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MR Perspectives is a twice-monthly newsletter that provides perspectives on market research topics of interest, best practices tips, emerging trends, quick case studies, and other useful information.

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March 31, 2005    Phoenix

Marketing Conference

The Council of American Survey Research Organizations (CASRO) is hosting a Marketing Conference entitled “Successful Strategies that Drive Growth” at The Wyndam Phoenix Hotel in Phoenix, Arizona.

April 4-5, 2005             

Atlanta

ISO 9000 Summit

The American Society for Quality will hold its 12th Annual ISO 9000 Summit meeting, including courses, a conference and the U.S. Standards Group meeting, at the Sheraton Atlanta Hotel in Atlanta, Georgia.

April 7-8, 2005

Washington

AMA Marketing Research Boot Camp

The American Marketing Association will host a Marketing Research Boot Camp at the Wyndham Washington D.C.

Jean-Baptiste Promoted

David Jean-Baptiste, former assistant process manager at Polaris, has been promoted to Information Technology Manager.

He is in charge of internal technical support for the company, handling IT analysis and design and managing outsourced programming. He will continue to act as Polaris’ SQL server administrator while taking on additional responsibilities for programming administration and maintenance.

Design Research with Results in Mind

Marketing research results should be relevant, useful, and actionable. Frequently, however, companies find results from a study they have commissioned either simply confirm what they already know, or are merely interesting and fail to generate information that can really be put to use. These situations could have benefited from a research design created with the desired deliverables in mind. Through a collaborative effort between sponsor and researcher, the shape and format of the report can be envisioned before the first data is collected.

Professor Alan Andreasen, in an article for the Harvard Business Review, advocated a “backward” approach based on the idea that the best way to design research is with the final report in mind. His procedure goes as follows:

• Determine how the research results will be implemented
• To ensure the implementation of the results, determine what the final report should contain and how it should look
• Specify the analyses necessary to “fill in the blanks” in the research report
• Determine the kind of data that must be assembled to carry out these analyses
• Scan available sources of secondary data to see if what you are looking for already exists
• If no such easy way out exists, design instruments and a sampling plan that will yield the data to fit the analyses you have to undertake
• Carry out the field work, continually checking to see whether the data will meet your needs
• Do the analysis, write the report, and watch it have its intended effect.

By starting off with a vision of what the final deliverables will include, the marketing researcher is able to align the entire program around how best to generate these results. The researcher can create a streamlined questionnaire leading towards the desired outcome, without wasting time asking questions about issues that will not help lead to actionable results. This technique also helps reduce costs for both researcher and sponsor, and leads to a more efficient and consistent experience for respondents.

Take for example an auto dealer that has commissioned a study on who is purchasing its products. Prior to fielding the survey, this dealership solicited feedbacks from its sales people and found that women more than men tend to prefer Car A. Without having considered the actionable items it would like to get out of the research, the dealership might structure its questionnaire on confirming or disproving this hypothesis. When the results come in and women are indeed more likely to prefer Car A than men, the company has a perfect example of interesting, but not necessarily actionable, results. The dealership is more knowledgeable about its customer base, but does not necessarily know what to do with this information.

Given the same situation, had the dealer and its researcher designed the research around actionable results, the survey could have included additional questions on the likely perspectives of women customers to various dealership aspects of the buying experience, to the financing experience, or to advertising and promotion techniques. The resulting report would not only give the dealership a better idea of what segments prefer particular cars but also would tell them how best to target these groups to get them into the dealership.

Popular Customer Loyalty Programs Still Have Their Pros and Cons

Programs rewarding customer loyalty have surged in popularity across many different industries in recent years. Proponents say such programs create a lasting bond with the customer, create opportunities for selling, drive interest in new products and services, and prevent churn among the most loyal customers – the 20 percent of customers who contribute 80 percent of revenues. These programs also allow marketers to obtain important data about their customers and create incentive programs customized to reach various market segments, according to a recent article in Sloan Management Review.

Despite their popularity, loyalty programs such as airlines’ frequent flier miles have come under fire by critics who claim that they do not fundamentally change behavior. Instead, they merely bribe a customer to purchase again. These critics contend the “top 20 percent” of customers that many of these loyalty programs target are, in fact, not necessarily the most loyal buyers, nor are they the most profitable. These criticisms are compounded by evidence that loyalty programs are often established only in response to a competitor launching a similar initiative, and are not the result of a proactive strategy.

When considering whether or not your company should create a loyalty program, consider the following:

• Will your program have a unique offering? If it can easily be matched by a competitor, you can be sure that it will soon be countered and a lose-lose situation will result.
• Do your firm’s core customers purchase several different brands? For them, a loyalty program is unlikely to change behavior in a cost effective manner.
• Are the loyalty rewards aligned with your brand’s core values? Loyalty programs provide expensive benefits to customers who may not be in line with a brand’s positioning.
• Does your program target the right customers? Research shows that loyalty programs targeting the wrong segments of customers are almost certain to cost more than they bring in.

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