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A Year in Review: Our Favorite Blogs from 2016

Posted by Savannah House

Thu, Dec 29, 2016

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What a year 2016 was.

In a year characterized by disruption, one constant is how we approach our blog: each CMBer contributes at least one post per year. And while asking each employee to write may seem cumbersome, it’s our way of ensuring that we provide you with a variety of perspectives, experiences, and insights into the ever-evolving world of market research, analytics, and consulting.

Before the clock strikes midnight and we bid adieu to this year, let’s take a moment to reflect on some favorite blogs we published over the last twelve months:

    1. When you think of a Porsche driver, who comes to mind? How old is he? What’s she like? Whoever it is, along with that image comes a perceived favored 2016 presidential candidate. Harnessing AffinIDSM and the results of our 2016 Consumer Identity Research, we found a skew towards one of the candidates for nearly every one of the 90 brands we tested.  Read Erica Carranza’s post and check out brands yourself with our interactive dashboard. Interested in learning more? Join Erica for our upcoming webinar: The Key to Consumer-Centricity: Your Brand User Image  
    2. During introspection, it’s easy to focus on our weaknesses. But what if we put all that energy towards our strengths? Blair Bailey discusses the benefits of Strength-Based Leadership—realizing growth potential in developing our strengths rather than focusing on our weaknesses. In 2017, let’s all take a page from Blair’s book and concentrate on what we’re good at instead of what we aren’t.
    3. Did you attend a conference in 2016? Going to any in 2017? CMB’s Business Development Lead, Julie Kurd, maps out a game plan to get the most ROI from attending a conference. Though this post is specific to TMRE, these recommendations could be applied to any industry conference where you’re aiming to garner leads and build relationships. 
    4. In 2016 we released the results of our Social Currency research – a five industry, 90 brand study to identify which consumer behaviors drive equity and Social Currency. Of the industry reports, one of our favorites is the beer edition. So pull up a stool, grab a pint, and learn from Ed Loessi, Director of Product Development and Innovation, how Social Currency helps insights pros and marketers create content and messaging that supports consumer identity.
    5. It’s a mobile world and we’re just living in it. Today we (yes, we) expect to use our smartphones with ease and have little patience for poor design. And as market researchers who depend on a quality pool of human respondents, the trend towards mobile is a reality we can’t ignore. CMB’s Director of Field Services, Jared Huizenga, weighs in on how we can adapt to keep our smart(phone) respondents happy – at least long enough for them to “complete” the study. 
    6. When you think of “innovation,” what comes to mind? The next generation iPhone? A self-driving car? While there are obvious tangible examples of innovation, professional service agencies like CMB are innovating, too. In fact, earlier this year we hired Ed Loessi to spearhead our Product Development and Innovation team. Sr. Research Associate, Lauren Sears, sat down with Ed to learn more about what it means for an agency like CMB to be “innovative.” 
    7. There’s something to be said for “too much of a good thing” – information being one of those things. To help manage the data overload we (and are clients) are often exposed to, Project Manager, Jen Golden, discusses the merits of focusing on one thing at a time (or research objective), keeping a clear space (or questionnaire) and avoiding trending topics (or looking at every single data point in a report). 
    8. According to our 2016 study on millennials and money, women ages 21-30 are driven, idealistic, and feel they budget and plan well enough. However, there’s a disparity when it comes to confidence in investing: nearly twice as many young women don’t feel confident in their investing decisions compared to their male counterparts. Lori Vellucci discusses how financial service providers have a lot of work to do to educate, motivate and inspire millennial women investors. 
    9. Admit it, you can’t get enough of Prince William and Princess Kate. The British Royals are more than a family – they’re a brand that’s embedded itself into the bedrock of American pop culture. So if the Royals can do it, why can’t other British brands infiltrate the coveted American marketplace, too? Before a brand enters a new international market, British native and CMB Project Manager, Josh Fortey, contends, the decision should be based on a solid foundation of research.
    10. We round out our list with a favorite from our “Dear Dr. Jay Series.” When considering a product, we often focus on its functional benefits. But as Dr. Jay, our VP of Advanced Analytics and Chief Methodologist, explains, the emotional attributes (how the brand/product makes us feel) are about as predictive of future behaviors of the functional benefits of the product. So brands, let's spread the love!

