consumer insight (1)

8/3/2019 Consumer Insight (1)

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Consumer Insight

A Necessary Evil


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What is Consumer

Insight

Customer insight is a process that begins with knowing andunderstanding what your customers want, and ends with proof oftheir satisfaction with you as an organization.


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Consumer Insight

Identifying customer needs and expectations, not only ofyour unique products and services, but also of the level ofservice you provide

Examining your processes and functions to ensure they arecustomer-centric

Encouraging and enabling your employees to be able tofocus entirely on the customer


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Implementing actions to improve the customer experience

Measuring internal performance, customer behavior andcustomer perception to determine what further action isrequired


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Developing Customer

Insight includes:

Understanding the explicitly stated or articulated needsof customers and potential customers, but moresignificantly...

Identifying their unarticulated needs


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Articulated Customer Needs Needs that arerecognized and communicated (stated) by customers

Unarticulated Customer Needs Needs unrecognizedby customers that when recognized and satisfied leadto products and services that delight them


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Ways of gainingconsumer insightUsing Companies Internal Records

Sales Information :

marketing managers can look at easily available, reliable andreal time sales report to gain how well there product is taken in

the market.

Databases, Data warehousing and Data mining

Companies organize their data in Databases- consumer

databases, product databases etc . For e.g. customer databasecontains data like customer name, past transactions,demographics etc. and based on it companies rank theircustomer according to purchase recency, frequency andmonetary value.


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Ways of gainingconsumer insight

Taking Inputs for sales force :

Many companies encourages sales personnel toprovide inputs on improvements as sales team isdirectly exposed to customers as well as competitors.

Setup customer advisory panel :

Members might include companys largest customersor its most outspoken or sophisticated customersalong with highly qualified moderator.


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Purchase information from outsidesuppliers : In India we have companiessuch as ACNielsen or TAM Media researchthat provides research data and reports.

Take advantage of government dataresources : government agencies fromtime to time comes out with host of usefuldata like population trends, demographiccharacteristics, agricultural data etc.


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Motivate distributors andretailers to pass along importantintelligence : We can look at Wal-Mart model where it captures data on

every item, every customer, for everystore and refreshes it every hour.

Use online customer feedbacksystems : Blogs, review boards,discussion forums, chat rooms can beused to capture candid opinions andvarious needs of customers.


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SUCCESSFULSTORIES

iPod- not first entrant indigital music player businessbut first to get it right

v How consumers want to

consume digital music

Insight:

v

People want to take all theirmusic with them

v But yet being Unobtrusive


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SUCCESSFULSTORIES

Eat the middle first and save thechocolate cookie outside for last

Insight:

Children love what they instinctively

discover for themselves: this issimply the best way to eat an Oreo

Oreo Double-Stufffor those who justcan't get enough of the creamymiddle bit


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SUCCESSFULSTORIES

Emami launched first Mens fairnesscream segment in 2005

Insight:

v Customer research which showed that

25-30% of customers of Fairness creamswere men.

v This insight paved way for a specializedbrand for men

Brand became creator and the marketleader of this segment


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SUCCESSFULSTORIES

ITC launched Sunfeast Yippee

Insight:

Some of the noodles in the marketbecome sticky if they are not

consumed early

Children prefer to slurp noodleswhile eating and therefore prefer alonger noodle

Many kids add sauce to enhancethe taste and look of noodles.


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SUCCESSFULSTORIES

Starbucks: Coffee is not a product but an experience marketed in athird place between home and work

Sony Walkman: Redefined the relationship between personal space

and private space

P&Gs Pampers:Insight about Japanese mothers as being fastidiousabout personal hygiene, spending a lot of time outside their homesand travelling on public transportation


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Consumer Insight -Need of the

HourCompanies need information about their:

Customers needsMarketing environment

Competition Limitations of Traditional Market Research

Marketing managers do not need more information, they need better

information that provides insights, which are useful for decision making.


