Grant Leboff: One of the things that you were talking about in the book is the need to be very customer centric and understand what the challenges are and their context. If you want to be very customer centric, obviously one of the things is to go and talk to the customers, but you make very good points about where market research falls down. I think people often think of the early adopters, that they‘re the ones to get on board and, actually, you say that’s not right either. So I just want you to expand on that a bit. As a company, who are the people you should be speaking with when you start to think about innovating?
Costas Papaikonomou Again, so putting it in the context of wanting to innovate more dramatically than just the incremental innovation, I completely agree, the early adopters are usually people who buy lots of stuff and they happen to get lucky because they also happen to buy all the crap that doesn’t become successful, which is often overlooked.
There is a definition of this type of person, defined by gentleman called [Eric] Von Hippel and he talks about lead users. And that’s also the definition that we use in our business to find the right people to talk to. These are people who are very engaged with the category and it doesn’t matter what your category is. It could be the ‘cliché – engaging stuff’, like electronics and software, when actually, there are lead users in stain removal, in toilet paper, in say – dry soups. People who just love the stuff that comes from that category, and they are also a bit frustrated by it. So the lead user is someone who is not getting from the category what they want, and they are often the opposite of loyal consumers because they shop around, because they know exactly which brand does well, and they know how to use it and when to use it.
So these are the people, and there are about 10% of your customers who will have this – say – trait, these are the people to really talk to. You want the ones who are not just complaining but are also eloquent and thinking about solutions and they will be loud about this, so they will be talking about this in forums. If you post out a question, as in; ‘guys we need some help on this new type of product we are developing’, they will be on top of you with opinions, and actually suggestions and ideas. These are really the people to talk to.
And the difficulty in a big blue-chip environment, which has a big market research team for example, is that these people are not, in any way representative of the general population. And that’s exactly why you should talk to them for innovating because general population won’t help you get to those big new ideas, but these people who are in the, let’s say, avant-garde of what’s happening, will.
Grant Leboff: And how useful, today – if we take this to the digital environment now – is social media, is online, in building a community that is engaged, that can help you with this? In your experience, and with the companies you work with, and in your agency, are you using social platforms? Are you engaging people through that way? Is it easier than it was 20 years ago, or is that not necessarily the case?
Costas Papaikonomou It’s absolutely easier to find them – no doubt – but again, the key is not to look at social media as this is where they all are, because that’s just like walking out on the street nowadays and saying, let’s talk to everyone. With these lead users they will be talking very specifically about your product and you could say that you can extract from social media, whether it’s through Twitter, through Facebook, or any of the other main channels, who are the really interesting people there to talk to you, and then to connect with them, because they’re loud and they’re making themselves heard.
One of the things that we do, is that we take it on a project by project basis. So it’s not like having your ear out all the time because then you’ll just gather way too much data, and noise and signals will get all confused. It would probably be better to have a more specific topic. Whether it’s a big broad topic like ‘being better for the environment’ or ‘we need three layers instead two’ – a very small chunk – but at least have a topic for which you are looking for a device from that consumer outside, because otherwise you won’t know where to start or really how to make sense of all that information coming in.
Grant Leboff: Where’s there a balance? Because what digital and social media gives you is, obviously, the ability to engage directly with these lead users as you identify them, and you can do that, but it also gives you the ability to – I say spy – but you know what I mean, to just sit on the side lines and listen. And where is the balance between the two? Obviously both are available but where is the balance between the two – between direct engagement in getting their feedback and actually just standing back and listening to what they’re saying and what’s going on?
Costas Papaikonomou They’re both equally important, and you can indeed, we have the tools to sit by the side, if you like, like a fly on the wall and just listen to what’s going on. When you start doing that, one thing that you need to get sorted internally is some kind of criteria on when to actually move, because you’ll be hearing lots of things that seem interesting but actually aren’t. That’s when noise and signal are getting each other’s way, because if you’re hearing everything, it’s very difficult to decide what really matters, and what doesn’t.
So you need to be prepared, when you’re listening to everything, when do I actually stick my hand up and act? Or when do I actually approach them, individually maybe, to figure out what’s really going on here, and is this something really worthwhile for us as a business to go after? It’s when listening then, all of a sudden, goes from data, to actual opportunities. It’s a two-way street in that sense. You cannot just hope to listen to everything and say ‘now we’re going to act’. No, you need to decide when is something interesting enough, how are you going to do with that information that you’re taking in, in order to make up your mind.
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