Commerce and Consumer Goods

Why lean research is vital for the future of retail

Lean research can help shape the future of retail with data-driven insights, cost-efficient processes, and customer-centric strategies. Read on to discover how you can leverage the lean methodology to empower your retail business.

Happy woman retail shopping
5 minutes to read

In today's rapidly evolving retail landscape, understanding your customers has never been more critical. Many retailers, from online boutiques to established giants, often find themselves at crossroads, grappling with challenges they can't quite put their finger on.

An online gift brand wonders why its transaction value lags, while a subscription business can't decode the mystery of unreturned packaging. Amongst these challenges, valuable insights lie buried within internal teams and customers, waiting to be unearthed. At the same time, there’s an increased focus on cost reduction, gaining and acting on insights quickly, and delivering results.

Having attended the Retail Hive CX Exchange in Luton, I noticed that these sentiments were echoed by the participants and were a major topic of discussion throughout the event. It became evident that the future of retail calls for reconnecting with customers. The direct connection, once lost in the maze of proprietary platforms and internal processes, is waiting to be rediscovered.

If you don’t think you’ve lost the connection to your customers, take a look at the scenarios below and see if any of them sound familiar:

  • Ineffective product launches or upselling 
  • Expensive and time-consuming research initiatives, yielding little results
  • Inaccurate pricing strategies, leading to lost sales or reduced margins
  • Missed opportunities in market positioning or segmentation
  • Decreased brand loyalty due to lack of alignment with target audience
  • Inefficient marketing campaigns with lower ROI
  • Overstock or understock issues due to misjudged demand
  • Lack of innovation based on outdated assumptions
  • Difficulty in adapting to changing market trends or customer behaviours
  • Reduced competitive advantage against well-informed competitors

If your retail business has struggled with any of these, chances are high that it’s time to reconnect with your customers. That’s the only way to future-proof and solidify your position in the retail market. So, how can you do this most efficiently? With the help of lean customer research.

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Benefits of implementing a lean research methodology

Lean customer research is an agile and cost-effective method for gathering insights and data about customer preferences, behaviours, and needs with the help of targeted interviews and AI tools.

This methodology focuses on streamlining the research process to deliver valuable information while minimising waste, resources, and time spent. In retail, lean research is all about reigniting that lost connection with customers, understanding their purchasing journey, and driving better results.

There is immense potential that lies in truly understanding and responding to customer insights. Businesses that invest in customer research and take action based on these insights observe the following benefits:

Uncovering insights into customer behaviour can help create targeted strategies for long-term success, better cater to customer needs, and reduce churn while boosting loyalty levels.

Discovering unmet needs or desires can lead to the development of new products, services, or features, generating additional revenue.

Tailoring your products or services to your target customers de-risks your investments and maximises success.

By understanding customer needs, you can gain a clear pathway to innovation that is both cost-effective and deeply aligned with what your customers are looking for.

When partnering with HSBC to help with a retail banking proposition, we adopted a lean research methodology which was crucial for the project’s success. Zühlke’s team conducted user research and an eight-week discovery phase with stakeholder workshops to clearly establish the needs of its customers. 

Thanks to comprehensive consumer research, we gained invaluable insights and a deep understanding of the problem space. This enabled us to design a mobile customer journey and solution around genuine user needs. This commitment to customer-centricity gained recognition from The Banker, when the project won the mobile category of 2023 Innovation in Digital Banking Awards.

Discover the full HSBC success story

How to prepare for the future of retail with lean customer research

When you’re ready to reconnect with your customers and transform your retail operations, it’s worth incorporating lean research into your efforts. The best part is – it doesn’t have to cost a fortune and can be done even with a limited budget. The lean research approach typically involves the following key steps which are a great starting point for any retailer.

1. Define your hypotheses

Before delving into the research process, it’s essential to lay the groundwork. You must build relationships with your stakeholders, prioritise the areas of focus, and define the hypotheses you’re testing to kickstart the lean customer research journey.

By carrying out these activities you’ll have a research plan that’s aligned with your business goals, achieves stakeholder buy-in, and ensures uncovered insights will be actionable and bring lasting value.

2. Carry out the research

Once you have your hypotheses in place, it’s time to put them to the test. This step involves conducting rapid interviews, surveys, and experiments to build user profiles and identify cross-cutting themes. This is the clever bit where AI tools can be used to expedite the analysis process and help obtain customer insights faster.

3. Identify the path forward

With customer insights at hand, you can begin charting the path forward for your retail business. It’s time to translate customer insights into evidence-based decision-making. Use visuals to identify high-impact areas and concrete next steps. This stage is all about turning data into actionable plans and making your retail strategy more customer-centric.

4. Implement continuous improvements 

In the ever-changing world of retail, it’s vital to remember that lean customer research is not a one-off activity. After implementing actions, it’s crucial to continuously monitor customer feedback and implement the necessary next steps. This iterative approach allows for ongoing improvements based on real-world feedback.

5. Rinse and repeat

Finally, while you implement continuous improvements based on feedback, you also mustn’t forget to continuously revisit the entire process and test other hypotheses too. By doing so, you’ll stay in tune with customer needs, ensuring your retail strategy remains relevant and customer-centric.

happy retail customer looking at phone

Reconnect with your customers and prepare for the future of retail

Lean customer research is a powerful tool for retailers looking to navigate the future of retail successfully. It ensures that your retail strategies are grounded in data and customer insights, helping your organisation remain competitive.

At Zühlke, we understand that it can be difficult to know where to begin with your retail transformation efforts and the process of reconnecting with your customers. We’re here to help. 

By leveraging our cross-industry expertise and experience in delivering solutions powered by modern technologies, we can guide you throughout the lean research process, ensuring you gain an in-depth understanding of customer needs and invest in initiatives that will drive ongoing value.

Melanie Marchant
Contact person for United Kingdom

Melanie Marchant

Head of Digital Consulting
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