The following is a guest post by Niraj Rajput, cofounder and Head of Engineering at Chisel Labs
The best businesses are ones that understand their target market and provide a product or service that meets their needs. Sometimes, this is easier said than done.
However, the insights provided by consumers can be invaluable to your business – whether you’re looking for new ideas on how to improve your products and services, validate an idea before investing in it, or find out what changes customers would like you to make.
This blog will help you understand what consumer insights are, how they can help your business, and what techniques you can use to draw them.
What Is Consumer Insight?
Benefits of Consumer Insights for Business
Methods To Gain Consumer Insights
Examples of Consumer Insights
What is consumer insight?
Consumer insights are valuable information about the consumer’s needs, wants, and aspirations.
Business people need to gain these insights in detail because this helps them to provide products/services which fulfill customer requirements.
Consumer insights are the information about what consumers think, feel or do.
They help understand consumer behavior and their needs when it comes to products/services provided by a business organization.
Gaining consumer insights is not an easy task because of the multiple variables involved in receiving these valuable data which can be obtained through different methods.
The following are some important facts related to gaining better insights:
- People lie to themselves all the time for various reasons – even if sometimes they don’t realize that they’re lying. We often tell ourselves things like “I’m fine,” when we aren’t really fine at all; or worse yet, “She’s just my friend.” When you ask someone how they truly feel deep down inside, chances are good that you’ll get a closer approximation to the truth.
- For organizations to make better business decisions, they should take full advantage of consumer insights in their marketing strategies and campaigns by employing relevant research tools such as surveys, focus groups, one-on-one interviews, and more.
In today’s highly competitive environment where businesses are struggling with both internal and external challenges that affect growth and profitability; gaining consumer insight is essential for increasing market share & revenue generation through effective business planning.
Benefits of consumer insights for business
- Better understanding and improved quality of product and service development that results in higher sales.
- Proven ability to achieve goals like increasing revenue, customer satisfaction, and so on.
- Improved decision-making for marketing activities such as pricing, advertising messages, and more.
- Consumer insights are very important in developing the product. It also helps in developing the marketing strategy of the business.
- It also benefits customer relationship management. Maintaining a good relationship with the consumer is important.
- Consumer insights for businesses help understand customer behavior and what turns them on.
- Customer behavior is very important to understand. For example, you can’t optimize your website for conversions if you don’t know why people abandon it in the first place.
A consumer’s mind is a complex and dynamic place that varies from person to person depending on age, social status, and geographical location.
However, in general terms, it can be said that consumers today are more connected than ever before due to advances in technology which has increased transparency and competition within industries.
The advent of new media such as the internet & smartphones, changing lifestyles such as the rise in dual-income families (where both partners work), or an increase in single-parent homes has changed the way people make decisions about their purchases.
Consumers now have access to vast amounts of information at all times via multiple devices like desktop computers/laptops/tablets that they carry with them everywhere they go and hence brands to understand what goes into making these decisions and what these mean for business.
Consumer insights capture the voice of consumers which helps brands to understand how do consumers make decisions, where they go shopping, who influences those purchase decisions, and so on.
Brands can use this information as a guide in developing their products and services or engaging with them through marketing activities like advertising campaigns, and social media engagement.
Consumers now have access to vast amounts of information at all times via multiple devices and platforms such as mobile phones, tablets, laptops, and so on.
This has had a significant influence over their life decisions especially when it comes to making purchase or brand decisions for themselves or others that they care about.
Consumer insights help companies develop products that consumers desire by understanding the needs of consumers which in turn helps brands to engage with them more effectively through advertising campaigns and promotions like sale events on various social media channels like Facebook, Twitter, LinkedIn, and more.
Businesses can also use this information while creating an engaging content strategy targeting a specific audience based on demographics & geography.
Companies can gain these insights across different levels such as market level (macro), business unit level (micro), and product/ service line level (meso).
Businesses need to understand the consumer needs and demands across all these levels to be able to create a competitive advantage.
Methods to gain consumer insights
Consumer surveys are a very popular tool for gaining consumer insight in detail.
The survey method gathers primary data from consumers through questionnaires, interviews, polls, or focus groups which are held face-to-face with live customers at their homes or offices.