We thank you for being a loyal reader throughout 2016. Stay tuned because we’ve got some pretty cool content for 2017 that you won’t want to miss.

From everyone at CMB, we wish you much health and success in 2017 and beyond.

PS - There’s still time to make your New Year’s Resolution! Become a better marketer in 2017 and signup for our upcoming webinar on consumer identity:

Register Now!

 

Savannah House is a Senior Marketing Coordinator at CMB. A lifelong aspiration of hers is to own a pet sloth, but since the Boston rental market isn’t so keen on exotic animals, she’d settle for a visit to the Sloth Sanctuary in Costa Rica.

 

Topics: strategy consulting, advanced analytics, methodology, consumer insights

CMB Welcomes Kathy Ofsthun as Head of Expanding Qualitative Strategy + Insights Practice

Posted by Megan McManaman

Fri, Sep 16, 2016

We're excited to announce that Kathy Ofsthun has recently returned to CMB as VP of Qualitative Kathy_final_casual_1_of_1-2.pngStrategy + Insights after spending almost 5 years at C Space as VP of Client Services. Kathy is back to head up CMB’s expanding Qualitative practice—growing clients’ businesses by bringing them closer to their customers.

Kathy  brings a wealth of experience and knowledge in qualitative methods, qual/quant synthesis, and creating connections and strategic partnerships. Her deep research expertise was developed through two decades of work with multinational companies, including a year in Shanghai managing the C Space APAC office. Her work has focused on topics as varied as New Product Development, Shopper Insights, Packaging, Brand Positioning, and Segmentation.

 "I’m thrilled to rejoin CMB at this exciting time," Kathy says. "As consumers move into the driver's seat, marketers and innovators need and want to be closer to their customers, understanding who they are, hearing their needs and incorporating their ideas. By including customers in co-creation of new products, communications development and more, brands can either fail faster or adapt and succeed. I look forward to helping clients leverage the voice of the consumer in order to achieve growth.”

Kathy will be headed to MRA's CRC in San Francisco next week, give us a ring, email us, or stop by booth 407 to say hello!

Are you going to CRC and want to get the most out of it? Check out Julie Kurd's blog:  How To Not Flunk the MRA Corporate Researchers Conference

Topics: strategy consulting, qualitative research, Kathy Ofsthun

CMB Conference Recap: NEMRA’s Spring 2016 Conference

Posted by Ashley Harrington and Brian Jones

Thu, May 19, 2016

nemra-logo.gifLast week, we spent the day at the New England Market Research Association’s (NEMRA) Spring 2016 Conference, learning from colleagues in the region, both on the corporate research and consultant/provider side of the business. There was a lot to take in, but a few ideas particularly stuck out to us:

  1. Embrace Agility: A session on the lessons we can learn from startups challenged us to dismiss existing perceptions of “agile” research as simply “fast and cheap.” Instead, he encouraged us to think about market research agility in terms of being flexible, working smarter, and challenging the industry or process-related status quo (without sacrificing data integrity).
  2. Be Consultative: While “faster” and “cheaper” are often king, we also have an opportunity to be better by being more consultative (which is critical to CMB’s approach). A panel of corporate researchers at the conference underscored the importance of research partners being more consultative by:
  • Developing a better understanding of how researching findings will be used. If findings are going to be used primarily to convince a C-level executive of one key point, a one-pager should be included in the report that addresses that point clearly and concisely.
  • Telling the story and delivering insights—not just “data dumps.” While the panel acknowledged that the research team may want the 100-page report for their own edification, a project is only successful when the data is socialized and shared off-team. We have the opportunity to help organizations do that. 
  1. Evolve: A speaker on mobile data collection and another on gamifying research encouraged us to consider instances when incorporating new tools might help us better solve our clients’ research problems. For example, there’s an exciting opportunity to capture real-time path-to-purchase data with mobile, in-the-moment research. With gamified questions in an A&U study, we can help better engage respondents and collect richer data (e.g., asking respondents to play a game in which they enter words to try to get another respondent to name a brand—think Catchphrase for a brand study). In both cases, it’s important that we stay at the forefront of what’s new and useful in the industry without forgetting to apply the same critical thinking and rigor to any “new” tools that we do to the tried-and-true ones.

