Marketers look at a colleague's case and make a clear statement: "Doing marketing without understanding customer insights is a failure!"
So what is Customer insights? Simply put, these are the thoughts and desires hidden deep inside that influence the purchasing decisions of Customers/Consumers. So what factors are ranked first and basic to determine customer insights?
Before going deeper into this content, the default convention for a Customer Insignt application business must be a Marketing-oriented business (whether manufacturing, commerce or service). That is, they enter the market with competition that already exists and will increase, making the role of Marketing important, and the concept of Marketing covers all 4 main processes of the business (Process Orientation). Customers, New product creation process, Policy setting and strategy building process, Human resource and technology management process). Without Marketing orientation, there will probably be no need for Insights.
Second, is the production/business method of the Enterprise in question. Specifically, how do businesses serve the market: Sell what people need; or sell what we have; or a mixture of both? At this point, we will see that there are two different paths of marketing activities.
Sell what people need: Marketing work will originate from the market and back into the company. Specifically: In the business field of the Enterprise, what do customers and consumers need? From there, we return to the processes of accumulating capital, techniques, technology, know-how, people, and production organizations. product, then bring the product to convince, penetrate and dominate the market. The attitude of businesses looking at Customer/Consumer Insights will be different: Detect Insights and organize business around that Insights.
The question here is: If businesses cannot produce products and services capable of meeting those insights, then what?
Sell what we have: Marketing work will originate from the Enterprise, then go back to the market. Specific: We have a specific product, with specific features and uses, to serve the market. To be able to convince the market more effectively, we must prove to them, "What will our products and services bring to you?" – or more deeply, which Insight to serve. The attitude of businesses looking at Customer/Consumer Insights will be different: From their specific products and services, dig deep to see which Insights it serves, then find people with those Insights to convince.
The question here is: If businesses cannot find which customers/consumers have that insight, what then?
In fact, foreign corporations with a general business orientation of "Selling what people need" will have a different marketing mindset than domestic small and medium-sized enterprises (SMEs) (most of which try to "sell what people need". Sell what we have").
Sometimes Small and Medium Enterprises expect to be able to apply prototypes of corporate practices and think that they cannot build brands and do marketing just because they do not have enough potential like the "big guys". However, the final destination is: The business performance of a specific enterprise, based on the resources that enterprise owns. This is an important criterion to evaluate the level of consultants and marketers.
Non Son is a typical example. Being in an extremely good position in the market. Suddenly, the insights you relied on for so long no longer have a place to live, even though the insights still exist. Reason: Insights are not banned, but the products that create those insights are banned. So what happens after the Sale Promotion no longer works? This means that at this time, the "luxurious but cheap" insights for the remaining small market are gone. One business is to move into a new product or segment. The second is to close, terminate the business, and completely move to a new business field.
Customer insight concept:
Customer insight is the act of (seeking to) deeply understand the hidden thoughts/desires/truths deep in the consumer's mind that have not been clearly stated at a level beyond what the customer self-identifies. decide for yourself.
Customer insight searches for the internal motivation that drives/controls human behavior and decisions/actions (decision making, behavior,..).
Customer insight answers the question "Why do customers behave like that"? While traditional Marketing research only answers the question: “How (will) customers act/decide?”
Customer insight and positioning strategy (Postion strategy) and innovation (Inovation & creating solutions)
- Each brand has a different view of consumers expressed through Customer insight. This is the premise for differences in brand positioning strategies.
- Helps strategic managers better understand emotional factors in the minds of customers and the public.
- This is the key point when building a competitive positioning model.
- Bringing new and profound perspectives on consumer needs.
- It is one of the most important factors of innovation and creativity activities in the organization. Including R&D strategies.
- Help Marketing experts build marketing/advertising/communication strategies that have a strong impact on the minds of customers and the public
Factors that determine customer insight
Chapter I: Macro Trends – Macro trends of the socio-economic environment
Macro Trends are new trends taking place in the environment outside the business. These trends significantly influence a business's current customers and their purchasing behavior. 5 main factors of Macro Trends:
Demographic Trends: Trends by Population
- Psychographic
- Economic
- Technology adoption
- Competitive
The factors in population trends are human factors:
- Age
- Sex
- Intellectual level
- Marital status
- Population movement
Perhaps few of us appreciate these factors in making marketing and advertising decisions. It is fair to say that these factors are probably more oriented towards corporate governance, but that does not mean that their role in marketing and advertising is meaningless. Or take a look around to see the impact of these factors:
Suppose Vietnam's current population is 86 million people. The average age of the entire population is 25 with a rate of 20%. 10 years later, meaning 2018, the average age is now up to 35 with a rate of 40%. So 40% population is 35 years old, the target customers of many brands will certainly have to change, including the birth of many new brands in new markets.
