Sep 032014
 

Last week I posted an article looking at the decline in survey research, which included some data from ESOMAR and some predictions.

This week, ESOMAR posted the latest Global Market Research Report and it includes some interesting figures on data collection modes. Figures which are broadly in line with my predictions.

The table below is mostly a repeat of the one I included in my previous post. It shows the data from the ESOMAR reports for 2007, 2010, and 2013, along with my forecasts for 2016 and 2019.

In this version, I have added the data from the 2014 ESOMAR Global Market Research report at the bottom.

Surveys 2014
Note, the ESOMAR data refer to the final figures for the previous year, so the 2014 report is based on the completed returns for the whole of 2013.

The decline in research spending on projects where the data was collected via surveys, from 53% in the 2013 report to 48% in 2014, is a very large drop and is even faster than implied by my predictions. The ESOMAR Pricing Study would suggest that some of the drop is due to falling costs for online research and a continued switch to online from face-to-face and CATI. However, the ESOMAR Global Market Research report also highlights the growth of non-survey alternatives.

The change in other quant is broadly in line with my predictions, and the 1% change in qual could be more wobble than message. The climb in Other is, however, large, and larger than my prediction, and is one of the drivers of the fall in survey research as a proportion of the total. The key elements in Other are desk research and secondary analysis and are an indication of the move away from data collection to analysis.

BTW, if you are interested in this topic you might want to read Jeffrey Henning’s riposte, Surveys A Century From Now.


 

Sep 022014
 
Coloured Rhino

One of the most frequent lamentations at market research conferences relates to the boardroom. Market researchers are not well represented in the boardroom and many seem to think this is proof of our weakness as a profession/industry. However, I think this is mistaken, I think that market research should only rarely be involved in boardroom decisions, and indeed that majority of what we do should be tactical not strategic.

Boardrooms are not places where many decisions are taken, and those decisions tend to be about issues such as mergers and acquisitions, accounts related issues, strategic decisions about estate management, strategic decisions about issues such as outsourcing etc.

The management of companies is not, typically, achieved at the boardroom level; it is provided by the managers and the specialists. Market research is at its most powerful when it is integrated into the wider knowledge base and information system of the organisation, and this integration happens best when done by the people working with the information, not externally, and not at a level too senior to understand the complexity.

Similarly, most companies make 1000s of tactical decisions for every strategic decision. If a company is making a large number of strategic decisions, they are not actually strategic, they are more likely to be panic. Market researchers certainly want to be involved in the strategic decisions, we have a lot to add and they tend to be interesting projects. But the bulk of the industry should be focused on the tactical if it is going to grow and be profitable.

If we look at the ESOMAR Global Market Research report we can see that the continuous projects account for the bulk of market research spending by clients, including audits, market measurement, customer satisfaction, brand and advertising tracking, usage data. All of this data is used strategically occasionally, but it is principally used to manage the delivery of services and products – i.e. it is used tactically. Ad hoc research such as product testing and ad testing are, in most cases, tactical. A company makes a strategic decision to launch X new products a year, the NPD, the pre-testing, the testing, the comms testing, the monitoring of sales and advertising are all (mostly) tactical. Of course, we would encourage a company to review its tactical data to gain inputs to its strategic thinking, but that is in addition to using the data tactically.

Am I talking about me or about the industry?
One of the reasons I think the MR industry gets confused about whether its core target should be the boardroom or senior management, and about whether its bread and butter should be strategic or tactical, is down to the opinion leaders in market research. Most of the opinion leaders are more strategic than tactical, they personally do more big picture work, and they do less testing whether the font on the pack should be serif or sans serif.

I worry that too many people who do the big thinking (or who try to do the big thinking) are generalising from their own particular. If the market research industry were to focus on the strategic and the boardroom, to the exclusion of the tactical and the everyday, the market research industry would be much, much smaller, many people would have to lose their jobs, and another business sector would need to do the tactical research that clients need.

The importance of the tactical and practical
The ability of some market researchers to focus on the strategic, to offer consultancy services, rests on the scale of the market research industry and its reputation for measurement, independence, and relative objectivity. The stars in our industry are there because of the field managers, the interviewers, the programmers, the operations staff, the coders, and research executives that facilitate the scale of the MR industry.

