Why is it that large institutions dehumanise us?

Posted on October 6, 2015 by Chris Radford

I was at an event on Monday, where I got some insights on the role of government and large institutions in defeating poverty. I left with a strong sense that achieving this task is inhibited by the way large government and business institutions don’t work for people. This article sets out preliminary thoughts. Answering the question will take longer than is possible here.

This was a Tory conference fringe event organised by Tim Montgomerie of The Good Right. The event hashtag was #defeatingpoverty. This featured four government ministers discussing their ideas on how to reduce poverty, increase social mobility and expand opportunity. This may seem ironic to some, since Michael Gove, Sajid Javid, Ian Duncan Smith and Ruth Davidson are frequently attacked by the left for doing things that achieve the opposite of these aims.

But I discerned a theme underlying all their ideas. It is clear they do believe in #defeatingpoverty. But these four ministers have a distinctive take on how to do it. They each believe that it is not the government’s job to provide us with everything we need and give us the money to get out of poverty, but their job is to provide us with the tools we need to help ourselves. The most valuable things the government can do is to provide education, an economy with jobs, healthcare, housing, public transport, infrastructure and essential utilities.

Now, that could easily have been said by many Labour politicians as well.

Conservatives and Labour have similar goals but believe in very different means

It is interesting that if you listen closely to both left and right-wing politicians and dig into their remarks, the surprising thing is they both seem to want similar outcomes. What they disagree about is, what is the best and fairest way to get there.

But the media prefer disagreements to agreement. Agreement does not make good politics and does not make good media. So what happens in the media debates and interviews is that this common aim is obscured and missed and the discussion concentrates on the means to get there. These debates tend to focus on how each side has different means to get to the aim rather than revealing the common ground and purpose.

Labour argue that the conservatives do not understand what it is like to be poor and disadvantaged. The Conservatives just look after their rich friends and the tax and business policies are evidence of how the conservatives are nasty, self-interested and unfair. Austerity targets the poorest and the rich thrive.

Conservatives argue that Labour ideas are too expensive, we cannot afford them, that they remove the incentive to work, they do not celebrate excellence and suppress individual initiative and enterprise. Labour policies are prone to create higher tax and spend, reduce our competitiveness and depress growth which creates more poverty.

Now I know that the arguments from each side are more nuanced and go into greater depth than I have done here. But if you dig deeper into the speeches from each side you will find that there is a commonality of aim but a disagreement about means.

Because they favour different means, when describing aims, they each use different language. The Conservatives talk about opportunity, family, jobs, growth, choice, excellence. Whilst Labour discuss fairness, social justice, jobs, public ownership and control, growth. Each side emphasises these because they each believe they are the most important means to reduce poverty, increase social mobility and expand opportunity for all not just a privileged few.

So whilst it seemed odd to some people that the Tories should hold an event titled #defeatingpoverty, for me it is not bizarre at all. The Good Right within the Tories is a subgroup that champions this purpose. It is great to see this as an aim expressed clearly within the party

But if the both Labour and Conservatives agree about the aim, who has the right answer on the means to achieve the aim? The Conservatives or the left-wing alternatives?

The left argue that the market punishes the weak and the only way to fix this is through collective action by government and government taxation. This is the best way to help the weakest and to lift them out of poverty. The right argues that the dead hand of government suppresses initiative, creativity and enterprise and business is better suited to many tasks. But in my view both of these arguments misunderstand the nature of large-scale institutions and the way they do and don’t work.

Large institutions are letting us down

After Thatcher, it was generally accepted that government-run organisations and businesses are not efficient or effective at many tasks and they should leave many things to the private sector. Business does it better goes the argument.

But in the 21st century we have increasingly seen that it is not just government run organisations that can fail but many badly run, inhuman organisations of all types from business, government and not for profit sectors. In fact in many areas, the government do things better. (There are great hospitals, schools and transport services that show this).

We have recently seen a number of dramatic examples of institutions that do not serve the people they exist to serve. If we want to help people lift themselves out of poverty or help them get anything else done, then we need to address the way our larger institutions are not working for people or to help people. I would highlight three areas of concern

1. When people go to work in large institutions of business, government or charity they can lose their humanity and their talent to be people.

Steve Hilton wrote about this in More Human and analysed it in many different fields

Something strange happens to people when they cross the portal of their workplace each day. They lose some of the skills they naturally have at home and with their friends.

I frequently observe that people in their personal lives understand how to flourish and understand how to interact with people, so they connect with others, are active in their lives, take notice of what happens, keep learning and find ways to give. But as they go to work they feel they are not allowed to do this and they stay within their job descriptions, are constrained by rules and remain in their silos at work. At its worst they develop a sense of entitlement.

