In order to be successful in today’s market, it is essential to understand in depth what your customers really need and value, to deliver this reliably and consistently and to ensure that the value you provide is better than your competitors”.
For many organisations the challenges of customer retention and increased market share have never been so critical as in this uncertain commercial climate. It is important to understand that not all customers have the same needs, but groups (segments) of customers do. If you aim your product/service at an “average” customer you will meet their needs “averagely”. Therefore segmenting your customer base is essential. Knowing exactly how well your respective products and services shape up versus your competitors is also essential, but from a customer perspective not yours!
So what is Customer Insight?
A commonly used definition is this. “A deep truth about the customer, based on their behaviour, experiences, beliefs, needs or desires, that is relevant to the product or service they require.”
Several of my clients are large multi nationals who have slowly come round to the fact that obtaining in depth insight about the needs and values of major customers is more than having a chat with the account manager or getting a research company to ask questions by phone.
In the B2B world, relationships between customers and their suppliers are very complex and getting good qualitative feedback is difficult. In my experience high quality face to face interviews of around one hour can provide this, but the interviewer needs to be an experienced business manager with high levels of listening skills and a good knowledge of the market. He must also be independent, not the account manager. By using an external third party to gather the Insight the interview (more a business discussion) can be more strategic and obtain information on the customers’ strategy, overall market drivers, competitor offers, performance of the suppliers product versus others, how needs might change in the short and long term. This depth of information can only be gained via face to face interviews using a technique of Appreciative Enquiry to build trust between Interviewer and customer. It is not possible by telephone or web based surveys.
One of my clients came to me with this problem. They wanted to launch a new product but prior to launching they had decided to seek an improved understanding of the customer reaction to their new “wonder” product. We were assigned the project. We conducted a significant number of face to face interviews in over 15 countries over several months. With this new “in depth” view it was possible to see what benefits the customers saw and what problems the customers perceived they would have. Some data was obtained which was not anticipated and in the end turned out to be some critical concerns that a majority of customers had.
The information obtained meant it was now possible to tailor make the (expensive) marketing campaign in order to reinforce the benefits (based on customers perception) and address customers real concerns. Isn’t this a much better way round than launch first and all of a sudden find you’ve lost half of your customers?
I’m pleased to say that this client has now decided to conduct regular Customer Insight interviews and ensure that the information obtained is used for new product and service development. If you like, an outside in process rather then the traditional inside out process or “we know best” process!
I am constantly surprised by the number of marketing or sales managers I meet in blue chip companies who tell me they have no process for regularly obtaining insight from Customers. They are focussed on “telling” the customer how good their products and services are through advertising and sales brochures, rather than “listening” to what customers actually want and importantly what their competitors are offering! So how would they know that a competitors’ product or service offering met the customers’ needs more effectively than theirs? The answer is they wouldn’t and probably the first sign would be when the customer left them for that competitor.
Achieving Customer Insight
“Customer Insight is a process that starts with knowing and understanding what your customers want and finishes with proof of their satisfaction with you as an organisation.”
- Identify customer needs and expectations, both product you provide and the service to deliver it.
- Segment your customer base and ensure you tailor you offer to each segment
- Examine your processes and organisation to ensure you are customer centric
- Implement actions to improve the customer experience
- Ensure your employees are aware of customers needs and values and understand how your product and service meet those needs
- Seek regular feedback on customer behaviour and customer perception of your offer and your competitors offer
Having built up his marketing understanding of B2B customers and their interaction with large suppliers through his management experience with Mars, United Technology, and BP Oil, and combining this with his experience as a consultant at Price-Waterhouse, Mike Crosswell is an advocate of using the technique of Appreciative Enquiry to gain Customer Insight to develop innovative new customer products and services.