Yes, let’s keep developing the consultancy services, let’s keep trying to garner a bigger role in strategic decision making, let’s embrace insight management, but let us also keep developing the tactical, the practical, the everyday. We need a parity of respect for all aspects of the market research profession.


 

Jul 252014
 
The customer relationship

Most companies claim to be customer centric, but when you look at what they do you will see that the customer is all too often treated as a cross between an outsider and an enemy – someone to be persuaded, entrapped, or smooched, not somebody in true partnership with the brand or organisation.

I think there are two reasons why so many brands talk about being close to customer while at the same time failing to achieve it:

  • They don’t realise that doing it right can make the business more profitable and more sustainable – so they just talk-the-talk.
     
  • They don’t know how to operationalise a relationship with tens of millions of customers – so they don’t try.

I think both of these positions are wrong and I have set out my observations and findings about how some companies are truly putting the customer into the decision making process in a new (short) book. In the book I highlight cases and show the tools they are using and the rewards they are achieving.

The four main points I make are:

  1. 1. Customer engagement comes in three layers, Listening, Crowdsourcing, and Co-creation – and the best companies do all three, using a variety of tools and approaches. Companies as diverse as Molson Coors, Kimberley-Clarke, SingTel, and Avianca are all using multiple strategies to sit side-by-side with customers.
  2. 2. Research from the likes of IBM, Aberdeen, and Forrester show that customer involvement can increase revenue and profits.
  3. 3. With the rise of the collaborative economy, for example Uber, AirBNB, and Kickstarter brands cannot sit above the fray, they need to be part of the answer or they will be part of the problem.
  4. 4. In the past brands and companies had product differences, but in most cases these have been eroded. The final competitive advantage for a company lies with its customers – not with the product or the service, but with what customers can help create and sustain. However, the overarching message from all these cases and examples is that brands have to mean it, they can’t just talk about involving customers, they have to believe in it and they have to make it happen.

If you’d like to read the full book you can download it from the Vision Critical website (in exchange for handing over a few details about who you are).
 

Jul 162014
 

Sometimes when I run a workshop or training session people want detail, they want practical information about how to do stuff. However, there are times when what people want is a big picture, a method of orientating themselves in the context of the changing landscape around them. Tomorrow I am running a workshop for #JMRX in Tokyo and we are looking at emerging techniques, communities, and social media research – so a big picture is going to be really useful to help give an overview of the detail, and to help people see where things like gamification, big data, and communities all fit.

So, here is my Big Picture of NewMR (click on it to see it full size), and I’d love to hear your thought and suggestions.

Big Picture

The Big Picture has five elements

The heart of the message is that we have reached an understanding that surveys won’t/can’t give us the answers to many of the things we are interested in. People’s memories are not good enough, many decision are automatic and opposed to thought through, and most decision are more emotion that fact. Change is needed, and the case for this has been growing over the last few years.

The four shapes around the centre are different strands that seek to address the survey problem.

In the top left we have big data and social media data, moving away from working with respondents, collecting observations of what people say and do, and using that to build analyses and predictive models.

In the top right we have a battery of new ways of working with respondents to find out why they do things, going beyond asking them survey questions.

In the bottom left we have communities, which I take as a metaphor for working with customers, co-creating, crowdsourcing, treating customers and insiders, not just users.

The bottom right combines elements from the other three. ‘In the moment’ is perhaps, currently, the hottest thing in market research. Combining the ability to watch and record what people do, with interacting with them to explore why and what they would do the options changed.

Thoughts?
So, that is my big picture. Does it work for you? What would you add, change, delete, or tweak?


 

Jul 062014
 

I am teaching a series of market research lessons in Tokyo at the moment (based on the ESOMAR book Answers to Contemporary Market Research Questions). At the first lesson one of the questions from the audience (who were all people with Japanese as their first language) was about the difference between Market Research and Marketing Research. I explained (and Tweeted) that there is no useful or meaningful difference between the two terms – which led to a few counter tweets. So, I thought I would set out my thoughts in more than 140 characters.

