Voices: the CMB Blog

As a market researcher, there are times I can’t help but look at the upcoming presidential election as the ultimate marketing campaign. A successful political campaign often adapts many of the same strategies used by marketers, and just as savvy marketers have adapted their campaigns to the overwhelming number of Americans who own a mobile device, our candidates have strategically followed suit.Due to the overwhelming and increasing number of voters who own smartphones, it’s easy to see why politicians today are placing so much importance on taking their campaigns mobile.  A study released this month by the Pew Research Center found that 88% of registered voters own a cell phone, and roughly half (48%) of these folks own a smartphone. Of the registered voters who own a cell phone, 27% have used it to stay up to date on the 2012 election or politics in general.

The rise in mobile phone ownership has created opportunities for both the Obama and Romney campaigns to increase exposure in hopes of gaining voters, and one of the biggest ways our presidential hopefuls are getting their message out is through mobile advertising. During this election, both campaigns and their supporters are expected to spend about $159 million on internet ads alone, and it’s expected that mobile advertising will consume a large portion of their online advertising budgets.  The Obama campaign has focused much of this mobile ad spending on an online Google advertising platform, while the Romney campaign has invested heavily into iAd; Apple’s mobile advertising platform made especially for its products including the iPhone, iPod Touch, and iPad. This type of advertising has been used extensively to augment existing television ad campaigns and to encourage voters to visit campaign websites.

The campaigns are also using mobile devices in their fundraising efforts and to keep supporters updated on campaign news and events.  Supporters can easily donate to their favored politician at campaign events by swiping their credit cards on mobile payment platforms like Square; a portable credit card machine that attaches to most mobile devices and can quickly accept electronic payments.  Campaign supporters who have their credit card already on file can also text to donate to either campaign—a major benefit because the less onerous the payment process the more likely people are to donate.

When supporters aren’t at fundraising events or texting donations to their favored politician, they can stay connected to the election using their favorite mobile application. Romney supporters can use their iPhones to upload pro-Romney images to Twitter and Facebook, order tickets to see him speak, and stay updated on campaign news and information, while Obama supporters can use an app to check out ways to get involved with the campaign locally. The Obama for America app enables anyone to look up information regarding news, events, community activities, volunteer activities, the President’s policies, as well as information on how to vote.  Of course voters needn’t limit themselves to partisan apps; there have been ample opportunities for voters to search for information on their own—the Pew study found 35% of smartphone owners have used their phone to fact check a campaign or candidate this election season.

Just four years ago, the internet played a critical (and much discussed) role in organizing, informing and motivating voters. mobile technology deepens and expands this impact— facts can be checked on the spot,  polls conducted, and prospective voters reached anywhere they take their phone. Raise your hand if you had your phone out while you watched the debates.  And who knows, maybe someday we’ll be able to secretly text our votes instead of filling in a box or pulling a lever.

Kathleen is CMB's Field Services Associate. She wants to make sure you get off your phone and vote on November 6th!

For more on how mobile is changing consumer behaviors, check out our Consumer Pulse: The New Banking Value Proposition.

This summer, a Harvard Business Review case study presented the dilemma of a modern dance  company caught between their mission to grow and enter new markets, and their mandate to remain creative and groundbreaking. The arguments on both sides are pretty compelling.  A new employee pleads her case that the dance company needs to know who their customers are and what they want, while the Company’s founder argues this information would be detrimental to creating challenging dance performances— “if we ask them what they want, we’ll end up doing Swan Lake every time.”Conversations like these aren’t just happening in the halls of fictional dance companies, they’ve been challenging companies for at least a century. Take this quote from Steve Jobs, founder of what is arguably the most consistently innovative company today:

We figure out what we want.  And I think we’re pretty good at having the right discipline to think through whether a lot of other people are going to want it too.  That’s what we get paid to do. So you can’t go out and ask people, you know, what’s the next big [thing]?  There’s a great quote by Henry Ford, right? He said, ‘If I’d have asked my customers what they wanted, they would have told me ‘A faster horse.’ [2008 Interview with Fortune magazine]

In the past several years, I’ve sat in on talks, read articles, and spoken to lots of product developers who now feel that research and talking with customers provides little, if any, value.  They invariably point to Apple or that ubiquitous Ford-ism, but it seems to me that those who are dead set against customer research are missing the point.  It’s not the customers’ job to develop the solution, it’s simply the customers’ job to tell you about their experiences and what they’re trying to accomplish.  In the famous quote by Henry Ford, the takeaway isn’t that they should develop a faster horse.  Instead, it’s that people want to travel faster, and Ford came up with a better solution.

