If your last segmentation project was a TV show which one would it be? Would it be like Cheers- great when it was done and lived on successfully after that, or was it more like Lost- complex and often confusing but enjoyable, you’re just hoping it ends well. Maybe it was more like American Idol and picking the right scheme became more of a popularity contest than one based on merit. Let’s just hope it was not like Buffy the Vampire Slayer- just one nightmarish scene after another or like The Hills- lots of style but very little substance. 
If you said any of these television shows, you are not alone. In fact, if you said any show other than Cheers you would be in the majority; and it is a shame, because segmentation projects typically get a bad rap among business managers and leaders due in large part to these poor outcomes. Often times researchers and managers point to poor analytical techniques or lack of industry knowledge as the root causes of the problem. However, these are just part of an overarching challenge to achieve success.
(You can also check out our best practices webinar where we identify six straight-forward rules to ensure your next segmentation project has everyone saying Cheers!)
As with anything in life there are trade-offs. A segmentation study is no different. Each segmentation solution will have different strengths and weaknesses, which is why it is so important to set business and marketing criteria for selecting the optimal solution right from the beginning. The science will always provide a best solution based on statistical scores, but the hard part is that there are a host of solutions that will likely meet a statistical threshold. So having clear and concise business and marketing objectives helps connect the segmentation solution to the key marketing and business objectives any business is facing.
And that’s the goal: connecting the segmentation solutions to these key marketing elements. At this point we are no longer talking about segmentation schemes in terms of frequency, means and indexes – all the statistical language that most of your organization doesn’t understand or even care about. To set the project up for success (and make sure the results are used) you need to translate the solution choices and options into more common terms people can easily understand so they can confidently trade-off and rank the solutions that will most impact the business.
Read a Case Study on How Segmentation Helped GE Healthcare
This case study in the Pharma Research Report shows how GE Healthcare and CMB partnered to conduct segmentation that informed and aided business decision making and targeting by GE Healthcare's Picture Archiving & Communication Systems (PACS). Read the full report here.
Posted by Jeff McKenna. Jeff is a senior consultant at CMB and a lover of the mid-west, the Cleveland Indians, beer and market segmentation.
There has been lots of talk in the industry about cloud computing for some time now. At the end of 09’ we checked in with our IT decision maker panel to get their perspective on cloud computing and where it fits into their IT plans. At that time, two-thirds of them were already using “cloud computing” in some capacity to lower costs or increase scale and flexibility. Deployment seemed to be more horizontally focused on non-core application workloads. But we saw signs that 2010 would be the year cloud computing would gain some serious momentum—many just needed some proof of concept and now Microsoft and eBay are teaming up to deliver just that.
Microsoft is claiming their stake in the cloud by announcing at last week’s developer conference that their long anticipated Windows Azure appliance was ready, making good on their promise to offer preconfigured datacenter containers directed at large enterprises who can’t have their data hosted off site.
Microsoft also announced that eBay will be one of the first customers to put Azure to the test as they announced a joint cloud computing agreement. This agreement comes on the heels of a successful deployment program which allows eBay the flexibility to put some applications on the pubic cloud. For example http://ipad.ebay.com— is hosted on the public Windows Azure platform.
Where there was once a lot of confusion there now seems to be more traction—particularly for private cloud computing. In a space that has a lot of competition, Microsoft is working hard to get a head start out of the gate. And this agreement with eBay is certainly a big feather in their cap.
Stay tuned as we are going back to our IT decision maker panel this month to gain new insights on what enterprise end-users require of vendors offering cloud computing solutions.
We would love to hear from you. Does this agreement between Microsoft and eBay give you the proof of concept you need?
Chris Neal leads CMB’s Tech Practice. He enjoys spending time with his two kids and rock climbing.
A recent article on Boston.com, “How facts backfire: Researchers discover a surprising threat to democracy: our brains” caught my attention for several reasons – some intellectual and some, well, personal.
As an employee of a company who used to have a tag line “Information for Decision-Making,” I believe in the value of facts in reducing risk and guiding strategic decisions, I love data and weaving a story from information gathered in our custom market research studies. I make my living from sharing facts! However, true confession here, as the liberal wife of a man who considers
Fox’s reporting “fair and balanced,” I recognize
my reluctance to accept political information presented as facts,
particularly from certain sources.
