Market researchers and consumer insights analysts have been around for many decades and long before the internet. However, market research in the digital age is something entirely different than it was in previous eras. Today’s research and insights professionals must be comfortable handling vast amounts of data and translating that into workable insights. Let’s take a look at what it takes to be an effective researcher in 2020 and the coming years.
Consumer Insights: Then and Now
Understanding the customer has always been the foundation of a successful business. However, when consumers, as well as technology, are rapidly changing, it’s essential to understand the transforming nature of consumer insights.
More Data Than Ever
The most obvious truth about data today is that there’s more of it than ever before. According to an already outdated statistic, the world is generating 2.5 quintillion bytes of data daily. This is a mixed blessing as a natural reaction to this is that many businesses are feeling overwhelmed and unsure of what to do with all this data. That’s why a major responsibility of a consumer insights analyst is to select the relevant data and interpret it in a useful way.
Everything is Speeding Up
Perhaps the biggest broad change that big data and digital technology are bringing is the speeding up of data, insights, and consumer preferences. In the past, companies had the luxury of conducting market research over months, even years. The internet sped things up so that surveys and other data could be processed within days. Now, we’re quickly entering the age of real-time data.
If your data is outdated, even by weeks or days, you can easily fall behind the competition. Just as significantly, your results could be obsolete. As people have access to more information and choices, their preferences can change overnight. To keep up with the frenzied pace of information today you need automated processes that can handle large amounts of data. You also need a solid understanding of how to make the best use of your tools so they provide you with actionable results.
Consumers are Changing
It’s not just technology that’s changing. If you want your market research to produce results, you need to understand how consumers are not the same as they were even a few years ago.
- Shrinking attention spans. This affects many market research techniques. For example, the longer your poll or survey, the fewer people will fill it out.
- The growth of mobile devices. Keep in mind that when you request feedback, many people are using smartphones. It’s essential that any forms or surveys are mobile-friendly. This is also a reason to keep content shorter as mobile users don’t want to scroll down many pages.
- The e-commerce revolution. Over a relatively short period, Amazon transformed the way people shop. DigitalCommerce360 reports that Amazon alone now accounts for 40% of all U.S. online retail. Consumers now have completely different expectations when they order something online, such as fast delivery and multiple payment options.
- Omnichannel marketing. Online and offline marketing are merging. Customers search for brick and mortar businesses online and appreciate the ability to book appointments and place orders online. They may access in-store digital displays to help them choose products. Sephora, for example, is known for its digital screens that let customers see how beauty and skincare products will look on them.
All of these consumer trends are relevant to market research. If you base your assumptions on outdated ideas, you risk missing some crucial insights. For example, if your research treats online and offline as completely separate compartments, you may end up looking at different streams of data without connecting the dots.
Guidelines For Market Research
Here are some ways to gain the most valuable consumer insights in 2020 and the foreseeable future.
Keep Up With the Latest Advances in Social Listening
Social media is getting bigger all the time. Though the demographics shift (e.g. millennials may spend more time on Instagram than Facebook), there’s no doubt that people are spending more and more time on social media. You need to track your analytics on every platform on which you’re active. However, the practice of social listening (or social monitoring, which is closely related) goes well beyond the typical understanding of analytics. Social media listening is not new but there are some interesting developments on the horizon.
Some of the most useful data is generated from social media platforms such as Facebook and Twitter. For example, Twitter launched a new study of cultural shifts based on analyzing billions of tweets with machine learning tools. The study, which is available for free online, identifies 18 trends within 6 larger themes such as Well Being, Our Planet, and Creator Culture. This is but one example of social listening getting more refined as more data is available.
Quality Data
As the quantity of data increases exponentially, one of the biggest challenges facing researchers is verifying the quality of their data. Here are some guidelines to make sure your data is trustworthy.
- Reported data vs. behavioral data. What people say in surveys isn’t always consistent with their actual behavior. Some cutting edge researchers, such as Disqo, are finding ways to quantify the consumer recall gap. This will make it possible to measure this gap so it doesn’t distort your results.
