Consumer insights: Understand what drives your target market

Consumer insights look at the wants and needs of your target market to explain why the market behaves the way it does. This type of research can give your business a deeper understanding of consumer behavior—including both personal consumer preferences and market trends.

Market research data, like how many people in your target market would consider buying your product, isn’t always enough to go on when it comes to product development and marketing. Your business also needs to know what drives that data. Consumer marketing insights help you understand potential customers and make product and marketing decisions that win them over.

Some companies use the terms “market research” and “consumer insights” interchangeably. In fact, both provide abundant knowledge that can enrich decision-making for your brand, but they aren’t interchangeable—the two types of research overlap but each has a specific purpose. Remember the difference this way: Market research is the collection of data about your target market, and consumer insights research is the interpretation of the data in terms of the customer's voice—basically, what you learn about customer behavior from the data.

Market research gathers data on consumer behavior using research methods like interviews, focus groups, experiments, and surveys. This type of research often generates both quantitative and qualitative data, such as data on market demographics and consumer sentiment.

Market research results are often either statistical or anecdotal. For example, you may find that 55% of consumers think it’s very important that your business donates to charity, while 31% think it’s somewhat important—and some consumers may even suggest a specific charity.

Consumer insights dig deeper into market research results to explain the “why” behind a statistic. For example: why do consumers think it’s important for your business to donate to charity? Maybe your brand values align with a specific cause they want you to support. Maybe they want to feel like they’re having a positive impact when they purchase your products.

Consumer segmentation and usage and attitudes are two types of consumer insights that yield useful, valuable information for your future business plans. Getting acquainted with the evolving preferences and behaviors of your customers will help you make informed, smart, and successful business decisions. Once you know how to use consumer insights, you’ll understand the amazing gains you can make in your marketing and customer satisfaction and retention goals.

To put together a full picture of your target market, you need demographic information, psychographic data, and a clear understanding of their consumer behavior. You can obtain this information through thorough market research. Once you’ve collected the data, you have everything you need to pinpoint your desired consumer segments within the target market. 

Within your target market, there are likely several different groups of people. They live in different places and have unique needs, pain points, traits, and expectations of your business and products. Consumer segmentation takes your customer list and separates them into groups based on the traits they share.

Segmenting your list allows you to use targeted advertising and marketing to reach a specific consumer group. Consumer segmentation groups can guide you in creating a customer persona for your overall marketing strategy.

You can measure the behaviors and motives of your consumer (and potential customers) with consumer insights. Use the data generated from usage and attitude studies to gain a deeper understanding of your market. Who is using your product? How do they feel about your brand? How often do they use your product? As the market for your product evolves, consumer insights on usage and attitudes will be critical to finding the right way to reach the right consumers.

As a brand, your goals should include providing your customers with a great experience, focused marketing campaigns, and brand innovations informed by your target market. Consumer insights take your market research a step further towards personalizing your marketing, products, and services.

Consumer insights allow your brand to experience itself from the customers’ point of view. This is a rare opportunity to gain insight into your brand by looking through the lens of the customer. By understanding what works and what doesn’t, from the customer perspective, you’re able to identify areas for improvement along the customer journey.

While the so-called “buyer's journey” is no longer a straight line and is more difficult to track, consumer insights can help you understand and improve the touch points along the winding pathway to the purchase of a product or service.

Your business runs an online store that sells educational materials and games for children. Your customer segment includes women aged 25-35 with one or more children under 18. Your consumer insights reveal repeated mentions of your online store being difficult to navigate, so your web developer is tasked with simplifying site navigation and eliminating errors. The improvements enhance the web experience and improve the journey, ultimately leading to more sales.

Customers expect personalized marketing, and your ability to provide experiences that are tailored to your most desired segment of consumers is what helps you beat the competition. Your marketing efforts should resonate with your customers' wants and needs—and you’ll reap the benefits.

You want to personalize customer experiences when they are shopping for educational materials on your web store. To personalize the experiences, you add a screen during checkout to show them what others who have bought the products they’ve chosen add to their own carts. These personalized recommendations will often lead to more sales. Test the effectiveness of your personalization efforts with messaging and claims analysis.

Customer churn is the rate of attrition or the rate at which customers stop doing business with you. Use your consumer insights to get to know your customers and predict and prevent churn. It’s said that it’s easier and cheaper to keep an existing customer than to acquire a new one. Keep the ones you have by watching for indicators of churn.

You note in your data that many respondents said that they like your educational software products. However, your market research indicates that many of your customers are requesting a new feature for homework help. You use this insight to develop a new help feature to keep those customers happy and still engaged fans of your brand.

Collect feedback from a new market you’re considering with consumer insights. The data will let you know if the market is viable for your business, as well as how to optimize and tailor your communication and marketing to turn a potential customer into a loyal customer. Use your insights to create new advertising for that market segment. Not sure your ad is creative enough to reach them? Try ad creative analysis to measure the effectiveness of your advertising.

You have long thought that your educational solutions for students would be valuable to teachers as well. You perform research to identify interest from this customer segment. Your consumer insights indicate that teachers would be interested in using your products for supplementation, lesson planning, or extra practice for students. Now you can plan new, personalized marketing campaigns based on the data and insights for the new segment.

