What Is "Customer Insight" and How Do You Gain It?


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I focus on helping clients find value opportunities and read a variety of subjects on customer knowledge, marketing, sales, innovation, execution, anything that touches on the subject of adding value to the propositions a company offers and making them work. Maybe it’s the focus of the material I read but most authors say that companies have to gain deep insight into their customers or know what they’re trying to accomplish or know their business.

But I’m not sure what that means since it seems most companies think deep insight comes from the mining of transaction data – information that customers bring to companies through sales visits or purchases and was gathered in the context of the seller’s product and related services. I feel, while this information is important, it’s not sufficient for deep insight.

My question is: What does “deep customer insight” mean to you and your company and how do you and your company go about gaining it? What would you do differently in light of the fact that the customer is more demanding of unique solutions and relationships?

Paul K Ward
July 2, 2007
Customer Insight

The challenge with gaining customer insight is two-fold:

1. How can you know that what the customer says is true?
2. How can you know what the customer does with your product/service?

The first question can be partially resolved by using a variety of qualitative and quantitative techniques (ZMET, focus groups, perceived customer value surveys), and then seeing how the responses/results “converge”. This is not a simple process, but it’s critical — especially when you’re using that data to innovate, and not just to improve an existing process or product.

The second question is partially answered by transaction data, but additional work, such as ethnographic study, can be absolutely critical in finding out how your service or product is actually used. And, given that your “service” is really your entire, lust-to-dust relationship with a person, you really have to understand how you engage someone, how that engagement compares with other sources of engagement, and then onward from there (exploration, selection, use, retirement of the product/service/relationship).

Ultimately all of this data should be in service of the question: What is the larger goal of the customer? It could be to solve a problem, to get closer to an aspiration, to serve the ego. As it has been said many times, people don’t buy a drill for the ability to drive a drill bit. They buy a drill to make a hole. They want a hole, not a drill.

This is in part why this quest for insight is especially tricky when you’re trying to innovate. Why does a customer want a hole? To put a screw in. Why? For many customers: To hang something. So, if you want to innovate, what you really want to do is to come up with something that helps people hang something. You might be able to circumvent having to continually improve your drill.

Then again, if you come up with a “hanging solution” that is not related to your drill manufacturing business, you’ll be robbing from your own sales.

Pragmatically, you can try starting with the following:

1. Do ZMET or focus groups to determine the overt benefits sought by your customers. (I want to hang something.)

2. Determine the aspects of this benefit (attributes of the offering — including soft attributes such as brand).

3. Do a survey.

4. Using factor analysis or similar technique, determine which aspects are most important, and which are truly independent of each other.

5. Do a bigger survey, using a reduced and sufficiently independent set of value drivers. SURVEY NON-CUSTOMERS, or customers of competitors. Use factor analysis again and determine how your customers “clump” in their needs.

If you want to take it further, you can also ask respondents to score how well you, and your key competitors, provide value along these value drivers. That can give you a score relative to both the value drivers as well as to your competitors.

Eric Engwall
July 2, 2007
Customer Insight

I agree with the previous respondent – transaction data only tells you one small part of the story, and may actually lead to erroneous conclusions. Real insight can only happen through dialogue, and surveys aren’t enough.

When I work with our clients I use this analogy: Imagine approaching your spouse/significant other and saying, “Dear, I’d like to really understand you more than I do, and to get feedback about what I might do to improve our relationship. Would you mind filling out this survey?”

The problem with that approach is that the method doesn’t match the intent. It’s hard to get at the issues that will lead to greater customer intimacy and centricity by using a relatively impersonal method of getting feedback. The survey is also likely to provoke as many questions as it answers. Some of that could be cleared up with a follow up conversation to probe for deeper understanding and clarify inconsistencies. Most organizations we encounter, though, don’t do a good job of following up and “closing the loop” with the customers they survey. The data is analyzed and presented – but may not be shared with the right people and therefore doesn’t lead to effective actions.

Short answer – to get deep customer insight, you have to ask and observe in multiple ways with disciplined processes. Our approach is to use face-to-face customer interviews (for B2B clients) that are conducted by the client’s own people – and joined with non-customer interviews and surveys that we conduct. The combination of those sources of input can paint some pretty compelling pictures.

Dave Jackson
July 9, 2007
Deep customer insight

Deep customer insight is usually complex and requires a multi-faceted approach, integrating feedback (of various types), transactional data and a dash of intuition.

