Gathering consumer insights and translating them into input for new-to-the-world products, services, business models or processes, is one of the most well established – not to mention popular - practices around. And for good reason. A consumer insight, defined as an intrinsic need or desire of the consumers to which a brand alludes with its solution offer, can be decisive for the correct placement (and ultimately, appeal) of whatever exits the innovation funnel. In fact, professional literature has even coined the term “consumer centric innovation” or CCI to describe the specific means by which successful companies leverage the wisdom and needs of users to create recognized brands.
But if consumer-centric entities are proficient at creating products that capture customers’ imaginations, provide entertaining experiences, and/or deliver solutions to previously unmet needs why do 80% of these products fail? A little over a decade ago, renown marketing scholar Gerald Zaltman synthesized his answer in a celebrated bestseller about the mind of the market. Today though, we realize that in some contexts not even the best of psychology, neuroscience, sociology, and linguistics can guarantee a product’s success. So how (ir)relevant has consumer research become? Should business leaders stop wasting their time? Does the type of innovation project even matter?
Some experts argue that spending vast amounts of the marketing budget on assembling focus groups, drafting questionnaires, developing expensive phone apps (ever heard of Over the Shoulder?) or even on leveraging RFID technology (Spychips predicted some chilling scenarios) to shamelessly invade the privacy of consumers and “extract” their beliefs and experiences – with or without their consent - is altogether pointless. Take Apple - its former iconic leader, Steve Jobs, was known to dismiss market research efforts on every occasion. His judgement was that customers don't know what they want until someone has shown it to them – a phrase later know as the Steve Jobs market research quote.
Yet Apple was never alone in its thinking. All major industry disruptors exhibit (to varying degrees) scepticism about their customers’ ability to articulate needs and predict futures. IKEA - unmatched in its innovative furniture retailing, Corning Glass - maker of the revolutionary Willow Glass or Genalice - a forerunner in the affordable gene map race are all using their own scenario mapping and future thinking skills as compasses, often going against what currently sells.
We now understand that consumer insights alone cannot produce breakthroughs unless accompanied by a strong ability to "recognise" the future. What about the incremental side of the innovation coin? Do product managers at fast moving consumer goods or video game companies need to stop spending their marketing budgets and start meditating more? Not entirely.
For businesses mainly concerned with extensions of products already on the market consumer insights are far more valuable. The ways in which these insights are collected & interpreted can make a world of a difference, though. As Jeff Ready humorously notes in 2011 Forbes article, consumers are by no means always right. Neither are they always truthful, good at assessing purchase likelihood or competent at drawing competitor landscapes. What consumers do have, however, are all the answers – answers (or insights) that market research teams are in charge of extracting through a number of modern approaches - chiefly web-based or consumer behaviour analysis related. The “Jobs To Be Done” approach, for example, provides a fresh way of looking at customer needs and motivations in business settings. The framework, developed by Clayton Christensen, builds on the premise that consumers often buy things because they find themselves with a problem that they need to solve. Hence, by understanding the exact “job” for which a customer hires a product or service, companies can more accurately develop and market products well tailored to those specific needs.
Summing up, consumer research is far from obsolete and understanding consumer insights remains, for the most part, a decisive factor in the appeal of a new product, service, business or process innovation on the market. While disruptive innovation, with its forerunners Apple, IKEA, Corning or Genalice, offer a cautionary tale, incremental innovation projects still benefit greatly from practices designed to uncover and interpret consumers’ aspirations and needs.
What ultimately sets innovation successes and failures apart are: vision and a powerful weapon of choice – research weapon / method of choice that is.