Interview | Market Research Should Strive for Insights, Not Just Information
Read time: 4 minutes
How would you define insight?
Insight is knowledge that makes a difference. Knowledge is ubiquitous in business. For example, sales have gone down this quarter by 5%; our brand awareness in the U.S. is 20% higher than in APAC. These would be just facts and numbers. In and of themselves, there’s nothing wrong with facts and numbers. But if you can understand what difference it makes for you as a decision maker, then you have something more meaningful: insight.
What would you say is the difference between information and insight?
Information is all about data: facts and numbers. We all need information. But we also need answers to the so-what and what-next questions that follow the data and numbers. We want to know why we should care and what we should do with the information.
Insight is about the so-what. It charges information with significance. You are informed about a fact, and you also comprehend how that new piece of knowledge makes a difference for you as a decision maker.
How can market research go beyond information to deliver insight?
Generating insight is not necessarily just data analysis or data interpretation. Market researchers can’t miraculously turn information into insight. Context matters. Market research is most powerful when it puts information in a meaningful context and connects new information with existing knowledge. It’s important to know what business decision will be informed by the research data. Ideally, researchers will also know what decision comes next and which ones have been made. Understanding this context is as important as the data collection and analysis itself. It allows the researcher to support business decision making instead of just generating tables and PowerPoint charts.
Can you give me an example of how market research uses business contexts to generate insights?
One area where customer feedback can be useful is new product development. We could conduct a survey with potential buyers and ask what their needs are today, how important certain new benefits or features would be for them, and how much they are willing to pay for these. But that’s what we call a kitchen sink approach to research. A better practice focuses on one business decision at a time. Each step provides a context for better understanding.
Product development is a journey, starting with a where-to-play decision: What customer pain points are relevant growth opportunities for us? Next is the value proposition: How does your value prop resonate with potential buyers? How can it be improved? This is followed by monetization questions: What are critical value drivers of my new product, and how much are customers willing to pay for it?
Research is much more insightful and actionable if it is cumulative, addressing one business decision after the other with a targeted method. A good researcher will then not just deliver isolated pieces of information but connect the dots to create a synthesis of market insight.
Do you think the impulse for decision makers is to fall back on institutional knowledge? At what point is that not enough?
Value-based pricing is a good example. The concept is widely accepted by pricing experts as the best approach. Still, many companies fall back on cost-plus pricing in one form or another. The reason is that cost information is easily available. Customer-value insights are not. How can you know the customer-perceived value of your products and features? You can’t unless you ask customers. But how do you ask a potential buyer what a product or feature is worth to them? It’s doubtful that you will ever get an accurate answer from a direct willingness-to-pay question. There are, however, powerful methods, like conjoint analysis, to derive value drivers and customer willingness to pay from survey data. Research can make a huge difference for companies with a value-based product and price strategy. And these are insights that have an immediate, significant business impact.
Any last thoughts on insight?
An average customer does not exist. This is true across markets and industries. Market researchers should be suspicious of averages in general and of averaging customers or buyers in particular. Different buyer segments have different needs and priorities. Accordingly, each customer segment has a different value for a business. Revealing the heterogeneity of markets and the resulting business opportunities should be the focal point of market research.
For a deeper look into this topic, read GLG’s Insights vs. Information Guide.
About Bernd Grosserohde
Bernd Grosserohde leads GLG’s offer for new product development and pricing research. His focus is on building company and brand value through innovation and optimization. With over 20 years of marketing research experience, Bernd has worked with many global companies on building stronger, more profitable products. Before joining GLG, Bernd was Global Head of Pricing and Portfolio Management at Kantar.
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