Mistake 10: Confusing market research for customer insight

I was working with a large client several years ago, and requested the opportunity to meet with their customers to understand and gather unmet needs.  The response?  We have thousands of reports on our customers.  Please see the market and customer research team.  Dutifully I went, fairly certain that while there may be a lot of DATA, the data would be less than helpful for several reasons.  First, most companies obtain market research focused on existing customers and their satisfaction with existing products.  If innovation is about creating new products and services, we need to discover new needs, from existing customers as well as prospects who don’t use our products.  Second, much existing customer research is conducted to validate a product rather than question the need for it.  Third, most existing research is backward looking, asking questions about existing products and existing conditions, rather than about future needs.  Don’t get me wrong – you should review existing market and customer research when starting an innovation effort.  But you certainly should not stop there.

Customer Insight

There are several other reasons true customer insight is difficult to acquire.  Real insight means meeting, face to face, with consumers and observing their unmet needs, workarounds, product or service gaps.  You need to be in their space, understanding their problems and needs, what they are trying to do and what keeps them from doing what they want to do.  This research is time consuming and qualitative.  You are much more likely to get indications of needs, directional information, emotions even, than quantifiable data.  And most executives thrive on data, and are uncomfortable making decisions with small sample sizes of qualitative data.  But often, that’s the best insight you’ll get.

In many projects we’ve gone rogue.  After reviewing market research we have struggled to get funding or approval to interact with customers.  Sales people and marketers are often uncomfortable with this notion, worried that we’ll anger customers or set false expectations.  So we’ve found creative ways to interact with existing customers and prospects, to learn more about their needs.  You can do this through focus groups, ethnography, interacting with customers in your store or place of business, or even over the internet.  People are happy to tell you what their challenges are.  They will flock to people who are interested in their needs and willing to listen.  Too many times many companies build walls between themselves and their customers rather than windows to allow conversation.

Don’t allow your team to get bogged down in thousands of perfectly correlated and statistically significant data that doesn’t provide insights into current and future wants and needs.  By all means review the existing stuff, then build the case that you need to discover unmet customer needs, and to do that you need to get face to face with customers.  Failing to discover new needs means that you’ll either create ho-hum products that align to existing solutions, in demand but undifferentiated, or you’ll create interesting products that aren’t important or necessary to customers, differentiated but missing critical needs.

One comment

  1. Hi Jeffrey – you’re right, information and insight are too often confused. The sequence should go something like this; empathy -> knowledge -> understanding -> insight -> inspiration -> ideas -> innovation.

    Kevin

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