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Most market research, while useful in traditional marketing contexts, is inappropriate and misleading for strategy development; it is the wrong data collected for a different purpose and therefore answers the wrong questions. Traditional market research targets current customers with questions about marketing and tactical issues, usually with the goal of incremental improvements.

If customers could tell us what a strategy should be, there would be little use for senior management.

For a searchable repository of market data check out our Market Research Center

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Like it or not, although market researchers often develop a solid understanding of the jobs that customers are trying to do, the primary language through which the nature of the opportunity must be described in the resource allocation process is the language of market size. Asking marketers to understand this concept is not the solution to the problem-because whether it is called "marketing myopia" or "jobs to be done," this concept has been taught before. It is a process problem. Because senior managers typically hire market research to quantify the size of opportunities rather than to understand the customer, the resource allocation process systematically and predictably perverts companies' concept of the structure of their market so that it ultimately conforms to the lines along which data is available.

For a searchable repository of market data check out our Market Research Center

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Much quantitative data—what we now think of as hard, concrete facts—are really quite soft and abstract.

Think about it. We come up with a question—say, how’s morale? We create abstract categories related to that question, categories like trust, confidence, or autonomy; we use these categories to formulate statements in some kind of survey; we give the survey to lots of people; we ask them to respond to our statements according to some scale; and we count their answers. In the end, we have what we believe to be facts about the degree to which some number of people do or do not trust their boss, have confidence in the leadership, or exercise autonomy. What we actually have is what people say they think, feel, or do in response to our categories—not what they actually think, feel, or do—or the categories they use to think, feel, or do it.

In some instances, this doesn’t much matter. But when it comes to relationships, this is a BIG problem. First, as we all know, what we say and do often diverges. And second, our categories often say more about how we think, not how someone else thinks.

For a searchable repository of market data check out our Market Research Center

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There’s another thing that organizations often miss: They assume that the things you go out and study should be the things that are right in the middle of the market, so they talk to customers who are in the middle of the bell curve about the products that the company already makes. That’s usually the least useful form of observation. The most useful is to go and visit with people who are at the ends of the bell curve. “Extreme users” are doing weird and wonderful things that you’ve never imagined, and that’s where you will get interesting ideas. Plus, you shouldn’t just talk to people who are using your product or competing products—talk to people who aren’t. If you ask somebody who already is, the best you’re going to get is incremental improvements of the thing you’ve already got.

For a searchable repository of market data check out our Market Research Center

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It’s a funny thing about demand: There’s often a huge gap between what people buy and what they truly want and need. That gap is revealed by the Hassle Map—and that gap is where the opportunity to create huge new demand is hiding. There are various kinds of Hassle Maps. Some Hassle Maps are lists of the steps involved in a process, often including too many activities that are needlessly complicated or whose value and purpose are unclear. Filling out your income tax return might be an example.

Other Hassle Maps chart the people, organizations, suppliers, and sources a customer must engage to complete a given task, often leading to confusion, waste, excess choice, and information overload—renovating a kitchen, for instance.

And still others graph the trade-offs between consumer needs that are equally desirable yet apparently mutually exclusive: In one arena after another, customers are told they can have low cost or quality, convenience or variety, personal service or speed—but never both.

For a searchable repository of market data check out our Market Research Center

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In a multi-polar world—a volatile, interdependent, globalized marketplace where upstart rivals can emerge quickly from any corner—competitiveness at speed remains imperative. But many of the previous bases for competition are no longer viable. Companies offer mostly similar products and use comparable technology. Proprietary technologies can be copied quickly. Physical location matters less when customers use the Internet to search and transact.

What’s left as a basis for competition is to gain a deep understanding of customer priorities by individual segment and to make the smartest business decisions possible about serving those segments. In this new environment, companies with weak segmenting and customer insight capabilities will struggle. Companies that master customer analytics will find abundant new opportunities for profitable growth and will be able to make wise decisions about investing marketing resources.