This is manifest in all levels at work from the customer service handler who cannot help the person on the phone, to the executives at Volkswagen who thought they could cheat the government and the public for 10 years, to the bankers who have lost sight of their purpose to serve customers, the charities who bamboozled older donors into giving more money. There are news stories every week and we all have experiences of dealing with institutions and being frustrated, horrified and indignant.

2. Large institutions and government favour single national solutions. But single national solutions to do not encourage the development of creative, innovative ideas. They tend to suppress initiative.

Even though everyone loves the idea of it, the NHS is now a monster that we cannot control and most worryingly many staff are very disheartened, frustrated and just want to leave even though they love looking after people.

The history of state-funded education since 1975 has been pretty disastrous under both Labour and Conservative governments. And again we see that many teachers feel like the NHS staff. They are disheartened, frustrated and just want to leave even though they love young people and love their subject.

Large businesses very rarely create great innovation from within. However, they have come up with a solution. What they do is wait for smaller businesses to come up with stuff and then acquire the smaller business and apply their investment and systems to scale it and grow it. But in this solution the innovation and fresh thinking happens elsewhere away from the larger business. There are a few examples that contradict this, but they usually involve one extraordinary individual (e.g. Steve Jobs, Richard Branson, Larry Page, Bill Gates) who operates like a small business owner but with big business money.

3. The welfare state focuses on what people are not or don’t have rather than what they can do or might achieve.

Alex Smith has written about how the welfare state has provided a safety net and done many great things, but there has been an unfortunate side effect. It addresses what people have not got and what they cannot do. It treats those it helps as dependents. It has led many of those who depend on it to become disconnected, inactive, have narrowing horizons, and a sense of entitlement. It is disempowering them and creating an environment that discourages initiative and self-help. Whereas people flourish when they connect, are active, take notice, keep learning and find ways to give.

Click here to read more

So my title question was: Why is it that institutions dehumanise us?

In this article, I have written about why I think this question is important. I have not answered it yet. I will follow this up later. I will also go on to discuss why this matters to business when they create products and services that aim to attract more customers.

What priorities were discussed at the event?

I was inspired to write about these issues due to the debate at the Good Right event on Monday. It is not directly what was discussed, but it was implied in the ideas that we explored. My takeaway from the event was that I feel that I side with the Good Right in believing it is more important to capture the human spirit and our capacity to innovate than to equalise the outcomes for everyone.

Something that matters a lot to me is that all politicians should support the aim to defeat poverty, develop social mobility, build social justice and create opportunity

The team last night highlighted five areas that must be the priority for a government that wants to achieve these aims. These are things that will help us to help ourselves. These are the priorities for the government institutions

Build more houses
Provide better education
Have effective healthcare
Building national infrastructure
Have a growing economy

Thank you to Tim Montgomerie and the team at The Good Right and the Legatum Institute for provoking me to write about this and providing a lot of the stimulus material. You can see more by clicking on the links

So the election pollsters got it wrong? What does that tell us about how we should use market research?

Posted on May 21, 2015 by Chris Radford

The polling business has had some cause for self-examination following their failure to predict that the Tories would get 37% and Labour would get as little as 30% of the votes in the recent general election. And there has been plenty of debate about this. See this article by Ben Page of Ipsos Mori. What I wanted to do in this blog post is to draw some practical observations about what business leaders and marketers can learn from this, where we should use market research and what to be wary of.

But before looking at the implications, what went wrong?

There has been a lot of debate and discussion. I particularly like the assessment made by Dave Penn click here (@davidpenn1) and Keith O’Brien click here (@keithobrien) and discussed by Mark Earls (@herdmeister) and Phil Barden (@philbarden). They argue that pollsters have failed to absorb and react to the implications of Daniel Kahneman’s finding that decision making is governed by two systems in the brain.

System 2 is the rational conscious analytical, slow, considered part. This is what is measured by traditional market research and polls.
System 1 is the subconscious, intuitive, emotional, gut instinct part that is fast and essential to our ability to get by in life. This is not easily measured by market research polling.

Since polling concentrates on system 2 rational thinking and behaviour, it can misread what people are actually feeling and fails to predict what they will actually do.

Political commentators seem to miss this point about system 1, when they debate the order of questions, the methodological differences between phone and online polls, the sampling error. Politicians don’t get it with comments like Vince Cable complaining that people misled him on the doorstep and a sense among the losers that voters were confused or misled or afraid and this explains why they were so foolish to not vote for them.

Lord Ascroft has commented that Lynton Crosby’s team seem to be doing something different and they knew they would win. Even Lord Ashcroft is curious about how they did that?

Can we rely on market research? Should we use it?

Inevitably the measured answer is “it depends”. I have long noticed that there are only really three business questions that market research is used to help with. These questions are

What should we do?
Are we doing it?
What will the customer do?

