Customer insight is a fancy way of saying a brand understands its customers. And it’s an understanding that is based on a variety of diverse data sources. In this post, we’ll explore what those data sources are, how customer insight capture looks in action, and why it’s so valuable to brands!
Data sources reveal lots about consumes, including demographic data that reveals age, gender, and location. This can help explain why customers exhibit certain characteristics in their purchasing behavior. Similarly, psychographic data including emotions and interests reveals why customers prefer certain products to others. The same goes for the myriad of other customer data sources.
But what’s so valuable about it?
Why is Customer Insight so Valuable?
In the past, businesses gained customer insight mainly through traditional methods such as focus groups and interviews. These were plagued with limitations that often led to an inaccurate understanding of the customer. Using modern consumer and market intelligence technology, brands are now able to gain customer insight quickly and more accurately than ever before.
Why is this necessary? First, customer insight is useful for personalizing products and services to the needs of the customer. Modern brands have realized that while customers face similar problems, they are not the same. Therefore, while they may require similar solutions, their satisfaction will vary according to how well their problems are addressed.
Naturally, the modern customer tends towards more personalized solutions for their problems and they can be choosy when it comes to which brands to buy from in our global economy. Hence, savvy businesses aim to tailor their products and services to the needs of individual customers at scale. Without customer insight, this would be impossibly ambitious.
Second, customer insight has the potential to boost marketing success and create authentic connectionns. As consumers look for products and services that align with their needs, the marketing messages they encounter in the process become increasingly important. The buyer considers the language, tone of voice, and content of the message to quickly determine whether the promoted product or service aligns with their values. And value-based marketing is huge––but it can’t be done in a vacuum.
Understanding the values and interests of a target audience helps brands align efforts and make consumers feel seen.
Third, customer insight helps businesses optimize their processes to minimize costs. When businesses know who their customers are, what they need, and how to reach them, they cut many unnecessary costs. They avoid wasting money on products that are not appealing to the target customer. They avoid shooting in the dark with products and services that are not in demand while producing more of what is needed.
They also avoid the heavy cost of poor marketing which all businesses that lack an understanding of their target audience must incur.
By making the process more efficient, modern consumer and market intelligence technology helps companies reap the full benefits of customer insight while avoiding many of the challenges they had to face in the past.
Traditional Challenges Companies Face When Gathering Customer Insight
Gathering customer insight through traditional methods such as focus groups, interviews, surveys, and direct observation can come with crippling challenges for a company. One significant challenge they have to deal with is bias, coming from both the researcher and the respondent.
When the methods of data collection that are researcher-led, the whole process depends on the perceptions, experience, and ability of the researcher to obtain the required information. This means that any biases, conscious or subconscious, can seep into the process leading to inaccuracies––even something as small as wording a question a particular way can entirely ruin the results.
In the consumer-led method – i.e. direct observation – the bias is no less severe as the objectivity of the researcher comes into play. And respondents have biases that are apt to come out most naturally in unnatural settings. And this is concerning since all traditional methods except direct observation rely on unnatural settings.
In these circumstances, respondents will exhibit subconscious bias and conscious dishonesty depending on how the study has been set up as well as their own natural characteristics. For instance, they may give positive feedback just to be agreeable or lie about what they would do in real life because they don’t know that their behavior would change in a natural setting. Oftentimes, respondents will answer in way they think they’re supposed to, rather than what describes the truth of the matter.
The solution to overcome these challenges is to use the more advanced consumer and market intelligence that offers a single source of unbiased AI-driven truth––a customer insight program.
Designing a Customer Insight Program
Think of a customer insight program as an established system designed with the customer touchpoints in mind. This makes sense, as you can only understand the customer at the point where they interact with your business, after all.
Customer touchpoints include social media accounts, website, ecommerce store, physical store, online ads, customer help desk, and point of sale and any other way interaction happens between the buying public and a brand. All these points are opportunities to get a better understanding of the customer through direct interaction as well as the data they leave.
It should also maintain the natural setting, minimizing interference with the purchasing journey. Unless it’s the only way, customers should not be asked to provide insights. Instead, your system should be designed to gather customer insight without their active participation in the process. And this means interpreting their behavior through the data they leave.
For instance, rather than asking a potential buyer why they abandoned their cart, your system should make it possible to retrace the steps of the buyer from that point in order to discover what could have led to their abandoning their journey. And you can also sort this out by way of their social media posts, as they leave clear indicators online that signal purchase intent (or what’s blocking them) as each phase.
With these considerations, it is inevitable that technology will play a central part in your customer insight program as it allows you to easily gather customer insight at every touchpoint. You don’t have always stare at the screen to see where activity is coming from. And you certainly don’t have to follow individual customers around with a clipboard or bug them in any way to keep track.
Capture Actionable Customer Insight in Real-time
NetBase Quid® and Rival IQ makes gathering real-time customer insight a breeze. In fact, our platforms completely automate the process, so your time is spent on other more demanding aspects of your business. How are your products or campaigns performing against competitors? It takes seconds to set up and monitor, so you stay ahead of any market share, brand positioning or sentiment shifts.
And speaking of those shifts, discover the power of social media conversations through our social listening features built on natural language processing (NLP) technology. Beyond that, uncover the consumer attitudes surrounding your brand through sentiment analysis and obtain actionable insights on how to improve those perceptions – all in real-time.
If you would like to see how we can help you improve your understanding of the customer, reach out for a demo today. Our experts are waiting to guide you.