Customer Insights Made Easy

Uncovering things you might not know about your business.

Market research, and more importantly, customer insights are extremely helpful in understanding what your business does well and not so well, comparatively in the market. Whether you’re a café owner looking for other avenues for income or a construction company looking to find out why customers are choosing the bloke across the road, getting to know your customers and their motivations can be an integral part of uncovering why your customers like what they like, or do what they do. At the end of the day, the customers are what define a business!

Let’s take a step back and think about it for a second. Customers are just like you and me, a fellow homo sapien. Now, you and I like certain things, do things a certain way, crave particular food items now and then and so on. Now picture your typical customer (profile) and imagine what it would be like to buy from your own business, for example:

  • Was it done quickly?
  • Did I spend too much money for what I was getting?
  • Was the quality of the product/service any good?
  • Was the service up to scratch?
  • Did I offer enough (or too much) choice?

These are some of things that customers (also both you and I) objectively and subjectively use to judge whether or not we buy again from a business.

But wait, that’s too hard.

Honestly, it really can be daunting for a small business owner and it’s why we have devised a little cheat sheet on how you can get started without the hassle of not knowing what to do in the first place!

We firmly believe that you don’t need complicated statistical software and algorithms to get started, on, what is traditionally, a very academic field of work, market research. Just sit down and use this example guideline to start on your journey of self-discovery.

Matching expectations with reality.

When starting for the first time, we encourage businesses to brainstorm what are the key criteria that your business’ life depends on. These are the things, when done collectively poorly, ruin a business and likewise, when done collectively well, flourish. All businesses usually sit within this spectrum.

Here, we limit it to five criteria, so that there isn’t an overwhelming list our brains can’t handle. It also keeps our minds focused on what matters the most.

For example, the five criteria we can look at are:

  • On-time delivery
  • Value for money
  • Quality of products and/or services
  • Customer service
  • Range of products and/or services

While it’s not an exhaustive list, depending on the business, some criteria may be different. Say you’re a hairdresser and “on-time delivery” doesn’t apply, something else may be more relevant.

 

PRO TIP
Try and choose criteria that encompasses the entire business as a single unit to start, then you can branch off into examining other arms of the business once you’ve wrapped your head around the bigger picture.

 

Part 1 | Mapping customers’ expectations

Once you’re done thinking about what areas of the business are important to its survival, now is the time to ask your existing customers to rank them 1-5 by importance to them when dealing with you, where 5 is most important and 1 is least important.

Here, we’re looking to find out what your customers expect of you and determining what matters the most to them. For example, maybe a customer values your quality products (gave a score 5) but price isn’t what matters when buying from you (gave a score 2). There are countless insights you can gain from simply asking customers to rank the importance they place on certain aspects of your business.

Part 2 | A reality check

Using the same criteria you’ve decided on, ask follow-up questions on how you ACTUALLY perform in each of those areas. Customers will rate your performance on a scale 1-5, where 1 is poor, 3 is average and 5 is excellent.

This will give you a more definitive health check on your business and find out where customers are and aren’t satisfied with your business.

 

PRO TIP
Use what you’re good at (competitive advantage) to boost your existing sales and marketing efforts. If your customers use more than one supplier for the same product/service, chances are they are thinking about how you weigh up against the competition!

 

Part 3 | Recommendations anyone, please?

As the icing on the cake, one could say, is the Net Promoter Score® (NPS®). This is a simple yet effective metric you can use to see if customers will refer any business to the friends and colleagues (more business, YES!). There is formula on how to do it (you can Google it for those wondering) but we won’t get into that here (that’s for another post).

Putting all the pieces together

Now you can really see how you’re doing with your customers. Work out how each of your criteria stacked up against the other criteria and map that against how you’re really doing with customers in reality. This should help identify areas of improvement at a glance as well as understanding how your customers’ expectations (Part 1: what’s important to them) are met with their current dealings with you (Part 2: your performance, Part 3: NPS®).

 

PRO TIP
Use this tool as an early warning system to flag down any potential problem areas before there’s irreparable damage: your customers go elsewhere!

 

So, what now?

“So, what now?” I hear you think. We’ve got you covered.

Here are a few extra tips and tricks to make this process much more valuable to you:

  • Use the above criteria to get you started, chop and change if you feel it doesn’t apply to your business
  • You don’t need a large sample size, 10-15 is usually enough to get an idea of how you’re tracking
  • Preferably, talk to customers you have recently done business with, the more recent the better
  • Keep the survey to the three questions and aim for no more than two minutes of someone’s time
  • If you find, as the owner, you don’t have the time to do so, have someone else who is close to the client and is familiar with your business to do it
  • After each round of surveys, brainstorm ideas together with your team and try and set recommendations for yourself
  • Make the necessary changes in your business
  • Rinse and repeat, preferably on a monthly, bi-monthly or quarterly, etc. basis

Be objective, be gracious.

