Voices: the CMB Blog

In March of 2011 a movie was released in theaters, with all the hallmarks of box office success, it starred a handsome Hollywood newcomer and a seasoned Hollywood veteran, it had an intriguing plot, and it was released during the traditionally uncompetitive winter/spring movie season. So, when the movie, Limitless, debuted at #1, it was no surprise.

Now this sounds like a typical Hollywood hit, but there was something about this movie that made me (self-proclaimed movie buff since age 8) pay a bit more attention. The main plot device was a product: an experimental drug that allows the user to use 100 percent of his brain, and this product played a crucial role in character development and the overall plot. Could this movie increase demand for a similar type of drug in the real world, specifically for a segment of the US population that previously hadn’t been very demanding of that product? In short, could this movie make a target market aware of a need that they didn’t even know they had before?Fired-up about this epiphany like Peter Finch in Network, I boldly predicted to a friend that a certain company might actually run short of supply of the drug, because the movie would uncover previously unknown needs to a large segment of the US population, and that segment would consequently want to start buying like the floor traders at the end of Trading Places. (Yup: two movie references, one sentence.) After all, I had previously seen the effect that movies could have on product demand in the past:

• Top Gun = approximate 500% increase in the number of Naval aviator applications to the US Navy as well as a 40% increase in sales of Ray-Ban Aviator sunglasses (in a decade that had been decidedly keen on Ray-Ban Wayfarers, which themselves were allegedly given a sales boost after Tom wore them in 1983’s Risky Business)

• Lord of the Rings = 40% increase in New Zealand tourism from 2001 to 2006

• Field of Dreams = an isolated cornfield in the middle of Iowa that gets 60,000+(!) visitors per year

• 300 = sudden spike in GoogleTrends for Mark Twight and his CrossFit-like workouts that made the actors look like Spartan warriors

• And then of course there is the sad story of what Supersize Me did for the demand of ol’ McDonald’s Big Mac and its friends

So, I had seen this sort of thing before, and – wouldn’t you know it – about three months after opening night, this certain company publicly announced to its stockholders that it did not have enough supply to meet demand for the drug: they were plum out!

Coincidence? I think not! Well, at least I didn’t think so at the time. You see, I wasn’t a market researcher yet, so I didn’t really consider the hundreds of variables that could be involved in the outcome of something (in this case, that “something” being a company’s unexpected shortage of a certain type of product). Besides, it was a pretty bold and insightful prediction, it wouldn’t be the first time a movie drove up demand for something! So, the fact that my prediction actually came true gave credence and justification (at least in my own mind at the time) to the fact that the movie must have had the effect that I predicted it would!

Well, now that I have a few market research years under my belt, I see the situation a bit differently. In the article “Advertising Analytics 2.0” from the March 2013 issue of Harvard Business Review, I was happy to see that they DID talk about movies having an effect on product sales…but “cinema” is only one of hundreds of variables that are taken into account and run in a software analytics engine that determines the true weight and importance of each variable. So, the only way to determine whether or not the “movie variable” was actually significant in Limitless would be to get fancy and use some of those new Analytics 2.0 techniques, run an analysis of the effects of all the possible variables – and, after watching CMB’s analytics team in action, I can tell you that this means a lot of variables. Any of which could have played a part in either an increase in demand or a shortage in supply or both happening simultaneously. There are a few possible scenarios that led to a shortage in supply, and a lot of different variables that could’ve caused each of those scenarios to occur.

So, is it crazy to think that movies have the potential to dramatically increase demand for a product, when the right conditions are met within the movie? Well…maybe; for Supersize Me, the effect is obvious, but for Limitless, the effect of drivers is not perfectly clear and the conclusions are obtainable yet less certain. But, what’s important is the fact that sometimes, completely unbeknownst to anybody – there could be an unforeseen variable or set of variables out there, and they could ultimately have a profound effect on your product or industry. It could be a shift in consumer viewing habits, it could be a general economic shift, or maybe, just maybe, it could be a movie. Either way, you won’t know until you start asking the right questions and digging through all the possible variables.

Jonah is a Senior Associate Researcher, he’s been a movie buff since he saw India Jones: Raiders of the Lost Ark when he was 8 years old. (If you ever need a “movie guy” on your trivia team, he’s your man.)

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You know you’ve been to a great conference when the ideas and insights are still percolating and expanding weeks later; the Insights Innovation Exchange Conference in Philadelphia definitely fit that bill.  In part one of my take on the conference I talked about the change we’re seeing in the market research industry.  In this post, I’ll discuss the implications and manifestations for the change.Technology is driving the change, but people will lead it 

Technological changes are a primary piece of the “revolution,” but does this mean we will do more with less? The short answer is no. Technology will not reduce our need for people.  In fact, the big changes introduced by technology and new tools & techniques will require most market research firms to aggressively hire more people, not fewer. The challenge, however, is defining and finding the new talent and skills that will apply to the market research of the future.  Data management skills will be critical, as will business systems knowledge. Most importantly, strong logic and an understanding of decision theory will be big differentiators for the professionals of tomorrow. 

