Yet another customer-related, marketing-oriented term is headed toward buzzword status. I’m talking about customer insight. Marketing researchers are now holding themselves out as experts in customer insight. The problem is that much of what they are coming up with is not especially insightful. I believe that, if you are truly insightful in how you look at your customers and creative in the kinds of information you gather, you are bound to look at marketing differently in the future.
I have been involved in a number of projects over the past couple of years in what would broadly be described as the B2B sector. These all involved firms who sell their products and services to business customers or through dealer networks. The objective behind each of these projects was to identify ways in which the client companies could gain an advantage over the competition by conducting themselves differently. To find new and different ways to compete meant finding customer insight.
I am constantly on the lookout for opportunities where clients can become more involved in the success of their customers or channel members. This is what B2B marketing is really all about—helping your customers be more successful. When I ask the owners or managers of midsize businesses what gives them the greatest rewards in business, they talk of earning the satisfaction and loyalty of their customers. They refer to “seeing the look on customers’ faces” when something goes especially well or when expectations have been exceeded. Yet, I also find that suppliers to these firms often overlook the fact that their customers have customers too.
So how do these midsize firms identify their “best suppliers”? It may be surprising to some that the best are not necessarily those with the best products or the lowest prices. In focus groups and in-depth interviews, customers tell me that they gravitate to suppliers who “look after things for me.” Their best suppliers are those who “seem to want me to succeed.” These great suppliers give their customers the impression that they want them to be successful. They regularly act in the best interest of their customers, suggesting new ways to do things, helping to train their staff. One of the most favorable reactions that they elicit is: “That’s one less thing I have to worry about.” When a customer says this about you, you have a winner.
Best suppliers
It’s also interesting to me that small and midsize customers take a dim view of what they call “foot-in-the-door” selling. When I ask them who they like to see call on them, they tell me they enjoy seeing the sales rep who has a suggestion on how they can save money or be more efficient, how they can better serve their customers. The best suppliers seem to understand their customers’ customers almost as well as they do.
Today there is a tremendous tendency to talk about customers in language straight out of a CRM strategy meeting. We say we want our customers to see us as their “partners,” so we add the tag line, “trusted partners,” or, “trusted advisors,” to all of our advertising. Then a customer insight project reveals that customers don’t really think of you as a partner at all.
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Just because we have captured megabytes of data on each customer in our data warehouse and employ sophisticated data mining tools does not mean that we have anything approaching insight.’
I was involved recently in a project for a multinational services company that operates a worldwide network of dealers and distributors. Thinking it was a good idea in this age of relationships to refer to its dealers as partners, the company relabeled its distributors and dealers as its “partner” network. In our in-depth interviews with these “partners” in Europe and America, the customers asked pointed questions about why they are often the last to know about price changes or new products. They felt embarrassed when they learned of such developments from their customers, rather than from their “partner” supplier. They were offended when they occasionally found themselves competing against their “partner” for large pieces of business. They asked, “What kind of partner does that?”
Your customers will decide who their partner is, not you. They will decide, based on your behavior and how you treat them, whether you can be trusted and whether they consider you a partner. If they feel they can’t, then any reference to partnering is what one focus group participant recently referred to as “just marketing speak!” Until you start behaving like a true partner, your tag line is just another marketing slogan.
There’s a reason for the current interest in customer insight. I suspect it’s because many practitioners now accept the conventional wisdom that the more one knows about customers the better. But there is considerable confusion between the amount of information we have and our depth of understanding. Just because we have captured megabytes of data on each customer in our data warehouse and employ sophisticated data mining tools does not mean that we have anything approaching insight.
I believe that, if you are truly insightful in how you view your customers and creative in the kinds of information you gather, you are bound to look at marketing differently in the future. It seems to me that we need to approach the B2B customers differently, ask different kinds of questions, understand their customers, gain true insight. Marketing has gone through a transformation, and competing for customers is now fundamentally different. It’s about looking at customers differently—not about how we can persuade them to buy more but about how we can help them succeed. To understand this challenge demands true insight.
Jim,
I agree with most of what you have to say, although I also suspect that part of the reason for adopting the term “Customer Insight” is for positioning value within the organization. It links the research department more closely to the end game of the organization and helps to differentiate it/disassociate it from the negative connotations that some associate with the research function. In some respects, this is similar to the CEM/CRM debate that we see here.
Customer insight concerns me as well. As you point out, if you change the perspective from which you look at customers, you are likely to rethink your approach to marketing. When marketing looks at a customer with a marketing lens they see things that reinforce existing marketing practices. No new insights can really emerge. I encourage marketing to look at the marketplace, and their product, from the perspective of the customer. Companies who have done this are usually shocked at how big a gap there is between the value they espouse and the value the customer seeks to gain.
This is not an easy exercise and usually requires the assistance of an objective third party. Amongst the insight they will gain about marketing is that customer acquisition and customer retention need to become attract and engage customer with the purpose of shifting the focus of the relationship from buying things to cooperatively and collaboratively dealing with issues. I believe this is what you are getting in your discussion of BtoB relationships. John I. Todor, Ph.D., author of Addicted Customers: How to Get Them Hooked on Your Company.
You make a very good point. I have no difficulty with the notion of separating customer insight from the marketing research department, as I honestly believe that much research as it has been conventionally done is decidedly unhelpful in promoting a customer-focused agenda.