Thomas Jefferson wrote in 1789: “Whenever people are well-informed, they can be trusted with their own government.” It is one of the primary underlying assumptions of modern democracy: people, furnished with facts, will be clearer thinkers and better citizens. However, recent political science studies by researchers at the University of Michigan have found that facts don’t necessarily have the power to change our minds. In fact, they found the opposite. When misinformed people (particularly political partisans) were presented with corrected information, they rarely changed their mind. Some became more strongly set in their unfounded beliefs.
While more research is being done to understand why when we have things wrong – we can be so sure that we’re right – and why we’re unwilling to “admit we were wrong,” researchers believe part of the answer is in the way our brains are wired. People, generally, seek consistency; we accept and interpret information with an eye toward reinforcing our preexisting views (…anyone want to debate the presence of WMD in Iraq? You get the drift…).
While poli-sci researchers are working on the young field of “political mis-perception,” several points of interest were noted: (1) One avenue may involve self-esteem…if you feel good about yourself you’ll listen. If you feel threatened and agitated, you are less likely to listen to dissenting opinions; (2) Hitting people between the eyes with objective facts that contradict current beliefs – particularly if it can be done in an interactive way - seems to force many to adjust their opinions.
With that as background, then, as market researchers it is essential to be conscious of not just the facts we are presenting, but how they are presented. Three ways to make sure the facts don’t fall on deaf ears
- Make sure to go beyond gathering “information you want” and towards “what decisions you will make” as a result of the information. This means gathering input from key managers or executives about their beliefs and hypothesis and building them into the research plan. This approach helps on two fronts: (1) by hypothesis gathering, you can confirm managers’ beliefs on some factors while presenting new information on others… “you were right;” and (2) by focusing on the business decision (not a single fact), you get past the “I don’t believe that fact” problem and support forward movement of the business.
- Engage information users in positive interactive and engaging meetings at key points in the project – planning/kick-off, analysis review, presentations. And do this in a way that welcomes contrarian points of view and respects all participants. This avoids people questioning the “facts” at the end, when it is too late to make changes and makes it easier for non-believers to dismiss the information completely.
- Know your audience and share with them in a way that is comfortable. It sounds simplistic, but some people want pictures and stories, others want facts and data. Some want to be hands on the whole way through and others want a final summary. By knowing the audience, you can build a report that tells a story and makes “facts” relevant, interesting, and easy to act on.
Posted by Judy Melanson. Judy leads the Travel & Entertainment practice and loves collaborating with clients on driving customer loyalty. She's the mom of two teens and the wife of an oyster farmer. Follow Judy on Twitter at @Judy_LC
In my blog post about multi-source, multi-method research last week I talked about the explosion in qualitative techniques over the past few years. Tomorrow’s webinar about Innovations in Product and Service Development Research touches on some of the recent improvements in quantitative research as well.
The webinar starts at Noon ET and will feature CMB's Rich Schreuer and Amy Modini as they share the latest best practices and case studies from their years of conducting product and service development research across verticals. (Click here to register).
If you’d like to see how some of these techniques feel from a respondent perspective, click on the link for each to go through our demo questionnaires.
Posted by Josh Mendelsohn. Josh is our VP of Marketing and loves live music, tv, great food, market research, New Orleans, marketing, his family, Boston and sports. You can follow him on Twitter @mendelj2.
I spent most of this week at the 2010 Shopper Insights in Action Conference, which is always one of my favorite events of the year because unlike many market research related conferences the attendees are eager to push the edges and try new and different ways to understand consumers. Even though they employ traditional techniques, they are hardly wed to them and epitomize the concept of multi-method, multi-source research (using multiple types of data and data sources to answer a question.)
We’ve been talking about multi-source, multi-method for years at CMB, but it is pretty amazing how much the landscape has changed even in just the last four years. Searching through the article archives I found a 2006 article that laid out many of the available qualitative tools, and it feels (how do I say this nicely?) a bit outdated.
While a quick perusal of today’s list is a bit overwhelming, I am certain there are plenty of options that I failed to include. There is both a challenge and an opportunity in the fact that consumers are smarter than ever and willing to provide more robust and useful insights than ever before. Between technology that simulates real world experiences and improvements in our ability to listen to consumers in their own environment, there is no shortage of ways to give and receive feedback. The hard part is choosing the right technique or set of techniques for a given situation and making sure that information users understand the biases and limitations of each.
With all of the available options, what new tools have you added to the tool box in the last 4 years?
Posted by Josh Mendelsohn. Josh is our VP of Marketing and loves live music, tv, great food, market research, New Orleans, marketing, his family, Boston and sports. You can follow him on Twitter @mendelj2.
