Many marketers believe the necessary first step to being successful is to have a complete understanding of their customers. In fact, in our What is Marketing? tutorial, we push home this point with a statement that reads: “Arguably the most important marketing function involves efforts needed to gain knowledge of customers, competitors, and markets…” To accomplish this, marketers have been taught to engage in marketing research in an effort to know as much as they can about their customers and what needs they have.
However, marketers know there can be lots of mistakes made when interpreting what they think customers really want. This is because most marketers gauge customer interest based on research driven by statistical analysis, where results may not tell the complete story of what the market really is and what people really want. Why? Well, there are a few fundamental reasons. First, most marketers cannot ask all their customers what they want because there are just too many people to ask. For instance, if Coca-Cola wanted to conduct a survey they would likely only sample a few thousand customers who drink their products. While statistical theory tells us that gathering information from a few thousand customers may still be quite useful in explaining what millions of customers think, the fact sampling is used to gain information on a large population means there is still a chance the results will not be accurate.
Second, even if you could examine all customers or use solid statistical methods, people are prone to change so what their needs were six months ago may be different than what they want now. Thus, many marketing organizations, that are traditionally subjected to rapidly changing customer attitudes/needs (i.e., certain food categories, exercise routines, high-tech products, movies, etc.), need market research to be ongoing all the time to figure out what customers will want in the future.
A good example of how marketers struggle with understanding customers is found in this Trendwatching story. They make the point that using demographics alone to identify target markets may not be the best strategy. They present interesting market information and statistics that may startle some marketers, such as a retirement community in Brazil hosting skateboard exhibitions for their residents or a statistic from the U.K. that says more women play video games than men. The story goes on to suggest reasons why consumers seem to be changing, including having greater access to more information and to more product options.
The takeaway from reading this story is that marketers cannot afford to stand pat. Instead marketers may need to work much harder understanding customers in order to segment at Stage 2 and Stage 3. Doing so is not going to be easy or cheap, but the evolving customer may leave them little choice.
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