August 17th, 2010
How much of the money spent on advertising is wasted? Although it’s a very difficult question to answer, advertising research goes a very long way towards measuring and tracking over time the effectiveness of any ad campaign.
However, according to a new study by Satmetrix, only 2% of consumers trust advertising the most as a source of information when choosing a product or service. Almost half (49%) of respondents feel personal recommendations from family, friends or colleagues is the most trustworthy source of information. While this statistic is not surprising – word-of-mouth recommendation has always had an extremely positive impact – it is maybe a little surprising that so many more people (15%) find opinions posted online as that much more reliable than the 2% who trust advertising. While online message boards, forums, etc are meant to be an independent source of opinion, many people are skeptical as to how unbiased they often really are.
The study, in fact, claims that some companies are wasting billions on attracting new customers through advertising when their focus should really be on keeping their existing customers happy. According to the study, poor customer experience has forced more than 10 million consumers to switch suppliers in the past six months.
The principal cause of dissatisfaction to the point of switching is unfair fees or charges. A further 22% blame poor product or service quality. 19% move because of rude of disinterested employees. And, 12% leave because they feel they can’t get anyone to deal with their problem.
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August 13th, 2010
Cristin Malone, looking to help a friend, this week discovered how market research can help find Mr. Right.
So the other night I was on the phone with a good friend of mine and of course the discussion topic was about men. Well, more specifically, it was about all her failed relationships with men. In agony, I listened for two hours as she re-visited every single relationship she had. She started from the very beginning of her romantic history and continued until she finished talking about the current guy she is dating (who is a very attractive, rude, and not very good for her, “bad” guy). For two hours I waited, itching to share my wisdom on love, patience, and being optimistic and just when the conversation was turning to my favor, she had to go. Why? Because her current “bad” guy was calling her on the other line; figures as such. Before switching over to the other line she asked me, “how come I always get stuck in bad relationships?”
As torturous as the conversation was, I felt terrible for my friend and wanted to help her. So for a few days, I pondered and thought deeply about her dilemma. Then the market researcher in me shined through. Eureka! The solution is segmentation analysis. Immediately, I called my friend and told her my bright idea, listed as follows:
Even though we considered our sample fairly representative in size, it is important to note how biased our data was. Well for one thing she was providing the information on these men, and even though I asked her to be as unbiased as possible, the information was still coming from her.
So after all our hard work and two large wine bottles later, we determined that the men she dated fell into four segments (which I think may be true for most women):
Now with our segments complete, we turned to creating the best questions my friend could ask on her next date to identify the type of guy she was meeting. With a few more looks over the data, we came up with these five questions:
In the chart above you will realize we did not mention the “ummmmmm what was his name again” guy. It’s not because we forgot about him, but mostly because we figured if she is on a date and isn’t even interested in asking these questions or if she is more interested in watching the ice cubes melt in her glass of water, that mostly likely he is an “ummmmmm what was his name again” guy.
Even in its simpler form, segmentation analysis is an amazing tool! In this case it was used to weed out the guys my friend was not interested in and to identify the type of guy she wanted: a good guy. However, in most cases, we as market researchers use this tool not to get rid of the bad relationships our clients have with their customers, but to help them improve or build stronger, quality relationships with their customers. Through segmentation analysis, we as market researchers can provide deep insights to our clients on the type of customers they have and who their customers are, including each customer segment’s behavior, needs, demands, and expectations. As a result of segmentation analysis, we help clients develop effective ways to communicate to their specific customer segments as well as better ways to serve their customer base. Helping our client better serve their customers leads to higher satisfaction and loyalty towards our client from their customer base.
While segmentation analysis works wonders for our clients, I have yet to determine whether my experimental, segmentation analysis has worked for my friend. We have completed steps 1-9, but still have to test our survey. Luckily, my friend has a date coming up this weekend. Stay tuned for my Next Thursday Night Insight for the results!
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August 10th, 2010
Figures from the B2B Barometer1 show that the economic situation for B2B marketers looks optimistic for the future:
Business optimism gradually returning amongst B2B marketers
On the client side:
- Three fifths (60%) anticipate economic recovery within the next 12 months
- Two thirds (66%) expect their own organisation to grow in the next 12 months (up from 50%)
- Three quarters (73%) expect marketing spend to increase; up from one half (48%) last wave.
Agencies are more optimistic, with four fifths (79%) anticipating that they will grow over the next 12 months. For many agencies this represents a significant turnaround in their fortunes; 45% report that revenues have declined in the last 12 months. For others it represents a continuation of an existing trend; 34% report growth in the last 12 months.