As we get ready for this year's Shopper Insights in Action Conference, we are taking a look back at last year's co-presentation by Stephen Day of Electronic Arts and CMB's Brant Cruz on research to help with the launch of EA Active, EA's entree into the fitness gaming market.
Following last year's session Stephen was kind of enough to sit down for a quick interview on the topic.
CMB: What were the big takeaways from your presentation?
This segmentation really helped us define and refine what we are doing on this specific product (EA Active) in the marketplace. For this product in particular, we didn’t have a whole lot of data about who we should market to, who these people are, etc., so it really helped us not only really understand this marketplace and market to them in a way that makes sense.
CMB: One of the things you talked about was using in home ethnography on the front end and the quantitative ethnography on the back end, how did you merge those two information sources together?
The qualitative was really used more to guide the product development and refinement phase, along with some demographic information. We used the data from that to help our product development efforts. With the segmentation we incorporated some product development components but really looked down the line at the product development road map to match key segments with new innovative products once we’re out of the gate with this initial offering.
CMB: Was there anything in particular you think made this segmentation particularly successful or useful?
The segmentation for us, at a holistic level, was exactly what we needed. We didn’t know a lot about the fitness marketplace in general. We had ideas and hypotheses but this helped us clarify the internal thinking about where we need to go and what we need to do. And it really helped us map out the future of this product line.
CMB: Now that you’ve launched EA Active, how will you use this information?
We’re definitely going to use it. Going forward we’ll be looking at some of the specific segments you (CMB) recommended as high priority segments that we can develop products for, and market to effectively. It is definitely going to help us clarify the road map for future product development and product market strategies.
CMB: As we wrap up here at the Shopper Insights in Action Conference, any big takeaways you can use?
The one big takeaway for me and for us as a company is that we really need to do a bit more research that enables us to get into the mind-set of the shopper. We haven’t done a whole lot of work in that area. Our work is primarily focused on product development and product marketing, but given the status of the economy and changing times I think it is more critical now to understand consumer behavior at the point of purchase so we can design the best products and services for them.
CMB: Thanks Stephen!
Posted by Josh Mendelsohn. Josh is our VP of Marketing and loves live music, tv, great food, market research, New Orleans, marketing, his family, Boston and sports. You can follow him on Twitter @mendelj2.
At 9:00 PM tonight east coast time, the NBA’s LeBron James will announce which city he will be playing basketball in for the next 5-6 years via a one-hour special on ESPN. As a near-rabid Boston Celtics fan, I’ve been spending a bit too much time lately thinking about LeBron's destination (and other free agents), and frankly tonight’s spectacle has me fascinated. Fascinated as a basketball fan, and probably fascinated as a wannabe agent and/or high-profile public relations executive. Given that my day job is as a market-research-based consultant, however, I figure that if I’m going to be spending any time today thinking about LeBron, I better tie it in to what I really do in some way. Below is my (somewhat feeble) attempt at this.
Sure, on one hand, market research is a science. And each of us who work in the industry can likely spout off a couple hundred 50-cent words related to methodology, sampling, or analysis. But where the rubber really meets the road is when we recommend to our clients (internal or external) what they should do about what the numbers say. One thing that all great market researchers (and the business decision makers they partner with) do is to always consider “The Law of Unintended Consequences” [screen fades to rolling thunderstorm with lightning and Vera Miles simultaneously screaming from the shower at the Bates Motel). Given ESPN’s insiders are largely reporting that LeBron is likely headed to Miami, I’m worried that LeBron and/or his advisors have either not considered this “law” or haven’t considered it from the right angles. So, I’ll use this forum to take my shot at it.
There’s an old saying in supplier-side Market Research: “Good, Fast, and Cheap. Pick 2.” Those of you who work in research know exactly what I mean. I think LeBron faces a similar trade-off (I promise not to start delving into the relative merits of Dual Choice Based Conjoint versus Adaptive Choice Based Conjoint as much as many for you may hunger for that). I think the three legs of LeBron’s choice set are:
- Championships – if and how many titles he can win over the next 6 years
- Legacy – how he will be remembered by basketball fans for what he has done on the court
- Brand Image – what the world beyond basketball will think of him, including the less tangible (general public sentiment) and tangible (short- and long-term sponsorship opportunities) associated with being LeBron and this decision
Where’s money you ask? I consider money a constant in this equation (and we market researchers love constants). He has the best combination of cost of living and tax rates in Miami. He can get the most guaranteed money from the Cavs. He has the best baseline opportunities for sponsorship dollars with the NY Knicks – likely followed by New Jersey (soon to be in Brooklyn), Houston (connecting with Yao Ming and his huge following in China) and other big-market teams like the LA Clippers and Chicago Bulls. In my mind, this all evens out. With the right people advising him, he can earn crazy, and “about equal” money in any of these destinations. Therefore it is probably not a key driver of his decision due to a lack of variation in this independent variable (how’s that for fancy market research lingo?).