Demographic Trends are always changing, so marketers must face 3 options:
- Do not change the target segment (Retain)
- Change Target Segment (Remove the old and replace with the new)
- Both (Retaining the old segment while finding solutions to serve the new segment)
So what criteria to choose and act on based on Demographic Trends (Age)?
Demographic Trends only serves as a reference factor, so if you rely on it to decide the market, it is probably only when the change is too profound:
The current segment in 5 years will only be:
- 70 1TP3M (Target consumer age population decreased)
Plus the continued reduction in target consumer:
- 60%(Gender structure in target consumer changed)
- 50%(Educational level in target consumer changed)
- 40%(Marital status in target consumer changed)
- 30%(Immigration causes the population structure of target consumers to change)
The final destination is: Business performance of a specific enterprise, based on the resources that enterprise owns. This is the ultimate criterion to evaluate the "Pro" level of a marketer.
Next, combine the two factors "Age and educational level". At the age of 35, with a high level of education and better cultural awareness than previous generations, they will certainly demand better services in terms of: Health, security, and other personal needs. Does this insight make marketers change something in their plans?
Gender: In recent years, women's role has become more and more important in society in all fields. Considering the household FMCG industry, who do advertisers and marketers care more about (women or men) in creating product images and planning advertisements?
Personal status: Married or single. The Vietnamese market may not have shown this clearly when the rate of having a family is absolutely dominant. Imagine that in the near future, single living trends spread and open up new, smaller but promising markets. How does it affect marketing? For example, marketers will have smaller SKUs (stock keeping units) for single people instead of large SKUs for a family of 5. Wandering on Truong Dinh Street, Zmanvietnam came across a hot pot restaurant with the name: One-person goat hot pot.
Immigration: In a country like Vietnam, marketers rarely have the opportunity to see the impact of immigration on their work. But marketers in the US must pay attention to this when they know that in the 90s of the last century, Mexico, the Philippines, China and Vietnam were the four countries with the largest number of immigrants to the US. What will happen? New products and services will be born with completely different insights from Native Americans. There will be Vietnamese TV channels, Mexican restaurant areas, Chinese magazines & newspapers, and schools for Filipinos.
At the end of Demographic Trends, marketers find a direction for their products with new approaches and new target customers, and of course new market niches by studying the 5 factors alone or in combination. above to find the key.
Part 2: Psychographic/Lifestyle Trends – Style and Lifestyle Trends
This factor includes 4 large areas:
- Activities: Work, hobbies and social events
- Interests: Family, community
- Opinions: Politics, economics, culture
- Personalities: Personality, behavior
Marketers rely on such factors to determine insights for each customer group and choose their target customer group.
On a smaller and more detailed level are the styles and lifestyles of groups of people with the same lifestyle with many similarities and differences. Accordingly, two people can be in similar and different customer groups at the same time. For example, we play together in the same Forum, but newbies like to ride the Air Blade because it proves many things in society such as wealth, luxury, beauty... while I would prefer an old-fashioned 67 because it's simple. masculine.
Psychographic is probably not really accurate when listed as Macro Trends. That's why Psychography will be discussed in more detail and specifically in chapter 4: Segmentation & Targeting.
Part 3: Economic Trends
In 1991-1995, Vietnam's GDP growth rate was 8.2%. In 2001-2005, this number was 7.5% (Source: Vietnam Statistics Department).
With that growth momentum minus the inflation rate over so many years, it is still clear that personal income has surpassed each period. As the economy develops, the gap between rich and poor becomes more obvious.
In the past 3 years, a series of tycoons have wasted a lot of ink in public opinion because of their cars worth up to tens of billions of VND, and most recently Bau Duc of Hoang Anh Gia Lai Group with his private plane. price... along with a private pilot who is the former deputy general director of Vietnam Airfly.
Saying so many things just to draw one conclusion: When the economy develops, people spend more and have special and greater needs. Marketing must also follow that trend to keep up with consumer insights.
The "Low income - High hope" trend in developing countries is closely related to Economic Trends and Lifestyle trends.
“Low Income – High Hopes” is the report for the letters “E” and “S” (Economics and Society) in PESTLE. However, it is impromptu and does not fully meet the targets.