What innovative approaches to research have you been exploring?

Ashley Harrington is a Senior Project Manager who leads projects for world-leading financial services brands. Outside of work and attending conferences, she enjoys managing the ultimate project a10-month old baby boy.

Brian Jones is a Senior Project Manager at CMB. He enjoys the sharing of ideas among peers at events like NEMRA’s Spring Conference.

Topics: strategy consulting, conference recap

CMB Employee Spotlight: Andy Cole, Strategy Consultant

Posted by Heather Magaw

Wed, Mar 30, 2016

Andy_Cole_Chadwick Martin Bailey.jpgEarlier this year, CMB proudly introduced our new Consulting and Research Services team (CRS). This team is an extension of our long-term commitment to extending the reach of traditional market research through strategic consulting services. To better understand this team’s unique contributions to client engagements, I sat down one of our strategy consultants, Andy Cole. 

Andy, thanks for taking the time out of your day to connect. Can you tell me a little about your professional background and experiences? 

In a word, I would describe my career as “varied” or “diverse,” but most people look at my background and wonder if I have a problem sitting still. I’m originally trained as a mechanical engineer, and I started out doing R&D projects involving aerospace with Google, non-emissive fuels with the EPA, military-focused brain trauma with the Walter Reed Army Institute of Research (WRAIR), and vehicle collision forensics (with a small, lesser-known engineering company). My first regular job had me working for a large alternative energy company that would send me all over North America to climb 300-meter industrial wind turbines to figure out why they were offline, design temporary solutions to get them up and running ASAP, and work with R&D in Denmark to develop a permanent fix for systemic issues. 

I’m not sure if that meets anyone else’s definition of a regular job. So, how did you get from scaling wind turbines to a career in strategic consulting and research? 

I realized that I had a strong interest in business and management, so I got my MBA and began consulting with large, small, and non-profit organizations on a wide range of topics, including social media marketing, energy, executive training programs, and product development. I also launched two successful businesses in the innovation marketplace, helping large corporations rapidly develop new technologies and discover emerging markets, which was a great adventure but lacked the lifestyle I was ultimately looking for. 

I value diverse experiences because the most innovative solutions are borrowed from other industries and combined or repurposed in a new way. To me, this is the difference between being a true partner who can “connect the dots” versus a consultant who simply knows the best practices in a given industry. Clients don’t hire CMB if they’re just looking for best practices—we recommend a Google search for that purpose. 

Given your unique line of sight, in your opinion, what's the greatest opportunity facing businesses today that a research-based consulting engagement could support? 

There is an enormous trend in companies turning from sales-focused strategies to customer-centric design. When you hear companies embracing things like user experience, VOC, pivoting, and iterating, it’s all about observing and listening to customers, making constant measurements, testing new concepts in the market, etc. That all just screams for custom research. 

When companies are looking to become more customer-centric, they have to have a deep understanding of the target market that is backed by market information and unique insights. This is a huge opportunity for businesses to gain an advantage over their competition, and it’s truly CMB’s sweet spot. 

It seems that more and more consultants are embracing the impact of research. What’s your take on the role of research in the future of business consulting? 