I’m also taking “lifestyle” out of this equation. If I can travel 75-80 nights per year, criss-crossing the country in coach class all the way, then LeBron can make any of these cities work. Again, given his resources, and the fact that we’re talking about a relatively short span of what I hope is a long life for him, I just can’t see this being as salient as the other three. Maybe he’s considering it, but it must be a secondary or tertiary driver.
We market researchers love matrices, don’t we? I do anyway. Below is a matrix I’ve created to summarize the “performance” results on what I think LeBron should be considering in his decision for each city.
My simple analysis says that he should pick Cleveland, but I could also easily support a decision to join the Knicks or maybe even the Nets. But Miami? I just don’t see it. “Championships” seem a fickle basket to put all one’s eggs in, as basketball is a team sport and injuries and other human tragedies happen.
And to spend an hour telling us that he’s decided to team up with two other superstars all making maximum money? It feels like a possible PR nightmare, and it seems like cheating to me, Yankees style. The ultimate dismissal of The Law of Unintended Consequences. (Note: I fully expect that this will result in many nasty posts about the Celtics and Red Sox from my NY friends who will perhaps rightfully call me hypocritical). I just don’t see how LeBron can possibly position this in an hour-long special, and then choose anywhere other than Cleveland or New York. The only spin I can see his team giving this is the “became friends while representing the USA during the Olympics” or “laser focused on winning.” But I think we’re too smart to fall for the flags, and Tiger already owns the “laser focused on winning” brand, perhaps to his own detriment.
My real problem is that I love LeBron the player, and everything I’ve read about him the person. I think he’s going to be making a mistake in a few hours. LeBron - if you’re listening, pick Cleveland, or the Knicks. And if you’re worried about being stuck for 6 years, how about structuring a deal so that years 4 and 5 are player options, and year 6 has both a player and a club option. This all seems fair to me, and both the Cavs and the Knicks should be amenable – as there is no viable Plan B.
Editor's Note: Brant is a great researcher, despite his lack of success in this prognostication.
Posted by Brant Cruz. Brant is a VP and segmentation guru at CMB. He is also proudly the judge of the Brant Approved awards in our upcoming CMB Cookbook and the self proclaimed funniest man in market research.
If you’re attending next week’s shopper insights in action conference, don’t forget to join us for a great session on the “new consumer” (see below for details) and stop by our booth to say hello. If you want to go and haven’t yet registered, you can get a 25% discount by registering here.
Reset! Engaging Consumers and Growing Market Share in the “New Normal”
With all of the talk about the “new consumer” mindset and shifting media behaviors, marketers are left asking what it all means. Slow category growth and heightened competition put an even greater premium on leveraging consumer insight to inform growth strategies. CMB’s Jon Giegengack and Steven P. Dennis of Sageberry Consulting (formerly SVP of Marketing for Neiman Marcus) will use recent research data and emerging consumer trends to provide marketers with a roadmap to reaching the consumer of tomorrow and what brands need to do to engage their customer and prospects.
Some advance reading:
My name is Josh. I am 34 years old and a pretty smart guy. I know almost nothing about insurance. And I am not alone.
For much of my life I was on my parents' insurance plans. When I moved out on my own I adopted their auto insurance carrier as my own and took the recommendation of my employer for my health insurance carrier and plan. And as I move into the next phase of my life with my wife, dog, and baby boy, I know I need Life Insurance but am paralyzed by the process. In February we conducted market research with over 1200 consumers about their knowledge of their insurance coverage and how they educate themselves about their coverage, finding that many young people are like me, admitting they don't have a good understanding of their insurance coverage in general, wishing they knew more.
Of course, this presents a great opportunity for insurance carriers who target Gen Y and even moreso for those targeting Milennials, 30% of which admitted they don't have a good understanding of their insurance coverage in general, with 57% of them wishing they had a better understanding. Sure, everyone knows the duck and the cavemen and all of the other insurance mascots and icons, but which carriers are taking it further to actually help young consumers make smart decisions about their insurance options.
