Innovation Management Wisdom

Posts with the tag 'Qualitative Insight into Customer Experience'

Product Development Advanced by Construct Psychology

One word changed the construct research subjects used to answer a question…and opened a flood gate of new product development insights.

We recently did some new product development research for a manufacturer trying to learn how tradesmen evaluate competing power tools. Personal construct psychology informed our approach.

Personal construct psychology (PCP) is a framework for understanding the categorical templates that people use to organize the realities of the world. Each person’s templates evolve in accord with what they learn from past experiences. They lay their templates over new, similar experiences to anticipate what will happen.

By understanding which constructs customer use to distinguish offerings, you can begin to understand which elements of message, product, package and experiential concepts differentiate offerings in customers’ eyes and which don’t.

In our initial draft of the discussion guide, we asked tradesman, “What makes some of these tools better than others?

We got these answers:

  • Durable. It’s going to get banged up on a construction job.”
  • “The manufacturer stands behind their product. They’ll take it back if it breaks.”
  • “You can maintain it easily to increase its working life.”
  • “How much it costs to use.”

While these comments were helpful, they weren’t entirely satisfying. We felt we had tapped constructs that tradesmen use to evaluate the quality of tool manufacturing. This was only tangentially related to what we wanted to know: what constructs do tradesmen use to select tools they’re going to buy?

So, our client agreed to change the question from, “What makes some of these tools better than others?” to, “What makes some of these tools more useful than others?” The word, “useful,” evoked a different contextual construct. It surfaced memories of on-the-job customer experiences where some tools were frustrating to use.

Here’s what we learned over and above what we heard before…

  • Speed. How fast it does the work.”
  • Maneuverability. It needs to fit in tight spaces. It needs to be lightweight.”
  • Portability. Sometimes, electric plugs get kicked out by other workers on a job site. That costs me time. Help me avoid having to use extension cords.”
  • Safety, Make sure it can’t tip over while it’s on. Put a guard on it so no one backs into and hurts themselves. Pat a safety lock on this so there’s no change it will turn on when it gets knocked around in my tool bag.”
  • Run time. Make it so I don’t have to replenish the power source as often. Give me a way of knowing how much run time is left so I can replaced the power source before I start a job.”
  • Adjustable controls. Let me adjust the power to a level suitable for doing the job.”

Much richer stuff. In this case, using just the right word meant the difference between acquiring pedestrian insight and scratching the surface of strategically valuable wisdom. It informed a variety of decisions about the product design and package copy.

We typically find that customers in a product category,

  1. cluster into groups who share common, but not identical sets of, constructs that help them anticipate what their experiences will be, and
  2. assign varying levels of importance to each dimension (e.g., speed, maneuverability, portability, etc.) across these groups

Personal construct psychology informs approaches that complement segmentation. At times, it can provide insights that go deeper. You learn not only what customers needs exist, but also how customers distinguish new products that will help them better meet their needs.

Bottom line: If you know why and how your prospect thinks and feels (not just what they feel), you can anticipate how they’ll act in new situations. That focuses creative thinking around those few new product ideas worthy of developing further.

Whyze Group works with B2B and B2B2C Fortune 500 organizations. The company has been recognized by the Baldrige National Quality Program, business associations and numerous business media as a leader in research and innovation. Inquiries: info@whyzegroup.com, (440) 785-0547.

June 28th, 2016

National Jewelry Store Chain Innovates Gift Giving

Using a variety of discovery methods, Whyze Group identified sixteen opportunities to improve this retailer’s customer experience.

Here’s the snapshot:

A customer experience audit revealed that managers knew what SKUs were moving and at what margins, but little about what drives positive customer experiences.

Whyze Group performed in-store cue scans at our client’s and competitors’ stores. We also conducted interviews with customers, store employees and corporate staff.

Many of the most valuable insights we garnered were through metaphor analysis. Metaphor analysis enabled customers to use images and photos describing their deepest emotions about buying and giving gifts. One key finding was that men and women differ in their gift shopping and giving habits. Through metaphor analysis, our clients discovered several meaningful opportunities to enhance the gift giving experience at relatively low costs.