Economics trends indicate a general increase/decrease in spending that manufacturers are likely to benefit from an increase/decrease in the general income of the population. However, in some cases, who can benefit or not depends on Lifestyle:
For example: Say that Vietnamese people are getting richer, everyone has money to buy motorbikes, so motorbike manufacturers benefit. However, due to the influence of the Lifestyle trend, in the end people wanted to buy but had to buy a scooter (especially women wearing skirts to climb up and down for... relief, and at the same time, they didn't have to stick their feet out and click the gear lever. ... This can also be understood as an Insight!). So Mr. SYM sniffed out Lifestyle quite well, making money for Mr. Yamaha and Honda to follow.
The above section is only to the extent of showing the necessity and sufficiency of both (Social & Economy) in analyzing the Macro environment and the Operational environment, but in addition to E & S, there are still P, T, L, and E (Environment). In addition to PESTLE, some modern marketing concepts also integrate many other macro factors, from PEST to PRESTCOM.
For convenience, please provide more information about PESTLE (not yet translated into Vietnamese, please understand) (according to www.rapidbi.com):
Part 4: Technology Adoption Trends – Technology trends
It can be said that today nothing is progressing faster than technology, especially telecommunications - electronics - digital science technology whose foundation is computers and the peak is the Internet.
The good news is that marketers are catching up and applying technology to support their work. Even a poor and developing country like Vietnam can highlight the talents involved in this marketing work:
Traditional: Radio => TV => Video Player => Cable => OOH-TV ads (and home recording technologies in foreign markets)
Mobile Marketing: MMS, SMS,…
Internet Marketing: Blog, Company website, online ads such as banners, text, videos, and even online events/compaigns can be used independently or in parallel to support other parallel activities.
But how does technology affect customer insights? Let's look at the evolution of a technology industry:
Digital photography: Camera => digital camera => camcorder => Camcorder combined with digital photography.
Where does Kodak fumble in this process? When digital cameras were born, Kodak thought
What are the customer insights in this market? What will Kodak have to do to continue to exist? Sticking with what you already have is not necessarily a bad idea. But that certainly cannot be done with the same marketing plans as before. In 2003, Kodak left the traditional market after 122 years of its existence.
At some point in Vietnam, Wifi cafes suddenly appeared, people went there to meet customers, work outside the office, or even to find a comfortable place to study. Nowadays, people consider bars without wifi to be obviously not premium because wifi has simply become an indispensable need.
Competitive Trends
This is the final element of Macro Trends.
By tracking all the activities of main competitors, or more precisely, the leading brands of their entire industry and market, businesses can somewhat predict the future of the market. that I am pursuing and striving for. This helps businesses predict future customer needs, and the delay in finding a good seat while waiting for their turn to meet customers at the station ticket office is also greatly reduced.
Some marketing and marketing research professionals feel that it is difficult to talk to customers about their unmet needs to find insights, and that it is almost a waste of time. They return to a classic saying in Marketing: "If you can just build a better mousetrap, the world will beat a path to your door".
That's why two lines of thought arise: Sell what the business has or sell what customers want? The argument of selling what customers need seems to prevail because it seems very scientific. However, the concept of selling what we have is supported by resounding successes, typically the Sony Walkman product, its variants are none other than today's MP3, MP4, iPod and PMP as well as many other versions. for a very long time.
Explicit Needs and Implicit Needs
This is another way of saying selling what the business has or selling what customers really need. So how to identify these two needs in customers? Through learning insights techniques, many things can be revealed. There are 6 techniques as follows:
- Focus Groups
- Observation
- Ethnography
- Depth interviews
- Archetype research
- Customer visits
Without a doubt, Focus groups have become one of the most popular research methods in marketing. In Vietnam, it is even more popular and even considered the best and worthy technique called consumer research method.
The reason Focus Groups is so popular is because this method can help marketers quickly and easily get quality contributions from their own customers.
So what can marketers do with Focus Groups?
- Having selected group members discuss and interact completely can help marketers come up with a new idea.
- Interaction between members allows marketers to have a miniature view of the process of how their target customer group chooses and accepts a product.
- Observe the attitudes and opinions of a representative group of target customers.
Going into more detail, Focus Group can provide the following insights:
- Customers' shopping habits.
- Better understand the industry's customers.
- Customer attitude.
- Check brand execution.
- Identify the emotional attachments and benefits of customers with the product.
But it should be determined that Focus Groups does not provide solutions. It helps marketers get a picture of target customer insights, thereby discovering the capabilities and limitations of the product serving the market.
So in what cases can Focus Groups be applied?
- Learn the language of your customers.
- Provide information as strategy.
