If you’re in an insight role at a consumer tech company, the types of consumer insights your internal customers need will vary according to your company’s lifecycle stage. We’ve listed the research tools and tests that will give you the biggest impact, whether you’re managing a mature brand, or starting up an exciting new venture.
We can group tech companies into three broad categories, according to where they are in the business lifecycle:
- Legacy Companies: At this stage, companies are mature, but can’t be complacent as they’re fighting to keep their users, in the face of intense competition. It may also be some time since they had a significant innovation (think YouTube, Amazon, or Apple).
- Growth Companies: These companies are putting their energy into growing exponentially through acquisitions, trying to gain users or customers and, while at the same time, scaling their offering (think Uber looking for both customers and drivers, or Netflix growing its subscriber base and developing content).
- New-Tech Companies: Attempting to acquire users – and fast – these companies are based on a significant innovation, and they have apps and websites that may seem polished, but no one’s heard of them yet (think cryptocurrency startups).
- Companies in decline and rebirth: Decline often happens when public opinion has turned or market innovation has moved far ahead of the company’s offering. Rebirth is rare – occasionally dying companies are able to invest in a radical change, as they are so far gone, there is no risk of further damage to their brand. Rebirth most often happens through risky acquisitions, mergers, and innovation – and consumer insights aren’t as helpful here as in the other company types, so we’ve not covered these in any more detail (think Henry Ford’s quote on consumers telling him they want a faster horse).
Each of these lifestyle stages presents insight professionals with a disparate set of challenges:
The Challenge for Large Legacy Companies
Legacy tech companies are fighting attrition, as competitors’ shiny, new offerings constantly roll out onto the market. For example, Apple has been reporting lower iPhone sales after intense competition in Asian markets and underperforming growth expectations. In order to stay relevant, legacy companies must create compelling content, pertinent upgrades, and novel features while battling the red tape that inevitably exists in large enterprises. If they’re too slow to innovate, they risk stagnation: a recent study found that 41% of corporate strategy executives admit their firms are “at extreme risk of disruption” but 78% of innovation portfolios are allocated to continuous incremental innovation instead of disruptive risks.
The fear is that if they act hastily, without proper testing, they risk making mistakes. And mistakes can be disastrous: Tumblr’s tone-deaf censorship policy has shut down the sort of body positive NSFW content that was its USP, and its algorithm has incorrectly targeted other content, resulting in reports of users leaving the platform, and a petition on change.org signed by over 600,000 people, asking for a reversal of the policy.
Companies in this category often use a myriad of data points from UX A/B testing, user data, and feedback forums to giant innovation conferences to find the “next best thing”. Agile testing that avoids the slow gatekeeper processes that constrain creativity will enable legacy companies to stave off decline.
Key Types of Consumer Insights for Legacy Tech Companies
White Space: At the ideation stage of NPD and content creation, tech companies use cutting edge publications, secondary research, industry conferences and meetups to share wins and learn from colleagues. Prediction tools such as Zappi’s Huunu Prediction Market, which is grounded in behavioral science and economics, can be used to accurately predict marketing and business outcomes.
Great ideas, effectively realized, can save a legacy company and retain users – why would they go elsewhere when there’s so much more to explore?
Upkeep: Complacency kills. It’s important to keep testing, focusing on looking at small function variations via a mix of UX testing leveraging qual, platform data points, and A/B testing. Researchers have a hard time convincing developers and product stakeholders to go beyond site usage metrics, but larger sampling is essential for creating new ideas and opportunities, and for discovering unmet needs.
For example, if you are relying on click conversion metrics, you may be misinterpreting the feedback. A user might be clicking heavily on your feature, not through engagement, but through frustration, trying to achieve an entirely different goal. Qualitative research adds context in these instances and conveys the actual needs of the users, versus the assumptions that have been made in house. If qual is too expensive or too slow, consider pushing for concept testing with a lot of open-ended questions, heatmaps, and questions on ideas to improve, to bring a “qually” flavour to the quant.
Content creation: This is a big opportunity. New content keeps users engaged, educated on new feature releases, can address sensitive topics, and brings users back on a regular basis. But where there’s high opportunity, there’s usually high risk. Creating content that misses through lack of diversity or gets the wording wrong could spell disaster by alienating or offending users. Pre-testing will mitigate these risks and enable optimization so your content can be even more impactful.
Short-form videos, made to be viewed without sound, are currently the primary content large tech organizations create for their users. Pre-testing tools such as Zappi’s Creative Digital enable you to include verbatims to see if there are any red flags, add custom questions around specific aspects for a deeper dive, and get a second-by-second analysis to help determine which moments in your video are the most impactful and resonate with consumers. After testing consistently, you’ll be able to create your own unique set of user norms to benchmark your performance against.
The Challenge for Growth Companies
Growth companies have slowed their ascent; they may have late stage funding or be planning an IPO or have already opened up for public trading. These companies are focusing on gaining users, but also trying to expand their proposition footprint, for example by attracting the “enterpriser” user (the drivers on Uber, the hosts on Airbnb). This category varies widely in offerings and value propositions, and is typically moving fast, so there is huge scope for research but, too often, marketing teams don’t see the value, so the budget isn’t there.
However, trying to be first to the prize can backfire for growth companies, if it means acting without the right types of consumer insights. Pre-testing ideas is not about stifling creativity – quite the opposite. Pre-testing should be thought of as a playground where you don’t have to hold back the most wacky ideas and creative options, but can work on refining them so that by the time they hit the market, they’re bulletproof. Qual methods are great here, but don’t fall into a “Qual with no Quant” mindset: are your local customer focus group participants representative of the nation as a whole? Or of non-users? Unlikely. You don’t want to make products and features that fit a small, specific user group, when quantifying your insights could help you attracting hordes of new customers.
