Consumer insights have emerged as an essential tool for marketing success.

When brands look into consumer psychology and the forces behind consumer behavior, companies can craft new products and marketing campaigns, thereby increasing profitability. Companies need to connect with consumers, watch out for frustrations, and, most importantly, identify their needs and expectations!

What is Consumer Insight?

Consumer insight is an act of collecting and interpreting customer data. Consumer insights are generated from online customer data, sales data, customer engagement data, customer feedback, and surveys, focus groups, and customer interviews.

Consumer insights are collected with an intention to derive a deep understanding of your audience. The act of consumer insights involves analyzing human behavior to understand their needs and wants. Not just that, consumer insights detect reasons that lead to particular consumer behavior. Studying consumer insight reveals the trends in human behavior. These trends become valuable to increase the effectiveness of a product or service.

Why Are Consumer Insights Important?

Elon Musk, Founder PayPal, SpaceX, and Tesla Motors says, "I think it's very important to have a feedback loop, where you're constantly thinking about what you've done and how you could be doing it better. I think that's the single best piece of advice: constantly think about how you could be doing things better and questioning yourself."

Customer insights derived using customer data allows you, as a marketer, to identify underlying patterns in your consumer behavior. Consumer insight is useful for decision making. These decisions based on customer data will result in effective campaigns and strategies. In other words, it results in increased profitability.

Here are 6 Reasons Why Consumer Insights Are Critical for Marketing Success

1. To gain a better understanding of your target customers

Who will buy your product? Why do they buy your product? From where do consumers buy your product? How often will they buy? When you get answers to these questions, you have a better understanding of your consumers.

Consumer data that is collected and processed into useful insights go a long way in predicting customers' future choices. With the help of customer data, marketers get to know precisely where to focus their time and effort to deliver an extraordinary customer experience. Marketers can focus on building the right marketing strategies, discounts, promotions, and social media messaging.

2. To gain knowledge of your competitors

To stay afloat in this highly competitive landscape, companies need to get creative by understanding their customers. Brands consistently have discovered methods to beat their competition, and have emerged as kings in their industries by using consumer insights.

Consumer insights help to assess the market and identify key players. Moreover, it will help you identify weaknesses in your competitor's marketing strategies. With consumer insights, you can determine what worked the best for the competition. This will, in turn, assist you to think more creatively and to model your new strategy.

3. To build high performing marketing campaigns

Consumer-insights-driven marketing campaigns make use of the customer data to convert it into insights that can be used to improve and optimize performance.

The fast-pace with which the consumer behavior changes makes it more important for the use of consumer insight into designing relevant marketing campaigns. When a company has researched its target audiences and has identified key drivers to purchase, it becomes easy to build a meaningful marketing campaign.

4. To improve the success rate of new products

Companies consistently strive hard to improve the success rate of their new products or new ideas. One of the most important ways is to conduct sound and thoughtful consumer research to derive consumer insights.

These consumer insights are incredibly important when a company is looking to penetrate into highly competitive markets. Consumer conversations reveal a lot about the way they feel and think about the requirement of a new product. This consumer data can be used to evaluate interest in new products. With the help of the real-time data on the reactions of the target audience, the products can be improvised, thereby leading to a better success rate.

5. To recognize the gap in the market and identify business growth

"The pre-eminent skill required to shift ahead in the twenty-first century is the ability to see and seize." -Adamson and Steckel, authors of Shift Ahead.

For a business to grow, a well-researched business strategy is a must. A significant part of the strategy depends on how its customers accept their products and services.

Out of all the ways of developing new business, recognizing the gap in the market seems to be most important.

For instance, see how consumer insights helped Aguas Danone, a bottled water company in Argentina, to identify market opportunities. Aguas Danone identified two reasons for its falling sales – health and flavor. Even though bottled water was healthy, consumers did not see that it offers a good taste. Whereas soft drinks and juices tasted really good, but consumers perceived it as highly caloric. With the help of these insights from consumers, the company identified an opportunity for healthy drinks that can offer taste as well as and flavor. As a result, they launched flavored bottled waters 'Ser' with great success.

Consumer Insights Tools

When there are consumer conversations on a large scale, a company cannot manually convert it into actionable insights. All you need is tools to lift the heavy work for you. These tools are important to analyze the massive volume of customer conversations instantly. The Artificial-Intelligence enabled tools can crawl through customer data and pull out relevant conversations. This data that was earlier lying without any use can now be mined to derive deep insights about your consumers.

For example, Clootrack is an Artificial Intelligence-based analytics platform that effectively gives companies the prevailing sentiment of their customers. It derives highly actionable insights that they can use to devise and execute more effective strategies, product improvements, better customer service, and marketing promotions. These would further enhance positive perceptions while addressing and ultimately eliminating the negative ones.

Through a detailed analysis of 2,905 customer conversations, Clootrack has created a list of the top four customer perception drivers that customers associate with the best telecom provider.

Wrapping Up

"At the heart of an effective creative philosophy is the belief that nothing is so powerful as an insight into human nature, what compulsions drive a man, what instincts dominate his action, even though his language so often can camouflage what really motivates him." Says William Bernbach, the U.S. insights pioneer.

Consumer insights are simply the fundamental truths of your audience!!

Consumer insights are critical and play an important role in targeted business decisions keeping consumers at the forefront.

But the humongous customer data can be overwhelming. Hence, it becomes important to represent the relevant findings in a way that can be easily understood by decision-makers. To express the story behind the data points, it is essential to use visual aids such as graphs and charts to bring the customer data to life.

Remember, a company is only as successful as its potential to appeal to customers!

Author Bio: Uma Bhat is a content marketing professional at Clootrack, a market
intelligence platform. She writes about consumer insights and market intelligence,
and how businesses can improve customer experience using consumer insights.