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market research for small business BNBranding

Strategic listening and consumer insight – Small business market research

BNBranding logoI’m a big proponent of small business market research. For me it’s insight first, THEN execution.

Insight is the foundation of every ground-breaking idea in history. Insight drives the strategy that directs the execution that produces results.

I’ve seen how research insight leads some brands in profitable new directions, and others back to their roots. I’ve seen, first hand, how research can be integrated seamlessly into the operations of a rapidly-growing start-up. And I know that some of the greatest ad campaigns of all time were built on tidbits of information from surveys and focus groups.

Can you say, “Got Milk?”

strategic listening in advertising

Got Milk print ad

But I’ve also done my share of branding strategies and marketing campaigns based on nothing more than gut instinct and the client’s opinion. It can be done, when the budget demands it, but believe me… it’s much harder and riskier.

I don’t think small business owners do enough strategic listening. (And their branding strategies usually reflect that.)

They often skip the research because they think they already know it all. The sales manager says “I’ve been in this business for 25 years, I know what customers want.”  Or the owner says “We tried that already, it didn’t work.” Or the marketing assistant says “We have some data from Survey Monkey on that.”

Don’t bet on it. Often times, customers don’t even know what they want.

Here are five common problems that business owner run into when doing market research for small business:

1. Questions are written from an insider’s perspective.

2. They ask the wrong questions.

4. They question the wrong people.

5. They don’t know what to do with the data once they have it. Or they just don’t want to hear it.

market research for small business strategic listening BNBranding

First, let’s talk perspective. (Or lack thereof.) 

As the old saying goes, you can’t read the label if you’re stuck inside the bottle. Most people are so wrapped up in the day-to-day business they can’t see the bigger issues well enough to ask the right questions. Their own bias creeps in at every turn.

An outsider’s perspective — and the objectivity that a professional brings to the table — is really the only way to get research that you can take to the bank.

Your lack of perspective leads directly to problem number two: The content of the research questions themselves.

A lot of time and money is wasted asking research questions that are dumber than a rock. For instance, I recently ran across a survey about the current plight of private country clubs. It’s no big secret that they’re hurting, and yet the survey started with a useless series of questions that just rehashed commonly known industry facts.

Don’t waste time asking questions you already know the answers to.

Clarify your objectives before you start. Spend some quality time framing the problem so you can ask better questions. Stick to subjects that honestly baffle you.

Problem number 3:  The issue of semantics in market research questionnaires.

There’s incredible nuance in the wording of a good questionnaire. In fact, how you ask a question can often guarantee results, one way or another.

Polling companies have known this for 75 years. That’s why there are Democratic pollsters and Republican pollsters. They can always get the results to skew in their preferred direction. Left or right.

Here’s a story that illustrates my point perfectly:

There were two priests who both wanted to know if it was permissible to smoke and pray at the same time. So they wrote to the Pope for a definitive answer. One priest phrased the question in this manner:  ‘Is it permissible to smoke while praying?’ and was told it is not, since prayer should be the focus of one’s whole attention. The other priest asked “Is it permissible to pray while smoking”  and was told that it is, since it is always permissible to pray.”

Chances are, if you’re writing your own questionnaire, you’re not being as clear as you should be. And clarity is one of the cornerstones of building an iconic brand.

The fourth problem arises when you ask good questions of the wrong people.

Many companies have feedback systems for their customers, but they never hear from their non-customers. Sometimes it’s more useful to poll the people who are loyal to your competitor’s brand. Why they don’t buy is just as important as why they buy.

When you do research make sure you have a representative sample of people on all sides of an issue. If you’re working with a research firm, insist on samples of real people, not professional focus group respondents.

The last, and probably biggest problem with small business market research is your ability to do something with the data once you have it.

In most companies there’s a huge gap between insight and execution. In the market research industry, that’s the most common complaint: Quite often, comprehensive studies end up on the back shelf, filed under “that’s interesting, now get back to work.”

All kinds of things can sabotage your best efforts. Sometimes corporate culture gets in the way. At HP the engineers run the show and even the most analytical marketing guys take a back seat. Innovation is a core value, so they might ignore market research in order to launch quickly and demonstrate their engineering prowess.

market research for small business branding strategies BNBranding

It’s like the software business. When they launch a product everyone knows it’s just v.1.0., and it will quickly to be replaced by v1.2 and 1.3. Their mantra: Launch first, ask questions later.

So make sure you’re in the position to act on the information you gather. Otherwise, don’t bother. Ask yourself some tough questions ahead of time…

• Do you have the brainpower inside the company to analyze the data and understand its implications? If not, can you hire someone who does?

• Do you have the financial resources to implement changes based on the analysis?

• Is the subject you’re researching important enough? Is it a C-level initiative, or just a mid-level management thing?

• Are you empowered to act? If not, who is? Do you have the allies you need to get things done?

research for branding strategiesIf you can answer yes to most of those questions, great. Here’s a fairly simple (simplified) approach that will produce information you can actually use.

In general, there are two types of research the typical business owner or manager can do:  Listening and asking.

It’s best to start with strategic listening because that will keep you customer focused.( And branding strategies that are customer-facing are almost always better than inward facing strategies.)

Put your own agenda aside and listen to what your front-line employees have to say. They hear it all. Revisit the customer feedback forms you’ve been collecting. Get out of the office and have in-depth discussions with real customers.

And by all means, tap into social media and other online sources. That’s a great way to “hear” what people are saying.

“I have numerous examples where we’re finding key nuggets, insights, aha moments and watch-outs coming from various online sources,” said Kristin Bush, Senior Manager of Consumer & Market Knowledge at Procter & Gamble.

