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Do Incentives Commoditize Surveys Or Reinforce The Relationship Economy?

Three new studies on the topic of market research and incentives indicate that the old idea of a transactional model of incentives may not be enough and that research participants are looking for something more.

Editor’s Note: This was originally published as a guest post on the Virtual Incentives blog here. I’ve reposted it here on GBB because I think this is topic that we should be exploring here as well. If the idea of using incentives as a relationship builder resonates with you, I encourage you to check out other thought leadership content on the Virtual Incentives website; those guys are super smart and really get it.

Much has been written about the tectonic shift occurring in the relationship between consumers and the world around them, specifically in how individuals interact with stakeholders in the economy such as brands and governments. The idea is summarized in The Relationship Economy model which suggests that transactional, one-off interactions are being replaced by longer-term ongoing value exchanges that support growth for all involved.

the-relationship-economy-3

To learn more about Relationships Economy on a macro-level, Jerry Michalski has a great series of Prezi’s here:  http://prezi.com/3igqdq90g-y0/thriving-in-the-relationship-economy/

Colin Strong of GfK sums this shift up in more pragmatic terms very nicely in this recent post for The Guardian:

“Classic marketing strategy has taught us that a consumer’s decision making process is generally linear; the awareness, interest, desire, action (AIDA) model, often represented as a funnel or pyramid and frequently central to assessing brand performance. However, this model needs updating to reflect how relationships change the way consumers shop. Online reviews, blogs and tweets exist at all stages of the model, leading consumers to deviate from the linear process.

Brand owners now need to ensure that they understand the importance of each touchpoint for the brand and on the relationship with consumers. Every interaction matters. This applies whether touchpoints are bought (paid for marcomms), owned (website, retail store) or earned (editorial, social media comment). However, because the relationship-driven brand model is still emerging, there is no history of best practice.”    

The longer term implications of this shift are obviously still to be determined, although the potential seems to be profound. Within the world of market research we are already seeing indicators of the shift in action via the growth of market research online communities, the nuclear-scale explosion of social media-based research (including understanding influence and reach on an individual and macro level), and the rapidly developing concept of the “single-source data exchange” whereby consumers are linking and aggregating their social graph along with transactional, attitudinal and behavioral data and allowing brands access to that data on their terms.      

So what does this have to do with incentive systems, especially for surveys? Quite a bit it seems.

Three new studies on the topic of market research and incentives indicate that the old idea of a transactional model of incentives may not be enough and that research participants are looking for something more here too.

First, my friends at Virtual Incentives and I used Google Consumer Surveys to ask 1,500 consumers balanced to US Census a very simple question: “When asked to take a survey, what incentive model is MOST appalling to you?”

We used a list of five common incentive programs as the choices: physical or virtual Visa or store gift cards (which Virtual Incentives offers), access to content (the model Goggle Surveys uses), lottery or drawings (a common tactic in panels or user/customer surveys) and points programs (another model used by many panel companies).   

 Here is what we learned:   

incentivechart1

Results were consistent across all demographic categories: age, gender, income and geography in roughly proportionate numbers to the aggregate, meaning that across the board Visa or Store Gift cards are almost twice as appealing as any other reward system.  That is compelling stuff.

incentivechart2

It certainly appears that when given a choice, survey participants prefer a model that delivers value, flexibility, and speaks to their personal preferences that gift cards deliver.  The research process is a value exchange by both parties: the research sponsor is seeking to inform decision making and consumers like to receive an acknowledgment of the value of their participation.

We didn’t dig in deeper to understand what else may play into the preference choices here so it’s entirely possible there are nuances missing, but when we triangulate with other data this growing preference is validated by a study released in December of 2012 by CEB:

GreetingCard_Infographic+(3)
   

Clearly, consumers enjoy utilizing gift cards.

How does that fit with the Relationship Economy model though? Aren’t consumer preferences for gift cards an indicator of a purely transactional relationship with research? Well, not necessarily.

The recent GRIT Consumer Participation in Research study GreenBook undertook with RIWI to understand global attitudes about survey participation (being released next week) showed a surprising high number of consumers who were willing to participate in research for no incentive at all:      

incentivechart3

Now, clearly due to the nature of the RIWI micro-survey model some caution is needed here; it’s entirely possible that the high level of respondents who say they are willing to engage in surveys without any incentive could be biased by the experience of a one question survey; that will be an area that will need to be explored in future research. It’s reasonable to consider that factors like length of survey, interest in the topic, relationship with the research sponsor, and psychodemograpics play a role here.

