November 7th, 2008
In a topical Thursday Night Insight blog post, Caroline Harrison reflects on why this week’s American elections have resonance for marketers and market researchers everywhere.
It probably hasn’t escaped your notice that the U.S. presidential elections took place earlier this week. Throughout Tuesday evening and into the early hours of Wednesday morning, the results from all 50 states, from the east coast of America to the west, trickled in to news networks and media broadcasting stations across the U.S.A. As I watched the drama unfold live on TV, it got me thinking.
The election in the United States is arguably one of the biggest, most important, and eagerly anticipated ‘surveys’ on the planet. Yet there are certainly some parallels to be drawn between this kind of poll and the surveys we carry out for our clients.
The first thing that struck me was the amount of detailed statistics available for analysis. Just a quick look at the exit polls conducted by CNN for New York state show the predicted voting behavior of so many different segments of society: you can study the trends by sex, race, age, income, education, political persuasion, or indeed any combination of these factors. Of course, similar statistics – and more besides – can be analyzed for every American state.
Obviously it’s no secret that businesses – whatever their size and whatever their industry – are continually looking to understand buyer behavior; that is to say, what motivates consumers in their choices and their actions. Most organizations aim to segment the whole potential market into groups of like-minded individuals, one or more of which will form their core customer base. Only by doing this can they develop a clear strategy to meet the needs of the target market(s) they decide to serve.
In much the same way, politicians know that they will never be able to appeal to all the different sections of society, many of which will have diverging or even conflicting values and opinions. Yet political parties recognize that they must try to understand how these groups differ, and assess the value they place on different aspects of a politician’s ‘offering’. Like companies, they can then try to satisfy needs and/or improve their current offering.
With this in mind, a phenomenal amount of time, effort and money has been spent by the candidates over recent months and years to find out what their ‘customers’ want. Even more time, effort and money has then been spent in communicating and promoting how they will be able to provide better solutions than their competitors.
Yet the same rules apply to politicians as corporations. By all means find out what people want so you can serve them better. Just beware of making promises you can’t keep.
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Caroline Harrison, Market Research USA, Quantitative Research, Segmentation, Thursday Night Insight |
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November 6th, 2008
Invest in your brands now, especially in these dry times. The easiest thing is to shut down, and that’s the worst thing.
“There has never been a more crystal-clear realization of why you need a strong brand.
It would be a mistake to say you don’t need to continue to tend your brand, even in a challenging market like this.
Let’s all go for growth. Let’s see this as an opportunity.
These were the messages emerging loud and clear from the 98th annual meeting of the Association of National Advertisers.
In an article appearing in the New York Times, Resolved to Keep on Marketing, Even in Tight-Fisted Times, the recurring theme of the conference was to stay positive in the face of industry difficulties.
The attitudes of the 400 members of this association, who together spend an estimated $100 billion a year on advertising and other forms of marketing, will likely have a huge bearing on the direction the marketplace takes in the coming months.
Marketers cutting budgets could intensify the recent sharp downturn in consumer spending, whereas maintaining or even increasing spending levels could help to shorten any recession.
The appeals of many of the conference’s speakers may have borne some influence on the 1,000+ attendees. In surveys taken on the day, around one-third of attendees questioned claimed that in the immediate term they would maintain their current level of marketing spending, with a further third stating they would reduce spend. Twenty-seven percent said they would spend more, with the remaining 7 percent unsure.
Similarly, when asked about 2009 compared to 2008, 28 percent predicted stability, and more than a quarter foresaw spending increases of more than 10 percent. Nineteen percent predicted decreases of more than 10 percent, 14 percent predicted decreases of less than 10 percent, and 13 percent predicted growth of less than 10 percent.
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Advertising Research, Commercials, Economic Downturn, Marketing, Recession |
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November 4th, 2008
How’s this for a costly promotion? ‘One free can of Dr Pepper soda for everyone in America if Guns N’ Roses release their next album before the end of 2008′.
Well, guess what? The album’s release date has been announced as November 23 2008, meaning a not-insignificant 300 million cans of soda could potentially be given away free by the corporation.
Guns N’ Roses have been working on their new album for some 17 years now, so when Dr Pepper made their ‘free soda’ pledge back in March 2008, they probably felt fairly secure in the knowledge that they wouldn’t be called upon to give anything away gratis. Yet, if everyone who is eligible to claim their ‘freebie’ actually does so, it will certainly eat into this year’s company profits.
In light of the recently-announced album release date, the soft drinks company has confirmed that it will stand by its promise. On November 23 only, Americans will be able to redeem their free can of drink by registering their details on www.drpepper.com.
