New Marketing Research

Clients of Market Research

Whether they are called Market Researchers or Customer Insight Managers, the people we meet when we visit their offices look very, very tired. They talk about the information requests as an unending stream that must be responded to, and they make it sound as if they have no chance to prioritize and no chance to step back and look at the bigger picture. They are routinely tasked with finding out customer preferences on colours and type fonts for marketing materials at the same time they are charged with determining strategic brand awareness and preferences.

I feel enormous compassion for them.

The tools I talk about on this weblog could make their lives easier--weblogs, wikis, podcasts, Furl, etc., etc. They should be creating a knowledge base for their organisation and giving their internal clients the keys to an engine that will actually free up the search for relevant information.

I sometimes wonder if the biggest service our company could perform for these people is building these tools and training them and their internal clients on how to use them.

Okay, it's not that I sometimes wonder about this. I think about it every day.

The Joys of Disintermediation

We are working on a report for a DIY (Do It Yourself) firm, based on two sources of information--one, analysis of their web traffic driven by a direct email marketing campaign and the other a short consumer survey.

Our findings are quite dramatic--and completely predictable, for anyone who has paid attention to the major demographic changes of the past generation. The challenge is putting this into language that the client can understand and react to.

One obstacle is our position as a marketing research organisation. They want our input because we are independent, yet our independence means that we are not privy to their knowledge base, built up over decades. They know things about their business that would help us help them, but they won't even tell us what they don't know, let alone what they do.

One way of overcoming this is to put them directly in touch with their consumers. Focus groups come close to doing this, by letting the client observe discussions between researchers and consumers from behind a one-way mirror. But, as any participant of such proceedings can tell you, the moderator is using his/her own experience to intuit where the conversation is supposed to go and what the next important question should be.

What if we as market researchers concentrated on assembling a forum with representative consumers, invited decision makers from client organisations to attend, set forth rules of engagement to both consumer and client, and then stood out of the way? What if we were referees instead of intermediaries? What if we participated in the discussion when we had something relevant to say, rather than trying to reinterpret to both sides what the other was (maybe) thinking?

We would add more value, I suspect.

Permission to Contact vs. Permission to Engage

Okay, here's a definition of market research to play with: The purpose of marketing research is to facilitate the exchange of information between consumers and organisations. Well, it's a short definition, and as such probably has its limitations. But it's mine. Where it differs from other definitions is that the emphasis is on dialogue, not surveys.

For as long as I've been involved in research, the exchange of information has been one way: Organisations want information about and from current and potential consumers. They give a brief of their information requirements to researchers, who design a method of obtaining this information. They ask consumers questions based on this, and faithfully report the answers to the organisation sponsoring this research.

It works, but it isn't enough any more. New Marketing Research should have as its aim the establishment of a dialogue between consumers and organisations, where questions and answers come from both sides. Okay, this should have always been the aim of this type of research, but now that the tools to build it are here, it's really inexcusable not to do it.

The tools I'm referring to are described in the post below this, somewhat falteringly by the Economist in last week's issue, and in more detail on sites such as Wikipedia. They are cheap as chips, work just fine, and can be used to promote engagement with the consumer for information purposes, rather than soliciting their opinion of our version of our clients' questions.

This is the New Marketing Research I've been trying to describe in this blog. I get distracted by news and new tools (and managing a research unit in a large company). But it's here. I am doing it. It works.

Join the party. As and when I get time (usually Sunday mornings at seven) I hope to use real world studies on how to do this. Hold me to it. People are actually beginning to look at this site--maybe it's time to engage in a conversation...

I'll leave this with one question for market researchers: Are we, as practitioners of a profession, secure enough to get out of the way and monitor a conversation rather than acting as middlemen?

Summary of New Media - The Economist Weighs In

Only ten years after blogs were invented, the Economist devotes a special section to blogs, wikis, podcasting, etc.

One of the reasons I let my subscription to the Economist lapse is that their coverage of matters that interest me had dropped to primer level. This report is an example. Bear in mind that they wrote this after the 100 millionth blog had taken wing, after the Washington Post hired its 30th blogger and after MySpace.com and Flickr each had more than 30 million subscribers.

Nonetheless, if you're new to the game and haven't figured out the vocabulary, the section is a decent introduction to emerging communications technologies. However, they do miss some basic points about each of the subjects they cover:

Blogs are important, sure, and they give a public and permanent voice to whomever should want one, sure. But what makes blogs important at a social level (rather than a personal diarist level) is linking - effective use of linking on blogs takes public discourse on a subject to a level of credibility that even newspapers cannot, by showing previously published sources. Despite the fact that the Economist titles their blog article, "It's the Links, Stupid," they give no more than cursory attention to the core function that makes blogs more than a diary.

