Using Market Research Just for Marketing Is a Missed Opportunity
September 1, 2012 Editor 0
In most companies, customer intelligence — that is, the collection and analysis of customer data — is largely used for improving customer relationships. Understand your customer’s buying cycle better, and you can target your mailings and product offerings more effectively.
Smart companies realize that intelligence about their customers can actually lead to a lot more than greater marketing effectiveness. It a powerful tool for identifying innovations, especially with the opportunities for data gathering afforded by smart technologies and social media.
To begin with, companies can gather data about their existing customers and use that to dream up new products and services to offer to those customers. Take Fenwick, a leading forklift truck manufacturer in France. Fenwick installed data-collecting sensors and radio frequency identification (RFID) technology in its forklifts, through which it amassed valuable information about how customers used its equipment. It used the resulting knowledge to develop new service offerings, including remote monitoring, a customer-specific intranet, and a school for forklift drivers. Today, 50% of its €500 million in revenues comes from services developed over the past fifteen years.
The Internet has provided a huge boost to this kind of intelligence gathering. Many firms deploy web-based tools to let customers autonomously make purchases, check their purchase records, track shipments, or simply access information about products and product applications. Over relatively short time periods, these customer interactions create a massive database, in which customer profiles, transactions, and inquiries are all associated. The great advantage for organizations here is that they can draw on potentially very large samples, which makes analysis of the data very robust.
But intelligence in the Internet age isn’t just about tracking what existing customers think about the products they buy and how they use them. Companies can also find opportunities by broadening their definition of customer intelligence to include analyzing public discussions by consumers in the online world.
This was exactly what Schwarzkopf, one of the leading hair-care companies in Germany did, when I worked with them recently. The company wanted to improve the performance of its website in terms of traffic and sales. To understand what hair-care consumers were actually looking for, we monitored and interpreted (via word interpretation algorithms) millions of consumer conversations in blogs about hair-care problems and products.
What we found was that, in their online conversations, consumers focused on their hair-care problems rather than on the attributes of specific brands or products. As a consequence, the company restructured the website so that consumers came to the product offerings through their hair-care problems. Instead of a list of brands and products, the home page now focused on hair types (stressed hair, thin hair, blonde hair, and so forth). The consumer came to a choice of appropriate products by navigating through a discussion of hair problems. Website traffic tripled after the changeover and word-of-mouth activity in online blogs referring to the website increased more than tenfold.
New applications like Facebook’s Glimpse are potentially a very valuable source of this sort of intelligence. Glimpse builds “LookBooks” of peoples’ “likes”, visual depictions of preferred products, conversation topics, celebrities, and so forth. They allow firms to understand the context that customers put brands into and open up strategic opportunities that managers would otherwise miss completely.
The challenge in obtaining this kind of intelligence is identifying the online environments or groups that hold the best data. Is your company’s market research department up to the challenge?
- Reviewing The Influence Of IT Applications Such As Implementing Online Distribution Channels In Hotel Industry
- Bad Service Can Be Good Business
- Data Analysis Should Be a Social Event
- Use Social Media to Partner with Customers and Improve Service
- Know Your Customers Wherever They Are
- Understanding Customers in the Solution Economy
Subscribe to our stories
- Can Africa’s tech start-up scene rise to the next level? November 20, 2017
- Chocolate innovation: Sweet tooth hackers solve cocoa farmers’ challenges November 20, 2017
- A new generation of CEOs: Running a business in West Africa as a woman November 20, 2017
- Is crowdfunding the silver bullet to expanding innovation in the developing world? November 20, 2017
- Towards building an Entrepreneurship Ecosystem- Global Entrepreneurship Week and Freetown Pitch Night-The Role and Significance of the Freetown Pitch Night November 20, 2017