Borrow the Thinking, Not the Budget: Who are you really selling to?

SHOP VISITSHOPTALK

7 Mar

What consumer insight can do for a small business, even when there isn't a research department, strategy team or sizeable budget to pay for one.

Somewhere in a meeting room, a very large company is trying to work out what you're going to do next.

Not you specifically. But someone rather like you.

What you'll eat. Where you'll live. What you'll stop buying. What you'll pay more for. How you feel about work. Whether you're worried about money. What you consider a luxury. What you're quietly fed up with.

Large organisations spend considerable sums trying to understand how people are changing.

There are research studies and focus groups, analysts and strategists, trend reports and customer segmentations. Sometimes the resulting presentation is several hundred pages long.

The interesting bit, however, is usually much simpler:

Something about people's lives has changed. What does that mean for us?

It's a question any business can ask.

Start with people, not customers

Earlier in my career, I worked in consumer insight at The Future Laboratory.

One of the things that stayed with me from that world was the distinction between looking at people as customers and looking at them as people. A customer buys flowers. A person might be living in a smaller home, working differently, getting married later, worrying about money, spending more time online, caring more about where things come from or deciding that Tuesday evening deserves flowers just as much as a birthday does.

Those wider changes are often where the useful information lives.

Because businesses don't exist separately from people's lives.

They sit right in the middle of them.

The Just Nots

One consumer group I remember working with was called the Just Nots. They represented a sizeable group of people for whom many of the traditional markers of financial progress were becoming just out of reach.

Not poor enough to qualify for much support. Not affluent enough to stop thinking about money. Home ownership might be out of reach. A large unexpected expense mattered. Even replacing a washing machine could require some thought.

But – importantly – aspiration hadn't disappeared.

People still wanted good things. Attractive homes. Enjoyable experiences. Products they felt pleased to own.

The question for businesses wasn't simply, how do we sell cheaper things?

It was more interesting than that.

How do you create something desirable that recognises the financial reality of the person you're selling it to?

That's consumer insight becoming useful.

Not a demographic on a slide.

A tension in someone's life that a good business might be able to resolve.

You don't need a focus group

An independent business is unlikely to commission a national study before changing its lunch menu.

It probably shouldn't.

But small businesses have access to something many larger organisations would dearly like more of:

proximity.

You actually meet your customers.

You hear the questions they ask.

You notice what they pick up and put down again.

You know which product requires an explanation.

You see what sells immediately and what everyone admires but nobody buys.

You hear, I'd love one, but…

That last bit is particularly useful.

The but is information.

Too expensive. Too big. Wrong time. Don't know where I'd put it. Need to ask my husband. Wish you did a smaller one. Could you deliver? Do you have it in blue?

None of these comments constitutes rigorous market research on its own.

Collectively, they begin to tell you something.

Listen for the change

The most useful question isn't always:

Who is my customer?

It might be:

Who is my customer becoming?

A florist might notice people buying fewer large arrangements but more small bunches for themselves.

A café might find that the morning rush has shifted because fewer customers commute five days a week.

A furniture maker might discover that customers love the work but increasingly live in homes where the proportions don't make sense.

A shop might notice people coming in to touch and try things, then ordering later online.

A photographer might find that clients increasingly need moving image alongside stills.

These aren't simply sales fluctuations.

They can be clues.

And noticing them early gives a small business the opportunity to respond while the answer is still relatively simple.

Watch what people do

There is another useful lesson from consumer research.

What people say and what people do aren't always the same thing.

Ask someone whether they value locally made products and they may enthusiastically say yes.

Watch what happens when the locally made version costs twice as much and you learn something else.

Neither answer is necessarily dishonest.

Human beings contain contradictions.

We want convenience and ceremony. Sustainability and next-day delivery. Fewer possessions and a new pair of shoes. Something unique that we've already seen somebody else wearing.

The interesting territory is often between the two.

For an independent, observing behaviour can therefore be more useful than endlessly asking customers what they'd like.

What do they return for?

What do they photograph?

What sells without explanation?

What gets abandoned at checkout?

What do regulars buy that new customers don't?

Where do people hesitate?

Pay attention to the behaviour around the transaction, not only the transaction itself.

Don't invent an imaginary customer

There is a particular temptation in branding to invent someone called Sophie.

Sophie is 38. She lives in a Georgian terrace. She enjoys Pilates, natural wine, European city breaks and browsing independent shops on Saturday mornings.

Poor Sophie has been responsible for an extraordinary number of brand strategies.

Personas can be useful.

But only when they help you understand something real.

A fictional customer's favourite magazine is less useful than knowing that your actual customers are increasingly buying gifts at the last minute and would happily pay for same-day local delivery.

Insight doesn't need to sound sophisticated.

It needs to change what you do.

Ask the better question

Small businesses will never have the research budgets of supermarkets, banks or global consumer brands.

They don't need them.

The advantage of being small is that research doesn't always have to happen in a research department.

It can happen behind the counter.

On Instagram.

Over coffee with a customer.

Inside your website analytics.

At a market.

While packing an order.

In the sentence somebody says as they're walking out of the door.

The important part is noticing.

Then asking:

What does this mean for us?

Because the purpose of understanding people isn't to produce a better description of them.

It's to make a better decision.