Posts Tagged ‘marketing research mistakes’

Too Many Cooks Can Even Spoil the Marketing Research Broth

August 11, 2010

In yesterday’s blog post, we discussed the importance of sharing research findings with other stakeholders in your organization. Today, we’re going to discuss how that can go too far, by trying to accommodate too many constituencies within the organization in the design of our survey. It is very easy to fall into the “too many cooks” problem of marketing research. Sometimes we have budget constraints and need to gather as much information from a survey to satisfy all the stakeholders involved. Other times, the department commissioning the survey is not the same as the department funding it, so the head of the latter department will see to it that the survey also serves some of his or her objectives.

The problem with involving too many departments in the planning and design of a survey is that it will create considerable infighting and result in a “satisficing” survey, that asks several questions, some tailored to each of the company’s internal constituents. As a result, the surveys are overly long, cumbersome, and lack a coherent focus. Quite often, these surveys result in respondent fatigue, unreliable responses, and biased results.

When your company is faced with several departments needing to share a survey for information, the best thing to do would be to first understand the company’s overall objectives for a survey. Then talk with the different departments about those objectives and understand what their needs are. Get them to prioritize their needs. Then once you understand the importance of each topic or issue to each department, try to match the most important ones back with the general objectives of the survey. Then talk with all departments together and prioritize those information needs that are most in need to match the company’s general objectives. It helps to have senior management providing top-down support for this collaboration. Stress to each department that you may not be able to get all the information they desire right away, but the quality and usefulness of the data you collect is more important than the quantity.

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Research Findings are Like Manure: They Work Better When You Spread Them Around

August 10, 2010

One of the biggest mistakes companies do when conducting marketing research is conducting it in a vacuum. At many companies, the marketing department will often execute a marketing research study for either its own information, or upon request from another department. The findings of the research may also be beneficial to other parts of the company, but rarely do departments share the information. This concentration of information often leads to silos and exacerbates organizational politics. Marketing research expert Larry Kilbourne considers this data myopia – the failure to share survey findings – one of “Seven Survey Sins,” referring to it as the “Mr. Magoo Syndrome.”

Repurposing research and sharing it within the organization produces immense benefits. The sharing of the information facilitates better planning, creates buy-in from and fosters consensus among cross-functional groups, creates accountability, avoids duplication, fosters a shared purpose, and enhances the company’s agility in responding to problems and opportunities. Imagine that an insurance company with a captive sales force wanted to conduct a survey of its sales office managers. Specifically, the insurance company’s marketing department wants to know how the company stacks up against the competition in various territories.

Specifically, the marketing department would like to know who each branch sales manager considers to be the three main competitors in his/her agency’s territory, the policy features that are most important to customers and prospects in that territory, an estimate of how many potential policy sales are lost to the competition in those territories, and where they feel their main competition is beating them in terms of product features and benefits. The marketing department conducts the survey and uncovers a wealth of information. Who can benefit from it besides the top executives who commissioned the research?

Each branch agency

The marketing department should start with each branch sales manager. The sales manager might want to know whether his/her problem with a specific competitor is unique to his/her office or common to several others. Moreover, the manager might want to know where his/her office stands with respect to the rest of his region or the entire company. The findings can also help the manager plan for improvement.

Actuarial and Underwriting

The insurance company’s actuaries can also benefit from the findings. If branch sales managers in the company’s Pacific Northwest territory complain of losing too many long-term care insurance policy sales to Insurer X on the basis of price or ease of acceptance, the actuaries can review the underwriting criteria and assess whether the company is being too risk averse in that territory, or whether Insurer X is being too aggressive.

Advertising

If the insurance company faces aggressive competition in certain areas, the Advertising department can benefit from changing its strategy in those areas. It might try advertising in different newspapers, utilize direct mail or email marketing, etc.

Human Resources, Training, and Recruitment

Sharing the findings of research can also shape a dialogue between branch managers and the home office to understand what is needed to increase sales. This can often result in a refinement in training and recruiting needs for various territories. For example, if the company is losing to Insurer X in the Seattle market, it may well be due to the experience of Insurer X’s agent force, which could be experienced insurance sales professionals, professionals with a successful track record in sales careers in any industry, or naturally extroverted people with a knack for selling. If this is the case, the insurance company’s HR department could start recruiting agents with similar characteristics. It may also identify ways to change performance requirements so that the company can get rid of underperforming agents. The company can also devise new training programs to increase agent performance, and create new incentive plans.

The list of groups within the organization with whom the marketing department could share the findings is far from comprehensive. Marketing research should never be conducted in isolation, but should be used for the greater good of the organization. Whenever a company conducts marketing research, it should always have a predetermined plan for what to do with the information, the departments that could benefit from it, and ideas on how to act on the findings, whether good or bad.

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Make Sure Your Marketing Research Efforts Have an “Owner”

October 8, 2009

When conducting marketing research, whether in-house or using an external marketing research firm, companies should assign responsibility for the research project to someone internally. Frequently, nobody owns the marketing research role, dooming the research project from the beginning. No designated owner ensures that research won’t be taken seriously relative to the employees’ other responsibilities; it almost guarantees that problem definition and project execution will be inadequate; it allows everyone to evade accountability; and it can lead to duplication of effort, as many departments may commission their own research.

