Drive sales by understanding customers

Understanding customers through user research can increase business lead gen results

When is the last time your company spent time learning about your customers? How deeply do you understand them? Research shows CX (customer experience) has increasing importance for companies of all sizes to remain competitive. Understanding users is a key function of setting a CX direction.

Improving the user experience of a digital product can decrease churn, increase retention, and ultimately improve KPIs for a business. But it can also increase sales for companies.

Intechnic reports that 23 percent of online shoppers will share a positive experience with more than 10 other people. But they don’t stop the word-of-mouth reviews with positive experiences. Thirteen percent of users will tell more than 15 people about a negative experience.

So how can companies create a positive experience?

Let’s paint a picture

Imagine you are walking into your favorite store. Close your eyes if you need to. Go to that store in your mind.

What do you hear?

Smell?

See?

How do all of those things make you feel?

Delighted? Appreciated? Excited?

It’s no accident you felt those things. The store knew what and how to encourage those feelings. You might find that creepy, but by understanding what you (and others with similar likes and dislikes) want and need, the store has tapped into your emotions. Because it understands your motivations, goals, and frustrations, you are more likely to buy.

Successful (and profitable) companies spend a lot of time understanding their customers. In 2018, McKinsey & Company published results of a study that tracked 300 publicly listed companies for five years. These companies varied in location and industry. Here’s what they found:

On average (and across industries), businesses that embrace design generate 32 percent more revenue and 56 percent more shareholder returns.

The companies McKinsey studied varied in their level of design maturity, but there was something significant to take note of. The top 25 percent of companies embraced the full user experience. And a key part of user experience is putting the user first.

Why understanding customers isn’t easy

Standard Beagle has worked with a number of great companies that have the best of intentions when it comes to their customers. Typically, our clients come to us because something isn’t working, and they are frustrated because what they’ve tried so far hasn’t solved the problem. We help them understand the customers’ needs.

Why doesn’t a company understand their own customers? Sometimes it’s because of the organization’s assumptions.

The risk of making assumptions

According to the Harvard Business Review, many companies are at risk by assuming other people see the world the same way they do. Most companies are the centers of their own universe. But there’s a trap. Some companies take that a step further by assuming their product or service is also the center of their customers’ universes, too.

Companies that are well-established may have done some initial research into their customers when they first opened for business. The problem is — they may still rely on the same research years later.

These companies assume customer needs are the same, because things seem fine. But the world has changed dramatically in just the past five years. Technology and people have changed, not to mention the habits and lifestyle changes caused by COVID-19.

Your assumptions may work right now, but what if a competitor steps in and starts wooing customers away? All of a sudden, you’re at a disadvantage because your assumptions gave you a false sense of security.

It’s not about you

I worked with a company once that had a lot of really smart people working for them. They made assumptions that the customers were coming to them because they were impressed by their credentials.

It turned out that what the company thought were competitive advantages weren’t relevant to their potential clients at all. The clients valued ease-of-access to staff and locations above all else. The company had been so caught up in their own hype, they totally missed the mark on what was important to their customers.

Admit you may be wrong

The first step is admitting there may be a problem. If you own a company or work for a company that dismisses clues that it’s failing to connect, it’s time for an intervention. It’s time to step back and start taking customer needs seriously.

Start listening to different perspectives

The worst thing you can do is get caught up in your own hype and miss the signals that you’re not connecting. I recommend drawing on fresh perspectives — like new employees — to learn more about what customers are saying about you. Don’t dismiss feedback you don’t like as irrelevant.

How to understand your customers

Flat Design Illustration about Sitting interview.

Listen

Now that you’re ready and willing to understand the customer perspective — what do you do?

It’s time to start listening to them. Customers love to be heard. People love talking about themselves and the easiest thing for anyone to talk about is what they need. By talking to your customers you’re doing two things:

  1. Showing them you care
  2. Gaining valuable information about what they need from you

It might be tempting to just start talking to people and asking a bunch of questions, but I urge you to step back. By planning out your process, you can learn a lot more and actually gain valuable insights.

I typically recommend a combination of qualitative and quantitative methods for learning about your customers.

Start with what you know

Don’t toss your assumptions just yet. Use them as a starting point. Understanding customers needs to start somewhere. So think about who your customers are and what you think you know about them.

  • What do you know about them?
  • Do they share common demographics?
  • Where do they work?
  • How do they behave?
  • Do they use the same technologies?
  • What are their frustrations?
  • Are there goals they want to achieve?

Capture everything you know and create a profile of your customer.

Gather quantitative data

Quantitative data provides information about who your customers are and what actions they take. You can gather this data through a number of sources, including analytics tools and surveys.

Surveys are tricky, though. Erika Hall of Mule Design warns against poorly done surveys, which are very common. Surveys are easy to create. They are also easily biased.

Well-written surveys executed with the right context can be useful for making data-backed decisions.