Because I have let my subscription lapse, I cannot go deeper and link to the rest of the Economist special report - a practice that the report criticizes... but the print edition I saw does a fairly good job at explaining podcasting, wikis, vlogging, (but not a word about RSS feeds...) without talking overmuch about what happens when they all come together. It focuses (again and always again) on teen usage and preference, without talking about the new power this handful of cheap tools will provide organisations. But really, it's when these tools are combined that the world of commnications changes. Maybe some day the Economist will have a weblog of its own and we'll be able to blog a discussion about it...

Back in 1999, when I had the sweetest gig--writing technology commentary for the International Herald Tribune, I wrote that the Internet would have its greatest effect at the local level. Looking at these tools, I'll just note that the primary beneficiaries of all of what is covered in the Economist's report will be small organisations from the not-for-profit sector. When they can ask for money(a PayPal tip jar on a charity weblog), show what they're doing, manage projects, etc., etc., (and we'd better add free phone service to the list--Skype 'em high!) for pennies and without the expensive advice of professionals, all of the charitable organisations currently starving in basements with three volunteers will be able to function like Oxfam. Hasten the day.

A Passion for Panels

Most of the larger market research firms (and almost all of those who conduct Internet surveys) recruit respondents from bespoke panels. These panels consist of people who have said (Twice! We are thorough...) that it is okay to contact them for market research purposes. You retain their contact details (and as much demographic information as you can coax out of them) and when a client wants to conduct a survey you just email them a link to your Internet survey.

The firm I work for has one of the larger panels--depending on which month we do the counting, we're either number one or number two in the UK.

Panels are a great and wonderful resource--unless they are misused. A panel, by definition, can never be considered a random sample. (Technically, even recruiting every nth name from the telephone book is not a random sample, because not everyone has a) a telephone or b) is listed in the phone book--all commercial research methodologies suffer to a greater or lesser extent from this problem.) Panels suffer from selection bias at almost every stage of recruiting for a survey. If you ever see a margin of error (+/- 4%) in a survey recruited from a panel, run, don't walk away from the research. It is physically impossible to determine a margin of error from research conducted with a pre-recruited panel.

These sampling problems are worsened when panel builders offer incentives to respondents to return and fill out more surveys. This essentially educates the respondent a bit too much about Internet polling, which makes them different to other respondents, and occasionally produces professional respondents who finance their weekend down the pub with hastily completed surveys. (That's why our firm doesn't offer participation incentives, by the way.)

This really only becomes a problem when a commercial organisation such as ours takes it upon themselves (or is paid by a third party) to conduct research designed to contribute to a public policy debate. A horrible example of what can happen is described here and here. That's why we don't do that kind of research.

What panels can do: Predict success of advertisements, determine appropriate costings for new products, explore attitudes and perceptions about a company, brand or product--all of the things that market research is supposed to do in a commercial setting.

What panels should never try to do: Offer definitive conclusions about social or public policy.

There are ways to produce a proxy of a general population within a panel. To the best of my knowledge, no commercial organisation does what is necessary to produce such a proxy. If anyone has information to the contrary, send it to me and I will publish it. But I'll also investigate it.

Media Notices Blogs--Sees Threat, Not Opportunity

The UK/Ireland version of the Travel Trade Gazette has a front page story about weblogs. You can tell blogs are coming of age--not because of the contents but because they didn't have to spend a paragraph explaining what weblogs are.

First sentences--"Agencies should police the internet to prevent bloggers waging a war of words against them, experts have warned. Agents’ brands and reputations could be threatened by disgruntled customers criticising them in weblogs, which often appear prominently in search listings." They talked to some interesting people: TUI's head of new media, Graham Donahue, David Burdon from SEM Simply Clicks, and Craig Hanna, a consultant, but had only one line from the person running Thomson's new travel blog. 'Thomson’s blogging site is run by new media content executive Jo Disney. She said: “It’s a really good way of inviting new customers to our site, and we can interact directly with them.” '

Sounds like the 'consumer generated media' box is being built, and we will be merrily forced into it if we are not careful. It's great that some travel companies are actually thinking about listening to their customers. The sector as a whole has been handicapped by too much data, generated from electronic bookings and pooled numbers from the IATA that give a global view of what has just happened. The government also finances a very robust passenger survey conducted at airports that gives huge amounts of information. This has been enough (so far) to allocate resources rather well.

But just once, wouldn't you like to see the answer to the following question? "What destination would you like to see your airport serve that is currently not available at the airport closest to you?" A weblog could gather that information continuously, in real time.