- Product Positioning.
- Optimize the product and its concept.
- Managing Brand equity and Brand image.
- Survey changes in industry trends.
- Discover trends and enter new industries.
- Test hypotheses.
- New product development.
- Support and develop long-term advertising campaigns.
Focus Groups is a qualitative research technique. Therefore, random selection methods cannot be used in research results like quantitative methods. That also means using Focus Groups to gain a deeper understanding of your customers and to develop potential assumptions, not just to measure numbers.
Speaking specifically about the case of Harley Davidson
Based on the history of the Harley Davidson brand and products, it was originally in the form of "Selling what we have" (This is also the reality of many other hundreds of year old brands - So, for a brand to "sell what we have" lasting", there are many deciding factors, not simply applying research methods or marketing strategies). Large displacement motorbikes are very rustic and cool for gangsters roaming the wide highways of the American Southwest, recalling the wild but heroic image of old cowboys. Anyone who has watched the Hollywood movies "The Wild Hog", "Torque", or "Stone Cold" will feel this spiritual value: "Play hard, if not then stay home" (Ride Hard - Or Stay Home).
So much so that the part-time players played by John Travolta, Martin Lawrence and William H. Macy in "Wild Hog", from unemployed urban boys whose wives left them, to a computer programmer bored with four walls office, or the playful guy who is invited by his friends to hang out with him... Also try once to sit on a Harley, try venturing out into the storm to take off everything: no watch, no phone, no matter where you are. will arrive, leaving nothing behind where they just passed... driving against the wind and the sun to Jon Bon Jovi's majestic song "Lost Highway"...
“Ride hard or Stay home”, is that Insights?
Will these Insights ever change, when will they die?
Thus, according to history, relying on its own capabilities (the know-how and technical intelligence of the two ancestors Harley and Davidson) Harley-Davidson has brought to the market leading products. about features and uses. With opportunities to be a supplier of weapons to the US government (during the World Wars, and recently for the police force), Harley-Davidson expanded its power. "Insight" of customers/consumers is created and led by Harley-Davidson itself! (Similar to the influence of Steve Jobs and Apple on the attitudes and behaviors of technology addicts across five continents).
Needs -> Desires -> Insight? Or Insight -> Desire -> Need?
For example: (hypothetical examples).
“I have a need to travel, I want a motorbike to meet this need. That motorbike must be durable, fuel-efficient and can help me look a bit more luxurious."
We will see:
Needs come first, and are a broader category. (travel needs)
Desire comes next, and narrows the scope a bit more specifically. (motorcycle)
So, what is the last part of this statement?
That is Insights (durable, fuel efficient, luxurious). Honda feels it can take advantage of this Insights based on its production and business capacity, to market a product line under the Future brand.
However, if in the statement, instead of the insight "makes me look more luxurious" it is: "a little cheap so I can buy", then Honda will respond with a product line labeled Wave Alpha brand.
Temporarily separate other issues such as market capacity, sales volume, business efficiency or capital recovery time... from this section.
So here, Insight is what lies behind, more specific than needs and desires because it clearly describes the set criteria. However, it is deeply hidden, for example, in the case of people wanting to buy cheap things but not daring to say so, they should choose to buy Chinese Dylan. In this case, the insight is "Low money but likes to play luxuriously" or "Aristocrats learn to be luxurious" and Chinese manufacturers grasp it quite well.
Insights must be the intersection between the consumer's desire and the manufacturer's ability to respond, not any insight that the manufacturer can use to create a product.
Let's try to think about the following statement:
“I want people to see me as a real American player, I have to buy a Harley-Davidson to prove this.”
Regarding the insight "Wanting to be a real American-style playboy", Honda clearly cannot meet this insight. And Harley-Davidson not only competes with the same industry, but may have to compete with all products and services that meet the "prove you're a player" insight. However, this competition has both elements of Competition and Agreement.
For example: Mr. A wants to be a playboy, he has 2 options: 1 is to buy a complete set from hats to clothes, shoes, jewelry... to match the playboy style, 2 is to buy a Harley. Had to choose one of the two, because he didn't have enough money to buy it at the same time. This is the case of “Picture”. But if he has enough money to spend to play until the end, then after buying all the outfits, he is motivated by the desire to buy another Harley, because "If you wear this outfit, you have to get on the Harley to ride it to make it worth it." . This is “Hop”.
Through the two cases of Honda and Harley, we see the difference between "Pursuing and serving insights" and "Creating and leading Insights".
Gobrand re-edited from ZmanVietnam, Openshare. com