One company that seems to be moving in the right direction is State Farm. Marketing Daily reported today that State Farm is releasing new TV spots this fall and have launched a new micro site, WhyAgent.com featuring comedian Ben Posner with all the reasons (some pretty funny) why you need an agent. This is an aggressive push for this segment of the market, and our recent consumer pulse data indicates that's probably a smart move for State Farm.
So how will State Farm reach this younger generation? Online seems to be the most likely channel. According to the research mentioned earlier, over half (56%) of 18-24 year olds do their insurance research online, while 28% will call the company directly, 34% will speak with an agent and 37% will ask their friends for recommendations. State Farm's big online push with YouTube videos and the new micro site is a great approach, but with 37% asking their friends for recommendations it seems as though more robust social media strategies would have to be on the radar as well. (See what Allstate is doing.)
Buying insurance can be confusing and daunting regardless of age, but even more so for the younger crowd. Like ING Direct did so well in the financial services space, there is a great opportunity for carriers to engage with Gen Y and Millenials through new messaging and media in an educational way. And with brand awareness extremely high for all of the major carriers it seems time for many to move towards helping people buy with trust and confidence, even if the message is sent through Youtube.
Posted by Josh Mendelsohn. Josh is our VP of Marketing and loves live music, tv, great food, market research, New Orleans, marketing, his family, Boston and sports. You can follow him on Twitter @mendelj2.
This blog post was inspired by Kathryn Korostoff's post Market Research Decentralization: Power to the People and is based on my experience on both the client and provider sides of the market research business.
These are exciting times in the market research industry - and while there has always been continual change (one of the reasons I love my career choice), now the pace of change seems to be at warp speed. Market research is more accessible than ever before and today anyone can get access to survey programming tools and if they are so inclined, training to conduct their own studies. For new start-ups and small companies without internal market research support or the funds to hire outside expertise, these new resources allow them to gather market information quickly and affordably.
There is no question that these resources benefit businesses that would have otherwise gone without, but what about large corporations? How should they deal with non-researcher access to these same tools? Does ownership of the expertise and technology need to live in a centralized department?
For a number of reasons corporate research departments often don't get the respect they deserve from the rest of the organization, but I don't think decentralization (or a hybrid solution) is the answer to increasing the attention, credibility, and actionability of research findings. I have worked on all sides of the business (client, supplier, advertising agency) and know cross-functional teams can work extremely well. In fact, some of my best work was done in a cross-functional environment - the stakeholders remained engaged with frequent team meetings and by learning what goes on ‘behind the scenes' (data cleaning, processing, analysis), they gain respect for the expertise I have worked hard to build, and they understand the process so that they have clear expectations and enthusiasm for the final result. Now that I am on the provider-side again, I have seen that powerful cross-functional partnerships also apply to provider /client relationships and that providers can help drive teamwork within organizations.
So, why is there so much interest in avoiding the research department? Why is market research treated differently from other areas of expertise?
I believe it comes down to people ‘not knowing what they don't know.' Most market research may seem relatively straight-forward, but there is definitely a line where expertise needs to come in, a line which is often difficult for the non-researcher to determine. Market research knowledge can give companies a competitive advantage, but in most cases the insights (and reliability of the data) gathered through a simple DIY survey does not suffice. An experienced researcher can ensure the right questions are asked in way that can be used to dig below the surface and uncover new knowledge that weaves a story for decision makers to act on.
Of course, for centralization to succeed researchers must commit to regularly scheduled meetings with stakeholders, share responsibility in cross-functional teams, and provide grounded, interesting communication of the results. They also must be willing to take the time to explain the ‘what,' ‘why,' and ‘how' to those who are interested.
In my opinion, it is just good business sense to keep your research function centralized. It serves as a hub of dedicated professionals who work closely together and share information. Upon this stronger knowledge base, the company can get a holistic view of their target audience and build synergies across projects. Centralization also ensures that market research efforts aren't duplicated, which results in significant cost savings and allows for resources to be optimized when research needs fluctuate across various departments.
Finally, there are potential damages to your brand and customer relationships if research is done improperly. For example, decisions made using questionable data or interpretations can lead to loss of profitability. And the use of amateurish questionnaires or over-researching your customers can hurt your company's brand image among the people who matter most.
In short, centralization
strengthens a company's market research function- both in terms of actionability and cost savings.
Posted by Cathy Harrison. Cathy is a senior project manager at CMB, loves social media, music, and kick-butt research. You can follow Cathy on Twitter at @virtualMR