In the age of real-time communication, when consumers can communicate with – and about – brands via a myriad of digital channels and social networks, will market research be replaced by more innovative ways of garnering customer insights? Piers Alington CEO of Feedback Ferret explores the issues.
In the 1920s and 30s, when market research began to appear as part of the golden age of American radio advertising, it was heralded as cost effective, efficient and innovative. It provided a way to discover what the customer wanted, needed or believed. For the first time, businesses could develop brand and product messages based on real insights of a representative audience sample.
In the days when brands had very little contact with their customers, any insight into customer preferences was valuable. Market research offered advertisers a way to learn what their target customers liked about their products so they could persuade them to buy more.
Today, market research remains firmly entrenched as the primary way for many companies and marketers to collect customer ‘insights’ and identify trends to inform a range of strategic marketing decisions. However, we live in an infinitely more complicated world, where speed of communication is all-important and ‘universal’ truths no longer apply. It is time to reassess the role played by traditional market research.
Technology is the great enabler
As marketers are clearly aware, consumer opinion is vastly more powerful in the 21st century.
However, this is not intended to be another article about the importance of social media. Undoubtedly, social media affords brands a new opportunity to engage with customers, but I believe another fundamental revolution is waiting to happen, one with far-reaching implications as great as the dawn of market research.
Listening to the real experts – your customers
I’m talking about the thousands of pieces of feedback – good and bad – that organisations collect every day as part of their existing business processes. The feedback recorded in voice calls, emails or IVR surveys via the contact centre, the online feedback forms on the company website, or the paper-based feedback forms completed after a visit to a store, restaurant or other physical destination. And that’s just the tip of the iceberg, the increased focus on customer satisfaction means many organisations are regularly collecting data from their customers.
With all of this data at our disposal, do we really need market research companies to run focus groups with ‘representative samples’ of consumers? Look carefully; customers are crying out to give feedback and to be listened to.
Companies need to find ways to listen to – and act on – the feedback they regularly invite from customers. Just as in the 1920s the advertising world grasped the opportunity market research provided, we need to grasp the insights provided by real-time communication from the legions of vocal customers, keen to help us (or make us) improve our products and services.
So why doesn’t market research tick the box?
Returning to the 1920s, society was more homogenous, making it relatively straightforward to discern representative trends from relatively small groups of people. Today, marketers are discovering that social diversity is exposing the limits of the broad segmentation approaches, which previously made market research so valuable.
Consumers have a multitude of lifestyle choices, which are reflected by their consumption preferences. Recently, we worked with a customer who receives around 5,000 pieces of customer feedback data everyday. This data represents a diverse range of rich, candid opinion from people who actually interact with the organisation regularly and buy its products or services, customers who naturally have a vested interest in the organisation’s continuous improvement.
The underlying problem with market research is asking the right questions. It is easy to gloss over important customer experience issues simply because you never thought to ask – or never could ask. I have never seen a survey question titled: “Was the salesman rude or patronising to you?” – yet that’s what some people experience and tell us about in their free form answers.
By listening to the entire range of customer opinion, organisations will find it is possible to find answers – answers that drive real change and innovation – to valuable questions they may have never thought to ask.
Embracing the Voice of the Customer
The most telling customer insights emerge from actual customer communication and feedback. To quote one example, the AA’s famous ‘4th emergency service’ positioning was devised after the ad agency listened to calls from stranded motorists and noted the sense of panic in their voices.
In reality, many companies are struggling to extract true value from the wealth of customer feedback data. Technology can help. Feedback Ferret technology can uncover real insights that lie behind general trends through in-depth textual analysis of the feedback comments. Charlene Li at Forrester Research pointed out back in 2007 that to realise the full potential of Voice of Customer programmes, companies need to “expand their firewalls” and include customers in business making decisions.
We are beginning to understand that customers should be seen as more than just data points, but as active and willing participants in the future of the organisation. But organisational change is needed for this shift to happen.
Social media has forced organisations to focus on real-time information that can be fed back into the business. Now it is time to apply this same sense of immediacy to feedback from your customers. Organisations who take too long to resolve issues are likely to cause customers to vent their frustrations via social media.
Market research programmes are ill equipped to meet this need for speed, often taking months to feedback findings into product and service innovation. It is also arguably slow, lacking in deep insight and unrepresentative of the needs of many of your customers. With innovative platforms now available to gather, analyse and act on customer feedback, surely it is time to listen to what your customers are already telling you?
By Piers Alington