Let’s be real here, don’t let the ego get in the way. It’s what stops us from growing and understanding ourselves personally and professionally. Customers don’t like certain aspects of your business? Embrace it. Change it. Reach out with open arms and customers are more than likely to give you constructive feedback to improve on.

When you sit down with your customers, just have a whole hearted and HONEST conversation about the current state of affairs. You are empowering them to help you provide a better product or service.

Stay objectively connected with the business and start a process of continuous improvement. It’s a long-term investment (emotionally and financially) that pays off in the end. Happy customers, happy business (isn’t that how the saying goes?).

PS. Now that you’ve made it this far, we’ve actually got the checklist for you here. Go get started and start making your customers’ voices heard!

 

Winning and Losing

For any business, being able to retain customers is one thing but understanding why you weren’t able to conquer the ones that didn’t make the purchase is just as important.

From my years of experience conducting market research, many companies seem to focus solely on business they do have (which is great) but forget about the sales they should have made but didn’t.

I have devised a simple and practical, yet effective, do-it-yourself market research strategy which any business can implement in-house. It’s called the Win/Loss Analysis and forms the first chapter in our series, Market Research Made Easy (watch this space!).

Understanding why customers didn’t choose you but someone else is central to this analysis. When you’re asking the ‘ones that got away’ as well as your usual customer base, you are essentially combining a competitor analysis, a customer satisfaction survey, your company’s own brand perception among your customers, and at the same time highlighting areas of the business which require much needed improvement.

How did the idea of the “win/loss analysis” originate?

  • After having worked with numerous clients over the years, we found ourselves talking to their customers about not only what worked well for them but also what didn’t work well for them.
  • We then translated this into asking lost sales (i.e. people who obtained quotes or made an enquiry but didn’t proceed with a purchase) why we didn’t win their business.
  • The analysis from these two groups then presents significant opportunities for companies to improve operations at all levels.

Why ‘winning’ and ‘losing’?

  • It’s very simple: we needed to examine the differences between getting the sale (winning) and not getting the sale (losing).

What are some of the key outcomes of the analysis?

  • This process can pick up significant issues; for instance the importance of inventory control or a company’s ability to provide the right training to deliver their product or service, or any problems relating to the sales function such as quote turnaround times etc.
  • Companies can also identify and communicate the how and what of their competitive advantage and unique selling proposition (USP).
  • And, just as important, it can identify operational issues such as service protocols and make sure they match customers’ expectations.

What are some the things to consider when doing your own Win/Loss Analysis?

  • Don’t be afraid to ask your customers tough questions (e.g. what did we get wrong or what can we do better for you?).
  • Make sure your questionnaires are consistent; it is important to use the same questionnaire for your customers so you can compare the results.
  • You don’t have to ask many of your customers or lost sales; 10 in each group is usually enough.
  • Make sure the questions are relevant to your customers and you are prepared to make changes based on those findings; good or bad.
  • Let your customers know what changes you plan to implement in your company, product, or service offering in response to their answers. This can translate into more customer loyalty.
  • Don’t let your ego get in the way; it’s not about you … it’s about your company and, importantly, your customers.
  • Once the analysis is done, be sure to follow-up any changes and measure how effective those changes are with your customers. Do this over regular intervals.

Don’t wait.
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The 8 global consumer types and how to reach them

Increasing sales whilst tightening budgetary expenditure seems paradoxical, but it can be achieved by focussing marketing efforts on your key audiences.

Traditionally, consumers were categorised by demographics, skewing representation of their habits and lifestyle; however, marketers are now releasing that consumer habits and preferences are the most important factors influencing purchasing behaviour.

Evaluating personal attitudes (i.e. media consumption, buying behaviour, individual aspirations); Euromonitor International identified 8 global consumer types in a 2018 study:

 

Identifying key audience/s, their shopping motivators, major personal influences, habits, and purchase decision drivers when evaluating product innovation, sales and the marketing will enable retailers to maximise sales on a low budget.

Source: Euromonitor International

Learn about how you harness the power of consumer profiling. Don’t miss out.
Contact us now for a free, no obligation, 2 hour consultation about your research needs.

How to build emotional customer connections

Today companies face ever increasing global competition, whilst striving for continuously growing profits and market share. Most firms focus on achieving high customer satisfaction at every stage of the customer journey. But satisfaction is not enough!