Key Types of Consumer Insights for Growth Companies:
User acquisition through advertising: It’s crucial to spend a lot of time with your in-house or external marketing, ad agency, and PR companies so they understand your brand. Then, once you have co-created that golden spot, make sure you test it. Agencies are notorious for being so close and committed to the creative, that they are unable to judge it impartially. Use types of consumer insights that are optimized for your medium such as TV testing, in-context digital testing inside Facebook or YouTube, claim or tagline refinement, or static ad testing if it’s going to be in print.
Testing new ideas: You wouldn’t have got this far without having a lot of smart, innovative people in your company. Use them. Your colleagues can be a source of new ideas from the ground breaking to the incremental. You can make the idea generation process interactive by setting up tournaments, with brackets using quick ranking tests like Zappi’s Screenit to get winners, which you can then test, iteratively, as monadic concepts. This is also where you should be doing disaster-checks to ensure you’re not going down the wrong path.
Address your growing pains: Maybe the type of growing pains your company is having are awkward to talk about, such as problems with internal communications. Maybe they seem minor when compared to other priorities, for example taking time to fix one user pain point, compared to working on a new feature release or campaign. However, whether they come from an internal or an external source, growing pains can hurt, so they need to be addressed. Here at Zappi we call it “tightening the bolts” – you need to make sure everything is locked down before you can attempt to scale to your desired size.
As an external example, users reporting Uber or Lyft drivers driving in the opposite direction after they have accepted the ride might seem like a small issue. However, digging deeper exposes that drivers might be trying to avoid fines, which is an unintended consequence of cancellation rules, or that drivers may be rejecting rides based on where people live or even who they are. What seemed like a small thing can anger customers so much that they churn and frustrate the precious enterpriser users doing the driving or home sharing. And, these days, stories like this go viral, and can do untold damage to the brand. Internally, growing pains could come from increasing employee headcount which can both alienate existing employees and frustrate new hires, especially if they don’t have a great on-boarding experience.
Calibrate this area and don’t let it fester. Initiate regular employee surveys and report anonymously, create processes that can scale with your company, and be willing to go back to the drawing board with features and tools to ensure your user’s voice is heard and integrated into your development.
The Challenge for New-Tech Companies
New-Tech companies have likely just got a big bag of cash to help their initial push for user acquisition. They have flashy, polished websites, used in their initial pitch and will be gearing up to rapidly take over a section of the market. As a researcher or even a brand/product manager, this is the time for you to hit your mark, prove the idea, and share cold, hard numbers internally and to investors.
The types of consumer insights needed are usually gotten through idea testing, though some New-Tech companies may need to push ads immediately to get a user boost. Investors won’t fall for feel-good assurances such as “the creative team that made it likes it”. Testing is essential to prove the need for necessary spending. Fast turnaround – testing an ad one day and showing the results, which quantify behavior change, the next day – will unlock wallets and ensure that your brand grabs that market opportunity.
Key Types of Consumer Insights for New-Tech Companies:
Calibrate your offering: You need to ensure you have all the data you need to optimize and proof out your concept. Using types of consumer insights tools such as Zappi’s Concept Test and MARC’s Rapid Results solution can help dig deeper into consumers’ likes, dislikes and ideas for improvement. You can then validate the offering, get pricing guidelines, understand bundling options, and know which competitor(s) you might be able to knock out. It’s worthwhile investing time into naming research at this stage – this often goes unnoticed, but names stick, and everyone hates it when their favorite brand changes its name later down the road.
Plan: Strategically lay out feature development plans based on potential revenue or user gain to get the most uplift per version rollout. As insight leaders, get close with your tech team and developers and plan monthly or quarterly reports using software such as Tableau to track usage, user experience, and site visitor feedback. Customer verbatims are great for understanding the ‘why’s’ behind the data, and they help to bring insight stories to life, but don’t forget to celebrate the wins just as much as you quote the verbatims. The most important thing here is being flexible and fast in your delivery so using platforms that can get you answers without having to wait several days is key in being agile.
Develop your brand: The types of consumer insights you will need here are around logo creation, ad testing with different tones and voices, and customer experience touch points. Make sure you’re making smart decisions around everything your user will encounter, from the gif on the app store to direct mail to social media ads. What taglines in your search result will make people click to learn more? There are thousands upon thousands of touchpoints – and together, they can make or break a company. Super-successful companies are often the ones that have started out with a small group of hyper-loyal consumers, which then helped them break through later on. Testing multiple touchpoints may seem like an additional cost and not needed, but testing makes a difference. When you test, you can have fun and play around with different possibilities without the fear of starting off on the wrong foot.
So how does your consumer tech company fit into these categories, and what types of consumer insights can you leverage to support your internal customers? The reality may be more complex than these overarching company descriptions. For example, legacy companies often buy a growth or start-up company, to head off decline and go into re-birth. Or new tech can surface as an independent initiative from a sub-brand under a legacy giant after effective white-space opportunity scoping, such as Microsoft creating Xbox in 2001 – a long way from its original offering of operating systems in 1980. Whatever your situation, keep in mind that every test you do will only improve your company. You get ahead of your competition by being outstanding at innovation and amazing at implementation. And you get to be outstanding and amazing by testing your initial ideas and concepts, following through, and continuing to test, iteratively, using consumer insights to win the day, every day.