Newer media continue to increase share of wallet
Client-side marketers continue to allocate a significant proportion of their budgets to three channels; trade shows (16%), direct mail (13%) and email marketing (16%). ‘Newer’ media channels continue their rise and now account for 41% of total marketing spend (up from 39% last wave).
Increased focus on measuring ROMI
There is a noticeable trend towards measuring the Return on Marketing Investment (ROMI)
from this spend. Two thirds of client-side marketers (65%) now measure return compared
with one half (49%) last wave. Unsurprisingly given this focus on accountability, two fifths
(39%) of agencies report that some or all of their clients measure agency performance using
ROMI measures.
Social media relevant …but B2B marketers lack understanding
Two trends have received extensive coverage in the B2B press in recent months:
- The alignment of marketing with sales
- Social media in a B2B context.
The B2B Barometer sought to explore each area in some depth and has brought fact to an
area where opinion dominated:
- Sales and marketing are becoming more closely aligned. Although 50% of client side and agency side marketers believe marketing still plays a secondary role to sales in B2B organisations, three quarters (70%) of clients report that the two functions are actually effectively aligned. Marketing may play second fiddle but it supports sales well
- Social media is perceived to be relevant in a B2B context. Three fifths (60%) of client-side marketers feel it is relevant to them and two thirds (66%) of agencies feel it is relevant to their clients. And social media is not a fad. Approximately three quarters of both clients and agencies disagree that social media in a B2B context is a passing phase
- However social media is still an area which puzzles many marketers. Two thirds of client-side marketers (63%) have no social media strategy in place; two fifths (41%) cite ‘insufficient understanding’ as the reason for this
For more information visit http://www.abba.co.uk/
1The B2B Barometer is compiled by the Institute of Direct Marketing (IDM), the Association of B2B Agencies (ABBA) and Circle Research
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August 6th, 2010
Mark Hedley this week realises that listening to and understanding customers’ needs is always key to making a successful sale.
The last few weeks of my life have been dominated by what has to be one of the most stress-inducing experiences one can have in life – buying a house. Having lived in rented accommodation for more than a decade, I had always dreamed of escaping my world of cheap decoration, shoddy furniture, broken boilers and dodgy landlords, and to finally have a place of my own to call home. Not only that, but with the housing market still in the doldrums, what better time for the astute first-time buyer to pick up a great house at a bargain basement price!
Little did I know what lay ahead of me as my wife and I drove to our first viewing on one sunny Saturday morning back in May. Having made half a dozen appointments with eager estate agents the previous day, I was sure that we’d have found the house of our dreams that very afternoon and be home in time for Final Score. With so many properties on the market, I was convinced that we’d find a fantastic property in no time and that the vendors would all be on their knees begging us to take it off their hands.
The first house we went to visit set the tone for the day. On entering the house I was overcome by a strange and powerful smell emanating from the kitchen that I couldn’t quite place. When we entered the kitchen all became clear as we saw the dripping ceiling and column of mould running from the ceiling down to the sink below. The polite gentleman showing us round the house assured us that, although the house ‘needed a bit of work’, it had ‘real potential’. Suddenly, I had entered a world of oblique euphemisms that would need decoding to know what a house was really like. Over the next few weeks I would quickly learn that houses advertised using certain phrases were best avoided, such as:
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Bijou
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‘Would suit contortionist with growth hormone deficiency’
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Original features
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‘Water tank still contains cholera bacterium’
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Internal viewing recommended
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‘Looks awful on the outside’
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Studio
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‘You can wash the dishes, watch the telly, and answer the front door without getting up from the toilet’
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In need of modernisation
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‘In need of demolition’
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The next four viewings that day were almost as disheartening. Even when the house was relatively well furnished, there was usually something that let it down in our eyes. Either the rooms were too small, the location was wrong, there was no garden or the ‘newly fitted’ kitchen seemed to have been teleported from the mid 70s.
Our disappointment that day was to be repeated several times over the next few weeks, as we traipsed around weekend after weekend searching for properties that met our needs and budget limitations. By the time we finally decided on a house, we must have already viewed at least 30 or 40 different properties and inched that little bit closer to that mid-life nervous collapse. Having said that, the tedious process of house-hunting undoubtedly helped us to better refine and crystallise what type of house we were looking for, and forced us to think more carefully about what our real underlying needs were. For example, before starting hunting I had no idea that the thing I most desperately lacked in life was a fitted dishwasher rather than a slimline, and that I may well contemplate suicide if I am to go another day without a chrome-effect heated towel rail.
