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Winning the research revolution – Take two

By John Forsyth and Leah Boucher

The answer to gaining insights to make consumers happy is learning to fuse old techniques with new ones.

Most companies underuse consumer insight. For some, this is because they stick to old market research methods, unaware or wary of new options. These companies are susceptible to the mistake of treating the discovery of surprising insights as anomalies to explain, rather than opportunities to pursue.

Other companies are largely abandoning classic market research approaches.  They focus instead on mining and analyzing “big data” to understand consumers. These companies risk finding only backwards-looking insights; big data is most often a collection of past behaviors.  Thus, these organizations may miss insights that drive innovation, anticipate market disruptions, and predict long term consumer changes.

The best companies blend old approaches with new ones. They accomplish this by focusing on four concepts – a focus we call “Take two on the research revolution.”

First, leaders in the research revolution leverage digital and mobile platforms to capture insight from classic market research more rapidly and more robustly. Second, they overcome the limitations of traditional qualitative research, such as focus groups, by expanding them into new forms. Third, they learn how people shop, not just what and why they buy. Finally, they link a deep understanding of consumer attitudes and needs to actual behavior (often from big data sources) to deliver insights that enable the company to drive higher impact marketing actions.

1. Leverage the power of digital and mobile platforms.

While many companies assert that they are using digital and mobile platforms in their market research efforts, few are harnessing them correctly.  Poorly designed digital research fails to deliver anything beyond the most basic of insights. Many companies have struggled to find depth of insight from basic consumer sentiment analyses. Carelessly crafted mobile research will yield hopelessly biased results. Surveys not optimized for small screens introduce significant biases simply because of the constrained survey interface.

However, when used appropriately, digital and mobile applications offer incredible power.  First, the platforms are fast. Brand diagnostics, or consumer reactions to specific concepts, can be turned around in days, even hours, rather than the few weeks required for traditional research methods. Private-equity firms in the middle of a deal, for example, can perform research on brand strength and customer loyalty fast enough to support their acquisition decision and price.

Digital and mobile platforms are also less expensive and subject to less bias than face-to-face surveys or telephone studies. They can collect dramatically larger sample sizes, allowing marketers to find more granular opportunities, such as the analysis of segment-level brand equities for each stage of the consumer decision journey.

Mobile platforms enable companies to field short quantitative research in emerging markets, such as China, where online research is not a reliable option. Mobile-based research can also be faster than online in many countries where both platforms are an option. Both digital and mobile platforms allow companies to launch waves of research to test and learn quickly, which is critical to refining and improving concepts.

2. Decrease reliance on traditional focus groups and expand into new forms.

Focus groups were once the default approach for qualitative research. Companies typically gathered eight or 10 consumers in a sterile facility for two hours, promised them a small payment or free products, and asked them to give written or oral answers to questions. In the right context, such traditional focus groups can still be useful, especially if the correct techniques are employed.

However, today’s leading marketers put greater emphasis on “deep immersion” approaches in order to deliver more sophisticated and reliable insights. In a deep immersion exercise, respondents may be asked to make a collage or draw a picture to help them convey what’s difficult to articulate, including emotional needs, fears, and barriers. Tools like semiotics and anthropology can unravel the signals we use unconsciously and place consumer insights in the context of culture. Home interviews, in-store observations and ethnography—the science of studying how people behave in their natural environments— can help researchers recognize the true needs and motivations of consumers. These techniques put qualitative research on a whole new footing, as these deep immersion approaches generate profound, forward-looking consumer insights that can fuel truly new product ideas, revitalize brand positions and even redefine a product’s competitive set.

Companies historically have used qualitative findings to also generate hypotheses to test in quantitative research. This application remains today. However, some of these hypotheses can be gathered from social media, online ratings, and other digital sources.  Although digital sources have a plethora of limitations for quantitative research, a quick scan of consumer reviews can help an organization quickly identify pain points, key buying factors and other attributes to then test with alternative research approaches.

3. Understand how people shop, not just why.

Companies have long focused on what and why people buy. Understanding how people shop, though, is just as important because such insights allow executives to address a wide array of critical business issues. In apparel, for example, marketers need to know how shoppers find their products. Is it first on a website or in the store? If in the store, was it on a mannequin or on a rack or shelf?  They also want to know how consumers make decisions on whether to try on an item. Just from looking? Do they hold it up? Feel the material? Finally, marketers want to know why consumers decide to buy or walk away. Was it due to fit, or was it price?  Armed with this knowledge, companies can identify the bottlenecks to consumer decisions, and figure out how to resolve them.

For years, retailers made merchandising and product placement decisions by videotaping or using direct observation to learn how consumers navigated a store. Today, leading market researchers use a variety of additional methods. There is, for example, the shop-along (or “accompanied shop”), in which people discuss how they shop as they roam the store.  Smartphones can be used in the moment to track how people navigate stores. Mobile photo journals can allow shoppers to upload photos of all the products they considered and comment on them as they shop. These additional approaches add tremendous richness to the shopping process. They also help remove the pesky challenges associated with traditional exit interviews, like interviewer bias and geographic limitations. Finally, since they are real time, they avoid issues with memory lapses and post purchase rationalization effects.

4. Connect what you know about consumer attitudes with their actual behavior.

Most companies separate the researchers responsible for gaining consumer insights from those charged with maintaining the customer behavioral database or developing insights from other big data sources. The best marketing organizations, however, integrate understandings from both. Doing so spurs action to improve marketing programs and enhance the customer experience – and that, ultimately, can increase sales.

Many financial institutions have robust customer databases and access to big data sources that can provide powerful insights into the behaviors of their customers. One such institution leveraged these sources to segment its customers based on their usage. From this segmentation, it hypothesized that its biggest growth opportunity involved trying to migrate medium level users up to heavy users. Yet when the company layered in additional insights captured through survey research, it realized that many of its heavy users were also heavy users of a competitor. This insight refocused the company’s marketing strategy.

Such examples help explain why leading marketers have moved from a typical CLM mindset, which focuses on behavior and testing programs, in favor of gaining a more complete consumer understanding. They have realized through experience that marrying consumer behavior with customer attitudes helps drive more innovative and higher impact marketing.

All of these innovations—the use of the digital space, shopper insights, deep immersion, and linked attitudinal and behavioral data—still represent the dawn of the research revolution. Some researchers, for example, are working on mining more insights from the trove of third party data available for purchase.  Others are focused on deeper, more experiential research repeated with a set of consumers over time.

Some techniques and methods will be validated, others will not. Marketers and researchers must be open to experimentation, knowing that not everything will work. The techniques that do succeed, though, can open up new and profitable ways of understanding consumers. Companies prepared to take the risk have a real opportunity to gain the competitive advantage that comes from making critical marketing and business decisions grounded in deep consumer insights.

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