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Consumer Understanding

Consumer Understanding

29 November 2024

Define your consumers’ needs to develop actionable insights that resonate and engage them effectively.

On pursuing market share, American entrepreneur Seth Godin once noted: “You don’t need everyone, in fact, the act of chasing everyone is probably keeping you from reaching anyone.”

Godin’s statement stresses the importance of focusing your efforts on the consumer segment you want to reach and devoting your resources accordingly to effectively reach the target consumers you care about.

How to define target consumer segments?

Note that focusing your resources does not equate to bombarding consumers with advertisements. Rather, it involves understanding and serving their needs and preferences.

Consumers can be segmented based on:

  • Demographics (e.g., age, gender, income, etc.), or

  • Psychographics (e.g., motivations, aspirations, interests)

Most importantly, identify one to two consumer segments that resonate most with your brand purpose, then start engaging with them and learn from your experience.

How to develop consumer insights?

Consumer insights help you anticipate consumer needs and unlock business growth. Insights tell you why consumers behave the way they do, informing you of their underlying motivations. Remember, information alone does not equate to insights.

Differentiate between consumer information and insights

A comparison of the distinguishing characteristics of these concepts

Information
What the consumer said or did

Insight
Why the consumer said or did

  • A statement or fact with no interpretation

  • Often derived from research findings or debrief sessions

  • Is something you or others have observed or heard

  • Minimal to no interpretation

  • Expressed as a want, need, belief or feeling

  • Represents an accurate appreciation of the consumers’ reality

  • Offers a fresh perspective that may seem obvious in hindsight

  • Opens up opportunities

Learn how to develop consumer insights with this 7-minute video.

Follow these steps to generate key insights

Generating insights involves four key stages:

  1. Identify: Define your business objective and determine the priority target segment relevant to the objective and your desired consumer behaviour.

  2. Information gathering: Ask a range of questions and use various sources to gather clues about consumer behaviour. Cluster the information to form themes.

  3. Insight generation: From the themes, identify insights that address the challenges outlined in stage one.

  4. Ideation and implication: Devise ways to translate the insights into actionable steps for your brand.

For more details on generating consumer insights, refer to this step-by-step guide.

Employ the 4Rs framework to derive actionable insights

After crafting your insights, use the 4Rs framework below to determine the insights you should act on. If an insight does not perform well within this framework, consider choosing another insight to work with.

The 4Rs Framework

Reaction

Relevance

Can you think of different ways to generate ideas using this insight?

Is this insight relevant to the business objective?

Resonance

Reach

Does this insight resonate with the consumer segment?

Can this insight be leveraged for impact?

How to engage consumers effectively?

In today’s market, countless brands are vying for consumers’ attention. Some believe that being loud or flooding consumers with communication is the solution. At best, this approach becomes white noise. At worst, it comes across as intrusive or insensitive.

The key to cutting through the noise is to cultivate deep consumer understanding. This will help you make informed business choices and sound marketing decisions — knowing when and how to engage your consumers.

A Consumer Experience Tool plots the key milestones in a typical consumer journey, helping you identify possible influences that consumers are exposed to. Use this tool to understand what consumers think, feel, and do at different stages. Doing so allows you to craft appropriate engagement strategies. Watch this 6-minute video to get started with this tool.

Now that you understand what resonates with your consumers, how would you prioritise the key stages and craft communications that effectively influence your consumers? 

Find Out More