The bottom line is that companies are looking for clear and confident strategic direction, and the language of today’s business is increasingly metric-oriented. It’s not enough for consultants to simply say that customers will like an idea or that a decision will result in greater revenues. The savvy business leader needs to know exactly how much more preferable a concept is and exactly how much revenue they should expect compared to taking an alternative path. Smart clients don’t trust advice without evidence to support it, and that is exactly what research provides. Good research forms the foundation on which effective strategies are built. 

Can you provide an example of a recent client engagement that blurred the lines of delineation between market research and strategic consulting? 

With the Affordable Care Act shaking up the entire healthcare industry, a large national insurance carrier saw an opportunity to use intimate knowledge of customer journey experiences and expectations to figure out which stages and channels were most influential (and would therefore pose the greatest marketing opportunity). Furthermore, the company wanted to know what messaging resonated with individual customers at each stage and within each channel, so it could be sure that marketing efforts would be as effective as possible.  

To tackle this ambiguous challenge, we took a multi-pronged and multi-phased approach: 

  1. A qualitative phase—involving in-depth interviews and moderated online discussion boards—to surface key stages, channels, and underlying context from the customer journey.
  2. A facilitated workshop with stakeholders and decision-makers to discuss key findings/insights and hypotheses, brainstorm potential solutions, and align on the path forward.
  3. A quantitative phase to reveal what individual customers value most throughout their experience and to identify which experiences have the potential to be particularly influential in the decision to purchase. 

It’s great when you get the opportunity to really dig in to that level of detail. What did you learn? 

At the conclusion of the project, we not only identified a number of surprising marketing opportunities by disproving a few fundamental assumptions, but we also validated (and put to rest) several long-standing hypotheses that were a stagnating source of internal debate. We also collaborated with the client to identify creative messaging campaigns that directly aligned with the trends stemming from our research as well as with the organization’s overarching strategic objectives. 

I look forward to hearing about more projects like this one that blur the lines in the future. Thanks again for taking time out of your day, Andy. 

Heather Magaw is the Vice President of Client Services at Chadwick Martin Bailey and has never climbed a wind turbine in her life. . .and never intends to.

Andy Cole is a Consultant at Chadwick Martin Bailey and has already left the interview to go investigate three seemingly unrelated things. 

Learn more about our strategy consulting expertise.

Topics: Chadwick Martin Bailey, strategy consulting, healthcare research, business decisions, growth and innovation, customer journey

Making Your Brand a Habit: Why Small Patterns of Behavior Make a Huge Difference

Posted by Hannah Russell

Wed, Jan 06, 2016

Decision.jpgMost of us have heard the phrase “humans are creatures of habit,” but have you really ever sat down and thought about how habits dictate your life? From the moment you get up in the morning, habits are playing a role in how you interact with others, complete everyday tasks, and function within your environment.

In a lot of ways, habits are a necessary part of human life. Our brains naturally seek out and latch on to routines and scripts—it’s how we’re able to work so efficiently. Unfortunately, habits can also be unhealthy or unproductive. Oftentimes, we even have habits that are completely invisible to us until we take the time to truly examine our patterns of behavior.

I recently starting thinking a lot about this after picking up The Power of Habit by Charles Duhigg. His book details the formation of habits and neurological systems at play, colored by examples from scientists, academics, and businesses. Duhigg explains that by breaking down a habit loop into the cue, routine, and reward components, we are able to experiment and focus in on how a particular habit functions. He cautions that his book isn’t necessarily a secret formula for immediately dropping your afternoon cookie habit, but it does provide you with the necessary knowledge to start identifying which levers to adjust.

The notion that we can take our patterns of behavior and use that information to improve our personal life or business is one that really stuck with me as a market researcher. After all, as a researcher, I am constantly keeping an eye out for patterns. Patterns within and across datasets, patterns in response styles, and patterns within an industry. Patterns (or lack thereof) are often drawn upon for insight, as they tend to be a good indication if something is going right (or wrong), expected (or unexpected), or reflecting larger changes within the economy, company, or brand. This is often why businesses invest in tracking studies—a small shift in NPS or brand awareness may not seem overly interesting quarter to quarter, but it’s often part of a larger trend happening in the data. Patterns tell us a story and direct our attention to areas that we may need to investigate further.