The story isn't at all bad--I'm just a bit discouraged that the conversation could have started at a different level, talking about all the companies that have weblogs on their site (Sun and Microsoft have hundreds of bloggers on the payroll, although not because they are bloggers). It doesn't surprise me that Thomson has started a blog--what surprises me is that the Travel Trade Gazette has not. The Washington Post has 30 weblogs on its site... and the vague talk about the problems that may arise if bloggers criticize your company--it would be so easy to give real world examples. Nothing about how you can use blogs for building online communities, conducting focus groups (self-plug, self-plug) or purchase diaries (gawd, another self-plug).

Blogs have been around since before 2000. Why are we talking about them as if they washed up on the beach yesterday?

Content for Tivo

How long will it take for someone to put together an advert that looks good in fast motion?

Competitive Intelligence On The Cheap

Adriana Cronin-Lukas is one of the pioneers of emerging communications technologies. I haven't seen her in a while, as she's spending a lot of time dragging the senior management of a large American conglomerate into the 21st century. She doesn't even have time to write too many emails, which is a pity.

But I know what she's thinking.

The reason is that she signed me up to a Furl email link to the websites she's visiting. Sadly, I'm not the only one she emails, but it sure makes me sound smarter to have seen the top stories, weblogs and other websites viewed by one of the top minds in the industry.

She does it right--she doesn't mindlessly add sites just to beef up the content. She adds a couple of sentences in front of each link. (Although she could also remind us which ones require a subscription--are you listening Adriana?)

If I were a time starved executive that needed a news digest... I'd probably pay for this. As a friend of Adriana's, I just say thanks.

Content Free

Full disclosure--the parent company of the research firm I work at practices the arcane art of direct email marketing. If what I write below is true, they would benefit from the consequences.

Google is good. Advertising on Google is good. Advertising on weblogs is good.

But a lot of money is being wasted by Google advertising on content-free sites.

There are marketing consultants advising people on how to create websites that exist only to host advertising and boost the Google rankings of other sites. I had read about this phenomenon, but it seemed like it would take just as much effort to create such a scheme as to create a site that had something useful to say, so I didn't think it would be a factor in online marketing.

Then our firm got a project to monitor an organisation's profile in the blogosphere. As it happened, they have an advertising contract with Google. The only references we found to the organisation were on phoney websites. Now, who knows? Maybe they are getting good traffic and exposure from these adverts. I doubt it, but it's possible. The point is, they didn't know where their adverts were going and what the adverts would be sitting next to.

Google is new, and some trial and terror is to be expected. But they need to work quickly to define for their clients the type of sites adverts will be placed on, and the overall context of where the advert sits. I advised our client to visit Google and ask for an adjustment of their fees, and a review of placement policies. You get the advice for free.

Eavesdropping in the Blogosphere

The client wants to know what is being said (written) about their organisation. They have a clipping service that provides news clippings from hundreds of news organisations. They still feel in the dark.

There are half a dozen good weblog search engines. There are somewhere between 70 million and 100 million weblogs. If the client has a high enough profile (and if they don't they won't be thinking about this), the odds are good that people are blogging about the client organisation and its competitors.

It's simple secondary resarch--not as easy as it used to be, but it's a legitimate gig, providing hard evidence of what people have to say publicly without prompting. Some of the people will be on a rant, others on a roll. But if you want to know what people say unprompted and unsolicited, this is the place.

We're doing two of these projects right now--budgeting our standard rates for secondary (desktop) research at about 4 or 5 days each, with a little left over for report writing. We won't get rich doing this type of work, but it is a useful entry point into client organisations.

There's a few details I've left out--gotta keep our competitive edge, of course--but given that companies like Hewlett-Packard and IBM are doing this with internal resources, if you keep your day rates lower than their internal costs (easier than you might think), there should be some productive work in it for you, too. Go get 'em.

More PR fun with weblogs

I keep wanting to write about weblogs and market research, but I also keep getting interrupted by the cluelessness of some organisations about blogging protocol and just plain ethics.

Note to UK newspapers: It's probably not a good idea to plagiarize weblogs (Thank you once again, Tim Worstall and Britblog). Although, in fairness, it does prove that you know weblogs exist--at least some of you.

Rank stupidity exists in any organisation. The Mail on Sunday told the person they ripped off that they had in house lawyers. If they're as stupid as the person who plagiarized the blogger, that may not be of much help.

At the very least, a few emails of complaint are warranted.

PR Disaster Unraveling in Real Time

Let's watch IBM deal with a weblog related disaster in real time. Click here for the back story. An Indian blogger resigned from IBM today rather than pull down his negative posts regarding a third party vendor that buys a lot of kit from IBM.

From a PR aspect, this has legs, and a big downside potential for IBM. As you can see from the post, lots of webloggers are jumping on the story. It received an Instalaunch (a mention from Glenn Reynolds' Instapundit, one of the most widely read weblogs), and it is not just an Indian story.

