Hope to See You in Boston!

I am headed to Boston early next week for the MRA’s Annual Research Conference. I have to admit bias, since I sit on the MRA board, but the educational content and speakers for this conference are outstanding. I truly believe this conference outshines all other industry conferences when it comes to the opportunity to learn.

While people go to conferences for many reasons, educational content is frequently a second thought. At most conferences, you usually see large numbers of people milling around in the exhibit hall or refreshment areas instead of attending the educational sessions. Not true for the MRA conference. People are in the educational sessions. They are taking a lot of notes and asking many questions. In other words, they are learning.

Hopefully you have registered and plan to be at the conference. If not, it’s probably too late for most of you. But if you live in the Northeast, a last minute registration is still feasible. You really should be there.

Airline Satisfaction

I recently had the pleasure of visiting beautiful Glastonbury, CT. It is not an easy place to get to from the west coast. It required a flight to Chicago, then a connection to Hartford. So round trip, I had 4 separate flights.

On this particular trip, I flew United. It is obvious that they are putting renewed emphasis on customer service. While I am happy to see that the flight attendants are a bit friendlier than in the past, I haven’t seen many other changes. I’m hoping this is a harbinger of things to come. Their renewed effort is also clear since I now get an invitation to complete a customer satisfaction survey after every trip.

I am always excited to see research play a role in any customer initiatives. However, I am wondering about their approach. When I entered the survey, they showed me the four legs of my trip. Rather than randomly assign me a leg to evaluate, they let me pick one. This approach is probably good from a customer perspective. After all, if I only had issues with one leg, but I was asked about a different one, I would be frustrated that they did not let me tell them about the flight with issues. By letting the customer pick the leg to evaluate, results probably skew toward those flights that caused some dissatisfaction. Likewise, for customers who had no issues, they are more likely to pick the leg where they had the best experience. This means United doesn’t really get a representative score card. I suspect they know that. This customer satisfaction survey is probably more about giving the customer a chance to be heard. Secondarily, it gives United a report on problem areas.

Is your research broad enough?

On a recent flight back from Dulles, the twenty something sitting next to me asked me what time it was at least three times. This didn’t surprise me at all. In fact, it frequently happens on flights. I’ve learned that his generation generally does not wear a watch. They count on their cell phone to tell time. An airplane is one of the few places where they can’t use their cell phone to check the time. I wonder if watch manufacturers even considered cell phones to be a threat to their industry. Actually, I wonder if a lot of industries and businesses have considered the competition and threat from outside their core area.

• Hollywood Video was probably worried about other brick & mortar video stores such as Blockbuster, but did they see Netflix or On-demand TV as a competitor?
  
• Did parking meters (yes, they are a revenue stream, so I consider them to be a business) see the impact of debit cards, where people no longer generate the change needed to feed a meter?
  
• Did FedEx realize the impact email would have on their business?
  
• And we all know that most newspapers were blind in terms of the crippling effect the Internet has had on so many aspects of their business.
  

Most research, trying to maximize the information garnered for the minimal amount of the respondents’ time, concentrates on the core category and known competition. Such studies would probably never give an early warning of competition from outside the core sector. But this path of efficiency could be dangerous, if not life threatening. I strongly recommend that at least once a year, and ideally twice a year, your research, whether it be qual or quant, explores outside the box. Study evolving ways that consumers do things. Like the cell phone has hurt the watch business, what is lurking out there that could hurt your business.

DIY Disasters: Part 2

My posting last week about DIY disasters seems to have touched a nerve with quite a few people. People emailed me with their own examples. Given the nature of the topic, they choose to email rather than add a comment. After reading some of the notes, I saw a recurring theme. I had talked about design driven disasters. The examples brought to my attention were all about interpretation disasters. In other words, bad business decisions were made based on the research.

A common problem was the lack of perspective. For example, one fairly new CPG company did a concept test. Based on a 35% “top 2 box” purchase interest score, they rolled out the product. A seasoned researcher would question the wisdom of rolling out a product with such a low score. But they thought it was a great score. They felt they could reach a third of the market, which was more than enough for them. The product went to market and it bombed. A detailed analysis of the original DIY results, by a research professional, easily identified the problem.

Another example was an ongoing customer satisfaction study that a service company was conducting via a DIY platform. Everyone was happy with the consistent 80% satisfaction score they were receiving. Then they started losing subscribers. They did another DIY survey, and could not figure out why. They eventually turned to a professional researcher for help. First, they were advised that rather than gloat about 80% of your customers being satisfied, they should be worried that 20% were not satisfied. The typical company threshold for unsatisfied customers is 5-10%. A little analysis gave them some big insights. They failed to see that the dissatisfied customers were downright irate with the service. They also failed to see that these customers were the heaviest users of their services. Losing 1% in customers from this group equated to losing 5% of revenue. They also failed to see that these irate customers were experimenting with competitive services.

In both of these cases, the execution of the research was fairly strong, but the interpretation was weak. Actions taken, based on these projects, were far more costly than it would have been to call in a professional in the first place.