If you want your business to be successful in the long term and to increase your sales, consumer insights are a necessity to know and understand the needs and wishes of your customers. The prerequisite for this is high-quality data that gives you insights into how your customers think and act.
What are consumer insights?
Consumer insights are the interpretation of data that companies collect to understand how their target audience thinks and feels. They use this data to increase sales and improve the customer journey in the long run.
What differentiates consumer insights from regular market research?
Market research helps companies understand what is happening, while consumer insights explain why it is happening.
Market research traditionally includes information about markets, target groups, market sizes, competitors, and more. Consumer insights additionally provide ideas on how to use the data to appeal more to customers’ emotions. Overall, both aim to increase customer satisfaction and improve the company's services and activities, which ultimately increases sales.
Challenges in collecting consumer insights
High-quality data is crucial to achieving valuable results and drawing the right conclusions.
The data must be analyzed by experts who can interpret it correctly to gain consumer insights. Without proper analysis, even the best survey is of no use.
Confidence in the results
Ideally, evaluating and interpreting the data results in insights about your customers' emotions, for example regarding your product or your industry. However, these insights may reveal an unpleasant truth or not match your personal expectations. In this case, it is especially important to put this new knowledge to use because the benefit for your company will be all the more remarkable!
Always keep an eye on your competition
You know your competition. But are they perhaps more well-known than you are? If they are, good for you! Taking a close look at what your competitors' customers say about products that you also have in your product range is a great benefit for you. General statements their customers make about them are also valuable.
Often, this can be the first step in gaining consumer insights since you can gather this information easily on the Internet. It will give you a first impression of what wants and needs you should be able to satisfy to take your business to the next level.
This is where it gets personal
The days of mass marketing are (mostly) over. The moment manufacturers and sellers of everyday products – toothpaste is a good example here – started targeting only certain groups instead of everyone with teeth to increase sales should have been a wake-up call. We now have zero waste toothpaste for the environmentally conscious, plaque-identifying toothpaste for the health-conscious, fancy flavors and designs for people who want variety and all kinds of other niche products.
It is a proven fact that addressing clearly defined target groups increases sales. Keep in mind: if you address everyone, no one feels addressed personally. Consumer insights help you find a personal approach that appeals to your specific target group and appears authentic.
Hypotheses are not facts
Many companies make the mistake of using their own hypotheses about what the desired customer thinks and feels as the sole foundation for their activities. It is important to remember: your own assumptions are not consumer insights, even if you belong to the target group and especially if you do not.
This is what your next steps could look like
- Define your target group if you haven't already.
- Plan enough time and resources for the process.
- Take a look at your direct competitors. How do they appeal to customers? What are customers saying about the company? How successful do they seem to be with the chosen strategy?
- Formulate questions to ask your target group (remember that hypotheses are not consumer insights).
- Think about how you want to collect your data and who should evaluate it.
- Think about how to put the insights gained to use. What should you change?
- Set a time frame for evaluating the effectiveness of the consumer insights.
After a set period of time, you should examine the direction in which the market and your target group are developing and update your consumer insights accordingly. The closer you watch the market and your customers, the faster you can react to changes and continue to be successful in the future. Even if the acquisition of consumer insights can be costly, the costs of ineffective communication and strategies are significantly higher.