Many terms in the lexicon of marketing and business are ambiguous at best, misleading at worst. Both old terms like ‘proposition’ and new ones like ‘big data’ seem to bring more smoke than light. But the lack of clarity that has troubled me most in corporate life is the many meanings of ‘customer insight’.
I have come across companies that mean data analytics, those that mean consumer research, some which still mean deeply held beliefs by the marketing leader and only a few which mean something more complete.
From my experience, genuinely producing customer insights does require the outputs of data experts, statistical analysts, experienced researchers and commercially minded database marketing analysts, but it is more than that. Akin to Aristotle’s “the whole is greater than the sum of its parts“, I see real customer insights as being developed based on a convergence of the above evidence.
It’s always difficult to come to a precise definition which is not too verbose, but a working version for me at the moment is as follows…
Customer Insights is:
“A non-obvious understanding about your customers, which if acted upon, has the potential to change their behaviour for mutual benefit.”
Four aspects of that definition that are worth highlighting:
- “Non-Obvious“: Real insights into your customers rarely come from one source (one piece of analytics or one research report), they almost always require digging further. The most successful method of extracting insights that I have found is the approach to Holistic Customer Insight that is outlined in this post.
- “Acted upon“: Customer Insight is of no value if it’s not acted upon. This is both because to generate commercial or customer value from insight requires acting on recommendations, but also because insights are hypotheses until they are tested in the real world with real customers.
- “Change their behaviour“: Too much of what passes for insight is just predictions based on assuming that people are creatures of habit & similar people will continue to act as they have in the past. However, real insights touch motivations and are deep enough to provoke a change in behaviour, not just assume people stay in their status quo.
- “Mutual Benefit”: In today’s Trust Economy and Social World, it is foolish short-termism to seek to take advantage of your customers for a fast buck. Sustainable profitable growth comes from mutual value sharing enabled by insights that help you really understand customer needs & the jobs they want to get done.
Do you agree with that definition? If you have an alternative working definition that has helped in your business, please do share it with us.