Intangible value

This is a great speech on creating intangible value...

Includes some really interesting case studies about why people value 'things' beyond the rational benefits they provide - e.g. why brands and marketing exist

Brand equity is a headstart, but it won't always win the race!

Shopper insights are creating a lot of buzz at the moment, but not everyone is on the same page. For the purpose of this post, I have defined shopper insights as... "Insights informing strategies/ tactics aimed at increasing conversion of demand to sales during the act of shopping". This is based on the premise that sales are driven by demand (preferences) and shopper activation (how this preference converts to behaviour).


Demand (consumer insights, the study of preference) + shopper activation (shopper insights, the study of how these preference evolve during the act of shopping) = sales*

*this is oversimplified, but illustrates the point I'm trying to make.

It's important to understand both sides, because they don't always match perfectly. In fact, I like to look at strong preferences/ demand (brand equity) as a getting a head start in a race; it gives you a good chance of winning, but doesn't guarantee success. And on the flip side, you might start from behind, but still win the race (e.g. lower preference, but you still get the sale).

The fact of the matter is that most decisions are made while people are shopping.

Another definition - 'act of shopping' - from need recognition through to post purchase

Let's take an example. I recently traveled to the US. I wanted to fly Virgin - I like what the brand stands for and I think they offer a good service. If you were to measure my brand equity, I would be a Virgin 'lover'. However, when looking at hotels in San Francisco I noticed a United Airlines offer for Aus - US return flights. The end result, I purchased a ticket with United Airlines. Why? They did a better job of shopper activation; they reached me with a relevant offer while I was in the act of shopping. Admittedly the service was terrible, you couldn't get more surly flight attendants if you tried, but this is another issue entirely and not something I won't to go into now (experiece>loyalty>brand equity).

You can see how this example fits with the framework presented in the diagram. I entered the shopping process with preference for Virgin, during the act of shopping I ignored preference and acted on an offer, I was disapointed with the consumption experience and therefore I'm now a rejector of United.

An interesting article re P&G focus on shopper marketing

http://adage.com/article?article_id=139127

Research provides the roadmap NOT the directions

This post is in response to the common misconception that research will provide the definitive answer to business  problems. The truth is, research is only a guide and needs to be combined with solid thinking before any decisions are made.

Think of research as a map to aid decision making - a map won't give you the exact direction, but gives information you need in order to navigate to your destination. If we continue with this analogy, two people using the same 'map' could take different routes to the same destination - this is the impact of judgement. The more research you do the more populated with information the 'map' becomes and arguably you are able to make a better decisions on what route to take. But regardless of the quality of this 'map', the decision on what route to take is a decision for the driver (e.g. users of the information), not the research.

Don't get me wrong, researchers are in a position to recommend a route, but we can't become overly reliant on the data we collect to make these recommendations - we need to apply common sense and intellect.

NYC

Some bits 'n' pieces from New York City.

A supermarket allows shoppers to rate the quality of their fresh food, these quality ratings are then shared with other shoppers. Another example of a company handing over control to the consumer, but also a sound marketing initiative based on insight. Shopper turn to others (friends and family) for advice and fresh food is product that has big variations in perceieved quality. Shoppers will have this dialogue with you or without you, so why not be a apart of it and gather information at the same time. This research directly benefits your customer, but also benefits the company - opt in research at its best.

To be continued...

How ads use insight...

Case studies of ads that have sound strategic foundations based on consumer insights...

Disclaimer: I'm no ad expert and therefore I will focus my comments on underlying strategy driving the comms, steering away from any commentary on the creative or execution of the ad itself.



All Bran - Honey & Almond



My take on the insights driving the comms...

• Traditional All Bran have a large group of 'taste rejectors'
• Growing the brand required taking the product to new consumers - the 'taste rejector' group
• Targeting All Bran 'taste rejectors' reduces the risk of cannibilising sales of the existing portfolio
• The ad directly appeals to this group, by suggesting that disliking the taste of All Bran is the norm - e.g. you'd be lying if you said you liked the taste of All Bran.

VB - Late Night Lamb Sandwich

This is just a great example of understanding the life of your consumer and what they get up to when consuming your products. Nuf said...

Research can't predict the future... but it can help

The exert below is from an article talking about the pitfalls of using research to inform future decision making. This particular passage focuses on the banking sector and how research pointed the major banks in the wrong direction. To be honest, I agree with lot of what is said in this article and I'm firm believer in fact that consumers don't know what products will be successful in the future.

Another example where market research got the future wrong is banking. In
1996 most CEOs of large banks dismissed the Internet as an irrelevance, a
plaything of enthusiasts with no real impact on future profitability. Market
research strongly confirmed their scepticism. The overwhelming majority of
customers said they weren't interested in using the Internet to run their bank
accounts.But since when have the general public been experts in global
technology and financial services trends? How could they possibly be expected to
form an opinion about web banking when most still doubted their need to be
on-line?

However, I think whoever conducted the research for the major banks made a fundamental mistake in the way they approached this issue. Rather than focusing the product 'online banking' in the research, they should have been focusing on consumer needs and how they manifest themselves in the banking sector. Undoubtedly, the need for 'convenience' would come up as key need that back then would have been met by ATMs, open hours, branches etc, etc. The researchers then should have asked themselves, will online banking meet this consumer need for convenience. Well it doesn't take a rocket scientist to answer that question.

