In Chrissie Douglas’ latest Insight, she reflects on the entrepreneurial focus of the latest Budget and the key role market research has to play.

Budgets…I have to admit…I have never really taken much notice of them. It just seems that each time the budget comes around, my husband reminds himself that he must give up smoking – I remember him saying he would give up when they reached five pounds a packet…and that was ten years ago! It was only after talking to a friend who recently lost her job that we got into a discussion about the recent budget. She has been a trainer for over 15 years but because of the range of new start-up incentives offered in the March budget (such as the extension of the rate relief scheme, business rate holidays, corporation tax reductions, entrepreneurs tax relief, R&D tax credits and the introduction of enterprise zones), she is now considering setting up her own consultancy firm. I know it’s only one example, but the government’s strategy which promises to “tear down the barriers to enterprise” may have actually got people thinking. We may be about to witness a new start-up boom.

This took me back 15 years to my undergraduate business degree. One of the things I remember (and there isn’t very much) is the huge failure rate in new business start-ups. I rechecked the stats and the gloomy picture remains. Depending on the source, the rate of business failure in the first year varies from 30% to 50%. Even worse, of those start-ups that do survive, as many as 95% will fail in the first five years.

The reasons for failure make interesting reading. They include a variety of factors such as overexpansion, overspending, poor location, bad management, failure to change with the times, ineffective marketing, underestimating the competition…the list goes on…but a recurring theme is poor business planning and lack of research. Basically, a failure to truly understand the market (i.e. customer needs and preferences, their decision making processes, price sensitivity, and who they are up against). As such, it is clear that market research has a critical role to play in the government’s plan for growth. Market research provides the necessary ‘intelligence’ on which to make more informed business decisions and minimise start-up risk.

But hasn’t this always been the case? Haven’t we always seen peaks and troughs in business start-up activity and hasn’t market research always had a key role to play? The answer, of course, is yes on both counts but often the major barrier to market research is both cost and perceived need. On the first point, and particularly for new start-ups, finance is often tight (especially in the current climate). On the second point, when an idea is borne confidence is often high. You have an idea, you believe in that idea, so why spend money to confirm that it will work?

The arguments for market research remain the same. It makes complete sense to test an idea in the market place and tailor the concept before making a sizeable investment. In this current cycle, however, we believe that market research is better equipped to play its role than ever before. Market research can now be carried out more cost effectively than in the past as a result of advances in technology and the use of online survey techniques. Online market research eliminates the high costs involved with face-to-face, postal and telephone data collection. It also offers the benefits of speed and data reliability and eliminates the barriers often associated with global research. For a business which needs to gain a general view from a large cross-section of the population, in as short a time as possible, there is no doubt that online research offers a viable solution.

Any new business start-up or new product launch is inherently risky as it is a venture into the unknown. B2B International has shown that thorough, well planned research can accurately pinpoint the richest areas of opportunity and therefore prioritise the most promising areas for new start-ups and new product development.

To learn more about how B2B International can help you, contact our New Product Development Research Team.

This week Chrissie Douglas reflects on the change of pace in both her own life and in the broader business world over the last 5 years.

Doesn’t time fly. Thursday’s here again and this week it’s my turn to put pen to paper. This is when I have to admit, I begin to panic. I panic because my life has been hijacked by my 2 young children for almost 5 years now. During this time I haven’t really had to think about the outside world, never mind write anything. Life for me is about minute to minute, hour to hour, day to day ‘fire-fighting’ – school runs, nappy changes, are they fed and watered?

So I palm the kids off with their Dad for a couple of hours and for the first time in years I sit, ponder and reflect. The thing that immediately comes to mind is how much things have changed in the last 5 years and the pace of that change – where did those years go?

Five years ago the world was a very different place. With the risk of being random – Britain was booming yet now we are in the midst of the greatest recession since the 1930s. Twitter was known as “text messaging” and the “tweet” only went to one other person – now you share your thoughts and movements with the world. Friends were called ‘friends’ and you used to go and meet them in the pub at the weekend. Now friends are your ‘social network’ and the pub has closed down! We now ‘talk’ to friends & acquaintances via the rapidly growing social networking sites like LinkedIn, Twitter and Facebook. We used to go to the store to shop – now the store comes to the door. And in keeping with this randomness – there were 9 planets in our solar system and now there are only 8 (Pluto was demoted in 2006)!