In addition, our client identified numerous opportunities to improve customer experiences through revamped store layouts, staff training, compensation and return policies.

We helped managers prioritize those opportunities that would most quickly and cost-effectively enhance customer experiences and repeat business.

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Whyze Group works with B2B and B2B2C Fortune 500 organizations. The company has been recognized by the Baldrige National Quality Program, business associations and numerous business media as a leader in research and innovation. Inquiries: info@whyzegroup.com, (440) 785-0547.

October 7th, 2011

How Global Birth Rates and Demography Influence Product Development

The sputtering economy is, in part, a symptom of a greater problem—a tectonic shift in global demographics. This shift may change consumers’ consumption and saving behaviors for years.

These changes open up new opportunities for companies that can learn and adapt most efficiently.

Here are six things you should know…

1. Declining birthrates are eroding the economies of developed nations. Their deleterious effects will likely be with us for a long time.

Reputable demographers and economists with the WCF, tell us, “The population of the world, particularly in developing countries, is aging. The baby-boom generation is reaching retirement and will need to be supported by the generations that succeeded them, all of which have had fewer and fewer children. This means fewer and fewer workers paying into the social security, medical and welfare systems of the world. Economies will be strained and governments will slow bleed as relative production dwindles and tax revenues decrease.”

Greece

Last month’s media coverage of worker protests in Greece might leave us to believe that the cause was the Greek parliament’s reigning in liberal social welfare programs. But, Greece’s fiscal math worked before. Not anymore.

The birthrate required to sustain population equilibrium is 2.1 children per woman in Europe. Greece’s birthrate had been declining for years. As of 2004, the Greece’s birthrate was 1.3. Today, there are too few younger workers to pay for the social security of Greece’s retirees.

Europe

Similar problems plague Spain (with a birthrate of 1.3), Italy (1.3) Germany (1.4), Netherlands (1.7), Norway (1.8), France (1.9) and Ireland (2.0). In Russia, the birth rate is so low that the government is paying women to have more children. According to the WCF, Russia is expected to lose one-third of its current population by 2050.

Japan

Japan is facing similar demographic imbalances and economic challenges. According to a market update circulated by Charles Schwab last week, “The problem in Japan is that “cheap money” hasn’t stimulated demand, a liquidity trap exacerbated by an aging population that’s shifting away from consumption.”

United States

Similar challenges exist in the United States, though they are somewhat ameliorated by influx of immigrants, particularly immigrating women, who bear more children on average than women born in the U.S.

2. Deflation is a risk in developed markets.

Schwab’s update continues, “The weight of deflation is also a factor. Consumers believe that prices could be lower in the future, providing little reason to consume or invest today, so economic activity gets delayed. Lower demand results in a drop in production, job cuts and wage decreases, resulting in a reinforcing and detrimental cycle. Global economic growth is slowing, and with the threat of a double-dip recession in Europe amid fiscal austerity, there’s increased potential for deflation, not inflation, for most of the developed world.”

3. As a result, consumers say they are reverting to post-World War II spending and savings patterns.

Recent McKinsey&Company research shows that 90% of U.S. consumers 36 to 65 years old with incomes of $25K to $100K say they are reducing spending. The personal savings rate, which was zero in 2008, climbed to nearly 6% of disposable income in 2009, approaching the 9% savings rate of the post-World War II era.

Less than half of surveyed U.S. consumers believe the stock market will outpace inflation over the next 30 years. Eighty-five percent of consumers ages 36 to 45 believe that it won’t.

Unlike recent business cycles, this downturn appears to be leveling off at range of economic activity that will remain with us for the long haul. Consumers and business leaders looking for help from financial services institutions and governments are finding them bereft of solutions.

4. The future favors companies that efficiently learn and adapt more efficiently in response to customers’ new savings and spending habits.

Learning and adapting sound simple. However, most companies fail to integrate the components of learning–data collection, analysis, knowledge sharing–with the components of adapting–planning and managing change.

5. Change management skills are required to get organizations to adapt more quickly, but change management is a blind spot for most CMOs.

This is where there is plenty of opportunity for improvement.

