A core concept in market research is consumer insight. It is a slightly misleading term, if you start to think a little about it in an innovation context. Firstly, it reduces the people to consumers and thereby narrows our research focus to use and purchase of products. Secondly, it is based on a hidden premise that consumers must create value for your business, rather than vice versa: how do you create value for people.
This has consequences. Using the concept of consumer insight, we can easily overlook what is interesting, namely understanding value creation for the people. It calls for a new perspective on market research and thus a paradigm shift in the methods we use. Instead of consumer insights, we need human insights that care for the whole person (daily life, needs, dreams, identity, etc.), rather than simply looking at consumption in isolation.
In a project for the City of Copenhagen to move people from car to bicycle, we ran around with drivers in their cars to get a deeper understanding of their needs and what it takes to get them onto the bike.
The businessman Naveen Jain is quoted as saying that it is not difficult to make a billion dollar business, you just need to find and solve a ten billion dollar problem. There are lots of “ten billion dollar problems” and the approach is great - to find solutions to important problems, both for the individual and for society. It requires that companies direct their focus on real people (even those who are different from you). This allows you to get insights into what concerns them, what is important, and what can make their lives easier or better. It can be difficult for most companies, where the existing product portfolio can easily lead to a kind of tunnel vision, because you naturally want to sell what is already on the shelves, rather than developing something entirely new.
Don’t go to the zoo - go to the savannah
At IS IT A BIRD, we often see that most companies know much about their customers, but that this knowledge is often limited to the use of their current products. Often these companies come to us when they see a changed customer behaviour, but have difficulty explaining why it has come about. We see it as a symptom of a general trend; a lack of understanding of the consumer as a human being, but merely as a consumer of an existing product.
In a project for Odense Municipality we visited and talked to citizens suffering from abuse in their own homes. The purpose was to gain a deeper understanding of their lives and their experiences of the municipal service, to find out what could be improved.
To understand and explain a changed customer behaviour you must zoom out of this narrow product focus and instead gain a deeper understanding of people's daily lives and work – and what shapes the decisions that people take all the time (rather than just looking at the sales figures, advertising knowledge etc.).
If, for example, we can see that the sales figures drop in a specific target group, it's not enough just to increase the advertising budget for this target group. We need to go out (physically) to this group to see and feel what is happening and gain insight into the causes of the change in behaviour. If a brewery finds, for example, that their younger target group are drinking less beer, but find it difficult to understand why, we must go out and shop, drink and party with young people and try with an open mind to understand the context and the feelings that they have when they drink alcohol.
The project for Carlsberg, we accompanied respondents in the purchase, pre-party and the party stages of the night, giving us insights into the journey stages.
New solutions to identified needs
On this basis, we can develop new products or services that give meaning and value to young people. The shift to studying real people opens the door for solutions that may fall entirely outside the normal area of focus (eg. beer). It is far from all companies that are willing to open up that way and certainly not in times of crisis. It takes tremendous courage to take an explorative approach and to be open to redefining what you do on the basis of the exploratory research, but the value is great.
A good example of a company that has managed to redefine its activities on the basis of deep understanding, not only of its customers (patients), but of people and social trends, is the US healthcare organisation Kaiser Permanente (KP). KP took control of the benefits of digital development, and worked with the fact that people's access to information has completely changed the way patients act.
They saw that more and more patients had a great deal of knowledge of their own illness and often knew more than the doctors, who were usually the experts. Against this background, Kaiser Permanente took a major strategic shift from being a traditional health organization where the doctor is the expert and the patient is a passive recipient of care, to a more collaborative organization in which patients are active experts, and the doctors are their coach, playing a more facilitatory role. Such a shift in the perception of their own business practices are only possible in an organization that is not only trying to keep its "customers" of existing products, but is open and receptive to how human behavior and needs change within society.
Clay Shirky says it very precisely: "Institutions will try preserve the problem to which they are the solution". That's exactly what we see when companies push shelf items out, rather than redefining its strategy to match the changing behaviors and needs that we can see if we widen our focus. We must look to the outside world, and have our finger on the pulse in terms of what creates value for people, rather than focusing on internal lines.
Social science does not provide the whole answer
This openness and change from customer focus to human focus requires other tools than we are used to when we find consumer insights. Large parts of market research are inspired by social science methods: quantitative methods (surveys) and qualitative methods (interviews and focus groups). These methods are not so strong in getting behind what people say, and may sometimes overestimate people’s reflections, and what they articulate in words.
We know from the latest research in behavioral economics that people rarely give valid answers to why they do what they do. However, we are really good at rationalising our actions. We also can rarely put into words what we need. This means that we cannot build market research on the assumption that people are rational agents who can articulate values, choices and preferences. And for the same reason it is dangerous to base decisions solely on traditional research.
For a project with DSB we immersed ourselves into the life of a commuter by taking the train every day during rush hour for two weeks. We gained deeper insights into how DSB communicates, and how this affects the transport experience.
We must serve people - not the other way around
Human insights require methods that get behind human behavior. We must therefore move the research to people’s homes, and other relevant contexts, and use empathy as our primary tool. We must observe behaviour, we must talk openly with the people we need to reach, and capture what is important and relevant.
It calls for methodical inspiration from anthropology, and from designers a more visual approach that can help us to get hold of the more hidden side which cannot immediately be explained: our irrational behavior, needs, values and dreams. These are all matters of importance when it comes to explaining our purchasing behavior and the choices we make in auto-pilot in everyday life.
This gives us a unique opportunity to develop solutions that affect humanity's future needs. And in that way we can 'serve' and help people to a better and easier life - and profit business at the same time.