So a lot has changed. The world has moved on in such a short time and I have struggled to move with it. I still use my phone as a phone whereas all my friends are talking about the latest apps. This preoccupation with our own world, the day to day and short term-ism is often mirrored in the business world. Just like me, some businesses are so entrenched in the detail, the tactical, the ‘here and now’, that they fall into the trap of loosing focus, lacking direction and forgetting about the big picture. Many businesses drift along unaware of the changes going on around them and even when they do, fail to react quick enough.

There are some high profile examples in this 5 year timeframe. For example in the retail sector in the last 2 years alone we have lost; Thirst Quench, Stylo, Mosaic, Principles, Sofa Workshop, Allied Carpets, Viyella, Dewhursts, Woolworths, MFI, Zavvi/Virgin Megastore, and Barratts. The list goes on…

The specific details are varied, but the commonality is that they failed to spot and/or react to change quickly enough. For example Woolworths, failed to move with the times and compete effectively with the ‘pile it high’, ‘sell it cheap’ supermarket discounters. In other words – as the competition changed their trading models – Woolies didn’t react. Another example is Sofa Workshop who struggled as consumers put off buying so-called ‘big ticket’ items due to the slowdown in the housing market, fears over the wider economy and the lack of available credit.

There are other companies that are clinging onto their existence. For example, Blockbuster was late in realising that brick based stores no longer work in a world of on-demand TV and is desperately trying to change their business model to one based on low-cost DVD rental kiosks and offering mobile movies via smartphone. Likewise, Borders, the global book store is currently developing a Kobo e-reader to try and compete with e-book readers from Amazon, Apple and Barnes & Noble. Will they make it or are they too late?

So how do we keep informed of what’s going on around us? How do we pre-empt change and respond proactively? How do we stay ahead? The answer lies in research.

Market research obtains information direct from the people who matter – business people, industry experts and customers. Market tracking research provides low cost, up-to-the-minute, detailed market intelligence. Market tracking monitors allow important trends to be captured rapidly, enabling quick, reliable decisions to be made on market size, growth, value and development. Tracking research is also fundamental to monitoring brand performance and measuring customer satisfaction. Market tracking allows companies to monitor how effective they are in relation to their competitors, and to react quickly to changing market conditions.
With more than 30 years’ experience, B2B International are ideally placed to offer advice, propose solutions and devise strategies for future business growth and development. We will help you keep focus on the big picture whilst you continue to look after the day to day.

 

Much has been written on the subject of brands – not least by B2B International! As we know, a brand is made up of many things – name, logo and values to name but a few. But can there be any doubt about the importance of a brand name? In a Thursday Night Insight article last year, Chrissie Douglas gave us some hints on selecting a brand name:

• Brand names should be simple so that they are easy to understand, pronounce and spell. Two words in the name should be considered the maximum.
• Brand names should be vivid in imagery so that the mnemonics present strong memory cues.
• Brand names should be familiar sounding so that much of the information to which the name relates is already stored in the mind.
• Brand names should be distinctive so that the word attracts attention and does not become confused with other brands.

So, what happens if you get it wrong?

According to research by YouGov/G2, Cillit Bang has been voted the UK’s most disliked brand name. Of the 2,000 British consumers surveyed, a quarter of women, a fifth of men and 27% of over-55s did not like the brand name. Yet, the cleaning brand, which was launched in 2005 by Reckitt Benckiser, is actually considered by its owner to be a “power brand” and its sales show it to be an extremely successful product. So, clearly, brand name is not everything.

Yet, of the top 10 most disliked brand names (shown below), four are new names for previously known brands, including 3 in the top 5:

1. Cillit Bang
2. Cif
3. Starbucks
4. Pasta Hut
5. Snickers
6. Veet
7. Accenture
8. Aldi
9. Plenty
10. Mates

Cif used to be known in the UK as Jif, Snickers was for many years called Marathon, and Veet previously went by the name Immac. This perhaps underlines the importance of getting the brand name right in the first place. Once people have started to associate certain values and attributes with a brand, any changes can lead to confusion or mistrust. Unless you recognise the importance of brands and adopt a well thought-out marketing and communications rebranding strategy, you could find yourself with a lot of brand rebuilding work to be done.

