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Breaking Market Research Rules to Drive Business Results

I don’t know about you, but I’d rather do meaningful research that will be put to good use than something no one will ever use. Market research is waking up to the potential that new technology and, especially, new thinking can offer.
mra market research conference 2012

Spent a good bit of last week at the MRA conference in San Diego. The weather was overcast and cloudy for the first couple days, a perfect metaphor for the general mood of the industry and uncertain outlook the future holds for us. But as always, I saw a lot to be optimistic about. In particular the first and second to last presentation I watched featured experience researchers who are enthusiastically embracing the opportunities that exist today.

Hal Bloom of Sage Software talked about their satisfaction research using a standard likelihood to recommend approach. They attempt to survey every customer every year and succeed in getting 20% of them to respond. This means tens of thousands of surveys with a multiple of that in terms of open ended responses. Sage makes extensive use of text recognition software to determine sentiment and help sort out who their most vocal promoters and detractors are. A great use of new technology, but what struck me even more was what they do next.

I should point out that Mr. Bloom has years of experience as an effective practitioner. Despite this research pedigree he abandoned one of the fundamental rules of market research…namely anonymity. He does so in a completely ethical way…being very clear with respondents that Sage might follow up directly based on the answer they give. Some researchers might find this appalling and if so they’d probably be really appalled by how they handled detractors.

Like most well-run companies, Sage doesn’t have many detractors, but of course they have some. When their surveys find a detractor they read the concerns raised and then they contact the customer to try to make the situation right. Some they can fix, others they can just apologize and still others all they can do is commit to work on the problem. Sage also has top executives call a random sampling of promoters to thank them for their loyalty. Over time this program has helped improve the satisfaction of customers, raised their net promoter score and driven revenue and profits. So instead of focusing on being a purist, Sage’s researchers focused on what was really important.

On the last day of the conference I got to hear from Barry Jennings of Dell Computer. He too has solid credentials and a researcher with experience in various aspects of market research and a full understanding of how to do textbook research. Like Mr. Bloom his talk was focused purely on how to use research, even if it isn’t in its purest form, to drive results.

Mr. Jennings spoke about Dell’s extensive use of social media and online communities to better understand the market place. In Dell’s case these communities have helped them get feedback from the market faster and cheaper than traditional means allow. Of course, these communities don’t pass any traditional research tests for being representative, nor do they allow for the easy implementation of methods such as discrete choice. Mr. Jennings recognized and acknowledged these weaknesses, but he doesn’t let that get in the way of driving results.

Often, he said, traditional research results would arrive after top execs had made a decision. Now he is able to hit them with results gleaned from one of their online communities as soon as issues arise. This doesn’t mean they always listen, but it does mean that they are making a better informed decision. This has also allowed Dell to save a big part of their research budget that otherwise would have been spent on research that was too late to be of any value.

Of course, from a research agency perspective Dell saving money isn’t a good thing, but in this case there is a silver lining. Dell is able to redirect the money they save toward more meaningful research. This might be larger sample cells or new product development research that previously didn’t fit in the budget. I don’t know about you, but I’d rather do meaningful research that will be put to good use than something no one will ever use (full disclosure: we don’t work with Dell).

I’m sure many left the conference seeing these and other presentations as another sign of the degradation of our industry. I’m not the only one left with the opposite view. Market research is waking up to the potential that new technology and, especially, new thinking can offer. That is what drives my optimism.

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3 Responses to “Breaking Market Research Rules to Drive Business Results”

  1. Steve Needel says:

    June 27th, 2012 at 2:31 pm

    I’m not seeing a lot of rule-breaking here, unless Sage and Dell are doing things that are inappropriate with their samples. For Sage, it’s not marketing research per se, but customer satisfaction research. As long as the responder has opt-in for re-contact, I’d say this is great customer service and not rule-breaking research. For Dell, on the other hand, if they are making decisions based on an unrepresentative sample (and let’s be very loose about what we mean by representative), I don’t care what kind of results the research drives, it puts the decisions at risk. The key here is how BEHAVIORALLY representative their sample is. If they behave like an other computer buyer, then they are sufficiently representative. If their buying patterns are different from the gen pop (say more high end, for example), Dell is doing shoddy research unless they want to know what high end buyers think.

  2. Taneli Rautavaara says:

    July 31st, 2012 at 3:34 am

    That is new,breaking a market research rule might be not good,you can say that it will drive your business,well that was an interesting points,most of the business in part of the Helsinki Finland they use what people grown up for market research and still it is effectively drive a business.Anyway you got a very challenging one and it was really excellent.

  3. Saul Dobney says:

    September 13th, 2013 at 6:47 am

    I thought back in the 1990s or early 2000s the MRS had to adapt it’s rule to adjust for exactly this type of customer satisfaction and voice-of-the customer work. I presented a paper on this type of thing in 2000 at the MRS conference.

    As a previously long-standing customer of Dell’s I’d be extremely pleased if they listened to the huge numbers of grumbles on tech sites about laptop screen resolutions.

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