At CMB, we spend a lot of time looking at these larger patterns and studying consumer habit loops that can impact a business. Companies looking to increase loyalty want to make their brand part of a customer’s routine—automatic and hard to disrupt.

For example, let’s imagine you’re going to pay for your groceries. Which credit card do you choose? Is it the one you always use for groceries? Do you even think about reaching for another payment method? Here’s the breakdown:

  • Cue: You’re at the register, and it’s time to pay.
  • Routine: You grab the card you always use since it earns you extra points for groceries.
  • Reward: You have your groceries, and you have earned bonus points.

By understanding these habit loops, we can begin to experiment with ways to make the cue stronger, the routine easier, or the reward more rewarding. We can also begin to understand what doesn’t work well when building brand loyalty and how these habits can be disrupted. At CMB, we’ve developed a method of segmenting on these habit loops, and each loop is linked to important outcomes such as NPS or database spend. We answer:

  • What are our client’s consumers’ habits?
  • If/how do these habits differ by consumer segments?
  • How well does each habit help drive business results?

These answers help our clients develop new strategies for reinforcing positive habits and disrupting ones that work against business goals. The takeaway: habits matter. Whether you’re looking in from an organizational or an individual perspective, these small patterns of behavior can play a huge role in both our successes and failures. 

Hannah is an Associate Researcher for CMB and is still working on transforming her coffee habit.

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Topics: strategy consulting, business decisions, consumer insights, brand health and positioning, customer experience and loyalty

The CMB Blog 2015: 6 of Our Favorites

Posted by Kirsten Clark

Wed, Dec 30, 2015

chaos_vs_clarity_light_bulb.jpgWe run this blog a little differently than other corporate blogs. Instead of relying on a few resident bloggers, each of our employees writes at least one post a year. This means you get a variety of perspectives, experiences, and opinions on all aspects of market research, analytics, and strategy consulting from insights professionals doing some pretty cool work.

Before we blast into 2016, we wanted to reflect on our blog this past year by taking a second look at some of our favorite posts:

  1. This year, we launched a market research advice column—Dear Dr. Jay. Each month, our VP of Advanced Analytics, Jay Weiner, answers reader-submitted questions on everything from Predictive Analytics to Connected Cows. In the post that started it all, Dr. Jay discusses one of the hottest topics in consumer insights: mining big data.
  2. Research design and techniques are two of our favorite blog topics. A member of our Advanced Analytics team, Liz White, wrote a great piece this year about conjoint analysis. In her post, she shares the 3 most common pitfalls of using this technique and ways to get around them. Read it here.
  3. In June we launched EMPACTSM— our emotional impact analysis tool. In our introductory blog post to this new tool, CMB’s Erica Carranza discuss the best way to understand how your brand our product makes consumers feel and the role those feelings play in shaping consumers’ choices. Bonus: Superman makes a cameo. Check it out.
  4. Isn’t it great when you can take a topic like loyalty and apply it to your favorite television show? Heidi Hitchen did just that in her blog post this year. She broke down the 7 types of loyalty archetypes by applying each archetype to a character from popular book series A Song of Ice and Fire and hit HBO TV series Game of Thrones. Who’s a “True Loyal”? A “Captive Loyal”? Read to find out!
  5. Our Researcher in Residence series is one of our favorite blog features. A few times a year, we sit down with a client to talk about their work and the ideas about customer insights. Earlier this year, our own Judy Melanson sat down with Avis Budget Group’s Eric Smuda to talk about the customer experience, working with suppliers, and consumer insights. Check it out.
  6. We released a Consumer Pulse report earlier this year on mobile wallet use in the U.S. To deepen our insights, we analyzed unlinked passive mobile behavioral data alongside survey-based data. In this post, our VP of Technology and Telecom, Chris Neal, and Jay Weiner, teamed up to share some of the typical challenges you may face when working with passive mobile behavioral data, and some best practices for dealing with those challenges. Read it here.

