What is Culture of Experimentation?
In this blog series, we’ve explored ways of thinking about how to make your organisation’s…
Customer insight is a requirement for competitive advantage
Customer insight is always the starting point for designing and building customer-oriented services and products. By understanding our customers’ activities, needs and problems, we can build, market and sell services that create value and keep our customers coming back. Customer insight is therefore a requirement for a successful customer experience and a competitive advantage.
What is customer insight needed for?
- Gaining customer insight early in the design process can save us from making bad investment decisions.
- Customer insight helps us ensure we focus on solving real customer problems.
- Customer insight helps us build products and services our customers want to use.
- Customer insight helps us to market and sell more effectively.
- Continuous acquisition of customer insight helps us to keep improving our services.
How is customer insight formed?
Customer insight is often seen as defining customer personas or collecting customer feedback. Both can be part of building customer insight, but if we really want to understand our customers we need to dig deeper. Unfortunately, knowledge doesn’t live in one place, and sometimes establishing comprehensive customer insight requires some detective work.
“Working with Sofokus was a valuable experience. We gained a better understanding of our ecosystem and have developed concrete ideas for making our product more appealing to end users.”
John Björkbom
CEO, T.R. Björkbom Trading Oy
Internal interviews prevent misconceptions
The design of digital services is typically initiated by an in-house project team. A close-knit and committed team is a great starting point, but it’s worth remembering that it’s unlikely that just a handful of people will have a complete understanding of customer needs. If the insights are based on the ideas of a few people, there is always a risk that the output is based on assumptions rather than knowledge. If you start building a service on assumptions alone, the problem that the service is trying to solve may not be real. We may invest in a service that our customers do not want to use.
In customer insight projects, we always try to extend our data collection beyond the project team and talk to people working on different functions. For example, salespeople and customer service teams have a lot of insight about the challenges that customers face. After the internal interviews, we also gain a better understanding of the business environment, the industry and its specific characteristics
Examining existing data broadens our perspective
Organisations today use a wide variety of digital tools to manage e.g. customer records, and as a result, a great amount of different data is accumulated. For example, many organisations have access to numerical data like customer and sales figures and website traffic. In addition, they may have collected qualitative data from customers, for example in the form of customer feedback.
However, data is essentially just numbers, and web analytics, for example, allows us to identify trends and problem areas. However, analytics does not answer our question of why our customers act the way they do, and that is why we need to ask them.
Customer interviews and workshops deepen understanding
Especially when your existing customers match well with the target group you want to continue reaching and serving through the new digital system, it is very useful to spend time talking with them. From existing customers, we can learn about the problems they struggle with, their expectations, where they need help and why they are your customers. At their best, interviews help us to identify hidden, unmet needs that would not be revealed by a survey, for example.
If, on the other hand, you are planning to build a service or product for a completely new target group, we want to identify what the potential customers might have in common. Once we have a hypothesis about customer types, we try to assemble a group of interviewees that represents the customer profile as closely as possible.
Depending on the industry and the service, customer and target group interviews can be conducted either as an in-depth interview between the customer and the interviewer or as a workshop for a larger group.
When building digital services and systems, customer insight is accumulated throughout the project. The way we collect data varies slightly depending on the stage of the development project. For example, customer testing as part of interface design and prototyping guides us in a more customer-centric direction in terms of usability and visuals.
Building customer insight is an endless process of exploration and testing
Customer understanding is an ongoing process and should never stop once the first version of a service or product is ready. Knowing how real customers use the service is truly valuable, and if we can interpret the information we collect and use it in the development process, we can help create even better solutions for our clients.