 The duplication of research efforts is arguably the most expensive result of not having a dedicated research owner, and the obvious waste of time and money is not the half of it. Imagine this scenario: The marketing department wants to measure customer satisfaction and the customer service department wants to understand what is driving customer complaints and explore ways to reduce them. If the departments don’t consult each other and each conducts its own survey, it’s very likely they will be calling on the same customers and asking similar questions. Now imagine you, as the customer, receiving both surveys. What opinions do you form about this company?

The moral: Assign the research role to a qualified internal person, who is charged with communicating with the different departments and outside research vendors and maintaining your industry and market monitoring system.

Are You Doing Marketing Research for the Right Reasons?

October 5, 2009

Companies that fail to define their business problem or conduct unnecessary marketing research ultimately end up doing marketing research for the wrong reasons.  You will know if your company is performing marketing research for the wrong reasons if you ask why it’s being done and you hear any of the following:

“We’ve always done this research.” (The research has taken on a life of its own; this particular project has continued for years and nobody questioned whether it was still relevant.)

“Everyone’s doing this research.” (Their competitors are doing it, and they’re afraid they’ll lose competitive advantage if they don’t; yet no one asks what value the research is creating.)

 “The findings are nice to know.” (Great – spend a lot of money to create a wealth of useless information!  If the information is nice to know, but you can’t do anything with it, you’re wasting money.)

“If our strategy fails, having done the research will show that we made our best educated guess.” (They’re covering their butts.  If things go wrong, they can blame the findings, or the researcher.  But if the research process was flawed from the get-go, they didn’t make their best educated guess after all.)

“We need to study the problem thoroughly before we decide on a course of action.” (They’re afraid of making a tough decision.  Conducting marketing research is a good way to delay the inevitable.  In the meantime, the problem gets bigger, or the window of opportunity closes.  How much is “thoroughly?”  How much information do you need?)

“The research will show that our latest ad campaign was effective.” (They’re using marketing research to justify past decisions.  Rarely should marketing research be done after the fact.  Research mechanisms should be proactive; they should be built into all marketing efforts so that their success can be tracked objectively and thoroughly as they progress.)

The Right Reasons for Doing Marketing Research

You know you’re doing marketing research for the right reasons when:

  1. It enables you to make strategic decisions about your product, pricing, promotion, or positioning;
  2. It gives you necessary information you cannot get from any other source, so that you can make a critical decision;
  3. It helps you attack the root problem of the symptoms your company is experiencing; and
  4. It leads you to a course of action resulting in significant, positive outcomes for your company.

Why is my Marketing Research Useless?

September 30, 2009

Many companies know the importance of doing marketing research.  Yet many do not know how to do it or why they are doing it.  This often leads to market research that is conducted for the wrong reasons, conducted unnecessarily, or conducted incorrectly.  In any of these events, the data you capture and the conclusions you reach will be useless.

When you need to conduct marketing research, always make sure you have a specific, well-defined problem you want the research to solve.  You might notice that sales are falling in a particular territory.  So you immediately try to do a survey to see what might make customers and prospects in that region buy more of your product.  But is declining sales the problem?  Or is it a symptom of another problem?  You need to rule that out before you try to tackle it.

To define the problem appropriately, you need to do some basic exploratory research.  Your business problem then is: “to discover why sales are falling in Territory X.”  So you talk to your sales manager and sales agents in that region.  You might find out that the competition in Territory X is more significant than in your other territories.  Or you may find that  customers in Territory X are likelier than those in other territories to report product defects, that they’ve stopped buying your product.  There can be other reasons.  But once you’ve identified the real problem, you can do the marketing research that helps you address it appropriately.

Another reason marketing research produces undesirable results is that your organization may have too many stakeholders with an interest in the research.  As a result, company politics influences the research that’s done, the questions asked, the vendor selected, and a host of other things that should be handled exclusively by the marketing researcher.  This is a recipe for research disaster.

One prominent association I used to work for wanted to conduct a survey of professionals who used and/or purchased its publications.  The publishing department wanted to understand what the needs of these professionals were, so that they could know what enhancements could be made.  So far, so good.  But the problem was that so many other departments had a hand in the process.  The sales department wanted to know about competition and purchase intent; the content writers wanted to know about satisfaction with specific features of the publications; and the business development department wanted to know the markets in which they had the best chances of success.  As a result, we ended up with a survey questionnaire that was so long, convoluted, and tedious that many respondents abandoned the survey or chose not to take it.  To date, the association has not acted on the findings of the survey, and that’s been a couple of years.  The moral of the story: keep the survey’s objective to a single purpose.  It’s better to do several short surveys on singular topics over time than to do one big omnibus multi-themed survey.

To ensure your marketing research efforts produce insights you can act on, always define your problem clearly and keep a tight focus on the research objective.