Let’s look at Apple, for example, if you take the latest version of the iPad, you’ll see they haven’t ignored customers at all.  People are more connected today than at any other point in history; our desire to connect with people and share, access, purchase, and manage media/content from anywhere at any time has only grown stronger with time.  Recognizing these trends, Apple made an incremental shift in current tablet technology and created a game-changing product.  The iPad might not be the perfect device for every user, but it performs great on attributes that allow us to connect with one another and consume content. 

What makes Apple special is their ability to anticipate needs becoming more important and that's what they did in the case of the iPad. But they don't just understand the customer needs from a macro level, they have a complete and nuanced understanding of the detailed needs that make up the entire customer experience.  So when it came time to build the next generation of tablets, they made the right decisions about screen size, processing speed, connectivity options, virtual keyboard size, touch screen sensitivity, gestures, etc., because they knew what mattered to customers.  The customers’ experience was the driving force behind those decisions.  This vision allows Apple to consistently churn out game-changers.

But donning a black turtleneck and taking the buttons off of your products won’t get you the next iPad.  While Apple may not engage in typical customer experience research, they have a culture that is customer focused from top to bottom. Their product development process is motivated, from concept to implementation, by the goal of providing seamless, user experience. Apple’s greatest innovations—the iPod, iPhone, and iPad—embrace simplicity and usability. Uncovering customer needs and creating products and services to meet them doesn’t require one of the greatest visionaries of all time, it can come through comprehensive customer experience research.

So we’re back to our dance company. How can they maintain their desire to grow with their commitment to boundary breaking dance?  The answer is customer research that identifies all of the customer wants and needs for a given product/service, and then tells you which ones matter the most.  Show goers may say they want to see Swan Lake, but do they really mean they want to recreate a powerful experience they had the first time they saw dance? Customer research that focuses on needs is a powerful tool, and critical to innovation whether developing a dance program or building a new processor. By knowing what matters to customers, organizations can discover unmet needs, find opportunities for disruptive innovation, know where to focus resources, and set the foundation for developing game-changing products and services

Needs based customer research is not about asking the customer to dream up the next new product, feature, or technology.  Nor is it about learning new ways to sell customers products they don’t really want.  It’s a proven method to help organizations connect with their customers and focus on what matters to them.  Apple’s success is based on a fundamental and detailed understanding of their customers.  Do you understand your customers in that way—or are you giving them Swan Lake?

Posted by Andrew Wilson, Andrew is an Account Director at CMB, he isn't sure about modern dance but awaits the iPad Mini with baited breath.

Headed to TMRE in November? Enter our code at registration and take 25% off the conference pass: CMB2012

A version of this post was published in Loyalty 360's Loyalty Management Magazine

My colleagues can tell you that although we're well into fall in New England, I still love the garden as loyalty program metaphor. That's because loyalty programs, like gardens, are living entities that require ongoing monitoring and periodic refinements to ensure they grow stronger, continue to operate at peak performance, and deliver the results you need for your business. Here are the four steps to getting your program ready to support growth:Step 1:  Review your goals and the (competitive) landscape

Before you tackle the issue of “what” and “how much” to offer to members to incent their behavior, take time to review:

Desired behaviors:  Are you trying to encourage members to visit more frequently?  Spend a bit more?  Advocate to friends and family?
Customer’s needs:  What goals are your members trying to realize?  What activities are they passionate about?
Brand alignment:  How well does your program reflect the unique selling point or values of your brands? Where are the misalignments? 
Program goals:  What key metrics do you measure to report on program success: member acquisition or retention, e.g. the percent of customers who redeem?
Competitive activity:  What outcomes are these programs focused on?  How differentiated is your program from theirs? 

Determining which, and how many, rewards to give your customers, requires careful consideration of multiple factors. Before you proceed down a “program optimization” path—test the soil.  It’s impossible to build a successful garden if you’ve chosen the wrong plants or haven’t added the nutrients your soil needs to support them.    

