Ever cranked up a treadmill a few notches too fast? That’s what it can feel like keeping up with all the changes happening in business right now.
To maintain pace, knowledge management platform Bloomfire’s Chief Marketing Officer Dan Stradtman — previously an executive at Walmart, Amazon, and General Electric — wants other business leaders to focus on one critical area: customer insights. Stradtman spoke with b. about how to do so.
b.: Why is it important to invest in customer insights?
Stradtman: Small-to-medium-sized companies … often lack that linkage between commercial activity and customer insight … so they don’t invest at the levels they should. … When you understand your customer — their problems and jobs to be done — you can align your business around what’s valuable, create the right proposition for that customer, and address them in a language they understand better than your competition.
b.: What’s the most effective strategy to determine your audience?
Stradtman: In the mid-2000s, Walmart was chasing Target. … Their research revealed that over 60 percent of the retail market was price-sensitive — but in different ways. … Some lived paycheck to paycheck and needed the absolute lowest price; others made decent money but preferred to save where they could.
This insight revealed that Walmart could win with the majority of consumers by doubling down on what they did best: price leadership. That’s where “Save Money. Live Better.” came from.
My belief is you always start with: “What do we think our value proposition is? Who do we think our customer is?” Then, go test it. Figure out if you’re right.
b.: At what point does a customer choose a brand they might not love simply because it offers the lowest price?
Stradtman: Think about how many brands exist today that didn’t before. I’m not talking about really chic brands. If you walk through Target, you’re going to see a bunch of brands that look stylish and high-quality, but they’re probably Target’s own brands …
That’s why understanding your customer is so important. It helps you pinpoint the breaking point — how price and quality expectations vary between different customer segments. … Whether it’s Walmart, Target, a CPG, or a B2B, it’s about bringing the right assortment of offerings to reach that customer.
This interview has been edited for length. Read the full Q&A at business.com.