“It’s definitely an area that we’re exploring quite heavily… we get the unprompted voice of the consumer, the real sentiments, the real points of view.  I think there’ s a huge opportunity in this space, and the companies that really figure out how to listen and respond in meaningful ways are going to win in the marketplace.”

Once you’ve tapped all the existing lines of communication, then follow up on with traditional market research techniques. Surveys, focus groups, and in-person interviews are useful for asking specific questions and probing deeper into topics that come up on the blogosphere.

New on-line tools make it easier than ever to get a survey done. But the do-it-yourself approach of Survey Monkey won’t pass the muster unless you follow the guidelines above.

Want more insight on branding strategies and small business research?

Want some help with small business market research? Give us a call. 541-815-0075.

6 Consumer behavior

Predicting consumer behavior: Or the whacky, random ways people buy.

BNBranding logoCorporations spend billions every year trying to predict consumer behavior.  Market research firms have sophisticated modeling protocols, ivy league PHDs and multivariate analysis to help them make sense of what is, inherently, nonsensical behavior.

Take, for example, the time my dad decided to replace his rusting Ford pick-up truck.

He drove two hours to the Big City so he’d have plenty of truck dealers to choose from. He went online to do some research, then he spent the weekend kicking tires, braving the onslaught of salesmen and test driving every make and model.

He came home in a Toyota Matrix. He was 75 at the time.

Consumer behaviorGod only knows what possessed him to switch from a Ford pick-up truck to a little urban pocket-rocket. The Matrix is more suited to base-thumping car stereo blast-a-thons than my dad’s easy-listening coastal lifestyle.

No amount of big data could have could have predicted it.

In hindsight, I suppose you could say it was consistent with his car-buying history, which is even more erratic than his golf game. I challenge anyone to find a pattern in this list:

1968 Fiat 124 Sport Coupe

1970 Chevy Caprice Station Wagon

1972 AMC Hornet (In order to torture his son)

1974 Chevy Vega

1976 Ford LTD 4-door sedan.

1980 Mazada 626 (below)

predicting consumer behavior

1985 Volkswagen Golf Diesel

1991 Ford Taurus

1997 Ford F-150 Pickup

2004 Toyota Matrix

2008 Ford Taurus

2010 Toyota Camry

2017 Toyota Camry.  (Wow, a repeat purchase. He’s getting predictable in his old age.)

I’ve decided he buys cars the same way he buys fruit… Whatever looks good, smells sweet and is on sale at that particular moment.

You might think that’s a little weird, but research published by University of Iowa neurologist Antonio Damasio shows that most purchase decisions are almost as random as my dad’s car buying. Predicting consumer behavior is not easy.

Damasio says marketing messages are processed outside the conscious mind. Emotions push us toward decisions we think are best for us, and we often bypass reason because experience endows us with what he calls “somatic markers in the brain.”

Somatic markers are the most likely biological basis for intuition. These pre-recorded behavior guides are based on inherited behavioral traits and formed by experience. When making decisions, somatic markers are triggered, often making reason irrelevant.

So it’s intuition and emotion that drives real life purchasing decisions. Not logic.

As Dr. Dean Shibata put it, “If you eliminate the emotional guiding factors, it’s impossible for people to make decisions in everyday life.”

On the other hand, when people are asked hypothetical questions about purchases, as in a focus group, the brain works on a much different, analytical level.

predicting consumer behavior“Instead of the real reason for buying, researchers get a rationalization based on the respondent’s idealized self-image. If they don’t account for this bias, researchers are left with a model based on how people think they ought to be motivated, rather than their actual motivations.”

So beware of market research that demands a rational explanation for irrational behavior.

And here’s another thing that makes predicting consumer behavior so difficult… Many times we aren’t “qualitatively conscious” of our motivation.

“Consumers have limited knowledge of their own values, needs and motivations that affect purchase decisions,” says Neurologist Richard Restack.

So my dad probably doesn’t even know why he made that decision to drive home in a Matrix. It wasn’t really because the garbage cans would fit in the hatchback.

The point is, all purchases are emotional purchases.

So the next time you’re throwing together a sales presentation, or putting together a Facebook campaign, you might want to spend more time trying evoke an emotional response, and less time building charts and graphs.

Reason certainly does play a vital role in some stages of many buying decisions. But in the end, the actual purchase is entirely emotional. The rationalization for the purchase is what’s rational.

Here’s an example from my own, personal experience…

I recently purchased a new driver, which was said to guarantee at least 20 more yards off the tee. (Don’t even get me started on those tired golf industry promises.)

Predicting consumer behavior

Here are the reasons why I pulled the trigger, now, on a new driver purchase:

  1. It’s been 8 years since I purchased a new club. I was due. I deserved it.
  2. A client of mine in the golf industry couldn’t shut up about this club. And he gave me a deal.
  3. I couldn’t find any consistency with my current driver.
  4. It was market research for this article.

Not exactly a rational decision, when all was said and done.

It had nothing to do with the features they tout in the golf industry magazines. I wasn’t searching for more distance. “Ten more yards” was not a relevant message for me.

The point is, people are unpredictable. Even old people who are brand loyal are unpredictable.

As marketers, the minute you start thinking you really know your audience’s hot buttons and can predict their behavior, forget about it.

Just when you’re sure you’re going to sell another Ford pickup, they throw you a curveball and go for the Matrix.

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If you’re wondering what your brand story should be, try this post.  If you want my personal advice, click here.   Copyright 2017. All rights reserved. John Furgurson.