Focus groups and surveys will tell you what customers think they think. What we say and what we really believe (as evidenced by our actions) are often different. For example, most of us say we believe that action on climate change is important but few of us have have significantly changed our practices.

Transactional data tells us what customers have done in terms of buying but on its own doesn’t tell us why, what they though of the experience or what other options they considered.

Process measures tell us how our organisation is working but not if they are working for customers. We might know how productive we are but not how effective.

Now of course put them all together in a comparable way and we have started to build a rich picture and can seek to understand the linkages between them. Now we can begin to see the hidden messages.

Insight comes from integrating different pieces of information. Think – would you trust an airline pilot that told you ho only ever looked at one dial?


Dave Jackson

Krista Sheridan
October 15, 2007
What is customer insight

Hi Dave!
I loved your post – thank you for taking a somewhat nebulous topic and making it so clear and tangible! You airline pilot comment is spot on!
November 21, 2007
Customer insight – tangible

Customer insight: what you want or need and how to get it is pretty straight forward.
Imagine you own a small bakery. You have repeat customers and you have the odd one-tme visitor.
Why do they come to your shop?
– do they live nearby?
– do they come by your shop on the way to work?
– do they appreciate your bread?
– is your pricing better?
– is your product superior to your competitors?
– or is there no competition?

Some of the se answers can be gained by customer focusgroups, some come from your own transactional data and some answers can only be obtained by looking at your own position in the market.

Examples of how not
1. A road side assistance company has asked their client base if they were happy and if they would recommend it to others. Each year the RSA company scored very high in customer appreciation.
Then, a competitor entered the market and took over 50% of the customers.
2. For a customer I merged research data (containing repurchse intention) and actual activity data. In the end, there was no correlation between the two. A customer who said “never again” kept on coming back and a customer who said “yes” never came back.
In the end, this data was not rich enough as it did not contain the drivers behind the customer choice. Those drivers were actually available in the end after all, but not at first glance.

Think about it: why do you buy something? Let that drive your decision on how deep your insight has to be and how or where you can get that information: from transactional data, from research or by adding competitor information.

Alan J. Zell
November 25, 2007
Understanding customers

Getting customer insight via statistics my not be the way to go because these track the middle of the picture and not the before and after part of the picture.

All customers have inputs, right or wrong, about what they are looking to buy or being asked to buy. In the former situation, the input could be forced by someone else to buy or by the customer trying to up-grade their life or business. In the latter case, often what is put before a customer either does not meet the needs or life of the customer or is not presented in such a way that the customer sees that there is a fit. If any of the negatives are such that there is not fit, there is no statistics to get other than “a miss.”

The what happens after-the-sale part may be the biggest of challenges in learning about the insights to customers’ thinking. With any product or service, different customers will not use it the same way even though they bought it. For some, they buy it and use it. For others, they pass it on as purchased, and still others use it with other products/services and they use it themselves or pass the completed product/service to others. This is where customer insight becomes so very important but is not often tracked. The only way this can be tracked is for those selling the product/service need to ask their customer(s)/client(s) how it will be used, note that use in some way where it can be found. While the first unusual use may seem as a fluke, it is bound to come up again. All products and services get passed on to others either physically buy use or through verbal communications and that opens up doors for others to see that the use is not so unusual.

Between these two ends are the statistics that might be better categorized with this additional information.

Alan J. Zell, Ambassador Of Selling, Attitudes for Selling
[email protected]

April 17, 2009
basic definition

Hi Jonathan,
I’m an HR manager in B2B ICT. Just in these days I’m involved in a project to define a list of competencies related to “Customer Insight”. So your post is a timely opportunity to share opinions with others.
First step for me had been try to define: what is it “Customer Insight” ?
Second step: how to gain it.
So exactly your basic questions.
At the moment I’m interested to opinions about the possible definition:

Thanks for any feedback

December 15, 2009
Customer Insight

I found this line that for me described customer insight perfectly.

Customer Insight is the collection, deployment and analysis of information that is essential for businesses to acquire, develop and retain the right customers.

I think it somes it up pretty well 🙂

Rajesh Agrawal
October 1, 2010
Customer Insight

To me Customer Insight means what a Customer thinks before and during purchases and what is his opinion after the purchases.

It includes minute details including his behaviourial and emotional aspects apart from materialistic details eg Prices,Delivery,Quantum etc.

Analysis of all these information helps Businesses to plan strategies to retain Customers and to revamp their Systems & Process in order to enhance Productivity and profitability.


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