To most business people, to most market/marketing researchers, to most users of marketing/market research the two terms are interchangeable. Whilst most people seem to have a preference for one over the other, a writer/speaker cannot expect an audience to draw a distinction between the two.

There are some people who assert that there is a difference between the two words. However, these people tend to disagree with each other. For example a Qualtrics blog post in June 2010 asserts that Market Research is a subset of Marketing Research. Conversely Wikipedia says of Market Research (in the entry on Marketing Research) “Market research is broader in scope and examines all aspects of a business environment. It asks questions about competitors, market structure, government regulations, economic trends, technological advances, and numerous other factors that make up the business environment.”

The definitive description of Market Research, for international purposes, is probably the one offered by the ICC (International Chamber of Commerce)/ESOMAR Code on Market and Social Research. The Code says “Market research, which includes social and opinion research, is the systematic gathering and interpretation of information about individuals or organisations using the statistical and analytical methods and techniques of the applied sciences to gain insight or support decision making.”

My personal preference is for Market Research, but that is perhaps not surprising as I am from the UK, and in the UK almost everybody says Market Research (as supported by entering the two terms into Google Trends and restricting the search to UK). The terms Marketing Research is more common in the USA, but even there Google Trends would suggest more than twice as many people are looking “Market Research” and “Marketing Research”.

I could try making the semantic argument that Market Research relates to every aspect of the market, whilst Marketing Research only relates to that sub-set of markets that pertain to marketing. However, that would be folly.

Most articles that look at the two terms say they are used by most people interchangeably. If you want to confirm this get hold of a few introductory text books on market research and marketing research and inspect the contents – they overlap entirely.

If two terms are used interchangeably, and, if those people who believe the words are distinct ascribe very different meanings to the words, then there is no useful difference between the words. Speakers and writers do not own the meaning of words; meaning is determined by the people who read and hear the words.

I suspect that those people who argue that there is a difference between Market Research and Marketing Research are saying:

  • There used to be a difference.
  • And/or they would like there to be a difference.

PS, in this post I have used caps for Market Research and Marketing Research as I am drawing attention to the two terms and wanted to highlight them. Please, normally, do not use caps for market research, it is not a proper noun.


 

Jun 282014
 

This week’s Economist has an interesting article about the founders of Napster (Shawn Fanning and Sean Parker) and the difficulty they have had in coming up with a successful second presence in the market. Towards the end of the article the Economist refers to one of my favourite terms in the area of new business, “First-mover disadvantage”.

First-mover advantage?
Whenever I meet start-ups, or people back from the latest hi-tech innovation fest, the talk is often about first-mover advantage. The idea is that a company gets in first and secures a long-term advantage. However, although there are examples of first-mover advantage (e.g. when a first mover can tie-up the market for scarce materials), it is much more common to see first-mover disadvantages.

First-mover disadvantage
Examples of first-mover disadvantage go back at least as far as the printing press, noting that in the 16 Century Gutenberg died bankrupt). The economist article quotes Motorola and the mobile phone along with Netscape and the browser. To this list we could add:

  • Alta Vista had first mover status in search engines, but was overtaken by Yahoo! and then Google.
  • When personal computers first appeared the early advantage was with companies like Commordore, then Apple, then IBM, and now the PC is largely a commodity item, with a range of manufacturers, and most of the early leaders no longer in the market (Apple is still making personal computers, but has a relatively small market share).
  • Henry Ford appeared to have secured a first-mover advantage in 1908 with the Model T, but was overtaken in the 1920s by Chevrolet.

The awareness of first-mover disadvantage dates back a long way, for example here is a Forces article on it in 2007. In 2001 the Harvard Business Review reported a study that found that first movers in consumer goods and industrial goods tended to have a 4% LOWER ROI than later entrants to the market.

There are numerous causes of first-mover disadvantage, most of which relate to second mover advantage. The second mover can see what is working, they can aim to meet the unmet needs of the incumbent (which often means cost, but can mean efficacy, range, style etc).

Another source of first-mover disadvantage is that if a first mover is making money from its current model it often neglects the need to change, to disrupt itself, leaving it open to be disrupted by others.

