Why customer insight is key to innovate new solutions and services?
I have been working recent few years heavily utilizing customer insight practices to building connection between customers and business strategy. Especially, in situation when company or team has desire to build their solutions or services more customer centric way. Counting all cases to together, it has required to run couple of hundreds of qualitative customer interviews by myself in recent two years. Addition to that, it has been pleasure to coach multiple teams to reach their targets in solution validation via customer insight. In this article I am explaining importance of customer insight in order to build successful new business.
Concept of customer insight
Customer insight is broad topic and the term has been understood bit differently when looking it through glasses of marketing, sales, customer service or offering development. In my book, customer insight means activity to gain deep understanding of your customer’s attitudes, motivations and behavior.
There are plenty of reasons to collect, analyse and make decisions based on customer data, but in this article I will focus only customer insight related to new solutions and services development.
Conceptually customer insight can be divided in four point-of-views:
1. Attitudinal: answering or measures people’s stated beliefs and emotions related to topic, example: “New service would help me to save my work time, because of simplified workflow for my daily tasks.”
2. Behavioural: answering questions or measures what people are doing, example: “We have observed that specialist could save work time 2h per day with new solution”
3. Qualitative: answering questions about why or how to fix a problem, example: “Based on field study we find out that option A is most suitable choice for the users reflecting back to their situation.”
4. Quantitative: answering how many and how much types of questions, example: “43% of our retaining clients has used the new service at least once a week”
The concept of customer insight is evolved from Landscape of User Research Methods by Christian Rohrer. Original framework is focused on end-users, but especially in B2B businesses you can’t rely only on end-users. You should think whole relationship matrix within the company to understand decision making process and driving forces. Therefore set of practical research tools and methods are partly different than Rohrer’s framework.
Importance of customer validation
We have tendency to fall in love with our own ideas. That is, of course, natural behavior when you are excited about your idea and start to build strong emotional belief that rest of the world think similar way.
This moment of time customer insight start to play important role in development process. Before any single line of code has written or even any wireframes drawn on the wall, it’s good make sure that we are building something that actually solving some real thing in this planet. At this stage you may collect mainly attitudinal insights. Typically need to validate following aspects like:
- Who is our potential client? Who is individual person ?
- How many of the potential clients can be identified?
- Do they have some real problem or need that we are trying to solve?
- How important / huge that problem is?
- How often it happens?
There are things that cannot be solved by desk study. That require real touchpoint to potential clients. General customer satisfaction surveys or market research studies does not give us right answers to these questions. Answers need to be specific to idea under development so that we are able to address concrete problems and linked back to value of our solution. It just too easy to jump to solution before understand the problem first.
When you have passed problem validation phase and are still convinced that problem is existing, it’s time to continue with solution shaping and validation. Solution could be just pitch deck or story enriched with prototype of your solution. From customer validation perspective it’s important to turn from attitudinal perspective to behavioural insight as early as we can. Practically it could be just like getting customer committed as become pilot customer, participating to coming user testing or accepting next meeting regarding the solution. Very often it’s two different thing what people are saying and how they are doing. That’s why behavioral signals are much stronger than attitudinal.
Conclusion
All in all, too many product or services are failing because missing customer validation. Or it’s realized too late. Huge amount of time, money and energy to burned until we are dare to kill our darlings (ideas).
It’s also too easy underestimate time, effort and competence needed to make customer insight practices alive. It’s actually one of the toughest job I have done during my fifteen years career in technology industry. But that work has been excellent way to learn more from people and markets.
My hint is that do not outsource customer insight from your development team. It so important to face customers and learn. Of course you can use extra help and skilled people to guide you, but in away that you are not loose connection to customer.
If you like bounce idea around innovation or customer insight topics, feel free to connect me in Linkedin.