“CEOs and CMOs agree that the formula for success involves leading innovation, improving marketing’s alignment with the rest of the organization, business strategy and marketing execution. Yet, both CEOs and CMOs agree that marketing is not as effective as it can be,” according to a report by executive recruiting firm, Spencer-Stuart.

6. As we reported in our 2009 white paper, “Bridging the Research-Innovation Gap,” (downloadable from our home page) most companies’ learning and adapting processes are quaint and inefficient.

Companies are attempting to learn and adapt via assembly-line management practices conceived at the turn of the last century. Potentially valuable customer insights are thrown over marketing’s silo wall to next-in-line executives who either don’t understand them, don’t believe them, don’t remember them or are unwilling to use them.

Hundreds of executives and marketing researchers have read our white paper and support our conclusions, which specify 11 ways to bridge the research-innovation gap. The U.S. Department of Commerce cites our paper as recommended reading for U.S. business leaders.

With businesses and consumers becoming more budget and value consciousness, demand will likely continue to shift toward companies that operate more efficiently.

That applies to innovating more efficiently, too.

Over the last ten years, Whyze Group has helped dozens of top companies innovate more efficiently. We integrate customer experience research, design and change management to enhance the innovativeness and performance of companies with which we work.

  • Customer experience research surfaces the influences of someone’s experiences, memories, goals, mental models, perceptions and emotions on their behaviors around brands and products. This understanding of ‘the person’, who has a life beyond the limiting role of ‘customer’, helps us more accurately anticipate how people are going to respond to specific new product and service ideas.
  • Customer experience design uses a workshop approach to designing advertisements, sales processes, products and services, packages and post-purchase events that deliver experiences  customers deem worthy of rewarding with their loyalty and referrals.
  • Change management is applied in creating leadership alignment around what leaders believe and need to learn about the customer experience. Change management is integral in implementing organizational changes needed to deliver the intended customer experience.

 

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Whyze Group works with B2B and B2B2C Fortune 500 organizations. The company has been recognized by the Baldrige National Quality Program, business associations and numerous business media as a leader in research and innovation. Inquiries: info@whyzegroup.com, (440) 785-0547.

 

July 8th, 2010

What Customer Experience Really Means

Customer experience holds the promise of profound benefits for executives who understand what the term, “customer experience,” really implies:

  1. Your company doesn’t have a customer experience. Customers do.
  2. The customer experience does not begin and end with your company’s “touchpoints”. Competitors’ actions, expectations set by other industries, life changes, and changes in customers’ economic, technological, and political situations all influence the customer experience.
  3. Customers filter their experiences through their associated memories, mental models, values, perceptions, cognition and emotions.
  4. Whether you manage it or not, your customers are having an experience with your company.
  5. 20th century management methods assure that customers will have disjointed experiences delivered by discreet silos that regard customers as “targets” (marketing), “users” (product development), “audience members” (advertising), “prospects” (sales), or “callers” (customer service).
  6. 21st century customer experience research methods, many developed by Whyze Group, surface meaningful insights into customer experiences, in accordance with the time frames and contexts in which experiences form.
  7. The mental models of managers who spend 20 years in an industry are almost always misaligned with the mental models of customers, who may spend as little as 20 seconds dealing with you.
  8. An authentic, deep understanding of the customer experience shifts executives’ mental models into closer alignment with those of customers and accelerates their innovations of experiences that matter.
  9. Successfully innovating the customer experience builds on an orchestrated delivery across your company.
  10. Sustaining a compelling experience requires that you focus on monitoring the consistency with which customers achieve their desired outcomes, not the consistency of company processes.

Whyze Group has a combined 60 years experience helping executive teams innovate and deliver compelling customer experiences. Our approach has resulted in more efficient customer acquisition, higher customer retention, lower operating costs and greater profitability. Learn more.

February 1st, 2009

One Customer’s Experience Management Audit of Apple

Last night, CNBC’s Jim Cramer said that Apple has become the bellwether stock that drove yesterday’s 900 point stock market rally.  If that’s true, then Apple’s preeminence as a stock worthy of investor attention emanates from its strong customer experience fundamentals.