In reality, of course, not too many people are going to remember, be able, or make the effort, to claim their drink. Yet, on the back of such an unusual promotion, Dr Pepper will surely benefit from increased brand awareness, and probably increased sales too.
Whilst in the long run it may not turn out to be too expensive a marketing exercise, interestingly the Dr Pepper website currently makes no mention of this generous offer!
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Brand Strategy, Commercials, Marketing |
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October 31st, 2008
It is widely accepted that satisfying customers profitably lies at the core of every successful business. But do we always fully appreciate all the different ways our customers come into contact with us, and do whatever we can to understand how they can best be served? Nick Hague isn’t so sure…
In these uncertain times, holding on to your most valued customers is more crucial than ever. From just a quick Google search you can get many different statistics thrown in your face:
The average company loses 10% of its customers each year
A 5% reduction in the customer defection rate can increase profits by 25% to 85%, depending on the industry
The top 20% of customers in a business may generate as much as 80% of the company’s profits, half of which are lost serving the bottom 30% of unprofitable customers
I recently read an article on www.btobonline.com about some research carried out by the CMO Council (an online survey of more than 450 global marketers). It stated that only a half of global marketers have strategies in place to further penetrate or monetize key customer account relationships, and only one-third have strategies in place to win back dormant or lost customers. It brought it back home to me that while b-to-b marketers are increasingly focused on improving relationships with customers, they still have a long way to go in implementing effective, consistent customer retention practices.
The survey found that everybody was spending money on demand-generation programs, but was missing a trick in not looking closer to home at their existing customer data and leveraging it further. We all know that it is easier to sell more of a product or service to a current customer than it is to try and get a potential customer on board, so it begs the question, ‘why aren’t more companies doing this?’
The problem is that, historically, companies’ customer satisfaction data hasn’t been disseminated widely enough throughout the company to heighten the importance of little things, like the fact that a delivery driver can speak the native language and is friendly and polite when on site, or that the appearance of the delivery fleet is up to scratch. These little things can impact on customer satisfaction and loyalty in a big way, especially because this might be the only real contact that a customer has with the company. Therefore, the lack of ownership of the customer relationship across a company is the first step to reducing churn.
Marketers should determine their most profitable customers, and look at how to improve the customer experience and how to increase business with those customers. The study showed that only 6.8% of marketers stated they have excellent knowledge of the customer when it comes to demographic, behavioral and psychographic data; there is no excuse!
At B2B International we are passionate about customer satisfaction and customer loyalty research. We have spent our lifetime speaking to other people’s customers. However, the question is often asked; ‘who is the customer?’ This is the biggest challenge business-to-business companies face in the battle for customer loyalty. Keeping on top of all the interactions and touch points a customer has with a company is difficult, but it is important to return again and again to this subject because we all know that the customer is made up of many touch points and different people in different positions. A company not only needs to know who the key decision maker is, who ratifies the decision and who are the key influencers, but also the wider myriad of connections between companies and their customers.
Think about the bank that you deal with. It is not just the cashier that you come into contact with; what influence does the ATM machine, the call centre, or the adverts you see on the television have on your perceptions and satisfaction?
A customer might call in to a call centre for a query on their bank account and get turned off because the call wasn’t handled properly. Small things like this might go unnoticed but when added up these could result in large churn.
It is crucial that all marketers understand that customer touch points are linked and thus work towards heading off the ‘domino effect’ if something goes wrong at one of them.
Posted in
Banking, Customer Retention, Customer Satisfaction, Market Research, Nick Hague, Profitability, Thursday Night Insight |
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October 28th, 2008
Segmentation is key to deciding which groups of apparently like-minded individuals to target with your product or service. From more basic demographic or ‘firmographic’ groupings according to sex, age, location, etc, through to more useful but undoubtedly harder-to-categorise behavioural or needs-based segmentations, most companies realise that they can’t be all things to all men.
Or, for that matter, all things to all women. One of the biggest segments some companies make a play for is women. Obviously it’s a large group that makes up 50% of the world’s population, but can you really group all women together? Hardly – but some products do target women specifically, among them:
- Telecommunications sector: Motorola is launching a jewel-shaped mobile handset aimed at women (the Moto Jewel).
- Automotive sector: In response to concerns that it is losing its appeal among women and young drivers, Ford has introduced an ad aimed solely at women, which features a pink Fiesta.
- Food & Drink industry: Coors UK has set up a working group to investigate beer formulation, packaging and marketing options in an effort to target women.
A recent Marketing Week article discusses the issue of targeting women in depth. To read it click here.
To find out more about how B2B International can help to segment your market, please click here, or read our Segmentation Case Study.
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Market Research, Quantitative Research, Segmentation |
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