IBM could learn from Dell, which had its customer service lambasted by Jeff Jarvis on his weblog. IBM could learn from Kryptonite locks, which had its locks exposed as faulty on a weblog. IBM could learn from Sun, which has dozens, if not hundreds, of webloggers who could enter the conversation and give IBM's side of it.

Or IBM could do nothing and further alienate a legion of the most technically advanced and forward looking people on the Internet.

Companies need to do a little bit of research about weblogs, using weblogs, reading weblogs, before they try and confront a weblogger. What was that old saying about annoying someone who buys ink by the barrel?

Mass Marketing Was Never Anyone's First Choice

It's easy now to dismiss traditional marketing and a few hidebound researchers as doddering relics from Lost Empires, hanging onto the stage long after their sell-by date. It's a bit of an exaggeration, though. Millions of people are still consuming media exactly as their parents did, and are reachable via the same strategies.

The problem is that these millions aren't really who marketers want to reach, being by definition more traditional and less likely to adopt new products or concepts. They're also older. The importance of their age will become evident as we talk through how mass marketing can save itself, but for now, let's just note it and move on.

Sending one marketing message to millions of people was never anybody's first idea--people were not stupid 50 and 75 years ago. But mass marketing was what clients could afford and what agencies could produce. As long as it worked, people put up with the inefficiencies. Consumers, clients and advertising agencies put up with the fact that women were confronted with advertising for cars and war movies, while men had to sit through ads for perfume.

Now, however, there are ways to reach more precise segments of the population. This is quite convenient, as there is no more mass to market to. This is also an exaggeration, or at least premature, but with TiVo, podcasts, blogging and niche TV channels all on the upswing, the rationale for a single message sent through a single pipe to the public has disappeared.

This puts the ball squarely in the market researcher's court. What media, which message, what rules of engagement, how to get feedback? That's why I started this blog.

Research Has The Cure

Just as in many other sectors depending on creative talent, advertising as a business currently works like this: Small agency with young talent develops reputation for effective, edgy messages that work. Big agency buys small agency. Bureaucracy strangles any impulse of creativity. Talent leaves, or vastly worse, has their creativity destroyed during the process. Repeat ad absurdium.

The result is that there are now a handful of behemoth agencies in the world with thousands of employees. They cannot live without huge accounts involving campaigns worth millions of pounds. But those campaigns are no longer effective in persuading consumers. Bit of a dilemma, isn't it?

As I noted in my previous post, marketing is not going away. Direct emails, Blogads, search engine advertising, all this is growing exponentially. But much of this growth does not require the intermediation of an advertising agency. This is because direct marketing is a real response (not a perfect one, obviously) to the failure of mass marketing.

It's not a coincidence that direct marketing, the effectiveness of which can be measured, is growing. This is because direct marketing can produce statistics on the advertiser's return on investment. Direct email marketers can go to a direct client and say, 'Here are the server logs. We sent this number of emails, which were opened by this number of people. This number clicked on the link in the email to visit your site. This number of people made a purchase (they know this from cookie placement) and this is how much they spent.' At the end of the day, even if a specific direct marketing initiative is less effective than a mass marketing campaign, at least the buyer knows what they are getting for their money spent on direct marketing. And the buyer can show this to their cost-conscious boss.

It is a signal failure of the market and marketing research community that, decades after the introduction of mass marketing, researchers have not been able to produce metrics showing return on investment. It's not an excuse that marketers did not want those metrics (which show failure as well as success).

That can change now.

Marketers have a problem

Hi everybody,

Since everybody's talking about New Marketing--and capitalizing the letters, which is ominous--I guess we'd better start talking about new marketing research.

It's appropriate. There are new ways of collecting information. There are new markets to measure. There are new ways of marketing. So why not? (ed. But we just finished convincing people that Internet research would work. We're tired.)

Okay. The real reason we need new marketing research is that marketers are terrified. It must seem to them as if their world is falling apart.

The Telephone Preference Service last month registered its 10 millionth UK household asking not to be contacted by direct marketers.

erinMedia has filed an anti-trust lawsuit against Nielsen about who's measurements are better, because everyone is finding it difficult to measure who's watching commercials in the world of digital video recording.

And people aren't going to the movies any more... in South Africa, Canada, and in the United States until last month.

But it gets worse... Look who else is reporting declining audiences: Broadcast television networks in the U.S. and here in the UK, AOL, even the Boston Symphony Orchestra.

Clearly, something is changing. That something is us. The change seems to be that we've found the Off Button. Just disconnect--the slogan for the decade.

The problem for marketers is that, although they cheerfully charged more money when audiences were climbing, they seem somewhat reluctant to accept less money now that audiences are shrinking.

That's where market research comes in--especially if it's new market research. When times are tough, you need more and better research.

Especially because the cure is worse than the disease. Because the real problem is not that marketing is disappearing--it's that new marketing doesn't really need old marketers. But that's another story.