Step 2:  Focus

“If you persist in trying to be all things to all people, you will fail. The alternative, then, is to be something important to a few people.” – Seth Godin, in We Are All Weird

The focus of your program may be on high-value members and that’s okay.  Today’s high value customers are fairly easy to identify; they’re the ones who buy higher margin products, visit often, and spend in multiple departments and categories.  But concentrating solely on these customers means that you may be missing an opportunity to lay the foundation for future success.  Consider identifying customers who have high value potential (via predictive modeling) and nurture those relationships as well.  In addition, you may find, upon reviewing your goals and objectives, there are certain other segments of customers that matter as well – and for whom you need to focus activities and attention.  For example:

• Caesars Entertainment’s re-launched its Total Rewards program to celebrate its position as the country’s leading entertainment loyalty program.  The new program offers additional offerings and experiences designed to appeal to Entertainment Seekers (in addition to the core avid gamer); their relaunch included concerts by Cee Lo Green, Mariah Carey, P.Diddy and Gavin DeGraw. 

• Best Buy gave select members of its Reward Zone loyalty program a ‘surprise and delight’ reward, a ticket to the Twilight premier.  Sales remain the driving force behind their points-based loyalty system, but in surprise-and-delight programs, marketers can choose consumers who might be major spenders but also because they're passionate or the kind of people who drive incremental buzz online. They’re using this approach to build greater engagement among high-value customers and create more PR-worthy and effective programs in a crowded loyalty space.

Bottomline: focus on the people that are aligned with what you are trying to do. 

Step 3:  Differentiate and innovate

Colloquy’s report on the state of the loyalty industry finds the average US household has 18 loyalty program memberships.  Eighteen! 

If your program is purely a frequency-based program, differentiation isn’t your goal.  However, dialing up program innovation to differentiate from competitors may prove valuable if your desire is to create loyalty, drive incremental spending, stronger customer engagement, and additional brand advocacy.

I love home-grown vegetables, and the varieties I pick are those that do well in my garden and that I can’t buy in a store.  Although I love to garden – if the only product I could grow was one that I could easily buy, I may reconsider the time I was willing to invest.  My pride in this activity would decrease and I’d tell fewer people about my garden. 

For the members you’ve decided to focus on, differentiate your program from competitors.  Give your members a reason to return— pride in their association with you and something to talk about!

Step 4:  Optimize program benefits

You’ve reviewed your objectives and the competitive landscape.  You’ve targeted specific members and have embarked on a program to identify innovative ways to differentiate yourself in the marketplace.  What now? 

To justify changes in your program, you’ll need to articulate the incremental value additional benefits will deliver.  You’ll need to do that if the additional benefits require additional investment – or if you are working with franchisors who demand financial justification to justify additional investment! 

Over the last ten years, we’ve worked with industry leading programs to analyze the cost-benefit of program benefits to support program development or refinement.  Here are a few examples where we conducted quantitative research using advanced analytics (like Discrete Choice):

• A leading upscale hotel chain, needed to figure out an on-property benefit it could provide in place of a guaranteed suite upgrade since some the upgrade wasn’t a viable option at some of their hotels.  An alternative was identified and members are given the choice at check-in. 

• As it develops and acquires new brands, this hotel loyalty program needed to identify the right type and level of benefits to offer at to guests at its extended stay hotels – benefits that would be of value to guests who stay, on average, for two weeks at the hotel

• A leading luxury retailer wanted to optimize structure to drive incremental sales and refresh benefits to incorporate more brand-relevant experiential elements for the refresh of its flagship shopper loyalty program

Discrete choice is a great tool for loyalty program optimization because it allows us to:

1. Optimize programs based on client’s goals:  By examining member interest in thousands of alternative benefit packages – and calculating the cost of providing those benefits – we can identify the best programs in terms of profit (‘high customer value’ and ‘low cost’), or for other key outcomes like member acquisition, increasing take rate from competitor’s customers, etc.

2. Estimate shifts in market share that could result from changes to your program benefits

3. Examine incremental spend - attributable to program benefits - from a couple of different angles

If you’re looking to optimize your loyalty program resources to get as much benefit as possible, following this four step plan may cause you to think differently about your program, the benefits it offers and the potential that exists.  Focus on what, and who, is most important and pruning back where you may be over-delivering can help ensure that your program grows stronger, operating at peak performance, and delivering the results you need for your business. 

