Can Product Managers Know Too Much About Their Customers?

by drjim on July 19, 2010

There Have Got To Be Some Limits On How Much We Know About Customers

There Have Got To Be Some Limits On How Much We Know About Customers

It’s sorta the Holy Grail of product management – to become so intimate with our customers that we can almost read their minds. Now while that may sound like a great idea, have any of us taken the time to consider what our customers might be thinking about us doing this?

Information Blending: Good Thing Or Bad Thing?

This whole question about having lots and lots of information on our customers has only really started to surface in the past few years as computers have gotten faster and the Internet has made sharing information almost ridiculously easy. However, just because something is easy to do, doesn’t necessarily mean that we should be doing it.
Emily Steel reports that a company called EXelate Media is in the process of creating an alliance with a company that we all know: Nielsen – you know, the company that keeps track of who watches what on TV. The reason that this announcement is generating so much interest among product managers is because really for the first time, EXelate’s captured information on 150 million web surfers will be able to be combined with Nielson’s captured behavior information on 115 million American households.
What this means for your customers is that when they go online, now there is the possibility that they may be seeing very, very targeted ads. Just think about for a moment: if you know a web surfer’s age, race, gender, profession, and marital status and you knew where they had been surfing in the last month or even year, what would your product’s ad look like?
The way that EXelate has collected their information on your customer’s web surfing habits is not really rocket science. What they’ve done is to strike deals with lots and lots of web sites and then they’ve scanned all of the registration data that you and I entered when we registered to use those web sites.
They next created web “cookies” that are placed on a user’s hard drive when they visit one of the sites that they’ve registered to use. This cookie allows surfers to be identified to other sites that have subscribed to EXelate’s service – when you drop by, they can look up a lot of information about you.

The Down Side To Too Much Information

As you may have already guessed, this explosion of personal data being made available to marketers is starting to cause some concerns. The Federal Trade Commission (FTC) has started to hold meetings to talk about this very issue.
Just because I like the color purple and I eat lots and lots of lime Jolly Ranchers doesn’t mean that I’m going to appreciate seeing ads starting to pop up on my browser for your blue widget product telling me that “4 out of 5” purple loving, line Jolly Rancher eating people have bought your blue widget. In fact, when consumers start to realize that data is being combined from multiple sources, they may flat out rebel.
For right now, marketing firms are saying that they understand the issue and that they handle consumer’s personal data very carefully. They say that no individual can be identified by the data that they have because they’ve stripped out any identifying info.

What All Of This Means For You

Yes, knowing more about your potential customers is always a good thing for product managers to do. However, in this modern age it may be possible to know too much about them.
The arrival of firms that track consumer’s online surfing habits and their alliances with traditional consumer behavior tracking firms has created a super tracker hybrid firm. All of a sudden, a great deal of information may be known about any customer that visits a web site.
If consumers believe that you know too much about them, they will push back. Product manager realize that as with all powerful tools, they are going to have to go slow and make sure that they don’t spook their customers by knowing too much…

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Product Management Help™

Question For You: If you had the opportunity to know what your customer’s web surfing habits were, would you use that info to reach them?

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What We’ll Be Talking About Next Time

Into every product manager’s life will arrive opportunities to make decisions, really, really important decisions. When this time comes, will you chose to take your product the right way or the wrong way? Perhaps more importantly, will you allow your customer to make the wrong decision with your product?

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{ 4 comments… read them below or add one }

Austin July 19, 2010 at 6:36 pm

I can definitely understand that from a targeted advertising standpoint there could be concerns about the freakishly relevant nature of the ads I see when I’m browsing. However, as a product manager, I don’t know if I can know too much about my customers if I am using that to deliver highly relevant solutions. Right??? As a consumer, if a company freaks me out by their ability to solve my problem to a T, I’m going to sing their praises all day long. Take LinkedIn or Netflix for example. They both freak me out regularly with their ability to suggest people I should connect with or movies I should put in my queue, but I love them because they are using their data to improve my adoption of their products.

So assuming their motives are right, I say product managers cannot know too much about their customers.

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Dr. Jim Anderson July 24, 2010 at 11:32 am

Austin: you make a good point — we all love great customer service. Perhaps the key point isn’t so much how much info we have on our customers, but rather how we go about using it. If done correctly, behind the scenes, then we’ve got a much better chance of delighting our customers than if we just show up and say “I know you like blue things, so buy this…!”

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Tom Leung September 6, 2010 at 3:11 pm

Great post Jim. I think there’s a distinction between too much data and too much customer insight. I’d argue it’s easy to have too much of the former but nearly impossible about the latter. I recently wrote about the importance of customer empathy here http://tinyurl.com/3a9htku. I can say so far, it’s been extremely useful for my product teams and we expect to make a human-centered approach something that will have even more weight than a data-driven approach. Although, I would say the optimal ratio might be 60/30/10 (empathy/quant/creative bets).

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Dr. Jim Anderson September 10, 2010 at 12:38 pm

Tom: Good point. It sure seems like the source of the data that you can collect on your customers probably has a lot to do with its quality. As you pointed out, too much high quality info is never a problem! The reality of life is that all too often we get a mix of customer data: the good, the bad, and the ugly. Anything collected by humans through interaction with customers has to rank at the top of the information pile…!

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