Know-How Exchange : Book Club

A majority of new products fail because their sponsors do not understand the true preferences of their target market.In addition, pricing, placement, and advertising decisions that are based on a poor understanding of consumer preferences will be haphazard at best.

In a research conducted in a restaurant participants stated their meal preferences and eventually had to pay for and eat the preferred meal. Using the traditional, hypothetical conjoint approach researchers are able to predict consumer’s top choice only 26 percent of the time. In contrast, using the incentive-aligned approach, they were able to predict consumer’s top choice 48 percent of the time.

I am not a fan of market research ... or more precisely, I am not a fan of the way that market research results are used.

Focus groups are cut off from the real world that they claim to "represent" ... the environment is artificial, the questions posed are open to interpretation and manipulation, the the participants have to respond within very loose or imaginary contexts. And just because you SAY you would do something doesn't mean you will actually DO it.

Why waste time and money when a small and targeted social media experiment can yield in-market, live results (at a fraction of the cost).

Research should be more experiential; in fact, I would call it inquiry and not research. If we approach the marketplace with an open spirit of inquiry and manage a good mix of conversation *and* observation, we might get somewhere.

Conversation will allow us to develop a stronger bond with our customers; observation will keep everyone honest. I find that we (all of us) often say one thing, and do another.

Interesting how you refer to the "vein of research methodologies." For me that is the broadband of research. Before I even got to this phrase I was thinking the chemical makeup flowing within the vein and the dna's, strands of behaviors that smart marketers are able to identify and exploit/add to/take from.

The methodologies of accomplishing that is key. Focus groups are snapshots at best or xrays which only tell you what the body of panels think at that very moment. After all, things could change tomorrow with something in a brand category that changes everything, giving you new issues you now need to deal with

In my opinion, there are 4 tenants that will truly enable marketers to use research to get maintain/increase a sale of some sort that strengthens their business:

1. Knowledge of where to look for the veins
2. correctly identifying both the DNA flowing through it is and what strand is the one that moves your brand
3. setting up a creative and media system that is actually capable of capitalizing on learnings - let's call this the heart of the matter
4. Insuring that there is a support structure, a correct allocation of resources that allows the body structure (marketing and sales) to work.

Here's how most brands allocate their above the line marketing $$

research 5%
metrics 5% (at most)
creative 20%
media 65%
technology 5% (structure)

Here's my perscription

research 15%
metrics 5%
creative 20%
media 45%
technology 15%

This is from a media guy!. Here's my reasoning:

Fact/Problem: There's an 80/20 skew to ad impressions in all media the dirty little secret agencies keep out of the conference room that is an unhealthy and wasteful dispersion of messaging. Perhaps this is why brands that are sick put all their funds into a short list of media vehicles and don't see any benefit. In essence, they are hitting the same audience even more. They may see a bump because the less reached audience gets more, but overall the expectation behind the $$ increases are often not met.

Solution: Creating a system, shifting more funds from media into research (to listen better) and technology (that makes creative and media more nimble and shiftable which creates a more equal dispersion of ad imps which elminates/reduces the too concentrated and too anemic and thus, increase effectiveness. I'll stop there.

i believe that focus groups are limited by the human nature. i mean when ask for a question, every human being is trying to look better, smarter, cooler. i understand that experienced interviewers my get the point but still data can be heavily affected. what i used to do, in a very empiric way is to go into supermarket or selling point and look for people attitude. on field activity such this gives you more hints than an unreal situation as a focus group.

I'm not sure if you would call this "market research"... but clearly this is "out of the mirrored conference rooms and into the market".

... but my first professional position was as a telephone interviewer, with a goal to gather statistically significant and unbiased data (e.g. no "tie downs", can't say, "You want to save money, don't you?" because this influences the answer.)

Today, in B2B outbound marketing, I use similar interview techniques in lead follow-up, to more accurately qualify prospects. tied with a long-term educational approach. If sales folk use the 80/20 rule, they focus their efforts on the 20% who are most qualified to buy... and fail to gather (and/or fail to document) market feedback from folks who are less qualified... yet a company (or or marketing manager or R&D director) may want to know just WHY a more companies are not interested.

It is my belief that an educational oriented program to follow up and cultivate leads long-term can provide valuable market feedback, complementing that one gets from the sales force... as well as occasionally turn up a sale or two.

Certainly the majority of sales and lead generation efforts should be directed to activities with high and trackable ROI - but supplemental calls to build rapport and credibility with thought leaders at innovative companies can yield valuable market feedback (e.g. help prioritize proposed new features, provide new product enhancement ideas).

Blogs as a/the new tool of social and market research is not just a fascinating prognostication. One of the most interesting comments I heard at the meetings and conferences I've attended in the past year was: "In two years Podcasting will be a thing of the past, but blogging will be bigger than ever and will have become a new form of mass media."

This book has caused me to believe that the mass media of the near future will unquestionably include social media. I see it as not only a disseminator of information, but as a useful tool for research, and a powerful way for marketers and others to promote, engage in and study conversations about their companies and their products.

ck:

Focus groups are excellent forums to raise questions but they are lousy at answering them. Because they're fast and cheap, however, many companies will use them as "check the box research", as in, "sure, we did our packaging research... we ran it past a few focus groups." Garbage in, garbage out.

Observational research, anthropological research, anything where you don't ask, you watch -- this is where I'd spend more of my time and money if I could. Paco Underhill pioneered this work.

Using social media for research is like using focus groups -- the 1% that responds will tell you what they think. This is not representational of the whole, but it does tell you what that (very important monster user) 1% want.