Customer research involves gathering information and insights about customers in order to build a deeper understanding of their needs, preferences, and behaviors. It is an important aspect of business development, product design, marketing, sales, customer service, and business improvement, as it helps businesses to stay attuned to the needs and expectations of their target market. Customer research can be conducted through a variety of methods, including market research, customer surveys, focus groups, customer interviews, and analysis of customer data. By regularly conducting customer research, businesses can stay up-to-date on market trends and customer needs, and make informed decisions about how to meet these needs and improve their overall performance. The following are illustrative examples of customer research.
The process of identifying your customers based on factors such as demographics and psychographics. For example, a bicycle helmet company that investigates what type of customers are willing to pay a premium for a safer helmet.
The process of identifying an audience for a marketing message. For example, a snowboard manufacturer with an extremely limited advertising budget that wants to reach influencers in snowboarding culture.
Customer needs are the root reasons that customers purchase products and services. This can include functional, social and emotional needs.
Critical to Customer
Critical to customer is a measurement that strongly influences purchasing decisions. For example, consumers who will only purchase a vehicle that has received a top safety rating from a government agency.
The real reasons that customers buy beyond what they say they need. For example, decision makers at a business who are strongly motivated to offload stress and workload.
The expectations that customers have for a product or service. These are often assumed and unstated such that they are difficult to research. For example, a customer who expects that labels will be easy to remove from a product. Such a customer may be unlikely to state this as a need but may become dissatisfied when expectations aren’t met.
Evaluation of customer preferences that impact customer satisfaction. For example, a hotel that evaluates how hard or soft customers like their pillows.
The requirements of business customers. For example, a solar panel manufacturer may analyze the common requirements in RFPs for solar systems.
Moment of Truth
Analysis of critical moments in the customer experience. For example, a fashion retailer who examines how customers react to different types of packaging.
Evaluating your target market’s ability to recognize your brand.
Evaluating brand awareness such as top of mind. This is the percentage of customers who name your brand when prompted with a product category.
Measuring customer satisfaction with your current products and services. For example, a hotel that interviews customers on exit to discover why the hotel has been receiving poor reviews.
Evaluating customer reactions to different prices. This can discover cognitive pricing factors such as a sticky price.
Modeling how sensitive your target market is to prices. This is often used to develop price discrimination strategies such as coupons.
Perceptions of Quality
Investigating what customers perceive as high quality and low quality. For example, customers that perceive paper packaging as higher quality than plastic for a particular product category.
Evaluating how pleasing and productive your products and services are to use.
Word of Mouth
Customer analysis using reviews, ratings and word of mouth information from sources such as social media. For example, poor ratings can be an excellent source of customer needs and expectations.
Accepting feedback from customers and using this as a source for analysis.
Experience sampling is a market research technique that involves asking customers to keep a journal of their experiences with your products and services.
Customer interviews such as a ladder interview or focus group.
Marketing experiments geared at understanding customers. For example, A/B testing different prices to identify price perceptions.
The use of observational studies to understand customers. For example, observing customer reactions to a merchandising display.
Surveys are a popular form of customer research because they are easy to do. Customers are often adverse to filling out surveys such that those who do may have unusual characteristics that aren’t representative of all customers.
Lead users is the process of engaging customers who are pushing your products to their limits or who are important to the culture surrounding your product. This implies an in-depth engagement whereby lead users may feed you ideas for product functions, features and design. For example, a technology company that engages developers and business units that are actively using a technology platform to understand pain points and needs.