The 5 Essential Rules of Customer Observation for Greater Business Success

One of the best ways I know to understand your customers is to watch and listen to them whenever you can.

Customer observation is a powerful, but unfortunately under-utilised tool these days. So when was the last time you got intimate with your customers? If it wasn’t in the last week or two, you’re not getting out enough!

Before going on, I should explain that I use the word “customer” to describe the person who buys and/or uses your product or service. For the B2B business, the recommendations in this article are still valid but would be of particular value when you work with your supplier or retailer, to help them to better know their own customers.

It is, therefore, not surprising that most companies run to conduct market research when they want to know something about their customers. They then (hopefully) invite relevant employees from marketing, sales, packaging, communications or R&D to watch the interviews or group discussions. However, this intense but short observation is likely to do more harm than good.

Let me explain.

Have you ever gone to watch a focus group only to discover that the research confirms your hypotheses? I bet you felt disappointed and even a little irritated that you “wasted” money on the project weren’t you? Well, this may be the result of your selective listening and interpretation. You watched and listened only to the topics that interested you. You were looking for confirmation of your hypothesis. But there was so much more you could have understood if only you had bothered to listen.

True understanding comes from regular interaction with your customers, not just from an infrequent observation or two. Here are some ideas on how to do this more effectively.

Make Customer Observation Everyone’s Job

There are many, many opportunities for every employee in an organisation to come into contact with their customers. In a customer-centric organisation, everyone has annual objectives which include connecting with customers on a regular basis. This could be by:

  • listening to calls at the care centre
  • reading posts on social media and message boards
  • participating in / watching promotions, demonstrations, and sampling in retail outlets
  • joining market research fieldwork

Some organisations also habitually get their employees to watch and listen to their customers in direct observation or connection sessions. However, these need to be managed carefully in order to avoid people jumping too quickly to incorrect conclusions, as I’ll explain in more detail below.


If you’d like to know more about running successful connection sessions in your own organisation, I can help.  Please contact me for more information about our 1-Day training sessions.


Customer Observation is Not as Easy as it Looks!

There is a very well-known example of the challenge of observation, in a video showing two teams of young people passing a couple of balls around. You can check out the Awareness Test and try it if you haven’t seen it.

In the exercise, people are asked to count the number … Click to continue reading

Three Clever Ways to Know the Competition Better

What is the secret to success in business? That’s easy! It’s how well you know the competition.

Alright, maybe this is a slightly over-simplified perspective, but it always surprises me how many companies work with a primarily internal focus.

I have written many posts about knowing your customers, such as “Why Customers Are The Answer To All Your Problems (If You Ask the Right Questions).” Watching and listening to them in order to fully understand their rational needs and emotional desires is a great – and free! – way to start.

But today I would like to speak about doing exactly the same thing for your competitors. If you are going to succeed in attracting their customers away from their products and services, then it would make sense to know them as well as you do your own.

Here’s a simple three-step process to do so. 

 

Encourage employees to use competitive products & services

Know the competition better by trying their products and services.In most organisations today, using competitive products is still frowned upon; after all, we make the best don’t we, so why use those of other companies?

However to challenge and beat the competition you have to intimately know what you are up against. Regular contact with competitive products will encourage your employees to evaluate your own offering. They will also be encouraged to suggest competitors’ strengths and weaknesses that were perhaps not evident before. It will also ensure that you are rapidly aware of any improvements made by the competition. You won’t get left behind and find yourself suffering from declining sales due to competitive improvements of which you are unaware.

This intimacy with competitors’ products and customers should be requested of employees at all levels, by being one of their annual objectives. Of course, in some industries this might not be possible, due to the selective nature of the product or service, but certainly for most consumer products and service companies, this can easily be done on a regular basis.

Now encouraging people to use competitive products is easy to say, but you should also be prepared to invest in it, by paying for your employees to experience them. It would be unfair, and would certainly be resented, if your people had to spend their own money to make such experiences. This knowledge gathering should be seen as an investment by your organisation, of at least equal value to offering your employees discounts on your own products and services.

Why don’t you start a similar process and add these experiences to everyone’s annual objectives? It’s a great way, and a free one at that, to know the competition better than you do today.

 

Make a Library of Competitive Products and Material

KNow your competition better by sharing what you knowIn one of my previous positions, the company had an incredible competitive library. This included every single competitive product that was available from all around the world, classified by country and organised by segment.

Everyone found this library extremely useful, especially when discussing such topics as shelf impact, packaging or in … Click to continue reading

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