Shopper insights and the case for burritos

Six ways to win that don’t require a pie-chart …

Consumer insights are big business for those that sell them. At conferences we crowd around the data, frantically snapping powerpoint slides with our iPhones (don’t tell me you use a Samsung) and craning our necks to hear interviews with amusing couples bickering about their shopping habits. While this is fascinating, I’ve always found it curious. Don’t we shop?

The case for intuition

The market for consumer insights is based on the fundamental MBA school mantra that “you can’t manage what you can’t measure”. Because this error is drummed into us early in our careers, intangibles make us feel powerless. Even if we have confidence in our own intuition, we know others won’t. Take your hunch, based on your intelligence, experience and mastery of your field, to your CEO and she will likely say: “Come back with the numbers and I’ll listen.” Numbers make us feel strong and dominant. They give others confidence in our strategies. They look like science versus faith. They look like certainty versus risk.

So — the purchase of consumer insight data is partly a pragmatic purchase, but also a strongly emotional purchase. The provider is not only providing useful information, but also soothing an anxiety for the buyer and making him or her feel strong.

When I listen to research people at the top of their game speak, I become increasingly convinced that the best ones, the smartest ones, are often following their intuition first and getting the numbers second. That the numbers are predicated on the insight and not the other way around.

The numbers guys would deny that, I’m sure. Because were it to be accepted as truth, it might harm their business. Their business is based on our perception that the number, the science, is worth more intrinsically than that which we intuitively know to be true. And if this were true — and hey, it’s only my hunch — it still wouldn’t lessen their offer. They’re still smart, experienced. The insight is still valid. The numbers still perform an essential service. It’s still worth the money.

But that is why reports on consumer habits rarely shock or surprise us. Sometimes they do. But mostly what they tend to do is confirm what we already suspect and arm us with a necessary weapon. With numbers you can sell truth. Without, all you have is conjecture. The other reason these reports don’t surprise us is that numbers take a while to collect and crunch. Intuition is relatively instant. By the time the numbers are ready, we usually already kind of know what they claim to show.

What’s my point? It’s not to disparage the numbers game. We need it, we want it. My point is this: disruptive innovation — the kind that breaks new markets, creates new models and forges the status of powerful market leaders — is invariably done by those who didn’t wait for proof but followed their intuition, and risked failure. You can be Apple, inventing iTunes. Or you can be HMV, trying desperately to migrate to digital a decade late and several billion dollars short, ignoring the fact that, in 2011, we don’t have a download store problem. Apple took the risk. HMV waited for the numbers. Their creditors may not wait so long for theirs.

The case for numbers

Numbers can help us out of wrong thinking. Sometimes we collectively head off down an illogical path, pushed there by ignorant media reports or dubious group-think. A good example would be the erroneous belief that recession would drive a major shift to private label among consumers. The truth, when you look at the numbers over 20 years (Nielsen helpfully provided these a while back), is that recession caused a brief spike and then the trend corrected itself. The shift is happening anyway, slowly and stably, and recession is neither here nor there.

The other chief benefit of numbers is that they enable us to visualize. Many of us — most of us probably — grasp a concept better when it is expressed as a diagram or a graph. It follows that if you can graph something, you stand a better chance of selling it. Be honest — you hire the consultant with the most pie-charts. But do you audit his numbers? The art of good business is knowing when to trust your hunch and when to use the numbers.

Six easy ways to win

I mention all of this because I got some publicity today from a research outfit that I much respect, advertising a forthcoming report on what drives repeat custom. Because this firm invariably talks sense and enriches my understanding, I’ll be keen to see the numbers when they come out and will probably be among those quoting them. But my guess is, we know the gist of it already. My intuition tells me that — for CPG retailers at least — the following six points will appear somewhere, more or less in this order, depending on the market.

I went back to Store X because:

1. The store had what I wanted.

2. It was convenient for me to shop there.

3. It was easy to get in and, crucially, out again once I’d made my choice.

4. The store people were nice to me and/or helpful.

5. The cost wasn’t prohibitive.

6. The experience enhanced my sense of self-worth (ie — it matched my aspirations, or at least didn’t depress the hell out of me).

I have no numbers to back this up. But we kind of know this from being shoppers. It rings true. Retailers surely can’t go wrong if they get these six points right. Unless, of course, they wait for some dilligent soul to come up with the numbers before making it right. There’s science in retail. Brilliant people shave millions off costs with optimisation tools. But then, how many millions are spent collecting loyalty card data that we have trouble converting into useful intelligence? The basics of good retailing are not rocket science. And yet, there are some who spend money on science before getting these six points right.

The case for burritos

This is all very much on my mind because this morning I made a tactical error: I promised to cook tacos tonight for my partner. She’s now expecting tacos and to honour this promise, I have to get ingredients from a hypermarket, because it’s the only place that stocks what I want.

It’s not convenient, I have to drive there and park. That’s a drag and takes a bunch of time out of my day. Once there, I know it will take me five minutes to locate the ingredients and twenty-five minutes to pay and leave, because the retailer wilfully ignores how shoppers want to pay. (Who on earth operates separate tills for different payment methods? Twenty people deep at one till and three empty tills refusing customers.) This is a major drag. I also know the store people will not be very nice to me. It’s not their fault, they just hate working there. I know the queues will be long and at least half the self-checkout machines will be out of order, while those that work will be less ergonomic than the manned tills and take just as long. The whole experience will make me feel bad and will not match my aspirations. In some small way, going there will make me hate my life, at least for the time I am there. This is a retailer that cannot even honour the “customer charter” it sticks on the wall. But they do have what I want.

That is top of my priorities, but I’m not sure one out of six is enough. Weighing up the pros and cons of this particular “shopping mission”, I’m considering the downside — romantically — of revising my offer to burritos.

Picture Credit: Los Primos Mexican Food.

 

 

 

 

 

 

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