This process is used by marketing research companies where they hire market researchers to conduct these types of studies.
This method helps in understanding people’s attitudes, desires, and motivations regarding a particular product or service.
It is also very helpful for identifying their problems and how they feel about them to find out what solutions they expect from a company offering goods or services related costs effectively.
This research technique focuses on individual opinions rather than being focused on statistical facts which makes the approach eminently suited for small businesses where budgets often fall short of extensive market surveys with statistically significant results.
Earlier companies were using this technique only during the recruitment process but now it is being used extensively in marketing research.
It helps the companies to find out what their customers are thinking, feeling, and doing through an online survey which can be distributed across a wide range of geographical locations or targeted at specific individuals with relevant demographics and psychographics.
Though it is a video-sharing platform, YouTube has evolved as one of the best research and market intelligence tools for business organizations to gauge their consumers’ reactions and behavior through real-time videos on product feedbacks or unboxings, brand reviews, and so on.
This helps them in bettering their products to suit the needs of target customers by adding more value as well as highlighting existing features that might have been overlooked earlier.
User testing is also a great way to gain consumer insights. User testing helps you in determining whether your customers can use a product or not.
This, in turn, helps you to determine the ease of doing business along with developing products that are user-friendly and highly functional as well as ensuring high levels of customer satisfaction.
The purpose behind gaining consumer insights is to make informed decisions based on what consumers want instead of making random assumptions about their preferences and behavior which might be misleading at times leading to bad decision-making for businesses.
When done right, it’s possible to develop successful marketing campaigns through strategically targeted communication efforts resulting in increased sales, better brand loyalty from existing customers, and expanding your base by attracting new prospects who have been influenced by word-of-mouth recommendations – all this because they’ve experienced positive results using a brand’s products/services.
Examples of consumer insights
A great example of consumer insight in action is the success of marketers at PepsiCo in 2012.
They created an ad campaign called “Live for Now” which showed young consumers living their lives to the fullest without worrying about consequences, and they experienced great results by increasing brand equity with this group of people.
Another important example of consumer insight is how companies use social media to interact with their customers.
In this case, a company needs to have strong customer service that shows they care about every person who uses their product or services, and then word-of-mouth recommendations will be able to spread much more quickly.
The following four most common mistakes that companies make when trying to gather market research data.
The first mistake is gathering information from just one type of respondent, e.g., customers or employees.
This makes it difficult for businesses with narrow target audiences because they don’t have the proper feedback needed to achieve success with their marketing efforts which leads back to making assumptions about what consumers want instead of relying on accurate and reliable information gathered through the methods explained below.
Gathering information only once doesn’t give enough time for a business to take action based on this insight either before similar competition enters the marketplace offering better products/services at lower costs while leaving their current clients dissatisfied without many other alternatives.
Businesses with narrow target audiences don’t have the proper feedback needed to achieve success with their marketing efforts which leads back to making assumptions about what consumers want instead of relying on accurate and reliable information gathered through methods explained below.
Businesses can gain consumer insights by using focus groups, surveys, or one-on-one interviews but these mustn’t be implemented as purely affirmative tasks where consumers simply answer questions designed by marketers asking them what they like or dislike about certain topics/products/brands.
The third mistake is a lack of follow-up to gain consumer insight. While gaining the initial insights may be helpful, businesses must continue acting on these by using different sources and methods for feedback from consumers.
Finally, the last mistake is to rush the entire process. While businesses must be quick in gaining consumer insights, they must be patient enough for consumers to respond to their initial questions.
Only by using these methods and avoiding the mistakes listed above, can businesses gain a clear understanding of consumer insight in detail.
The benefits for a business will be evident in its future marketing campaigns and strategies if it acts on this information properly over time.
Consumer insight is a key aspect of marketing that can be used by businesses in various departments such as sales, customer service, and so on.
It helps companies understand their target audience better for better communication with them through personalized messages.
This has proved beneficial for business growth over the years.
Niraj is co-founder and Head of Engineering at Chisel Labs, a premiere agile product management software company that brings together roadmapping, team alignment, and customer connection. Niraj is passionate about building scalable infrastructure and systems and he also happens to be a huge fan of Cricket!