Voices: the CMB Blog

On Saturdays, when the weather is not fit for the playground, I take my toddler to a tumble gym where he can run, climb, and kick balls around with other kids his age.  Parents must accompany kids in the play area as this is a free-form play center without an employed staff (other than the front desk attendant).  As a market researcher and a perpetual observer of the human condition, I’ve noticed that these parents fall into three distinct groups: the super-involved group, the middle-of-the-road group, and the barely-involved group.The super-involved parents take full control of their child’s playtime.  They grab the ball and throw it to their kid. They build forts. They chase the kids around.  They completely guide their child’s playtime by initiating all the activities.  “Over here, Jimmy!  Let’s build a ramp and climb up!  Now let’s build a fort!  Ooh, let’s grab that ball and kick it!”

The middle-of-the-road group lets the kids play on their own, but they also keep an eye out and intervene when needed. For example, a parent in this group would intervene if the child is looking dangerously unstable while climbing the fort, or if the child steals another kid’s ball and sparks a meltdown.

The barely-involved parents tend to lean against the wall and stay on their phones—probably checking Facebook. They don’t know where their kid is or what their kid is doing.  For all they know, their child could be scaling a four foot wall and jumping onto another kid’s head.

This just demonstrates this simple fact: people are more the same than they are different.  This is why I love segmentation studies—it’s fascinating that almost everyone can be grouped together based on similar behaviors.

At CMB, we strive to make our segmentation studies relevant, meaningful, and actionable.  To this end, we have found the following five-point plan valuable for guiding our segmentation studies:

• Start with the End in Mind: Determine how the definition and understanding of segments will be used before you begin.
• Allow for Multiple Bases: Take a comprehensive, model-based approach that incorporates all potential bases.
• Have an Open Mind: Let the segments define themselves.
• Leverage Existing Resources: Harness the power of your internal databases.
• Create a Plan of Action: Focus on internal deployment from the start.

Because each segmentation study is different, using appropriate selection criteria ensures that segments can be acted upon.  In the case of the tumble gym patrons, we might recommend that marketing efforts be based on a psychographic segmentation.  What are the parenting philosophies?  In what ways does this motivate the parents, and how can marketing efforts be targeted to the low-hanging fruit?

Incidentally, I find that I fall into the middle segment.

Jessica is a Data Manager at CMB and can’t help but mentally segment the population at large.

Want to learn more about segmentation? In the “The 5 C’s of Great Segmentation Socializers,” Brant Cruz shares 5 tips for making sure your segmentation is embraced and used in your organization. 

Webinar: Modularized Research Design for a Mobile World

Join us and Research Now to learn about the modularized traditional purchasing survey we created, which allows researchers to reach mobile shoppers en mass. We'll review sampling and weighting best practices and study design considerations as well as our “data-stitching” process. 

The New York Times article, The Extraordinary Science of Addictive Junk Food, caught my attention by linking the hot topic of “junk food” and the obesity epidemic to the market research that supports it.  This is where my inner geek gets really excited—it’s not often that two things I’m passionate about (nutrition and market research) are so perfectly linked. 

Ever wonder why it’s virtually impossible to eat just one Dorito? Or how they got the recipe for Dr. Pepper just right?  How do you think they engineered Cheetos into the perfect cheesy, crunchy, melt-in-your-mouth treat?  As any market researcher knows, it goes far beyond basic trial and error—this isn’t like asking a few people if they like your new brownie mix. But even for someone who lives and breathes market research, the article was incredibly illuminating. Companies put a lot of time and effort into developing foods that will both taste good and be profitable; they consider the basic principles of supply and demand, and couple that with food science and a lot of market research to fill our needs and desires.

Because I know very little about food science, I won’t talk about the “bliss point” (the levels of sugar, fat and salt in processed food that keep us craving more) though I find it fascinating.  Instead, here are some fascinating examples of how market research plays a role in determining what foods end up on the shelves of your local grocery store and in millions of pantries around the world.

Qualitative research identifies a need
In the article, we learn how Oscar Meyer conducted focus groups comprised of working moms to learn not what they were feeding their kids for lunch, but how they felt about the challenges and expectations they had in providing meals for their children. Oscar Meyer learned that these moms were strapped for time and felt pressured to provide a full lunch, while also getting themselves out the door, and to the office. The qualitative research revealed some of the tremendous sociological, psychological, and economic pressures faced by moms.  The company’s solution was Lunchables—a hugely successful product, with sales of $218 million in the first year.

