If two years ago brands were banking on being customer-centric, this year they’ll take it a step further and be customer-led.
But what are the implications of this shift?
Consumers have always been top-of-mind for brands, but over the past year, brands have learned first-hand the effects of not understanding the shifting behaviors of consumers. To be successful, brands can’t simply consider customers’ opinions anymore — they need to be the driving force behind every business decision. This means brands must be speaking with consumers continuously and constantly adapting products before and after going to market.
Feedback Loop recently released its seventh annual Product Management Insights Report which revealed, among other things, that in the past year brands have relied on more frequent communication with their customers to help chart their courses. According to the report, nearly half (47 percent) of product managers said they’re spending the perfect amount of time talking to customers in 2021, compared to 11 percent of product manager reporting the same in 2020.
Brands are proactively establishing de-facto boards of consumers: groups of hundreds or thousands of customers that help them to evaluate decisions to forward, iterate or even scrap products completely.
Here are three ways brands are using their boards of consumers to make critical business decisions.
Understand What Consumers Want — or Don’t Want
A traditional board is often laser-focused on what it thinks is right for the bottom line and bases its decisions accordingly. Consumers will instead simply tell you what they want or don’t want. When brands focus on customers, they’ll generate revenue. But if they focus on revenue, they’ll generate nothing.
For example, when Farmers Insurance Group was launching Toggle to build entirely new insurance products for Gen-Z and millennial audiences, it wanted to create its new offering based on direct feedback from consumers. In speaking with consumers, Toggle found that renters’ insurance policies didn’t account for tenants storing equipment related to their “side hustles” in their homes and that most people wanted pets covered by their renters’ insurance. Based on this insight, Toggle launched products specifically covering pets and side-hustle equipment.
Even when a product is decided upon and has gone to market, that doesn’t mean that the communication with consumers stops. Brands need to continue testing and iterating their offerings to ensure they’re always meeting consumer needs.
Identify Missing Pieces in Product
Brands don’t know what they don’t know — which is why they need consumers to tell them what’s missing in their original calculations. Maybe a product is missing a crucial piece, or perhaps there’s an oversight in marketing the product. What brands don’t know can actually hurt them.
For example, Swiss Re's digital insurance startup iptiQ had to figure out how to transform 150 years of B2B knowledge and expertise into a new B2B2C model. In speaking with consumers it found it didn’t understand the language that insurers use, like "life cover," "sum insured" or "lapsing my coverage." iptiQ learned, from speaking directly to consumers, that it had to speak about insurance in a language consumers understand by using easy-to-understand terms and phrases like "life insurance," "pay-out amount" and "cancelling coverage.”
Once brands identify any missing pieces through consumer feedback, the next step is to put those findings into action and update their offering or marketing accordingly.
Adapt to Changing Consumer Behaviors
What may have worked for consumers a year ago might not work for them now.
The past year especially has revealed how dramatically and rapidly people’s attitudes and behaviors can change. The brands that are continuously speaking with consumers will not only understand their needs now, they’ll be able to predict their future needs as well.
When insurance technology company Rhino set out to replace security deposits with low monthly insurance payments, it didn’t anticipate a pandemic that would completely reshape the rental market. COVID-19 transformed its ideal customer profile, and the rental market became unpredictable. When a number of reinsurance companies stopped backing payments for security deposit claims, Rhino was able to use consumer insights to predict which guardrails to put in place in their policies during COVID to protect its business while still benefiting renters.
There’s an endless number of products that brands can create, but only a few that consumers actually want. Those brands that are establishing boards of consumers — and continuously running critical business decisions by them — will be the ones that see the most success.