I recently bought my first Mac. So, my customer experience management audit of Apple’s customer experience is based on the experience of one–me–and my pre-purchase research about how consumers rate various PC brands and Macs.

This isn’t our complete customer experience management audit. However, it illustrates the kind of evidence we present to management teams deciding where to invest to improve customer experiences.  Just like with stocks, a cogent presentation of the evidence can make your choices so much more obvious…

  • Computer users rate reliability, ease of use, compatability, speed and computing power among the most important infuences on their computer and software purchase decisions.
  • On these measures, Apple rates superior to most or all competitors.
  • Customer loyalty, satisfaction and likelihood to refer are higher for Apple users than for other providers. Apple users are raving fans.
  • PC users are defecting to Apple due to their frustrations with software bugs, vulnerability to viruses, incompatible software, system crashes and lost productivity. Consumers’ complaints about Microsoft’s Vista operating system have contributed to consumer resistance to upgrades under the Microsoft brand.
  • Apple store staff I interviewed confirm that roughly a third of new Apple computer buyers had never owned a Mac.
  • Apple stores provide local market presences, user-friendly product displays and highly trained staff.  Live, in-store training sessions are provide for a nominal fee. These bolster customers’ confidence that their transitions from PCs to Macs will be short and successful.
  • Apple store staff are well prepared to answer customers questions about transferring files and software compatibility. Staff positively differentiate Apple by describing how Apple designs their software and hardware to work together and why Apple’s software is less prone to bugs and hacks. Store staff introduced me to two ex-PC users in the store who testified to Apple’s superiority.
  • Apple’s product lines, including Macs, iPods and iPhones, are literally made for each other and are 100% compatible.
  • Post-purchase, the same Apple store staff who sold the Mac called to assure that I was satisfied with my purchase and to answer any questions.
  • Computing consumption, in the form of desktops, laptops, software, entertainment and other products will continue to grow globally. New market entrants in the U.S. are mainly younger users who favor Apple in disproportionately higher percentages than Apple’s current overall market share. This presages likely increases in sales and market share for Apple.

According to stock market expert, Jim Cramer, if you were determined to invest in technology stocks, Apple would have to be near the top of your list. Choosing where to invest in improving your company’s customer experience is similar to choosing stocks. It’s not a mysterious process. With a robust review of the evidence in a customer experience management audit, the choices become clear.

October 29th, 2008

Customer Experience Lessons from Obama and McCain Campaigns

The process by which the American electorate chooses presidents is representative of how customers choose your products and services. They make decisions based on emotions, not necessarily a lengthy or even rational comparison of features.

The Obama and McCain campaigns provide lessons for organizations striving to deliver compelling customer experiences. Both campaigns are increasingly relying on sound bites and photo ops that stir emotion and influence a specific voter persona–those who are still undecided.

In the private and public sectors, emotions drive customer experiences and decisions. Presidential candidates use tracking polls to tell them what emotions they are are creating among voters. In response, politicians change their tactics daily.

While Obama’s platform includes tax reductions for 90% of households, the McCain campaign has repeatedly referred to Obama’s intent to raise taxes on the middle class. McCain’s sound bite is easier to understand and strikes a powerful chord with voters, even if it’s arguably untrue. The facts, however, carry less weight among undecided voters at this point in the election cycle.

Emotions rule, particularly among voters just getting to know the candidates. The persona of today’s undecideds is different from those who’ve been paying close attention for the last 18 months. The undecideds are probably far less engaged.

The process by which the American electorate chooses presidents is representative of how customers choose your products and services. They make decisions based on emotions, not necessarily a lengthy or even rational comparison of features. Emotions drive customer experiences. Each customer persona responds differently.

If you know what emotional hot buttons to push, how to push them and among whom, you’ll be well on your way to innovating customer experiences that grow grass roots support.

October 8th, 2008

Maintenance and Repair Parts Wholesaler Innovates Small Business Customer Experience

This billion-dollar distributor of maintenance and repair supplies wanted to find ways to deepen its relationships with small businesses.A customer experience management audit revealed that the company relied heavily on research with large business customers to guide improvements in the customer experience.  Small business customers, however, were becoming far less loyal.