Conjoint analysis configures a new product
Campbell’s Soup used a statistical method called conjoint analysis, to determine the optimal product configuration(s) for their soups.  We use conjoint analysis quite often ourselves because it lets us measure and evaluate the relative importance of individual characteristics and determine the right combinations of these characteristics. Campbell’s used conjoint the same way—to optimize the perfect combinations of ingredients, texture, taste, mouth feel, and so on, to (literally) engineer the ideal food.

Segmentation pinpoints a new target audience
Prego conducted segmentation research to find that there are three primary segments of spaghetti sauce consumers: those who like their sauce plain, those who prefer it to be spicy, and those who like it extra-chunky; the key here is that when the research was conducted, there was no extra-chunky tomato sauce on the market! Prego was able to identify a huge segment of the market whose needs (for extra-chunky tomato sauce) were not being met; the result was a new Prego “extra chunky” sauce that dominated the market.

Food is more than just fuel, especially for those of us lucky enough to have plenty to eat… it’s about things like family, comfort, convenience and love.  And whether you won’t touch a GMO or want Mayor Bloomberg to leave your giant sodas alone, it’s important to know when you grab that bag of chips—the first ingredient is most likely a ton of market research.

Dana is Research Director at CMB. Her husband’s recent conversion to a vegan diet has her thinking about food science even more than usual, though she continues to enjoy cheese.

Check out our latest webinar: The 6 Secrets of Succesful Segmentation, it's much healthier than Doritos we promise.

A lot of time and money is wasted on segmentation studies. Here’s why, and what to do about it.

Last November I partnered with a banking client for a conference presentation on a segmentation study we conducted to help guide his organization towards greater customer-centricity. The study provided market insight to help transition from a product-based to a customer-centric organization by identifying need, attitude, and behavior-based segments.  The results helped them develop value propositions customized for each segment, which addressed products, messaging and customer experiences. 

The study was a great success. It’s used by our client in many ways, and was “actionable” in every sense of the word.  But rather than dwelling on our very great success, it got me thinking about why segmentation studies are often not acted upon.  In my 25 years of market research experience, I have found that segmentation studies are often found “interesting” but not “actionable.”  And it’s often not a function of the quality of research.  Poorly executed studies are never actionable.  But even well executed studies may not be actionable.  (And, by the way, when a client finds a study “interesting,” for me, that’s code for “I don’t want to hurt your feelings, but you failed.”)

Back to the conference presentation…at the start of our talk I asked the audience how many had worked on  well-executed segmentation studies (either as a supplier or a client) that were ultimately deemed “not useful.”  I knew the situation was bad, but I was shocked when about four-fifths of the audience raised their hand. So, here are a number of things we at CMB have learned over years about how to make segmentation actionable.  Note they don’t have anything to do with the mechanics of execution.

1. It’s the process, stupid (apologies to James Carville)
   While any good market research firm can write a decent questionnaire, structure a sound sample, and use state-of-the art analysis techniques, it’s the process that usually determines the project’s fate.  Simply soliciting client input, executing the study and presenting results is not enough.  The study will be a success if the process involves making information-users partners by capturing their definition of success, upcoming decisions and hypotheses, and then including these partners in selection the final segmentation solution.

2. Articulate and agree on business decisions
   Our experience shows that while, many research consumers are good at listing information needs, few actually identify the decisions they intend to make with this information.  Most seem to believe that if they have enough information they will find insights to help make as yet undetermined decisions.  This problem is especially acute in segmentation studies, because different types of decisions (product development vs. messaging vs. targeting) require different type questions and measurement techniques.

3. Many options, but no silver bullet
   Over many years and many studies I have never had an engagement where one segmentation solution worked equally well for all decisions.  For example, solutions that are stronger for targeting will typically be weaker for messaging.   At CMB, our process involves examining and rejecting up to 50 solutions, and then presenting four or five really good ones to our client. This is where management art blends with science.  By understanding competing decisions at the start, we make rational tradeoffs to select the best solution.

4. Real work begins when the study ends
   A segmentation study is typically treated as a discrete project with a beginning and end date.  If the final presentation is well-received the supplier and client may have celebratory drinks or dinner, if not the supplier quietly slinks off to the airport.  But the reality is that no matter how positive the initial reaction, segmentation studies can die on the vine if planning for implementation doesn’t occur before the final presentation.  In successful segmentation engagements, the final presentation is not “the end,” but rather “the end of the beginning.”  Segmentation often requires managers to think differently about the market, and this can’t occur without a process to support and reinforce this way of thinking.  We typically use a set of cross-functional workshops in which participants work with the information and participate in exercises to develop plans with input and support from the group

If you can internalize and act on these principles you’ll never have to slink back to airport after a final presentation. 