So the next time somebody is pitching a product, investment, or job opportunity, watch out for that use of first-mover advantage.

In-and-Out
When somebody is talking about first-mover advantages. It can be a good idea to check whether it represents and in-and-out opportunity. An in-and-out opportunity is where there is a short-term first mover advantage, and there is an understanding by the people running it that the optimum strategy is to ramp it up quickly, generate revenues, and then get out.

Other Examples?
What are your examples of first-mover disadvantage?


 

Jun 252014
 

Lots of people seem to have a big down on jargon, but is that fair or useful? In Research-Live, Lucy Hoang of Northstar asks whether jargon is a necessary evil? In her post, Lucy pointed out some of the downsides, highlighted the uses of jargon, and shared some good points about helping newcomers get to grips with key terms, for example the use of COB for close of business.

Some of the comments on her post reiterated the view that all jargon was bad. However, I think some jargon is both necessary and indeed helpful.

In terms of definitions my starting point is the Oxford English Dictionary (the OED to its fans) which defined jargon as “words or expressions used by a particular profession or group that are difficult for others to understand.” Jargon is also of relevance to sociolinguistics where it is one of the terms that can indicate a speech community, where the use of language is different from the wider community, but facilitates communication within the group, where the group can be as broad as a profession, or as narrow as a family or group or friends.

Facilitating communication
The starting point for any aspect of communication is whether it aids the message recipient receiving/understanding the message the speaker/writer is attempting to convey. This means the speaker/writer must choose words that ‘work’ for the purpose of the message and which ‘work’ for the audience. Any use of jargon needs to be based on a reliable assumption that the recipient is going to understand it.

Bad Jargon
I do not think all jargon is good, indeed it might be the case that the majority of jargon is not good. When I talk about jargon that is bad I mean anything that confuses the audience or distracts the audience or reduces the ability of the message to be communicated.

Examples of bad jargon include:

  1. Language which is now out of date. For example, I sometimes see notes that ask the recipient to revert, or where the recipient of my message promises to revert. Revert used to be a common way of saying ‘reply’ or ‘respond’ – however, in the UK/USA/Australia few people under 50 are familiar with this term. Many Latin terms fall into this out of date category, at least in the worlds of marketing and insight, for example inter alia, amongst other things, is no longer readily and widely understood.
  2. Jargon from other professions. If you are talking to market researchers and marketers, then jargon from other fields should be avoided, or explained. For example the Big Data acronym ETL is likely to confuse, even if spelled out as Extract-Transform-Load it is likely to confuse. In these cases if ETL is important (and in these days of big data it is of growing relevance) then it needs to be explained.
  3. Jargon that is used to make the speaker appear smart or trendy, as opposed to helping communicate the message. For me, two recent examples are “Swim lane” (a specific responsibility within the business) or “Tiger teams” (a team of specialists, often technical IT specialists).
  4. Jargon that reinforces discrimination or bad taste. Many people feel that sporting analogies tend to be discriminatory in the sense that they are much more familiar to men than women, and represent an ‘in group’ (i.e. men) and an ‘out group’ (i.e. women). Dinking the Kool-aid (i.e., unquestioningly following the company line) is a fairly tasteless reference to the Jonestown Massacre. And, “opening the kimono” seems to me both sexist (otherwise why not open the yukata – worn by men and women) and somewhat creepy!

Good Jargon
Good jargon includes things that:

  1. Make the meaning clearer
  2. Reduce the effort required of the reader
  3. Place the emphasis of the message in the right place.
  4. Make the communication more engaging.

Making the meaning clearer
When talking about survey questions to people who know about survey questions the jargon term “Grids” is much clearer than a plain English description. The jargon term random probability sample, is usually much more precise than a paragraph explaining what it is. The term verbatims is rejected by Microsoft Word, because it is a truncated form of something like “verbatim responses” or “verbatim comments”, but it is very clear and very precise, amongst users of research – it means the comments from research participants, collected as part of a research process.

Reducing the cognitive load
Hey, cognitive load is certainly jargon. I could have changed my headline to say “Reducing the effort required by the reader to understand the message by recognising that recent developments in neuroscience have indicated that analytical thinking processes require considerable effort and that the brain typically tries to reduce work, which can result in the brain ignoring elements of the message or of jumping to conclusions.” But, I would argue my heading is better for the people I am expecting to read this post.