Drive growth by increasing the value of your existing customers (remember—we said it’s easier to keep customers than gain new ones). Use your consumer insight data to listen to what your customers want, go above and beyond, and identify channels for cross-selling and upselling to maximize customer lifetime value. 

Your educational company, now selling to parents and teachers, wants to maximize customer lifetime value. You launch a loyalty program, offering existing customers motivation to continue to shop with you to obtain rewards in product discounts, cashback, or free items. This keeps your customers loyal and returning to you for their educational needs, extending their time and value as your customer.

Every business needs consumer insights and even those with a bare-bones staff and budget can generate them relatively easily. Agile market research techniques empower your business to take control of its own market research, instead of hiring outside researchers to do the work for you. Here’s how you can find consumer insights in your research data:

Businesses with accurate data are more likely to generate meaningful insights. Make informed conclusions about consumer behavior by diving into the wants, attitudes, and buying behavior of your target market with consumer insight research. This type of market research helps you build correlations between beliefs and buying behaviors.

While there are many types of consumer insight research, surveys are often the most versatile way to tackle consumer research questions—and they play a key role in more complex research methods like focus groups and experiments. With surveys, your business can quickly and frequently collect data from a representative sample of your market.

There are two main ways to extract consumer behavior insights from your research. You can either directly ask respondents for their insight or establish correlations between data points once your consumer insights research is complete. If you’re using the first method, ask follow-up questions that encourage participants to explain the reasoning behind their buying behavior. Survey logic can help with this, as it lets you include custom questions based on a respondent’s previous answers.

Businesses often struggle to manage the information they collect from market research. Only 1.9% of marketing leaders say that their companies are equipped to leverage marketing analytics and effectively use their data. To generate insights from consumer market research or analytics, you’ll need to sift through big data to find the most important data points.

To identify potential insights, organize your data so that patterns emerge in your participants’ buying behavior. To manage large data sets, filter your responses to look at patterns in smaller segments of your target market. This technique helps you uncover micro-trends and correlations, and lets you focus on a more manageable pool of participants.

Consumer insights are only useful in the hands of the people who know what to do with them. Make a real impact on your business by sharing your key consumer insights with the co-workers or employees who will benefit most from your research. A shared database or report are good ways to make your insights accessible to anyone at your business who needs them.

New consumer insights help your business stay on top of market shifts, but consumer behavior data from the past can be just as useful. Past insights are a great way to add context to future research questions and benchmark future insights, so hold on to the reports you make—the best consumer insights are those that your business can return to time and time again.

Any data point that explains why consumers behave the way they do is a consumer insight. A digital consumer insight looks at why people behave the way they do in your online store. A retail consumer insight looks at why people behave a certain way at a business location.

An online retailer, for example, might try to find out why some people place items in their online shopping cart without ever checking out. Is it because they encountered an unexpected fee? Is it because they never had any intention of going through with an online purchase? A digital consumer insight that answers these questions will help the retailer convert these customers.

A coffee shop, on the other hand, might look for retail consumer insights that help it meet the demands of nearby consumers. Does its target market like to experiment or prefer to stick to the same drink every day? Do they drink coffee for a boost of energy during the workweek or to relax with friends on the weekend? These types of insights inform local buying behavior.

Just like consumer insights, customer insights look at the “why” behind market research results. However, consumer insights examine the thought process of your entire target market, while customer insights just focus on the wants and needs of people who are already your customers. Methods like customer satisfaction surveys and case studies help businesses get insight into important buying behaviors like customer preferences, frequency of use, and repurchase behavior.

Many businesses use both consumer and customer insights, but B2B businesses often lean more heavily on customer insights. These businesses work with the same clients (or type of clients) over and over, so understanding customer behavior is key to retaining business. B2C businesses, on the other hand, often spend more time with consumer insights. They may need to constantly attract new customers, so keeping a finger on the pulse of the market is crucial.

From the quality of customer service interactions to the ease of repurchasing a product, customer insights can take many forms. For many businesses, understanding the thought processes behind customer metrics is crucial to delivering a good customer experience.

A business software company, for example, will probably spend lots of time with metrics like number of downloads, number of active users, number of people using specific features, and overall user satisfaction. More than consumer market insights, these customer experience insights help the company adapt its user experience to the evolving needs of the market.

While customer insights are based on satisfaction with the experience of purchasing your product, the consumer experience is focused on the product or service itself. Consumer insights are borne out of examining requests for new features or products, what the competition is doing, brand sentiment, and other data directly related to the consumer experience with your brand and product.

Once the customers in the above example of a software company have made their purchase, the consumer experience begins. The consumer market insights identify sentiment, behaviors related to a brand, and how they interact with your marketing and product after the purchase has already been made. These insights into what consumers experience want, like, and dislike, are used to drive the company to launch new products and features and to make changes.

Whether you’re getting your insights from consumers or customers, your business generates better outcomes when it takes the time to really understand people’s wants and needs. With consumer insights you can develop a comprehensive understanding of buying behavior, so you no longer have to market test every idea to predict how your target market will react.

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