A wider view of consumer behavior
Besides the change in how we conduct our work, technology is changing the way we view behavior.  IIeX focused an entire track on neuroscience and emotional measurement, with a variety of emotional measurement techniques like fMRI, EEG, eye tracking, and facial recognition becoming more mainstream (see Mediapost’s: The State Of Neuroscience In Market Research)

If some in our industry see these new technologies as just measurement techniques, they’re not seeing the forest for the trees.  In fact, the trends and changes in the industry reflect new consumer behavioral models that reflect multiple aspects of decision making processes. During the conference, I even noted the fact that we seem to have reached “critical mass” with regard to behavioral economics.

Gone are the days of the rational economic decision maker.  Instead, advances in neuroscience and behavioral economics reveal the strong emotional components of all decisions.  If you don’t have an understanding of the core value and applications of behavioral economics and the new research in neuroscience, you may as well go back to using MS Office ’98, collecting data on 80-column punch cards, and worrying about how to conduct interviews via that new-fangled Internet.  Cognitive models developed within the past couple decades have gained acceptance and are frequently being applied in market research. The growing regard for intrinsic measurement gives me hope that we will achieve a more cohesive framework for addressing the emotional and subconscious layers of behavior. 

New innovators, new partners, new collaborators
The conference’s final day wrapped up with two presentations around a common theme: collaboration.  Gayle Fuguitt, CEO/President at Advertising Research Foundation (and former Vice President Global Consumer Insights at General Mills), presented “A Call For A New Collaborative Model,” highlighting ARF’s efforts to bring clients and competitors together to address the promises and challenges of biometric and neurological research methods .

Gayle’s central argument is built on well-regarded themes—organizations need to find new ideas and innovations by fostering the diversity of thought and value a broad team can provide.  Her advice:  “work with people who don’t laugh at your jokes” and “seek partners who are frenemies,” highlighting the fact that true collaboration doesn’t occur among the like-minded.  In a similar vein, Kyle Nel, head of International Consumer Research for Lowe’s Home Improvement, presented “Data Philanthropy: Unlocking The Power Of Adjacency Across Sectors.”  For Kyle, the focus for the future will be on “uncommon partnerships” to help companies gain a competitive advantage.    

These new relationships will take market researchers out of their comfort-zone, working with partners who might not bring the same rigor and methodological requirements. The hard work arises from more than accepting compromises; instead, the greatest effort (and reward) comes from working with new partners to find an optimal solution aligning the strengths of each participant with the desired objective.  When working with technology partners, market researchers must be aware of tradeoffs when using the technology; no technology solves all problems. (BTW, technology partners, you’re not off the hook either. You must be aware that you can't solve all problems and will need to partner with market researchers to create optimal solutions for the business objectives). The effort of collaboration is a matter of compromise and acknowledging that “perfection is often the enemy of progress.” 

A great opportunity
In spite of all of the posturing about the end of market research as we know it—the irrelevance of the “long-form survey” and the un-engaging nature of many online interview formats, I came away from the conference with a positive outlook on the industry.  We‘re in a unique position, intimately involved in the largest trends that are shaping business and the economy: mobile, social and big data. The Information Economy is fully upon us, and market research has the opportunity to seize the value that new technologies are bringing to businesses and the economy.  It’s a matter of hard work, collaboration, and courage to accept new ideas and change that will allow us to take advantage of these opportunities.  

Jeff is VP of Market Science Solutions at CMB. This marks the first, and probably last, post accompanied by a picture of Vanilla Ice. Find Jeff tweeting @McKennaJeff.

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Welcome to Part One of my coverage of the Insights Innovation Exchange Conference (#IIEX) that recently wrapped up in Philadelphia. The event was three solid days of presentations and panel discussion on the changes and innovations that are shaping the future of market research and the business insights industry. The event targeted insights practitioners and anyone who wants to deliver evidence-based business insights to their clients. The event focused on the future of the industry, and the usual suspects were there: mobile, social, gamification, Big Data, neuro-measurement tools (like eye tracking and facial coding), and communities. The vendor space was filled with companies offering technological solutions, and the lion-share of presentations focused on at least one of these tech aspects. I was surprised, and pleased, to discover that this collection of innovation agents focused less on the tools and technology (partly because speakers were limited to just 20 minutes) and more on fundamental elements of change in our industry. In Part One, I’ll briefly summarize our current state. In Part Two, I’ll describe the manifestation of that change for future growth.

The Shift from Old to New Research: 

“We no longer live in a world where information is rare.  In contrast, we are overwhelmed with data, Big, Medium and Little. This represents the most fundamental challenge to the business model of market research since its inception.”