What do you want us to cover in 2016? Tell us in the comments, and we look forward to talking with you next year!

Kirsten Clark is CMB’s Marketing Coordinator. She’ll be ringing in the New Year by winning her family’s annual game of Pictionary.

Topics: strategy consulting, advanced analytics, consumer insights

Time to Brand Refresh

Posted by Lindsay Maroney

Thu, May 07, 2015

Brand buildingAfter a brutal winter, many of us in the Northeast are glad to finally begin our annual spring-cleaning, but we’ve noticed we aren’t the only ones looking for a fresh start. With confidence in the economy growing, there has been an uptick in established brands taking a fresh look at their brand strategy, an area they may have neglected during the recent tough economic times.For most, a brand refresh means creating a stronger platform for growth. To see evidence of this, one need look no further than recent TV commercials. Domino’s eliminated “Pizza” from their name, allowing for new items beyond their foundational menu offering. Meanwhile Buick promotes their redesigned cars through commercials with actors stating in disbelief, “That’s not a Buick.” Even Southwest has jumped on the bandwagon, highlighting that customers not only receive low fares and free checked bags, but some TLC when flying on one of their planes: “Without a heart, it’s just a machine.”

Some common triggers that appear to spur brands down a new path:

  1. The product and service offerings have fundamentally changed. That is not to say the brand has transformed at its most basic level, but needs to be updated to better reflect what the company is currently offering.
  1. The target audience has shifted. The brand may no longer be reaching its intended audience due to that audience aging, narrowing, broadening, or otherwise changing. Legacy brands may need to create a fresh image to become more relevant to younger audiences.
  1. The company is outgrowing its old brand. Recent company growth from geographic expansion, mergers and acquisitions, or internal structural changes may necessitate a shift in the brand or a split into sub-brands in order for it to stay true.

So with spring in the air and a little more life in the economy, now might be a good time to re-examine your core brands. A thorough market-based review may confirm your brand positioning remains strong and remind you of the core tenets that keep the brand motivating, distinctive, and believable. Or it could reveal opportunities for renewal and reinvention.

south street transp1

 

Lindsay Maroney is a consultant at South Street Strategy Group where they combine strategy and marketing science to uncover insights that help clients grow their business and strengthen their brands. 

 

Topics: South Street Strategy Group, strategy consulting, brand health and positioning

3D Diversity: High-Octane Fuel for Your Innovation Engine

Posted by Andy Cole

Fri, Mar 20, 2015

3D diversity, south street strategy, CMBDiversity in the workplace has proven massive benefits for organizations that rely on innovative thinking. Contrary to what most people believe, however, diversity in business is not just about surrounding yourself with people who look different. It’s also about equipping your team with a wide array of approaches to a common challenge.You can imagine each of us having a diversity score – based on 3 dimensions – that fluctuates depending on the collective characteristics of the team. However, the score isn’t static: each of us can increase our individual and team diversity score at will. Let’s take a look at the three common dimensions of diversity to understand how we can do this:

  1. Inherent Diversity

Inherent diversity includes race, ethnic background, gender…hardwired traits that we are born with/into and cannot be controlled. For better or worse, these traits can influence the way we perceive the world around us, and vice versa.

A McKinsey study shows the difference inherent diversity can make, finding that executive boards in the US with inherently diverse members enjoy a 95% higher return on equity than those without. Impressive! On the flipside, what is an example of the drawback to sameness? Ask Bertelsmann, whose all-male team turned down Bethenny Frankel’s pitch to launch a low-cal alcoholic beverage for women. They simply could not relate to the target market, and the unseized opportunity gave rise to Skinnygirl, the fastest growing spirit brand in history.

  1. Acquired Diversity

This dimension involves the ingrained experiences we collect throughout our lives that train us how to think and behave, such as educational background, professional expertise, and even experience abroad.