The worrying thing about the above case study is the fact that the users of the research listened explicitly to what consumers said and took it as gospel. If you do that you end up with the 'homer dream car' - a car designed by consumers that NO consumers want! The lesson here is that consumers don't always know what's best for them, especially when you're talking about what's best for them in the future. If you are making decisions for the future use research to explore what they are looking for in terms of benefits/ needs and then use your brain to retro fit new products/ technology to those benefits/ needs.

Future of market research

I recently sat down with colleagues to discuss the future of market research, what will the industry be doing in years to come? Will we become redundant to technology?



For me the most interesting thing that came out of this discussion was the possible extinction of traditional question and answer research methodologies. If tomorrow's technology provides the ability to understand exactly what consumers are thinking without anyone asking a question - would Q&A become extinct, arguably YES.



However, this doesn't mean researchers are redundant, far from it, clients will still need someone to makes sense of the information and link it to their business. Imagine, a day and age, when consumers are fitted with computer chips that record thoughts, feelings, needs, wants, attitudes, and beliefs etc every second of the day. This same computer chip also records the stimulus (e.g. media) prompting these reactions. This would create a mass of information with none of the current caveats around consumers not being able to articulate how they feel etc. Someone will need to digest and distil this data and return it in the form of useful insight!



It could be our collective insecurity surrounding our worth in future, but we came to the conclusion that researchers (like we have in past) will adapt to technological changes and still feed the primary need our clients have for information.

Tracking research…is it useful?

Another quarter has passed and yet again the tracking presentation has been booked for 2 hours. You have to wonder, why? Do they really have 2 hours of fresh insights? If so, who wouldn’t be clamouring to attend the tracking presentation?

The sad truth is, that in most cases, the 2 hours time slot is arbitrary and more likely driven by the questionnaire length, not the quantity of fresh insights. You arrive at the presentation to realise the same charts are being presented in a similar order and trends are mostly flat. You make it through the 2 hour presentation, do you?
a) Have a clear idea of what to do based on the findings
b) Walk out a little wiser, but still need to ponder the so what; OR
c) Exit with a slight headache and desperate need for caffeine.

Perhaps, I’m being a little extreme, but I do think c) is a viable answer for some and I do believe many would fit into box b). You need to ask, is this good enough given the amount of research budget allocated to tracking?

I’ll say now that there is no set solution, mainly because every businesses needs will be different. For this reason, a ‘food for thought’ approach is more appropriate. There are a number of ways to improve your continuous research program…

Ensure everyone is aware of what you want to get out of your tracking research
Objectives are normally clear at the briefing stage, but this undoubtedly changes with time. And when you are talking about tracking research the original briefing is often a distance memory. To overcome this issue, objectives should be set for every presentation and reviewed at an overall level at least yearly. If there are no objectives in a particular quarter, then there should be no presentation. On this point, presentations should only be scheduled when there is something to say and if this means not presenting for 4 months and then presenting 3 times in one month then so be it.

Keep your approach to tracking flexible
The areas in which you are seeking insights will change throughout the year as the macro and competitive environments change. Tracking research should be flexible enough to offer topical insights as required and provide a cost effective means for collecting this data. For example, right now is an opportune time to use the tracking vehicle to get a quick read on the impact of the recession on spending in your category.
Consideration should also be given to transferring some of the tracking budget to more ad hoc continuous research. For example, create you own consumer panel to conduct ongoing ad hoc research with (e.g. this month lets ask them about cooking habits, next month lets talk about celebrity endorsers etc).

Ensure tracking is reflective of the real-world
This is extremely important for the credibility of the research, but also the usefulness of the research in decision making. It’s common for the research to say one thing, while the business metrics (e.g. sales) are saying the opposite. It is essential to, at the very least, understand why there is this disconnect, but ultimately the goal should be line up tracking results with business metrics.

Reporting needs to be collaborative and engaging
To often research recommendations are naive and too broad to be meaningful. For this to change a collaborative approach to reporting needs to be adopted. Firstly a brief should be prepared before the agency begins work on the presentation –involving internal stakeholders and other agencies (e.g. advertising and media). The draft presentation should be shared with stakeholders and feedback incorporated into the final version.

Really there should be no surprises in the final presentation; no one needs to feel blindsided or defensive. It can also be more useful to run the final presentation as a workshop, as opposed to the common ‘speech’ format. This way everyone’s comments can be included in the final recommendations and the end result is more meaningful insights.

Cover all touch-points consumers have with your brand
The marketing world adapts to changing media outlets and consumption at a rapid pace, and research needs to keep up. It’s not sufficient to just focus on the effectiveness of TV advertising anymore. Ultimately, tracking research should account for all the touch-points that influence a consumer’s perception of brands in your category. This also means understanding the impact of word of mouth or press on the brand. Arguably a news story about your brand will have more of impact than your own TVC.

Granularity is essential in driving actionable insights
The final point I want to touch on relates to usefulness of the actual data collected. In most cases brand data is collected at an overall level with little consideration given to different buying situations/ occasions. Take this example, brand preference at an overall level could be flat, but this could be masking a significant ‘undercurrent’ trend. For example, brand preference could be increasing within the ‘snack occasion’, but decreasing within the ‘meal occasion’. This simple example highlights the importance of granularity in tracking research and implications on marketing decision making.