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A customer insight, or consumer insight, is an interpretation of trends in human behaviors which aims to increase the effectiveness of a product or service for the consumer, as well as increase sales for the financial benefit of those provisioning the product or service.
Specifically, Consumer Insights is a field that focuses on analyzing market research and acting as a bridge between Research and Marketing departments within a company. Commonly referred to as CI, it is the intersection between the interests of the consumer and the features of a brand. Its main purpose is to understand why the consumer cares for the brand as well as their underlying mindsets, moods, motivation, desires, aspirations, that motivates and trigger their attitude and actions.
A customer insight can be more precisely defined as : "A non-obvious understanding about your customers, which if acted upon, has the potential to change their behaviour for mutual benefit".
The author emphasises four components of this definition: First, such insight is “non-obvious”, so it does not normally come from just one source of information and often does not come from just analysis or just research; rather there is a need to converge evidence to glean insights. Second, true insights need to be “action-able”; hypotheses that stay theoretical and cannot be tested in practice are not insights. Third, customer insights should be powerful enough that when they are acted upon customers can be persuaded to "change their behaviour". Just benefitting from targeting based on analysing past behaviour and assuming people will be creatures of habit does not reveal any depth of understanding them, certainly not insight. Fourth, to be sustainable, the goal of such customer change must be for "mutual benefit". As  argues, a key law for marketing today is “earn and keep the trust of your customers”, which is achieved by acting in their best interests as well as the long term value for the organisation.
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Impact Assessment will help a business to understand how actions taken by the business affected their customer behavior, and also allow for some predictions of customer reaction to proposed changes.
Propensity Modelling predicts the future behaviour of customers based on previous actions and helps businesses understand how likely it is that a customer will behave in a given way.
Cross-Sell Analysis identifies product and service relationships to better understand which are the most popular product combinations. Any identified relationships can then be used to cross-sell and up-sell in the future.
Critical Lag allows a business to deliver specific customer communications based on an individual's purchase patterns, helping to increase loyalty and improve customer retention.
The above components only cover the scope of customer analysis or marketing analysis. Best practice is now expanding to including customer data management, behavioural analysis, predictive analytics, consumer research and database marketing.
- "What Are Consumer Insights and How Do They Impact Marketing Effectiveness?". The Huffington Post. 2014-10-02. Retrieved 2016-03-06.
- Tucciarone, Kristy (2007). "Vying for Attention: How Does Advertising Affect Search and College Choice?". College and University. 83 (1): 26–39.
- Laughlin, P (2015) "Holistic Customer Insight as an engine of growth", Institute of Direct & Digital Marketing (IDM) Journal of Direct, Data & Digital Marketing Practice Vol 16 Issue 2
- Peppers, D. (2008). "Rules to Break and Laws to Follow". New Jersey, John Wiley & Sons.