Referring to CATI instead of spelling it out (or instead of a plain English description) reduces the reader’s cognitive load. RDD (Random Digit Dial) is an even better example, when you are sure the reader is familiar with the term. So, I would write RDD in a paper for sampling geeks, I would write random digit dialling if writing for a wider research audience, and outside of research I would probably not refer to this degree of detail.

Putting the emphasis in the right place
The fairly new term C-suite refers collectively to people like CEOs, COOs, CFOs (Chief Executive Officer – i.e. the boss, Chief Operations Officer – often the person running the bits of the company that make it work, and Chief Financial Officer – the person running the financial side of the business, in particular the accounts). If the reader can reliably be assumed to know the term C-suite, then a sentence can be written about the need to communicate with the C-suite without the sentence having to focus on the detail of who, which is important when the focus should be on the message.

One of the key elements in communication is where the emphasis is. Jargon allows the writer/speaker to focus on the message, rather than giving equal weight to every part of the message, when the jargon is understood by the recipient.

Making the communication more engaging
Plain English definitely has its role. But nobody would have watched Shakespeare’s plays if he had used plain English, nobody would have read Hemmingway if he had used plain English, and nobody would listen to the messages of people like Seth Godin, Tom Peters, and Daniel Kahneman if they had used plain English. Busy people, people in marketing and insight professionals expect messages to be engaging, they want storytelling, they want creative use of images and language. These things tend to require jargon, metaphors, analogies, and idiom. Plain English runs the risk of not being listened to.

Some disparaged examples
Forbes is running a poll about jargon, seeking to identify the most annoying examples. So, here is my defence of some of their contenders:

  • Take offline: This means to stop discussing a topic in a group situation so that it can be covered later, perhaps in a one-to-one discussion, rather than in a group. Why do I like it? Because it allows a problem to be diffused politely and easily. It is great when two people in a meeting disagree and the rest of the room do not wish to be involved until the two people in dispute have come to a single view.
  • Full service: In marketing and market research this term is becoming increasingly useful as there are a growing number of companies who are not full service, choosing focus on one service, one media, or one method.
  • Ecosystem: This is a relatively new term in the marketing and insight world. It means looking at how things work in total, rather than looking at just one aspect. The mobile ecosystem, for example, refers to telephone service providers, handset manufacturers, users of phones, mobile advertisers, app producers etc. The reason to use the term ecosystem is to encourage the listener/reader to embrace the whole picture, not just the bit they have historically looked at.
  • Scalable. A scalable business or method is one that can be increased in size without a major problem. A good example of a business that is not scalable is face-to-face qualitative research. To double the size of the business requires twice as many people, and the people are hard to find. A good example of a scalable business is one that depends on technology, in which case a doubling of the sales might require very few extra people. When assessing new businesses or opportunities one of the key issues is whether the option is scalable.
  • Bleeding edge: The bleeding edge is when a development is so full of new developments that it is going to create stresses and problems because of its newness. For example, people who use Google Glass at the moment are going to meet challenges from legislators, shop owners, the general public, and from technology. The benefit of the term Bleeding edge is not only that it describes a phenomenon succinctly, but it also embodies a warning. For most people the bleeding edge is not a good place.

Remember
The key issue, as Lucy makes clear in her post, is making sure that the writer takes the reader into account. One of the great bits of advice in Lucy’s post is that we need to help newcomers to our industry learn the key terms and we should avoid stigmatising people who have not heard of: COB, CFO, IPO, CTR, or TLA.

ps the acronym TLA is a joke, it refers to Three Letter Acronyms


 

Jun 222014
 

We like to think of ourselves as rational creatures and we like to think we can trust our ears. However, watch the video below and be ready to change your mind.

The Mckurk effect , the understanding of which dates back to 1976, shows how hearing and vision interact with each other. One of the interesting things about this effect is that even once you are aware of it you still experience it.

