By Gregory Stephens, Windrose Partners, & Jim Dorsch09.07.17
Most of us likely have vivid memories of market research studies that may not have turned out as planned. A number of memorable experiences come from focus groups.
In one study, surgeons told us in no uncertain terms that they (fixers of life) did not cause the problem (post-op reperfusion injury) for which we designed a nutritional prevention. Thus, why were we talking to them? It wasn’t a total waste of money as we learned that obtaining support of surgeons for a post-operative complication would be an uphill battle.
In another set of groups, the project goal was to expand a well-known brand of geriatric nutrition to address the needs of baby boomers, expanding the market. The new products provided convenience, energy, and other potential benefits for the active, aging population. It was well over half way through the first group that we had our “aha! moment.” Up until that point, all the feedback and comments were positive and quite encouraging. Then one gentleman halted the group, “Wait! You mean this is for me? The product sounds great but I thought it was for my parents. (This brand) is what you drink when you are sick or dying. It’s great stuff, but I’m not ready for it.” As you can imagine, we made some modifications for subsequent groups that evening but the feedback was the same. One lesson learned was that once a brand has developed a strong identity (the ultimate goal for many marketers), even with significant efforts, the goodwill may not be stretched far.
Traditionally, budgets for such sets of qualitative focus groups have been in the range of $20,000. Subsequent quantitative research can easily double that. Today, you need to consider if there are more effective and economical ways to achieve your market research goals. There are many new methodologies to conduct market research. Quality secondary data are more available as well as search tools to obtain both qualitative and quantitative insights. There are also a variety of affordable online surveys that can provide actionable insights.
A well-thought-out plan is key to ensure that market research addresses your business goals. My colleague, Jim Dorsch, has extensive background in marketing and market research from fortune 100 CPG to start-up dietary supplement companies. Jim offers the following advice in developing an effective market research program regardless of your budget.
Tips of the Trade
The first step in developing the appropriate market research plan is to define your business model for success. Market research is just another tool to enhance the performance of a business.
The world is dynamic, not static; it is getting more complex every day. There are more choices coming, from more competitors to smaller target audiences every day. Three companies that have successfully addressed this complexity in their meteoric rise are Facebook, Uber, and Airbnb. These companies are transformative, having created enormous investor value in less than a decade.
Each of these companies had to deal with multiple competitors in a changing environment. They were not always the first mover or the best financed. They ended up as big winners driven by these six factors:
The first step is to define potential “big ideas”—those benefits that when delivered would lead to a large, sustainable business. There is no one proper way to accomplish this, but certainly qualitative input from clearly defined end user groups is one source. Another source is industry experts from both within an organization and outside “influencers.” All of these sources should be tapped upfront.
The next step is generating prototypes that are as close to market-ready as feasible. Obtaining reaction from end users to these prototypes is next. The project budget, timeline, and business risk/reward profile will dictate whether end user market research feedback is limited or extensive. In either case, flexibility is important, so measure and plan for adjustments, make the indicated adjustments quickly, and measure again. The market research term for this learning approach is “iterative.” The business plan should include time and resources for several iterations, designed to move initial prototypes to things that deliver an excellent end user experience.
Next, measure behavior. We all know that too often people do not behave as they indicate they will. (If they did, the only market research tool we would need would be a large sample survey purchase intention scale.) The prime measurements for the transformative companies mentioned previously was actual behavior. The prime measurements for our nutrition world should simulate actual decisions and behaviors to the extent possible. There are many web-based systems that create market-type situations on-screen and then measure respondent behavior. The web has made iterative learning almost instantaneous.
The talent, passion, and focus of the people tasked with a specific project are the single most important success drivers. A great team is likely to make any reasonable system successful; an average team—not so much.
Gregory Stephens
Windrose Partners
Greg Stephens, RD, is president of Windrose Partners, a company serving clients in the the dietary supplement, functional food and natural product industries. Formerly vice president of strategic consulting with The Natural Marketing Institute (NMI) and Vice President of Sales and Marketing for Nurture, Inc (OatVantage), he has 25 years of specialized expertise in the nutritional and pharmaceutical industries. His prior experience includes a progressive series of senior management positions with Abbott Nutrition (Ross Products Division of Abbott Laboratories), including development of global nutrition strategies for disease-specific growth platforms and business development for Abbott’s medical foods portfolio. He can be reached at 267-432-2696; E-mail: gregstephens@windrosepartners.com.
Jim Dorsch
Jim Dorsch has worked for 30+ years in Fortune 100 companies most recently as Campbell Soup International CMO and Vlasic Division VP. He has created or led new business development projects generating over $700 million in sales while managing profit centers. He has consulted in the nutrition space, founded a beverage company, and was a partner in a web market research business.