An Art History class might allow you to understand the context surrounding important works and to fully appreciate the artist’s vision. Raising children helps you value an uninterrupted night’s sleep and wholeheartedly empathize with new parents in a way that others simply cannot. Though we cannot dictate all life events, we do have a great deal of control over the diversity we acquire over time.

According to the Harvard Business Review, companies with leaders who exhibit 2-D diversity (that is, each leader possesses at least 3 inherent traits and 3 acquired traits) are 45% more likely to report growth.

While this is all wonderful, raising the level of inherent and acquired diversity at your organization (especially at the leadership level) is not something that is easily achieved. We believe a third dimension is needed; a dimension to help you raise your overall diversity score immediately with the human capital you already have: that third dimension is Inspired Diversity.

  1. Inspired Diversity

Through the development of our subject knowledge over time, mental models begin to take form and solidify in our minds. That’s natural, but these biases can also blind us to new opportunities and challenges. In order to increase our openness and mental agility, we must constantly identify opportunities to branch out from our immediate environment and learn how others might solve interesting challenges, focusing on how we might apply their insight to fit our purposes.

For example, touring a manufacturing facility can give fresh insight to the way we think about our internal processes and workflow. Interviewing an exceptional street performer could provide wisdom on courage and leadership. Perusing an exhibit at an art museum can help you reimagine your brand’s image through the artist’s lens.

When I run rapid innovation programs with clients, there is a clear trend among the super creative folks who consistently ideate at a higher level: They are renaissance people. They have many interests, are curious about many subjects, and partake in many activities that all contribute to having a wide array of perspectives. They have the unique ability to create using their past experience (acquired diversity) and also in-the-moment when they bring a specific business challenge to an outside activity (inspired diversity). They challenge themselves with new experiences and perspectives as often as possible.

When business requires innovation, pulling novel ideas out of thin air is simply not a realistic expectation; it’s about attacking a challenge from angles that have never been considered. And this level of thinking requires diverse individuals, with diverse minds, stimulated by diverse activities.

South Street Strategy Group
Andy Cole is a consultant for South Street Strategy Group where we use a multi-method approach to identify and test growth and innovation strategies for increased 
commercialization success. 

Topics: South Street Strategy Group, strategy consulting, growth and innovation

"Learn" to Innovate: Why Companies that Celebrate Failure Are Only Half-Right

Posted by Andy Cole

Mon, Feb 23, 2015

Scientist Looking at VialIn an effort to counter the fear-based culture that inhibits innovation at many companies, some leaders (GoogleAmazonRoche) have advocated actually celebrating failure. Interesting! Could this new mindset really be the key to building an internal culture of fearless innovators?Clearly, we want to create a safe environment for employees to admit faults, share lessons learned, and have the courage to attempt things that have never been done, all without the fear of reputational – or even career – consequences. But do we really want employees to idolize those who don’t accomplish what they set out to do? Although provocative, a broad policy like “celebrate failure” can be misleading and create unintended problems.

What companies should be celebrating is the learning derived from failure, not failure itself. To illustrate the difference, putting the focus on failure raises post-mortem questions like “Now that we’ve failed, what worked well?”, “what did we learn from this?”, “how might we do better?” This retroactive approach is better than nothing, but it’s in no way sufficient.

When the goal shifts to maximize learning, it invites key questions at the beginning of the process, like “what might we learn from this activity?”, “what key assumptions could we test?”, and “how might we modify the idea so that we learn even more?” As you can see, this proactive approach can guide and influence activities from early stages in a direction that prevents future failure (or at least the sheer quantity and size of failures before realizing success).

Used in combination with a project debrief, this tactic can be used as part of a powerful learning strategy, ensuring that you get the very most of your innovation activities, independent of failure or success. And that’s certainly worth celebrating.