Judy Melanson 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

This November we'll be in sunny Boca Raton, for The Market Research Event, presenting with our friends at The Atlantic City Alliance and SunTrust Bank.  We'll share findings, challenges, and insights from two very different segmentation studies:

Track: Insight Driven Innovation Track
Time and Date: Tuesday November 13th @ 2:00 pm
Presenters: Judy Melanson, Vice President, Travel and Hospitality Practice, CMB and Rich Mirman, Consultant to the Atlantic City Alliance, Former CMO for Caesars Entertainment, The Mirman Group, LLC

While Atlantic City attracts over 30 million visitors a year, the popular tourist destination faces a number of challenges—including a recession and increased competition. Join us to hear how CMB and The Atlantic City Alliance took a foundational approach to segmentation—identifying and assessing Atlantic City's greatest growth opportunities to decide who to attract, and what to build.

SunTrust: Segmentation as a Change Agent

Track: Insights Leadership & Transformation Track
Time and Date: Wednesday November 14th @ 11:15 am
Presenters: Rich Schreuer, Senior Consultant, CMB; Mark Carr, Co-founder and Managing Partner, The South Street Strategy Group; Jeff VanDeVelde, SVP, Director of Client Experience and Loyalty, SunTrust Bank

Learn how CMB and The South Street Strategy Group partnered with SunTrust to develop and prioritize consumer segments based on goals and needs. This segmentation was central to  forming the foundation for SunTrust’s brand strategy, and helping the bank make the critical shift from a product-focused to a customer-centric organization.

We're excited to see you, click here to register, and enter CMB2012 to receive 25% off.

Check out one of our favorite moments from last year: TMRE Highlight: The Art of Choosing

From the CMB Light the Night Team:

Last Thursday, CMB employees, friends, and family gathered for our annual Light the Night BBQ and silent auction to raise money for the Leukemia and Lymphoma Society (LLS). While the LLS supports research for millions of people around the world who suffer from blood cancer, we started participating in Light the Night for reasons a lot closer to home. In 2008, Catherine Shannon, our Director of Finance, was diagnosed with Hodgkin’s Lymphoma. And when Catherine began what was to become two years of grueling treatment, CMB got walking.We went looking for creative ways to sponsor our team, and as luck would have it, CMBers aren’t just talented market researchers. Our Field Services Manager Jared Huizenga is President of the New England Barbecue Society, and for the past 5 years, he’s catered a full lunch including some seriously delicious pulled pork, corn bread, and macaroni and cheese, for over 60 enthusiastic ticketholders. This year, Jared started cooking at 4pm the afternoon before, eking out three hours of sleep, and showing us why he’s a champion competitive griller.

The silent auction was another chance to show-off the secret, and not so secret skills of other CMB team members. There were dozens of things on offer, including two hours of landscaping from Jonah and Sean, tech help from technology gurus Abdullah and Marc, custom designed party invitations from Stephanie, and of course a whole range of foods—from full meals like Rich’s chicken Vindaloo dinners and Tomoko’s Japanese curry to delicacies like T.J.’s homemade cannoli and ravioli.  All this eating (tough work) and bidding got us $4,000 closer to this year’s goal of $18,000. 

In the five years the CMB team has participated in the walk, we’ve raised over $36,000 and while it’s one of our favorite times of the year at CMB, we never forget why we started walking. Due in no small part to the advances made in cancer research, Catherine has been in remission for 2+ years.  We want to help more families have happy outcomes.  The LLS funds research with the goal of curing blood cancer and at the same time provides support to patients and their families.

From the LLS website:  When LLS was founded in 1949, a blood cancer diagnosis was almost always fatal. Thanks in part to innovative research funded by LLS, survival rates have doubled, tripled and even quadrupled for blood cancer patients. Today, cancer research in one area helps across all types of cancers.  One example of this is the approval of the revolutionary drug Gleevac. The 10-year survival rate for certain blood cancer patients improved from 1 in 10 to nearly 9 in 10.  Gleevac is also approved for patients with rare skin and stomach tumors, and is showing promise in many other cancers.

Help in the fight against cancer by donating to our team. Please click on the link below and give what you can.  Every dollar helps.  We want to kick cancer’s butt!

The CMB Light the Night Team Page

Posted  by Senior PM Lynne Castronuovo, Director of Finance Catherine Shannon, Office Manager Adrianne Economu, and Senior Associate Sean Kearney, who are constantly thinking up new ways to help us Light the Night.