The RIWI data was compiled from hundreds of thousands interviews across over 200 countries and was weighted to global census data, and it particularly targeted people who did not normally participate in research, so there is no reason not to take it at face value as an indicator of high level attitudes towards participation in research. That being the case, then perhaps this almost equal split on incentives vs. no incentives points to a growing group of consumers who are looking for something more than a simple transactional relationship with research and are more focused on other drivers of value exchange.

Perhaps the reconciliation here does indeed lie with the idea of the Relationship Economy again, and perhaps the way to manifest the value exchange for consumers is in giving them a choice going into the relationship.

To spell it out a bit more, I think it’s worthwhile to stop assuming we know what consumers want and to simply ask them during the beginning of the research process. Maybe our invitations should say something like this:

“We are conducting study on XXXX topic. We’re using a survey to do gather the needed information and it’s going to take you about xxxx minutes to complete it. We value your time, energy, and participation and want to build a relationship with you, so we’re giving you a few choices on how we can show our appreciation. Which would you prefer?

1.       A Visa Gift Card or choice of store Gift Card worth $xxx

2.       $xxx that can be applied to your Amazon Account

3.       Access to the results of this research

4.       Nothing but our thanks and good karma”

Obviously that is a bit simplistic, but the point here is that IF relationships are becoming more important than simple transactions and IF consumers globally prefer some type of flexible and tangible reward such as a gift card as a sign of the value exchange then we need to start tying those ideas together and developing an engagement model that really addresses both concerns.

I do think more will go into this than just the reward type. My belief is that we can learn an awful lot from social games when thinking about our relationship with consumers and in that context consumers seem driven by 3 things:

1.       Fun

2.       Rewards

3.       Social standing

We need to think of how we can combine all of these elements into the relationship with research participants in order to be relevant to them.  

And that brings me to the final report that important here. The 2012 Confirmit MR software survey by Tim Macer and Sheila Wilson, meaning ltd asked market research suppliers about their incentive strategies, and the results fly in the face of what Virtual Incentives discovered about consumer preferences:

confirmit

Although clearly researchers have not entirely missed the boat the reliance upon Points based systems, which clearly are used more than any other model, is not helping the perennial issues of response rates, sample quality and respondent engagement.

The overarching message for me here is that researchers need to re-examine our relationships with consumers and how we honor their participation in the experience is one area that we can immediately begin to experiment in.      

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9 Responses to “Do Incentives Commoditize Surveys Or Reinforce The Relationship Economy?”

  1. Vic Crain says:

    October 14th, 2013 at 8:24 pm

    Hi Len,

    The discussion of incentives is always interesting. The elder Dr. Gallup said, many years ago, that the use of incentives would affect data quality, and I think it has. At one time, the industry was sensitive to “panel effects” and “professional respondents — that is, people who would answer surveys, but whose answers might not be representative of the target audience.

    Now, that doesn’t matter. A few questionnaires ask about past participation, and I suspect most respondent either don’t recall that accurately or aren’t truthful. Panel hosts, daisy-chain survey invitations together — complete one and here’s the next one for you.

    If you actually read the survey results instead of simply tabulating the numbers, you can see respondents who consistently give middle-of-the-scale and don’t know responses. Larger incentives seem to gather more junk data.

    What I didn’t see in this discussion is the notion of segmentation of incentives. Why should the same incentive be equally valuable to a Gen Yer and to a 60s+? How do you tailor the incentive to the target market?

  2. Leonard Murphy says:

    October 14th, 2013 at 8:53 pm

    That is a very good question Vic, and I think reinforces my point that in order for us to get away from the biasing affect of transactional “pay to play” surveys we should rethink the relationship building aspects of engaging with respondents. Part of that is (I Think) developing a range of options that cater to the desires of the consumer. We may even be surprised to find that many don’t want a traditional incentive if the experience is rewarding for them.

  3. Dan Kvistbo says:

    October 15th, 2013 at 9:30 am

    IMHO this article comes across as a poorly constructed content marketing piece for Virtual Incentives, more than anything else. Sad, since the topic is interesting and deserves ongoing attention and exploration.

    Allow me to elaborate my ‘critique’: The ”learning” that people prefer *cash* over anything else is hardly new, but moreover, the referenced surveys appear, well… for starters; using GCS to conduct a survey on incentive model preference introduces the first bias (likely towards ’access to content’?). Secondly, few respondents would distinguish between ”Visa cash or Gift card” vs. ”Virtual cash or gift card” – and keeping ”cash” and ”giftcard” in the same choice alternative might muddle up the signal further. Finally, visa cash – as I understand – implies a minimum incentive of 5$, which would clearly be preferable compared with a likely 1$ worth of points for taking the same survey. In short, there seem to be a lot of noise and not much signal in this data, no?