How do these issues show up in your organization? Does your company embrace failure or learning? Do you conduct structured “after action” analyses of major initiatives to facilitate learning?  We’d be pleased if you would share your ideas, stories, rants, insights, and responses in the comments below.

south street transpAndy Cole is a consultant for South Street Strategy Group where we use a multi-method approach to identify and test growth and innovation strategies for increased commercialization success. 

Topics: South Street Strategy Group, strategy consulting, growth and innovation

The Price Is Right (or IS it?)

Posted by Abe Vinjamuri

Thu, Jan 22, 2015

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When Redbox, the movie rental kiosk company, raised their prices 25%, many analysts saw the move as desperate—predicting significant losses to market share in 2015 and 2016. At the same time, the company’s stock rose, with investors expecting customers to adapt to the higher prices. So who’s right?  I have some predictions, but we’ll leave those for another blog. Today, I want to write about some of the fundamental questions companies need to ask before they embark on a new pricing strategy.

If you think pricing isn’t all that important, here’s something to ponder: a 1% increase in prices of Wal-Mart products ($10 on a $1,000 TV), assuming a demand around existing levels, would increase operating profits by about 20% and add about $48 billion to Wal-Mart’s market cap.

Companies rarely approach pricing from a “value to customers” perspective. Even when they do, they don’t fully exploit the potential of value based pricing for fear of backlash. For decades, airlines have understood the importance of pricing, and, in my opinion, outside of CPG companies (and some new tech entrants) have best implemented and used pricing as a tool for competitive advantage.

For any pricing strategy to succeed, you need a well thought out plan. Answer the following questions to get started:

1. Who is the customer?

a. While you might have customers you've served for a long time, you still need to ask yourself how people interact with your products. Are there touch points you’re currently ignoring? Are your current customers the ones you should be serving?

      • How can you answer these questions? Start by observing and getting these discussions going.
      • When’s the last time you did a Segmentation? If it’s been more than 2-3 years, that’s another potential starting place.

2. What are the closest competitive offerings?

3. What is the monetary value of your product to the market?

a. Think of this in terms of the savings your product could offer customers over competitor products. This doesn’t automatically mean a lower price. A higher priced product could offer savings in multiple forms—a few examples include a lower cost of ownership, lower maintenance costs, and peace of mind. 

4. How are the different product features valued?

a. To figure this out, you can conduct choice exercises that replicate the market behavior of consumers. A good choice exercise must include, at a minimum, products that together control 60% of the market. Here’s another tip: make sure you also include future offerings and even some potentially ridiculous products you would never offer. 

5. Based on the above steps, are there different customer segments? If yes, what are the optimal product and pricing tactics for each segment?

a. You also need to consider whether there are psychological price barriers for different customer segments that must be kept in mind.

Answering the above questions is a battle half won. For pricing to be truly successful, you need to go beyond coming up with tactics. Answering the next set of questions can be the difference between a good strategy and a great strategy.

1. What is the messaging and communication strategy for...?

a. Product value?

b. Pricing?

2. Is the above pricing strategy feasible? Think:

a. How crowded is the marketplace?

b. Is there a clear market leader?

c. How mature is the market?

d. Is your organization trying to maximize profits, gain a foothold in the market, or maximize share?

3. What is the action plan to react to competitive moves in the marketplace?

4. How do you plan on approaching end-of-life pricing for your products and services?

As you can see, building a thorough pricing strategy is not an easy task. At CMB and South Street Strategy Group, we take our pricing research seriously. We're experts at not only conducting research but also helping clients with rollout plans, and we have a lot of experience guiding clients from a wide range of industries through these steps.

If you’re interested in reading about this further, I’d highly recommend Thomas Nagle’s The Strategy and Tactics of Pricing and Rafi Mohammed’s The 1% Windfall. And, of course, I’d be more than happy to chat with you about pricing structures in the comments! 

Abe is a Senior Project Manager, strategy junkie, and CrossFit enthusiast. He's recently taken up snowboarding so watch out if you're headed to the slopes. 

Topics: strategy consulting, market strategy and segmentation