In one study, surgeons told us in no uncertain terms that they (fixers of life) did not cause the problem (post-op reperfusion injury) for which we designed a nutritional prevention. Thus, why were we talking to them? It wasn’t a total waste of money as we learned that obtaining support of surgeons for a post-operative complication would be an uphill battle.
In another set of groups, the project goal was to expand a well-known brand of geriatric nutrition to address the needs of baby boomers, expanding the market. The new products provided convenience, energy, and other potential benefits for the active, aging population. It was well over half way through the first group that we had our “aha! moment.” Up until that point, all the feedback and comments were positive and quite encouraging. Then one gentleman halted the group, “Wait! You mean this is for me? The product sounds great but I thought it was for my parents. (This brand) is what you drink when you are sick or dying. It’s great stuff, but I’m not ready for it.” As you can imagine, we made some modifications for subsequent groups that evening but the feedback was the same. One lesson learned was that once a brand has developed a strong identity (the ultimate goal for many marketers), even with significant efforts, the goodwill may not be stretched far.
Traditionally, budgets for such sets of qualitative focus groups have been in the range of $20,000. Subsequent quantitative research can easily double that. Today, you need to consider if there are more effective and economical ways to achieve your market research goals. There are many new methodologies to conduct market research. Quality secondary data are more available as well as search tools to obtain both qualitative and quantitative insights. There are also a variety of affordable online surveys that can provide actionable insights.
A well-thought-out plan is key to ensure that market research addresses your business goals. My colleague, Jim Dorsch, has extensive background in marketing and market research from fortune 100 CPG to start-up dietary supplement companies. Jim offers the following advice in developing an effective market research program regardless of your budget.
Tips of the Trade
The first step in developing the appropriate market research plan is to define your business model for success. Market research is just another tool to enhance the performance of a business.
The world is dynamic, not static; it is getting more complex every day. There are more choices coming, from more competitors to smaller target audiences every day. Three companies that have successfully addressed this complexity in their meteoric rise are Facebook, Uber, and Airbnb. These companies are transformative, having created enormous investor value in less than a decade.
Each of these companies had to deal with multiple competitors in a changing environment. They were not always the first mover or the best financed. They ended up as big winners driven by these six factors:
- Focus on an end user experience that would provide major benefit.
- Small systems (beta tests) were operating in small areas early in the development process.
- Every system’s touch point with end users was measured.
- Mistakes were made but corrected quickly; speed was critical for competitive advantage.
- Scale-up was fast once the model had been proven.
- There was a passionate, talented, focused small team that thrived on the opportunity to deliver excellence to end users.
The first step is to define potential “big ideas”—those benefits that when delivered would lead to a large, sustainable business. There is no one proper way to accomplish this, but certainly qualitative input from clearly defined end user groups is one source. Another source is industry experts from both within an organization and outside “influencers.” All of these sources should be tapped upfront.
The next step is generating prototypes that are as close to market-ready as feasible. Obtaining reaction from end users to these prototypes is next. The project budget, timeline, and business risk/reward profile will dictate whether end user market research feedback is limited or extensive. In either case, flexibility is important, so measure and plan for adjustments, make the indicated adjustments quickly, and measure again. The market research term for this learning approach is “iterative.” The business plan should include time and resources for several iterations, designed to move initial prototypes to things that deliver an excellent end user experience.
Next, measure behavior. We all know that too often people do not behave as they indicate they will. (If they did, the only market research tool we would need would be a large sample survey purchase intention scale.) The prime measurements for the transformative companies mentioned previously was actual behavior. The prime measurements for our nutrition world should simulate actual decisions and behaviors to the extent possible. There are many web-based systems that create market-type situations on-screen and then measure respondent behavior. The web has made iterative learning almost instantaneous.
The talent, passion, and focus of the people tasked with a specific project are the single most important success drivers. A great team is likely to make any reasonable system successful; an average team—not so much.
Gregory Stephens
Windrose Partners
Greg Stephens, RD, is president of Windrose Partners, a company serving clients in the the dietary supplement, functional food and natural product industries. Formerly vice president of strategic consulting with The Natural Marketing Institute (NMI) and Vice President of Sales and Marketing for Nurture, Inc (OatVantage), he has 25 years of specialized expertise in the nutritional and pharmaceutical industries. His prior experience includes a progressive series of senior management positions with Abbott Nutrition (Ross Products Division of Abbott Laboratories), including development of global nutrition strategies for disease-specific growth platforms and business development for Abbott’s medical foods portfolio. He can be reached at 267-432-2696; E-mail: gregstephens@windrosepartners.com.
Jim Dorsch
Jim Dorsch has worked for 30+ years in Fortune 100 companies most recently as Campbell Soup International CMO and Vlasic Division VP. He has created or led new business development projects generating over $700 million in sales while managing profit centers. He has consulted in the nutrition space, founded a beverage company, and was a partner in a web market research business.