    I missed the supposedly validating study (as I currently suffer from infograhpic-blindness) and I wanted to dig into the GRIT Consumer Participation in Research Study to understand this better, but the link appears to be dead? From the results that are communicated in the article though, the conclusions on that data makes even less sense than the GCS study. Obviously, saying ”No” to the question of whether I’d like to ”get PAID for taking surveys”, does not imply that I’d be ”willing to engage in surveys without any incentive”. Perhaps the respondents on this question have already been filtered on survey participation willingness – but as a reader I have no way of knowing and in the context, the conclusions appear to be based on assumptions rather than data.

    The Confirmit report is interesting but doesn’t add to the points, particularly since the whole transactional versus relational aspect of the article is a bit muddy at best: for instance referring to the ”old idea of a transactional model of incentives” and suggesting a move to something more relational – while in fact e.g. switching from a point-based incentive system to visa cash would be the exact opposite. In other words, throwing the Confirmit report into the context seems like a rhetorical appeal (not much unlike the reference to Colin Strong’s article) that only serves to (however unsuccessfully) add credibility to what essentially remains a marketing piece.

    My apologies! I have long been a fan of this blog, but this particularly post only left me ever so slightly confused – and certainly not any wiser.

  4. Leonard Murphy says:

    October 15th, 2013 at 1:24 pm

    Hey Dan, it’s always great to hear from you and fair enough points. Here is the chain of events that led me to write this post. First we did GRIT CPR to understand global response rates and attitudes towards incentives. The data was surprising and it got me thinking about the importance (or lack thereof?) of relationships in market research. That question was percolating in my head for awhile and then Virtual Incentives asked me to run a quick poll using GCS as part of a strategy engagement with them. I was curious as to how respondents who were already participating in a content-rewards model would respond to other incentive models. When I saw the data I asked them if I could use it publicly to help shape this post.

    Arguably the questions could have been phrased differently, but I think the data was still very clear that even respondents already engaged in a content-wall incentive survey preferred a more flexible solution.

    That then brought me back to the idea of how could incentives be used to build relationships rather than purely being transactional interactions and I started digging and thinking about how reconcile the two models. The data on Gift Card usage seemed to confirm that consumers like the flexibility of those solutions, and of course when I saw the Confirmit data on the dominant incentive models for panels it crystallized (at least for me) the bigger question of maybe MR needs to rethink our whole thinking on the subject.

    I absolutely agree the topic is ripe for further, more rigorous, research. This was meant to get folks thinking directionally; it was not meant to be an authoritative position. I would welcome the chance to dig in deeper and really come up with a recommendation on this based on a more robust study. Maybe we should discuss working together on that? 🙂

    As to this coming across as promotional, I believe in giving credit where it is due Dan. The Virtual Incentives folks did play a big role in pushing me to explore this topic, and they are doing good work to reposition incentives from a pure cost center into something that reinforces and support long term value. I’ll give kudos to anyone who is trying to make things better.

    Does that help clear things up a bit?

  5. Dan Kvistbo says:

    October 16th, 2013 at 10:17 am

    Thanks for the feedback and clarification Lenny! I first stumbled upon this post on Virtual Incentives’ blog via LinkedIn and was actually left with the impression that it had been written by a Rob Petersen, so I figured that you had merely re-posted it here. Had I realized that you were in fact the author, I would – of course – have been much harsher in my critique! 😀

  6. Kevin Gray says:

    October 17th, 2013 at 7:07 pm

    As a marketing science person I now have more and better analytic tools than I would have imagined possible just a few years ago. Having these new capabilities is often frustrating, however, because the quality of survey data has been in decline over the same period, IMO…”Data, data everywhere, Nor any drop to drink…”

    The “professionalization” of survey respondents, if that is not too harsh a way to phrase it, is certainly one reason. Another, though, is questionnaire design; many questionnaires I see nowadays are simply awful, even before they are translated into a dozen languages.

    There are still opportunities for fieldwork and other MR companies able to move beyond a commoditized offer, even in “traditional” space…

  7. Mark Cannington says:

    October 18th, 2013 at 12:35 am

    It seems you have a typo in your article in this paragraph:

    First, my friends at Virtual Incentives and I used Google Consumer Surveys to ask 1,500 consumers balanced to US Census a very simple question: “When asked to take a survey, what incentive model is MOST appalling to you?”

    I believe it should be, “appealing”, not “appalling”.

    An interesting typo – I wonder which way your respondents read the survey?

  8. Leonard Murphy says:

    October 18th, 2013 at 3:25 am

    LOL; that is a good, and very funny, catch Mark! Thanks.

  9. Should You Give Incentives for Surveys? | QuestionPro Blog says:

    May 5th, 2014 at 4:09 pm

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