From a marketing and market research point of view key messages are:

  1. Changing the sound can change the perception, which means that the real sound should be tested as part of the research.
  2. More generally, the behavioural sciences, such as behavioural economics and neuromarketing are changing the our understanding of how marketing works and how it should be evaluated.
  3. Perception is not reality, which in terms of persuasion means that reality is not always relevant.
  4. People exposed to this sort of effect may be tricked, but if they are they are likely to be angry once they are aware – so include checking to post purchase remorse as part of the research.

Can you suggest other similar effects that help remind marketers and market researchers that they can’t trust their model of the rational consumer.


 

Jun 132014
 
Steve Wills

On July 16 Steve Wills will be giving a NewMR lecture on Insight Management and various initiatives to make it a recognised professions – click here to find out more about the lecture.

One of those initiatives is the creation of a MSc Insight Management degree by the University of Winchester, in the UK (to the South-West of London). Below you can read more about the course.

 

MSc Insight Management

The University of Winchester’s MSc Insight Management is designed for working managers, delivered on a part-time weekend basis. It will appeal to managers from diverse business support organisations such as market research, data analytics and competitor and market intelligence. The degree will give students an understanding of the Insight Management function and equips them with key skills in insight generation and delivery for business decision-making.

The degree develops students’ ability to critically evaluate the information needs of an organisation and the potential value it can generate. It explores ways in which organisations make sense of the information they generate, examining consumer decision and business decision processes. It examines the barriers to getting that information used when decision makers are swamped in diverse and often conflicting data and reviews approaches to generating insight through creative thinking techniques, within both divergent and convergent processes.

Being able to convey and articulate the meaning of insight at all levels from the Board through to those working at the sharp end of organisations forms a major part the degree.

You can find out more about the course from the Winchester University website.

Winchester Business School is a signatory to United Nations Principles of Responsible Management Education and the programme has been designed to fit within this framework.


May 022014
 

One of my favourite social media/listening books is Stephen Rappaport’s Listen First!, so I was delighted when his new book ‘The Digital Metrics Field Guide’ was announced, and even more delighted to get a copy to review.

The book has been produced and published by the ARF and you can download an interactive PDF from this link on the ARF site. The Field Guide is free for ARF members and $29.95 for non-members.

To produce the book Stephen reduced a list of about 350 metrics to 197 and backed these up by referring to almost 150 studies, which illustrates the claim that online is the most measurable medium. The book covers four digital channels: email, mobile, social, and the web, and produces a really easy to use reference for anybody interested in the area.

To make things easier Stephen has organised the information in three ways, Alphabetical, Category, and Marketing Stage – to deal with different tastes and preferences.

12 Fields per Metric
The book is organised in terms of 12 fields per metric, including: where it fits in Paid/Owned/Earned, its category, a definition, and the sorts of questions it answers. The use of a standardised format makes it much quicker for the user to find and locate a specific piece of information.

Examples of metrics covered include:

  • Average time spent on page – including issues such as tabbed browsing and download time.
  • Brand Lift – Did exposure to the advertising impact brand lift measurement?
  • Conversation – How many conversations are people having about the brand?
  • Direct Traffic Visitors – how many people came to the site directly?

Who should buy this book?
I think anybody who, over the next year or so, needs to check on the meaning, use, or definition of more than three or four of the digital metrics should buy a copy of the book. If you only need to refer to one or two, you could simply Google them, find some links, read some articles and come to a view. But, if you want a handy, well-researched, well laid out reference – this is the book for you.

Note, you will not want to necessarily sit down and read this book cover to cover, it is much more of a reference than a good read (but see next note on the essays).

Viewpoints/Essays
The book finishes with a series of 12 essays and viewpoints, from people such as Gunnard Johnson from Google and David Rabjohns from MotiveQuest. Unlike the rest of the book, these should be read as opposed to referred to. Whilst I don’t agree with all the points made in the essays, they are valid and interesting points, and ones that anybody engaged in the medium should be familiar with.

Timely publication
For me the publication of Stephen’s book is very timely as I am working on part of the IPASocialWorks project, looking at a guide to ‘measuring not counting’ in social media. The focus of our work is much more about the strategy and best practices of measuring social phenomena, but Stephen’s book provides a great reference to the variety of metrics available.