- Use customer surveys while understanding their limitations. For example, many surveys are incentivized, which can reduce their reliability. People may fill out forms without much thought or honesty in order to collect a reward. Customers who have actually bought something from you recently are generally the most reliable.
- Don’t overlook the human element. While AI and machine learning are making it faster and easier to do quantitative research, don’t underestimate the value of humanistic research. This means understanding and caring about customers and respondents. It also means balancing quantitative and qualitative research. The latter includes conversations with customers, answers to open-ended questions, and analyzing blog and social media comments. When you include humanistic and qualitative factors you need a more intuitive approach as you’re dealing with words, tone of voice, body language, and other subjective factors. However, the best market researchers of today (and tomorrow) understand the value of both quantitative and qualitative information and taking a humanistic approach to both.
Predictive Analytics
Consumer insights are concerned with the past, present, and future of customer behavior. However, the future is what’s actually most important for product development and marketing. Ideally, you want to know what your customers will want in the future, perhaps even before they themselves do. Market research is increasingly focused on predictive analytics, which helps you do just this. Many of today’s most successful companies place a great deal of emphasis on predicting what their customers will want in the future. In some cases, of course, also nudge customers to guide them in a certain direction.
Amazon and Netflix are companies whose entire business models depend on predictive analytics. Amazon shows customers related items and recommends products based on past purchases. When you place an item in your shopping cart, you immediately get a list of related items and suggestions for products to add to your order. The online retail giant has been steadily speeding up delivery times. The next phase, which has been in the works for several years, is anticipatory shipping. Amazon wants to know customers so well that they can predict orders before they are made. This way, the moment you place your order, the package will already be ready for shipment, reducing delivery time even more.
Netflix also cares a great deal about predictive analytics, perhaps even more than online retailers. In the case of Amazon and other sellers of physical products, it’s likely that customers will re-order either the same or very similar items in the future. When it comes to streaming content, however, people are always hungry for something new. Netflix does, of course, recommend programs based on previous selections. Beyond this, it also customizes the entire screen you see as you browse. In addition to main genres (e.g. Action, Drama, Romance) there are actually more than 3,000 category codes. Categories are based on variables such as year, country of origin, director, actors, and hundreds of other criteria.
Netflix is very likely an early example of how AI and machine learning algorithms are used to predict consumer behavior. By segmenting obscure categories of films such as “Steamy British Independent Dramas,” “Understated Horror Movies,” and “Heartfelt Sports Movies,” the algorithm actually identifies viewers’ preferences more precisely than they could do themselves. This is ultimately the goal of predictive analytics: to know customers even better than they know themselves.
While most businesses don’t have the resources of Amazon and Netflix, you can still gain valuable insights by studying their approach. 2020 researchers need to embrace data science and at the very least be conversant or basic consumers of all that data science tools already offer.
The Importance of Business Acumen and Storytelling
Research and insights professionals need to focus on more than just data. They also need to understand and balance the needs of stakeholders and business partners. In fact, they should be ahead of their business partners when it comes to understanding the consumer behavior trends that will impact the business. It’s essential for marketing and technology departments to recognize insights professionals as equals.
Data smarts are important but not enough. Today’s insights professionals need to be able to tell stories with their data. Numbers alone are crucial but they don’t inspire. Stories put the numbers in a context that everyone can understand and act upon. This is one reason that companies are starting to turn to liberal arts majors as well as those with STEM skills for their market research needs. A background in fields such as literature, film, and other humanities helps researchers grasp essential truths about individuals and society.
Research and Insights Professionals Are Needed More Than Ever
The methods of market research are always evolving but the need for consumer insights is as great as ever. With so much data and so many tools to collect and interpret it, market researchers and consumer insights analysts need a great deal of discernment. They must be able to collect data that’s accurate and relevant and analyze it in a way that results in actionable insights. Imagine If Research & Insights delivers inspiration that creates impact. We’re a full-service agency that provides strategic custom solutions based on decades of experience. To learn more about our services, contact us.