A recent study published by the Harvard Business Review suggests that customers with an emotional connection to a brand are 52% more valuable than highly satisfied ones.

They purchase more and more often, are less price sensitive, pay closer attention to promotional material, follow advice and actively promote the brand.

But how can a brand build emotional connections with their customers?

A brand has to understand their customers’ deep and often unspoken needs and link these motivators to specific purchasing behaviour to evaluate which desires are most profitable.

 

Source: Scott Magids, Alan Zorfas, and Daniel Leemon, “The New Science of Customer Emotions" 

Source: Scott Magdis, Alan Zorfas, and Daniel Leemon, “The New Science of Customer Emotions”

 

Emotional connections may differ between industries, categories and customer segments and may even shift in a segment depending on where a customer is in their customer journey.

Each brand needs to identify a specific set of needs that motivate their key customers and drive sales:

  1. Examine how the top quartile of your customer base or your most successful location differ from others
  2. Search for the key motivators of these connected customers
  3. Quantify the impact of different motivators on purchasing, spending, loyalty, and advocacy
  4. Gain a deeper understanding of connected customers through online surveys
  5. Evaluate motivators separate from your brand (reasons for brand choices do not always match key motivators)
  6. Develop informed strategy and optimise investments to turn highly satisfied customers into emotionally connected ones
  7. Make emotional connection a key objective not just in the marketing department but across the firm
  8. Regularly review customers’ emotional connection levels, as well as the correlation of customers’ emotional connection scores with lifetime value measures, such as annual spending, churn and tenure to adjust the strategy

A retail case study has shown that the implementation of an informed strategy led first year sales of new stores to exceed past averages by 20%, leading to shorter breakeven times and higher returns on capital. Sales grew by 3.5% in comparison with the annual average of just 1%, whilst inventory turnover increased more than 25%. Market share and customer advocacy also grew, contributing to record-high customer lifetime values.

The retailer had identified the need for a sense of belonging, a sense of thrill and a sense of freedom as key motivators. The brand redesigned their stores and implemented a social media campaign were customers could share their favourite outfits to satisfy their customers deepest desires.

 

Sounds daunting?

Actually, some of the world’s leading brands mistakenly believe that being considered a “good brand” by a large percentage of customers will secure long-term success. However, the blue bar in the following graphic demonstrates how many customers these brand failed to build an emotional connection with.

 

Source: Scott Magids, Alan Zorfas, and Daniel Leemon, “The New Science of Customer Emotions" 

Source: Scott Magids, Alan Zorfas, and Daniel Leemon, “The New Science of Customer Emotions”

 

This emotional connection gap represents an enormous opportunity for all brands to transform satisfied customers into emotionally connected and more valuable ones.

Source: The New Science of Customer Emotions

Know what your customers are thinking. It’s really that simple.
Read more about the Key to Successful Marketing.

The Power of Data Analysis

Global competition and increasingly ambitious business objectives leave no room for instinctive decision making.  Staying ahead in a world of infinite social media tweets and posts and online shops requires a 360-degree view of the elusive customer to guarantee successful and goal oriented omni-channel brand engagement. You have to know your customer and their every wish and desire to service them strategically and uniquely to guarantee sustainable success.

However, a 2017 CMO survey by Black Ink revealed that marketers perceived access to advanced analytics and general data to be the biggest hurdles in marketing; and, continually find themselves forced to rely on legacy solutions such as Excel or CRM systems.

The key to sustainably successful marketing is to align data insights with strategic company objectives.

Ask yourself:

  • What are your core objectives?
  • How does marketing contribute to these objectives?
  • Which data can you utilize to analyse your performance?
  • How will you measure success?
  • How can you design and install a systematic and continuous measurement process?

These questions will help you identify your key objectives and strategically collect and analyse data to measure success and inform strategy.

Be very selective about which data you choose to analyse and how and why. Metrics should only be included if the relationship between the metric and the goal is clear.

Such as:

Goal

Metric

Increase brand awareness Number of daily website visitors
Focus budget on most profitable customer segments Return on ad spend
Maintain market leader position Content trends
Optimise spending on campaigns Campaign conversion rates

 

This objectives-focused data analysis approach makes data both accessible as well as actionable by providing an in-depth performance summary, enabling decision making on the spot.

Metrics should be re-evaluated and modified regularly and made accessible to all team members; guaranteeing informed, prompt and appropriate decision making and goal oriented actions.

Source: Marketing Analytics dashboards: The do’s and don’ts

Know what your customers are thinking. Act now.
Read more about the Key to Successful Marketing.