Customer Insight Management – Meaning, Challenges and Opportunities
Customer information is of great value for any company. Using it they can determine strategies for the future, acquire their customers directly with individually tailored products, targeted offers as well as communication methods and lead them to conversion. However the knowhow, time and resources required to gather and evaluate this information are often lacking. For that reason there are people who have specialized in just this sort of task – obtaining and assessing customer information – the so-called customer insight manager.
In this blog post we take a closer look at the challenges and opportunities of customer insight management.
What is Customer Insight Management?
A simple definition of customer insight management:
Customer insight management includes the gathering, processing, analysis and interpretation of information about customers, their consumer behavior, desires, needs, motivation and opinions. The goal is to achieve profound insight into the customer, and through correct interpretation of the data to develop strategies and take steps that lead to customer loyalty and new customer acquisition.
What do consumers think about my company, about my brand, about my products? What motivates them to buy products, use services, or to do neither? Those are just some of the questions that can be answered thanks to customer insights. But customer information can be even analyzed more deeply in order to discover desires, moods or attitudes. Customer insights deliver your business a comprehensive understanding of your customers.
As a bit of an exaggeration you could even say: Correctly performed customer insight management allows you to understand your customers better than yourself.
The knowledge gained about customers through customer insight management should be incorporated into your marketing strategies and activities. A further and very important aspect of the takeaways from customer insight management is that ineffective and outdated marketing activities can be identified and discontinued. In this way customer insight management also helps you to utilize your marketing budget more efficiently.
Necessity of Customer Insight Management
Experts agree that there are seven challenges a company should never address without the knowledge about its customers gained from the use of customer insight management:
- Product development
- Lead generation / Sales
- Business model change
- Target audience
- Content marketing
- New features
- New brand or identity
1. Product Development
When a new product is to be developed, you have to know what your customer’s needs are. Which product variant do they prefer? Is the value proposition persuasive enough? Are alternatives from the competition available to customers? How are initial samples being received by your customers?
2. Lead Generation / Sales
Why are your users losing interest in your homepage or in your services? Why is traffic declining? Why did the last online campaign generate hardly any leads? And sales are lacking too. No one knows exactly why sales figures are dropping. Your customers know the answers to these questions. Ask them which story appeals to them most (keyword: storytelling). Find out which rational and irrational motives there are for choosing your product. What price does your clientele consider justified? What does the customer appreciate about your competition’s products and services?
3. Business Model Change
You want to change your business model, maybe to open up new markets or to emphasize digital service activities more. Your customers can also help you out here. What does the customer desire from you? What does the value proposition of the new service need to look like?
4. Target Audience
You don’t know your target audience well. There are outdated perceptions about them in the company. Ask your customers about their values and opinions. Find out which products and services they use. What are your customer’s current needs? How large an area do your products penetrate? What do customers think of your company, your brand?
5. Content Marketing
How can your company’s interests and those of the customers be combined into one content marketing strategy? What story do your customers want to hear? What content interests them? Are there channels through which you reach your customers especially well?
6. New Features
In e-commerce processes should be optimized. And you would like to come out with new product features. But which ones should they be and at what speed should they come to market? Your customer’s opinions can aid you here. Ask about successful relaunches. What kind of weaknesses do your customers see in your online store? How can you increase your conversion rate? For which features would the customer be prepared to pay more? Do the new features even mean anything to them?
7. New Brand or Identity
You would like to realign your company’s corporate identity. The restructuring will be tackled with a new logo, new images, etc. But does the new logo even fit to your target audience? What do people associate with the logo? Which are the best channels to use to publicize the realignment?
Challenges with Customer Insight Management
One of the larger challenges with customer insight management is the evaluation and analysis of existing data. Most companies already have a large amount of customer data available to them. However they haven’t managed to analyze and draw the correct conclusions from it. Manually comparing and evaluating the data is simply considered old-fashioned and in addition is very time-consuming. Often the personnel capacity is also not available for manual processing. So companies rather place their hopes in self-learning artificial intelligence (AI) systems. The AI systems are supposed to then analyze the customer data, recognize patterns and provide insights into the customer psyche. However AI systems today are still mostly insufficient to do this. In addition AI systems require as much base data as possible to be able to learn. This data must inevitably be manually evaluated so that the AI system learns correctly. Customer insight management therefore can’t yet entirely avoid relying on people when it comes to data analysis and interpretation. Moreover no one understands people better than they do themselves.
An additional difficulty with customer insight management is that the existing customer data for many businesses consists entirely of information obtained from sales, customer inquiries or newsletter subscriptions. This data, however, is normally not sufficient to compile all the important insights about the customers. Information about customers like their motivations, desires, needs, behavior at PoS, as well as opinions, attitudes and mindsets are not yet present. Here it is necessary for customer insight management to find additional ways and opportunities to gather this customer data.
Opportunities for Acquiring Customer Data
Here are some ways to acquire, in addition to the existing base customer data, more in-depth information and obtain customer insights.
- When it’s about the product
To get these answers, a poll could be organized on your Facebook page, for example. People could also be invited to participate via a newsletter. Give the customer the feeling of really participating in the development process of the new product. Be careful of surveys linked to prize giveaways. They usually only draw “bargain hunters”. The results of this type of poll are therefore not very meaningful. With the survey service from clickworker you can also conduct surveys with your target audience quickly and easily.
- When it’s about customer satisfaction
How satisfied is the customer with your company’s performance? What can be improved, from the customer’s perspective? What is the company doing right?
After contacting customer service, an automatically generated email can ask your customer how he felt about the experience. You can also check online review portals to see how satisfied customers are with your products and your company. You can evaluate this information with sentiment analysis.
- When it’s about customer behavior
How customers behave in an online shop can be seen and evaluated directly in analysis tools like Google Analytics. With bricks and mortar activities, customer reactions at PoS can be observed and assessed. How does the customer behave in front of the product shelves, where does he look, which products does he reach for, how does he react to any promotion stands present and how does the shopping experience take shape for him as a whole? At the PoS itself or to analyze your existing PoS information, clickworker offers PoS customer insight service.
- When it’s about customer needs
Which desires, experiences, motivations, attitudes and perceptions does the consumer associate with your products or brand?
The easiest place to find this out is the Internet. Visit the numerous forums and social media platforms. You can find out a lot about your customers here. The records found can be further evaluated using sentiment analysis and text mining. .
- When it’s about customer relationships
Through the use of special software you can capture all customer contacts and customer reactions. In this way customer needs can also be analyzed and you don’t even need to ask them about it directly.
Thanks to the Internet a large amount of data is often already available. It helps you to draw conclusions about your customers. However, it isn’t very useful to wait for super intelligent AI that evaluates everything correctly, so tackle these things immediately. Your best bet is to combine already existing analysis software and human knowhow. Software could for example compare the frequency of product purchases and returns and filter out conspicuous products. In the next step people then search for the cause of the abnormalities. Thanks to crowdsourcing you can have analysis processes, surveys, community research, etc. performed by a large number or people within a short period of time.