  • Who
    Use Survey Monkey or another tool to set up a short survey and send to segments of your customer base.
  • What
    Make the survey short. Most people won’t take a survey. Tell them it’s just a few questions in your email. You might also set up a prize drawing and give customers an opportunity to enter if they complete the survey.
  • How often
    Be persistent. Ask for feedback three or four times if you haven’t heard from them. People often miss emails or think they’ll come back at a later time if they do want to answer. You shouldn’t give up after sending out the survey. Send these with about one or two weeks in between emails. Personalize them as much as possible. Just make sure you don’t harass someone who already filled out the survey.

Gather qualitative data

Where quantitative data provides “what” is happening, qualitative provides the “why.”

There are a number of methods for collecting qualitative data, and one of the ones we turn to most frequently is customer interviews.

Interviewing allows you to gather deeper, more emotional insights that can be used to create genuine insights.

Here’s why: customers are more likely to open up and tell you things that you didn’t know to ask about.

The Febreeze example

Let’s look at an example.

Proctor & Gamble originally tried to sell Febreze as the cure for America’s foulest stenches. But that flopped. The problem was that people got used to the odors in their homes, so they thought their houses smelled fine regardless of any lingering stench. That eliminated the cue to spritz Febreze.

Understanding customers of Febreze

So P&G hired a researcher to interview customers on how they used the product. That person spoke to one housewife — who kept an immaculately clean home — who said she sprayed Febreze as part of her room-cleaning habit. Not as a way to combat nose-pummeling odors.

That priceless nugget of insight triggered an analysis that made P&G realize customer motivations and product uses. The company changed the way it marketed — showing Febreze as a reward for cleaning in its ads and product packaging.

Within two months, sales of the product doubled.

Interviews reveal insights

Interviews reveal the things you can’t get from emails, website comments, or surveys. Here’s how you get started:

Create a list of questions to ask customers

Answers to the questions should provide a clear picture of why your customers act the way they do. Make the questions open-ended. You don’t want to make them leading or rhetorical.

A word of caution.

Customers don’t always know what they want. Humans have a cognitive bias that cause us to overestimate our future actions. People can make confident but false predictions about their future behavior.

You don’t want to ask what people want or like. You want to ask them about what they’ve previously done or liked so you can understand why. Your questions should help you understand the pain points and goals so that you can innovate from them.

Recruit participants
It’s not necessary to recruit hundreds of people in order to understand customers. You want a decent sample to gain valuable insight, but not too many. Studies show that just 12 interviews will uncover up to 80 percent of the most common issues faced by customers.

  • Who
    Look at your persona. Recruit participants that roughly match that persona — you want to reach people who are and might be your target customers.
    Customers are best, but if you can’t get them, sit down with people who might be but aren’t.
  • Compensate participants
    Make sure to compensate participants in some way for their time. Your interview might take anywhere from 30 minutes to an hour. Buy them a cup of coffee or better yet, provide a gift card.
  • Build rapport
    Explain to your participant what you’re doing, and help them feel comfortable. Ask the questions and let them talk. The interviewee should do 80 percent of the talking. You need to listen. Be objective and encourage honesty.
  • Take notes
    Be sure to write down as much as you can. If you don’t think you’ll be able to, ask the interviewee if you can record the interview on your phone so you can listen to it later.

Creating actionable insights for understanding customers

You’ve interviewed 12 people, your survey generated a number of responses… now what?

Now it’s time to analyze. You need to take the raw information and generate insights so you can take action.

Who should be part of this?

I recommend your team. If you’re organization is large, then perhaps your executive team. If it’s small, then perhaps everyone. You want to make sure you have a diverse group of individuals, but not too many.

Collect the data

Start by taking everything you know and entering it into a spreadsheet.

Be careful. It’s easy to be biased here. The best way to overcome the bias is to have two people who did not conduct the interview to pull the information into the spreadsheet. Have them listen to the interviews and gather the survey results and pull everything out.

Group

Multiracial developer team working on scrum sprint board together and organising project tasks flat vector

Now it’s time to take the information and start categorizing.

I recommend taking each idea and putting it on a sticky note and placed on a whiteboard or blank wall. This allows the information to be visible and grouped together. Don’t be afraid to move them around.

What are common themes that can be groups together? What ideas are similar? Different?

Insights

You probably have three to 10 categories by now. Insights are what you learn from your research. Ask:

  • What can you see about each one?
  • Are there common themes?
  • Can you see patterns of behavior?

For example — are most customers using their phones at home or on the go? Do they have common pain points and frustrations? Do they have common goals?

Where do these insights differ from what you thought you knew before you started interviewing?

Next steps

Now that you have a clearer idea of your customer, what they look like, and what their pains and frustrations are — you have something to work with. This customer profile is the starting point for any changes you need to make.

  • Does your messaging resonate with them?
  • Does your product or service make sense to them?

If not, you might have some changes to make.

Because this work can be time consuming and involved, it’s common to work with a user research specialist, like Standard Beagle, for help in this process.

Conclusion

This process is just a starting point. By understanding your customers, you are keeping your ears to the ground, just like the big companies.

You can stay nimble as the market changes. But more importantly, you are able to make changes that will not only help you retain your current customers, but also attract the customers you want to serve.

Resources

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