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Gaining Consumer Insight helps in answeringfollowing questions:


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Importance of Consumer Insight:

Envisions a future dramatically different from the present

Targets and develops both long- and short-term innovations

Engages the customer as a collaborator, partner and knowledge resource

an integral part of the process

Thinks offensively and focused on beyond-me-too strategies

Challenges business boundaries and explores beyond existing

comfort zone where breakthroughs reside


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Importance of ConsumerInsight:

Retail profitability is connected to consumer insight-Customer Insight can be used to determine merchandising

decisions, determine a technology investment and drive brand relevanceto help retailers uniquely differentiate themselves

Firms use customer insights to develop competitive advantage.


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Kelloggs The concept of eating breakfast

cereal a new for the Indian Subcontinent The company faced challenge of not only promoting its product

but even the concept of eating cereal for breakfast

As the product was expensive consumer bought it cornflakes as

one-off novelty purchase Kelloggs remained unwilling to bow to price pressure and

decided to launch other products in India, without doing anyfurther research of the market

FAILURE


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New Coke A classic example of product failure

As company decided to scrap Original Coke consumers

boycotted New Coke

Coca-Cola capitalized on its original status in variousadvertising campaigns so by launching New Coke, Coca-Colawas therefore contradicting its previous marketing efforts

FAILURE


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McDonalds Arch

Deluxe McDonalds launched this new burger as a more sophisticated

option for consumers

The target market segment for this product was adults

But the working class adults were not ready to pay more for aslightly better tasting burger

FAILURE


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Coca-Cola Blak

A coffee - flavored soft drink introduced by coca-cola in2006

Launched as an energy drink

Poor coffee to coke ratio and bad taste led to failure

FAILURE


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Tata Nano

The Tata Nano is a cause for every Indian to celebrate, butthe joy was short lived.

Faulty features led to failure of the car

FAILURE


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Advantages ofCustomer Insight Identifies High-Potential Target Markets to Increase

Revenue & Market Share

Focused Marketing Efforts on Highest Leverage Activities

Increased Lifetime of Customers Loyalty

Increased New Business Referrals

Reduced Marketing Costs


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Disadvantages ofCustomer Insight

Cost to the Company

Time Constraint

Dehumanized

Maintenance and Repetition

Difficult to interpret their requirements


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Consumer Insight : A Failure

Problem not because of lack of skill of the workers

Problems in getting incomplete/incorrect picture ofconsumer needs


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FAILURE INSIGHT

1. Targeting Wrong Customers

1. Asking Wrong Questions

1. Failing to act on the information they have

1. Failing to turn Good customer insights they have into greatproducts


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Targeting WrongCustomers

Selection of wrong sample for survey

These users might not reflect the true needs ofthe masses

Problem of recognizing who real customers are

Focusing only on existing customers andignoring potential customers

Can be avoided by having a truly representativesample

Requires great level of intervention bymanagement


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Asking WrongQuestions

Questions about what they want rather thanwhat they are willing to pay for

Can be avoided by having discretequestionnaires of comparing two products


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Not acting on availabledata

Some kind of bias prevents managers fromtaking a fair valuation of data

The data collected is wasted

Can be avoided by having multiple views on thedata collected

Also by changing or rotating the decisionmaking teams


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Not converting good insightto great products

Failure of translation of customerrequirement to product specification

May be caused due to ignorance tosome of the facts collected


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THE PROFESSIONAL DOMAIN OF

CONSUMER INSIGHT

Professionally, the domain of consumer insight stretchesfrom market research, into database marketing, intocustomer service, into any function that deals directlywith consumers

Where it is used ?

q Direct marketing

q Direct Mail

q Database marketing

q Customer relationship management


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The relationship between market research and database

marketing is often troubled.

Database marketers need research to make their workeffective

Much can be gained by using the information thatdatabase marketing generates

Consumer insight process helps to change how we thinkabout consumers, staff and our organizations, rather than

supports a counterproductive way of thinking about them


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Thank you!!

consumer insight (1)

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