Rich is Senior VP and Chief Methodologist at CMB, he also knows the secrets of raising chickens, and the lost art of ski ballet.

You didn’t think we’d give away all our secrets did you? Join us this Wednesday the 27^th at noon to learn more secrets to successful segmentation.

As with many financial services firms, SunTrust Bank has had to re-consider its strategy over the past several years. My colleagues at Chadwick Martin Bailey (CMB is South Street’s sister company) and I had the privilege of recently working with the company as it shifted into a decidedly customer-centric approach to the way it designed its products and services.

Next Thursday, I am pleased to be co-presenting a webinar with Jeff VanDeVelde from SunTrust and Rich Schreuer from CMB. We’ll be covering SunTrust’s use of customer segmentation to drive its shift to customer centricity.

What’s a strategy consulting firm doing talking about segmentation, you might ask?

Well, strategy is as much about saying “no” as it is about saying “yes” to opportunities for growth. Being able to identify, understand, and then remain true to your target customers is at the core of any good strategy. Clarity around target market segments helps businesses crystallize and rally around the strategies that will drive the most value for their best customers, profitably.

At some point, all our projects hinge on being able to answer the question: will this product feature/marketing message/overall initiative/etc meet my most valuable customers’ needs? Because we believe customer-centric strategy and innovation leads to more profitable growth, all our work contains a strong foundational element of re-grounding the client in the market and their best target segments – for today and the future.

We hope you will join us to learn more on the 28^th, and please drop us a line to let us know what you think! Click here to register.

Posted by J. Mark Carr, Mark is co-founder and managing partner of South Street Strategy Group.

South Street Strategy Group, an independent sister company of Chadwick Martin Bailey, integrates the best of strategy consulting and marketing science to develop better growth and value delivery strategies.

After 19 weeks, we’re finally ready to see which two teams will meet on Super Bowl Sunday, battling it out to determine the NFL’s best. I'm really looking forward to February 3rd, because I love football, and because I've got a new take on looking at the teams. After 3 years at CMB, it’s not surprising that a market research perspective has crept into a few areas of my non-work life. Case in point, I found myself thinking about how the NFL season compared to deciding on a segmentation scheme.

I got my first experience with a segmentation project last year, and I found the process of evaluating the different schemes particularly interesting. The schemes that move past the initial round of evaluation often have a few things in common, but there is usually a differentiating factor that makes each scheme unique. In the end, the winning scheme will be the overall strongest of the bunch based on how it supports key business decisions like audience prioritization, messaging and targeting. Evaluation in the NFL is simpler— more points wins.

In the NFL, the 12 teams that make it to the playoffs also have a few things in common. A team usually needs strong (or at least competent) quarterback play to make it to the playoffs, as well as strong coaching. As of this week, we have four teams that definitely have those two factors, but there are distinguishing factors as well:

Atlanta Falcons
The Falcons have a dynamic passing attack led by a quarterback who seems to be reaching his full potential this year, along with two Pro Bowl caliber receivers and a Hall of Fame tight end.  This gives the offense the ability to go downfield with ease, which helps to open up running lanes for Michael Turner and Jaquizz Rodgers.

San Francisco 49ers
The 49ers spent Saturday night putting the rest of the NFL on notice; they finally have an explosive offense to match their bruising defense. With Colin Kaepernick at quarterback, the 49ers have the ability to make big plays on the ground or through the air. They have arguably the best offensive line in the league, with a coach who is a creative offensive mind that takes advantage of this strength.

Baltimore Ravens
The Ravens have a reputation of being a strong defensive team that does enough on offense to win. This year has been kind of a change of pace, with the offense carrying a number of games. The defense is as healthy as it’s been all year, but I would say the offense is still the better of the two units on this team. Joe Flacco has the ability to throw the ball down the field and is a proven playoff performer, and they have a strong running game with Ray Rice.

New England Patriots
No other team can score like the Patriots. Just last weekend they showed they have guys on the bench, like Shane Vereen, who can come into the game and make plays. They have the best quarterback (by far) of the remaining four teams, and enough offensive personnel to run any number of different formations and plays. The scary part about this team is how well their defense is playing. With that combination of two strong units, this team doesn’t have any glaring flaws to point out.

Taking a look at these four teams, I think two stand out. If I were picking my ideal team/scheme I would want to use the Patriots or the 49ers models for victory. If I’m right these two teams will meet in the Super Bowl, which would make for a great game.

Sean is a Senior Associate Researcher at CMB. His lackluster high school football career, spent mostly on the sidelines, led him to the hobby of amateur football analysis. He is a lifelong 49ers fan, but this bias barely affected his prediction.  

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