding needs that customers CAN ARTICULATE
                 • BUT FOR UNARTICULATED NEEDS...
                   • You need DIRECT OBSERVATIONAL TECHNIQUES
                     • Contextual inquiry
                     • Customer experience mapping
                     • Human factors research
                     • Ethnography
           • 3) Understand non-customers
             • You need to ESCAPE the TYRANNY OF THE SERVED MARKET by looking BEYOND current customers and products
               • EXPAND THE PERIPHERAL VISION
                 • See objects and movement outside of the direct line of vision
                   • Try to understand the customers who DON'T do business with you
                     • AND users who DON'T do business with anybody in the category
                       • disruptive innovations often compete against category non-consumption.
                         • eg Southwest Airlines did not compete with other airlines. It competed against railroads and cars, taking people out of cars and putting them into planes.
           • 4) Create new observation posts
             • Customer insights often emerge from STRANGE PLACES, so you must cast your net wide in fishing for insights:
           • 5) BECOME PROACTIVE
             • Marketing orgas should not wait for product managers to come to them for research projects.
               • These are seeking answers to KNOWN questions, because they relate to a specific product or marketing problem
                 • They should COMPLEMENT these projects with PROACTIVE, OPEN-ENDED projects that develop a DEEP UNDERSTANDING of customer PROBLEMS & NEEDS

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