More Black Jelly Beans: Getting the Most from Market Research

More Black Jelly Beans: Getting the Most from Market Research:

These are good times for the market research industry. In 2010, North American companies spent over $10 billion on market research (ESOMAR Global Market Research Report, 2011), which, for perspective, is about 20% more than 2010 total Internet ad spending by all US advertisers. Globally, the spending figure is $31.4 billion, which represents a 5.2% increase over 2009. Yet amid the healthy growth and enormous size lies a shameful secret. There is a growing sense that much of the money spent on research may be wasted.

More Tools. More Data. Less Insight.

Modern market research goals are the same as they have always been: understand customer or other key stakeholder behavior and motivations in order to support decision-making – whether about marketing, new product development, location selection, or any other type of investment. What’s changed is the approach. Research methods have evolved far beyond mailed questionnaires, telephone surveys, and focus groups, and now include:

• DIY (Do It Yourself) survey and analysis tools and passive ‘listening’ via social media make it easy to gather information on consumer opinions, activities and ‘likes.’
• New “biometric” and facial recognition tools tell us what consumers can’t put into words (“The All Telling Eye,” The Economist, October 22, 2011).
• Passive listening technologies aggregate many voices into trackable trends.
• Video brings the voice of the customer alive.
• Mobile technologies make data more immediate than ever.

In a sense, the process for collecting data has become almost too easy. As a result, there is a greater variety of data — and more of it — than ever before. The hard part is discerning what is meaningful and, for marketers, determining what should be translated into marketing action. Jerry Thomas, veteran researcher and CEO of the independent research firm, Decision Analyst, commented recently in Quirks.

“We work with many large organizations, and the greatest problem they face, day after day, is confusion. Our clients are awash in a sea of data, consultants, gurus, and professors and don’t know who or what to believe (“A Look Back, A Look Ahead: Researchers Weigh In on the Last 25 Years and Opine on the Next,” Quirks Marketing Research Review, October 2011).”

Similarly, T.J. Andre, CEO of research firm, Chadwick Martin Bailey, wrote, in the same Quirks article:

“It’s very common, even expected, that companies today have a wide range of listening tools: customer feedback, social media, employee feedback, brand tracking, etc. Given these advances, and hearing from more customers, the number of companies facing the problem of translating all this data into real actions to improve the business is distressing.”

As can be seen by these remarks, there is a high level of consensus about the nature of the problem but less consensus about what to do about it.

• Researchers focus on things they can impact – data quality as measured by response rates and engagement, sampling costs and requirements. Listening in on market research conversations at conferences or in AMA publications, you would think the most important thing they have to talk about it is whether the Net Promoter score is still valid.
• Corporate clients complain of managers who don’t understand market research, who ask the wrong questions, or provide inadequate funding.
• Vendors complain of unclear RFP’s and inadequate budgets (see hilarious video: The RFP).

Getting the Most from Market Research Investments

As valid as these concerns may be, they don’t address the underlying issue of how to eliminate waste and generate more actionable research. Solving that problem requires rethinking the role of research and researchers. Recasting researchers as consultants, as well as technicians, who partner with marketing decision makers to solve practical business problems and build brand value would go a long way to solving the ‘last mile’ problem.

• Marketing decision makers need to stop thinking of research as data and start including researchers as strategic partners in delivering business results.
• Researchers and research suppliers need to stop talking about things decision makers don’t care about and start focusing on solving real business problems.

We work hard to make a difference and often that requires a different approach. We recently asked one of our most loyal clients why they chose us over larger, better-known competitors for a long-term relationship. It’s rare to have an opportunity to know how you compare so we seized it. The answer surprised us – they said it was hard to compare us to research companies because we were like the ‘black jelly bean.’ They explained by saying our approach was unique in combining insights with practical marketing implications and recommendations. We loved that description and the recognition of our desire to blend insights with impact.

Whether you are a researcher or a decision maker, ask yourself these simple questions as you begin each project to get the most from your investment:

1. What is the goal of this research project? Keeping score or generating real insights?

Large amounts of money are spent tracking customer satisfaction, customer value, brand awareness, and advertising impact. Does this data actually get used for improving the customer experience? If not, perhaps it should be scaled back or eliminated altogether.

2. Can these questions be answered more efficiently with existing data?

Many questions can be answered through greater use of secondary research or omnibus research, better use of internal data resources like the sales force or customer service, or repurposing past proprietary research. The data collected as part of a research project is often sufficiently robust to address more than one issue, but it is rarely revisited after the project is completed.

3. Will people charged with solving the problem stay involved in the research?

Marketing managers need to do more than develop the briefs and read the reports. Allow time for “discovery” as a key part of every research project. Be sure the people who will be using the research are part of the process. With so many online resources, travel is no longer an excuse for missing the qualitative research. The brand manager for a recent project sat in on every one of our twenty-five online in-depth interviews over the course of three days and, as a result, was in a much better position to comment on report drafts and apply the findings.

4. What is the proportion of cost allocated for analysis vs. out of pocket costs?

There has been an explosion in data gathering software, yet much of it is still relatively expensive to use. Ask yourself whether plain conferencing software, NING (social networking platform for creating and maintaining communities), or a blog can replace that fancy MROC (Market Research Online Community) software. Invest in software that really matters, like robust interviewing tools, but don’t get seduced by the ability to gather more text, photos, and content unless you really have a means of analyzing it. More is not always more.

5. Can we push the data harder?

The strongest case for “research malpractice” can be made for studies where the data is under-analyzed. Cross tabs are just the starting point of any analysis. Analysis should be an iterative process of asking questions and drilling down for the answers. Our savviest clients keep asking “why?” Fancy segmentations are meaningless if they don’t connect with the rest of the report.

6. Is the data presented in a meaningful way or is it for “the files?”

It’s shocking how many 85-100 page reports we’ve seen in client files. And that’s where they stay. The role of the researcher is to make the important ideas jump. Make presentations into interactive “workshops” to engage decision makers in what the data means and how it can be used to shape marketing programs.