That’s Dr. Larry Friedman, Chief Research Officer at TNS, who packed a comprehensive synopsis of the market shift into his 20 minutes. The key points are nicely summarized here.

It’s true that because we are an industry that has established its value through collecting and managing data, market research faces a difficult future; its fundamental activity has become less valuable. For a hundred years, businesses and managers have turned to market researchers to design studies, collect data, and translate the data back to them. Some market researchers might find additional value in providing insights and recommendations, but it’s rare to be rewarded with full “consulting rates” for this work. 

Given that data can be collected at low cost, the management tasks of sample design are not as important today, and the science behind collecting the “right” data can be glossed over with more (and cheaper) data. Even the translation and application of research data to business decisions are becoming more common with easier-to-use software and training. Tableau, Good Data and (even) MS Excel are some of the analytical tools that now put data directly into the hands of business decision-makers. Heck, even kindergartners are learning the “basics” of market research.

But market researchers still have a head start. As the professionals who have experience with managing and translating data, we should be able to fill a vast need for curating the wide variety of data files and warehouses to support business analyses. Additionally, our knowledge of data types (e.g., categorical vs. scale, just to name one of the many ways we look at the multidimensionality of data) and structure is critical for laying the foundation for information users to access and translate data most efficiently and effectively.

We might not be able to design the right sampling methods, but who among us has not fixed a study where the sampling was done incorrectly? We might not be able to design the questions to get the best data for analysis, but who hasn't needed to come up with a method to fix data that had been coded incorrectly or had incorrect skip patterns applied? (Just to name a few of the complications that can occur). All of these new data streams bring many more opportunities to fix, translate, and apply the results to support the decisions our clients need to make.

The takeaway: there are major challenges but Market Research isn’t dying, and it’s not on life-support. It’s a reasonably secure business that has attracted other companies to its space because companies find great value in evidence-based decision making. Let’s be honest, Google wouldn’t be making a big investment in Google Consumer Surveys if it didn’t see an opportunity to make a lot of money.

But when Google enters your space, you better believe you need to put your helmet on, and get ready…

Jeff is VP, Market Science Solutions at CMB. He is just as comfortable explaining advanced analytical models as he is parsing the cultural significance of "Tommy Boy." Find him tweeting @McKennaJeff.

On Sunday, The New York Times Magazine published a piece: How Companies Learn Your Secrets, by Charles Duhigg, author of the forthcoming The Power of Habit: Why We Do What We Do in Life and Business.  It’s an interesting article, especially for market researchers, and I recommend everyone take the time to read it.

Consumer "habits” are a big focus of the work we (market researchers) do as we seek to understand consumer behavior. From the perspective of the article, a large part of what we do is identify behavioral habits to help marketers find ways to insert their product or service into people's habit processes. 

In this blog, I want to focus on the insights the story shared about predictive analytics. Much of Duhigg's article looks at how Target conducts advanced analytics to identify data within their CRM system to predict whether a shopper is expecting a baby.  From a business process POV, and how we think about using predictive analytics, it’s important to point out a few relevant facts for market researchers:

1. It wasn’t a “fishing expedition”: The analysis started with a clear marketing benefit as the outcome – Target wanted to begin promoting itself to expectant mothers before the baby is born. As the article points out, by marketing to these families before the baby becomes public knowledge, Target can get beat the flood of marketers that begin pitching a range of products and services once the birth is entered into public record.  It was the marketing team that came to the analyst with a high-value opportunity.  The analyst did not create the winning marketing idea (“Hey! Let’s market to expectant mothers before the baby is born!”).  Instead, the analyst looked under every stone and in every corner of the data to find the key to unlock the opportunity.

2. The research didn’t stop with finding the key: The application of these insights required a lot more research to determine the best method of implementing the campaign.  For instance, Target ran several test campaigns to identify the best offers to send to the expectant mothers, and cycled through several messages to find just the right one in order to avoid revealing that Target was prying into the data.  Although the predictive analytics found the key, Target still relied on a comprehensive plan to make sure the findings were used in the best possible manner.

3. Don’t let this story increase your expectations: The Target approach has had a big impact on how the company markets to a highly valuable segment of shoppers.  It's a great success story, but it's also something that happened ten years ago.  While I’m sure the Guest Market Analytics team achieves many victories along the way, they also spent a lot of time reaching “dead-ends,” unable to find that magic key.  And most of the time, the predictive solution yields valuable but incremental gains, these high-profile stories are few and far between.

The article shares many interesting ideas and insights; the story about the re-positioning of Febreze highlights another great research success. I'm looking forward to reading Duhigg's book, and if it covers more of these thought provoking business cases, I expect we will be seeing Charles Duhigg’s name popping up in other discussions on market research.

Did you read the article? What do you think?

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