To find out more about branding, please refer to several of our white papers, including:

• What’s in a name?
• Branding in B2B markets
• The value of brands; how much are they worth?

In her latest Thursday Night Insight, Chrissie Douglas highlights the sheer pace and scale of economic change in the UK (the so called credit crunch), how this has completely changed our perceptions of things that we have always taken for granted (i.e. that our money is safe in the bank!), and the fact that market research is now perhaps more important than ever to keep in touch with what exactly is going on out there.

Let me start by telling you about my banking experience in the last six months.  After ten years of riding the property boom we sold our house and put the proceeds in the safe hands of our family bank – Royal Bank of Scotland, whilst waiting for our next dream move.  The months passed and as the property market began to decline we felt great in the knowledge that our secure pot would actually buy more as time went on.  We thought we were playing it by the book.  We’d made some money and we’d put the proceeds away safely in the bank with no risk – just as we’d always been told to do (“after all, your money is always safe in the bank”).

This all changed in October last year with news reports that British banking giant Royal Bank of Scotland was about to collapse.  The share price had fallen from over £2.50 to 40p (a fall of 84%!) in a matter of days and was on the verge of going under.  We had to move quickly.  A review of the alternatives revealed that the only 100% safe option for savings was now the Post Office (owned by the Bank of Ireland), following the Irish government’s pledge to guarantee 100% of all savings in Irish Institutions.  So the money was safe again, or so we thought.  Just after Christmas, amidst continuous press reports of financial doom and gloom, we noticed that the Irish economy was worst hit and on the verge of bankruptcy.  The promise of their 100% safety on savings was not worth the paper it was written on (they would not have the funds to back up this guarantee if bankruptcy occurred).  With the hysteria surrounding the bankruptcy of the Iceland economy and the loss of savers’ deposits in Icesave still fresh in our minds, we moved the money back to RBS where incidentally it would have been safe all along (in the meantime RBS had become 75% owned by the British government).

The point of telling this story is to highlight the rapid scale and pace of change, and that things that you had always taken for granted are not necessarily so in the current climate.  The term ‘credit crunch’ has become part of our everyday vocabulary but, until it hits you on a personal level, I don’t think you appreciate the nature of the current financial situation in the UK.  Things are changing very quickly and it is difficult to keep up.

A quick review of recent headlines highlights this point.  For example:

• The 2009 Sunday Times Rich List suffered its biggest annual fall since it was first compiled 21 years ago. 
• Unemployment is forecast to reach 3.3 million next year (possibly 5 million in the next few years!) – the highest since the early 1980s and at any time since comparable records began in the early 1970s.
• The UK has just announced its biggest budget deficit in peacetime history and the steepest downturn in the economy since the Second World War.
• Last September the Dow Jones recorded the biggest single-day point loss ever.

There are many more examples but the common theme is that economic decline seems to be on a bigger scale and is changing faster than ever before.  Nobody knows what is going on.  Nobody knows what will happen next.  All we do know is that we have to carry on and plan for the future as we have always done.

This brings me back to the topic of market research.  In this current environment it would be understandable to remove market research from your list of top priorities.  It may be hard to justify expenditure on something that may be out of date soon after completion (given the pace and scale of change, last year’s market research may already be out of date).  However, companies still need to make informed decisions on future direction.  I would argue that market research is actually now more important than ever.  What we really need is continuous customer monitoring that is cheaper and has a quick turnaround.  Luckily with the aid of new technology, market research techniques have come on leaps and bounds and now enable us to keep our nose to the ground.  For example, e-surveys, online focus groups, internet panels and bulletin boards are all providing us with the ability to keep up and keep in touch.

For more information on how B2B International can help you stay in touch, please call one of the B2B teams on +44 (0)161 440 6000 or +1 914 761 1909.

• For more information on B2B International’s internet research capabilities visit – http://www.b2binternational.com/aboutb2b/techniques/internet.php
• Using Online Focus Groups As A Business-To-Business Research Technique – A White Paper by Matthew Harrison