Whyze Group led in-store cue scans and focus groups with small business customers. These showed that small businesses have buyer personas and needs that are different from large customers. 

Small business customers’ usage of phone, internet and store locations correlated with these personas.  This helped the company to anticipate the expectations of small business customers depending on which channel the customer used. 

Whyze Group identified opportunities in sales, customer communications, products and pricing to deliver improved customer experiences to each small business persona. This became the foundation for redrafting customer communications and customer relationship management processes in ways that resonated with small business customers. 

We prioritized these opportunities to improve small business customer experiences in light of changes in the size and composition of the small business market.  Our analysis showed that the size and makeup of the small business market was likely quite different than the management team had believed.  We worked with managers to prioritize opportunities in accordance with assuring mutual benefits to customers and company.

October 7th, 2008

Paint Manufacturer Learns that Customer Experiences Start with the Can (not What’s in It)

A manufacturer of exterior coatings wanted to find ways to initiate superior customer experiences among shoppers browsing for deck stains.Managers wanted to know what consumers currently experience when they shop for deck stains. 

A customer experience management audit revealed that the company had done little consumer research before. The company had only recently hired a marketing staff. Cryptic product names reflected chemical properties that were meaningless to us and, we presumed, other non-chemists.  We suspected that homeowners needed more user-friendly information before they’d even consider buying this brand.

Whyze Group moderated interviews with do-it-yourselfers who own patio decks and other exterior wood products. Through this exploration, we identified six expectations and 14 different concerns among prospective users of deck stain products. 

With Whyze Group’s help, managers identified 12 measures it could take to communicate more effectively and initiative positive experiences with shoppers in store aisles.

October 7th, 2008

Wireless Company Learns that Customers in Two Markets Have Different Expectations

Managers of a wireless communications company wanted to improve customer experiences, loyalty and sales in two geographic markets. The company was considering several alternatives.  These included changing its rate plans, improving customer service, investing in transmission quality improvements and increasing its advertising expenditures. 

Improving “everything” was not feasible.  Managers needed to focus its efforts in the areas that mattered most to consumers.  Whyze Group designed, conducted and analyzed 1,000 interviews with cellular users, including competitors’ customers.  Questions focused on perceptions of quality, price and overall value for each competing wireless carrier. 

Comparing customers’ perceptions of each carrier enabled us to identify the strengths and weaknesses of each competitor.  Additionally, we determined the relative importance of each quality and price attribute we explored. 

Whyze Group demonstrated to managers that consumers in the first market were quality-sensitive.  Also, consumers perceived that our client’s transmission quality was inferior to competitors. 

The company needed to improve consumers’ perceptions of its transmission quality. We recommended that our client measure its signal strength throughout this market.  If our client’s signal strength was on par with competitors, then our client could effectively employ marketing messages bolster perceptions of quality. If not, then managers should consider increasing signal strength.

In the second market, consumers perceived that our client’s quality, price and value were on par with competitors. Consumers in this market were more sensitive to price. We recommended that our client incorporate messages about its competitive rate plans in it marketing materials to boost its share of this market.

October 7th, 2008

Insurance/nGenera Engagement Complete

Whyze Group recently completed an 18 month engagement at a leading Insurance company in conjunction with nGenera. The company’s property and casualty and financial services businesses are innovating their customer experiences based on wisdom they acquired with Whyze Group.

“We’re honored to have worked as a catalyst for innovation with these two great organizations,” explains Whyze Group vice president, Jason M. Sherman. Whyze Group deployed nearly its full complement of customer experience research and innovation design services over the course of the eighteen month timeframe.  The financial services division asked Whyze Group to repeat its success with them after Whyze Group’s initial nine month engagement with the property and casualty side of the business.

Whyze Group facilitates management teams’ discoveries and innovations of new customer experiences. Whyze Group applies a reliable and powerful approach, integrating deep customer experience insight, strategic innovation frameworks and executive alignment workshops to guide managers toward innovation breakthroughs. Clients include Rubbermaid, Zales, Nationwide Insurance, Grainger, ING, Humana, Dominion Power, Key Bank and nGenera.

September 5th, 2008

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