The whole experience also caused me to realise that fully understanding customers’ underlying needs is critical to success in any market, and especially one that is crowded with competitors and very little differentiation between suppliers. The estate agents that had now taken to harassing me on a daily basis to go and view this or that ‘fantastic little property’ seemed completely indistinguishable from one another, and despite their hard efforts none of them seemed to have properly grasped the type of property that we were looking for.
In markets where brand awareness is low and competition is fierce, fully understanding and meeting customer needs is paramount to success. In the case of buying a house, buyers do not particularly care about brand and are purely motivated by a house’s specific features and its price. Most estate agents had failed to properly appreciate our underlying requirements and had simply shown us around the houses that fell into the price range we had mentioned to begin with. Had these agents focused more on their level of service (i.e. in terms of fully understanding our needs), this would have distinguished them from the competition and would have been more likely to lead to a sale.
The house we finally decided to buy was well above our initial budget. The estate agent that eventually got the sale had only introduced us to a total of two properties. By listening to our comments when we looked around this first house and by asking the right questions, he had realised that our true needs did not revolve solely around price, and that we might be prepared to pay a slight premium for a property that satisfied our principle underlying needs. The agent had also shrewdly realised which property features we would be willing to sacrifice and what were the ‘must haves’. For example, while we were happy to forgo a garage or an open fireplace, the agent had picked up on the fact that modern decoration, proximity to public transport and a private garden were features that we couldn’t go without.
The need to properly assess and satisfy underlying customer needs runs strong in all markets, and companies should always beware of assuming that price is the only factor informing purchasing behaviour. In fact, consumer decision-making often relies on a myriad of different considerations, from product features, speed of delivery and return-on-investment through to after-sales support and customer service. For myself, although price had acted as the starting point, in the end it was the specific features of the house (such as decoration and location) that proved to be more important when making the final decision. Well, those things and that chrome-effect heated towel rail.
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July 30th, 2010
Research by market research specialists B2B International on the value of HR certification around the world reveals an average ROI of gaining the credentials of over 250%
The message seems to be ‘get certified’! An online survey for the HR Certification Institute, of more than 1,500 HR professionals in 37 countries worldwide, has shown that human resources employees and employers value HR certification at more than two-and-a-half times the initial certification outlay.
From an employer’s perspective, having employees gain professional HR certification brings numerous advantages to the organisation, including an increase in employee engagement, satisfaction and productivity, as well as a reduction in staff turnover, all leading to an increase in customer satisfaction. Employers also comment that certification increases employees’ HR knowledge and ensures that they keep up-to-date; it demonstrates employees’ commitment to HR and to learning, as well as increasing confidence in their ability to do their job; and having employees with certification is good for the organisation’s reputation and demonstrates that it takes HR seriously.
For individuals, the biggest incentives toward pursuing HR certification stem from the belief that the credentials will increase their HR knowledge and thus strengthen their CV. 94% of HR employee respondents and 97% of HR employers believe that certification is important for those working in human resources, more than 60% of whom stated it is ‘very important’. An even greater number of employers expect certification to be of importance in five years’ time.
Ninety-six percent feel that an HR certified candidate applying for a job would have an advantage over a non-HR certified candidate, with more than 50% believing this to be a ‘very significant’ advantage. This is borne out by employers: more than two-thirds state that an HR certified person being considered as an independent consultant for an HR department would have a ‘very significant’ advantage over a non-certified individual. HR certification was highlighted as particularly advantageous for HR professionals going for a promotion or facing redundancy.
HR Certification Institute’s global business development director Alexandre Bouché, who commissioned B2B International to conduct the study, remarked on how highly valued the survey showed certification to be. “Of the four types of credential that an HR professional might hold, that is to say an undergraduate degree, a graduate degree, a certificate or a certification, the certification was felt to be by far the most beneficial. Its advantages include it offering the most value for money and return on investment; being highly flexible and customisable; being the most practically and professionally oriented of the choices; being the most experience based; and that choosing to work toward a certification provides the best networking opportunities.”
B2B International’s Matthew Harrison, in charge of the study, noted differences between continents. He said: “Finding the time to study for certification was not a key issue for Europeans or Asians and yet was a key unmet need for Americans. Indeed, the survey conveyed a general sense that US employers were less actively involved in professional certification than their foreign counterparts, with only 8% deciding which certification their staff obtained, against 22% in other countries.”
About HR Certification Institute – www.hrci.org
HR Certification Institute is an internationally recognized leader in HR certification, having been certifying HR professionals for more than 33 years. The HR Certification Institute has awarded more than 108,000 credentials in over 70 countries to HR professionals who have passed rigorous exams to demonstrate their mastery and real-world application of forward-thinking HR practices, policies and procedures. HR Certification Institute is an affiliate of the Society for Human Resource Management.
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