I would argue that market research is helpful and reliable for the first two and quite hazardous and misleading for the third one. The industry promotes products and services that help top answer all three questions. I would suggest that the industry has not come up with a satisfactory approach to answer the third question. the reason they sell a lot of product to answer that question is that business leaders have an insatiable appetite for the answer to the question “What will consumers do?” Executives like to manage risk and market research is used to justify decisions.

What the pollsters error teaches us is that research is not yet a great indicator to understand what people will do. Some like Dave Penn are using neuroscience and behavioural economics to pioneer new techniques to try to overcome this problem.

What can we use market research for?

Lets look at the three business questions that market research is used for.

1. What should we do?

Whilst consumers find it tricky to accurately predict what they will do and they are not good at imagining products they have no experience of, they can tell us a lot about their lives, their problems, their needs, their frustrations. Also we can observe their actual behaviours.

As business leaders we know that we have to offer customers things that help them address needs and solve problems e.g. feed the kids when they come home from school, get breakfast on the way to work, communicate with my friends. We can watch what people do, we can find out about frustrations and problems, we can measure what really matters to people. We can find this out through personal experience and observations or we can use formal market research. So

Usage and Attitude studies
Observations and interviews in store
Panel surveys and interviews
Consumer workshops and group discussions

This is called exploratory research and if it is well designed it informs our plans. Do not expect consumers and customers to imagine possibilities that we have not shown them. That is our job to create and imagine that.

2. Are we doing it?

Business leaders are suckers for measurement. we want to know if things worked, we want to know about the customers experience, were they satisfied, will they recommend us. This is another area that professional market research is brilliant at. So

Brand tracking
Customer satisfaction
Net promoter scores

These all help us see how we are performing. Provided we did the work properly in the “What should we do?” part and we are measuring things that matter to our customers, then this is really valuable.

3. What will the customer do?

This is where it all goes wrong. It is what business leaders most want to know. The question rings out, “have you researched that?” and executives feel they have to go and that. But much of this work holds out false promise. the worst possible question is

“Will you purchase this product in the future?”

The reason for this is simple. As people we are very bad at predicting what we will do in the future. This is mainly because we do not know what our priorities will be in the future. It is hard to see how market research can help us overcome that. But it is also because of the influence of the unconscious system 1 on our decision making.

My own approach to concentrate all the effort and work on questions 1 and 2. if we get that right and do that well, then the products and services we offer to customers will be attractive to them and enough people will buy them. Asking them if they will buy them does not give us a better indication. Lord Ashcroft understands this and proclaims his polls to be only a snapshot. However even he must wondering about the quality of his snapshots in 2015.

Read this article about Attractive Thinking to see how to answer questions 1 and 2 and avoid the need to use research to answer question 3. This is about coming up with a plan for growth that you are confident will attract more customers.

Top 10 books that changed the way I do business

Posted on May 21, 2015 by Chris Radford

A client (David Edwards from UL) asked me yesterday for some advice on what books he should read to develop his product marketing knowledge. This prompted me to reflect on which books have had the greatest influence on me. All these books have had a material effect on my approach to creating growth strategies that everyone is convinced will work.

Product marketing is about more than marketing, it is about attracting more customers. Over the years I have found very few marketing text books that were really helpful and stimulating. But many books that have influenced the way I think about marketing and attracting customers.

None of these books give a simple answer straight out of the box. They are all thought-provoking and will help you to move your thinking forward. If you want easy answers then look elsewhere, if you like a challenging thought-provoking read, then take a look.

My top 10

The science and laws of marketing

Start with Byron Sharp. He has taken the pioneering work of the late Andrew Ehrenberg and made it accessible to everyone. This is about why it is more important of get more customers, not just focus on customer loyalty. It is about why light buyers matter so much. It is why the 80:20 rule is wrong. It is based on years of research into how people actually behave and not anecdotes and armchair thinking about marketing theory and customer loyalty.

Byron shows us why evidence matters and how to bring science into marketing. Byron shows you that there are 10 laws of marketing and why you cannot ignore them.
Watch his TEDX Talk here

The Text-Book

This is the only marketing textbook I would recommend. It takes the laws of marketing as explained in How Brands Grow and tells you how to apply them to the business decisions you need to make to develop a marketing plan that will actually work.

It is written by whole team at the Ehrenberg Bass Institute of Marketing Science and has some good case studies. It is aimed at university students studying marketing and strategy.

This academic work is known and been adapopted by global brand leaders like P&G, Mars, Unilever, Colgate and Google for some time. It has only become accessible to everyone else in the past 5 years.

Leadership and innovation

Mike Harris shares his experience of creating totally new and game changing brands by taking a radical approach to providing service to customers in conservative industries.

Find Your Lightbulb draws from Mike’s experience of creating game changers in banking (First Direct and Egg) in telecoms with Mercury and in internet security with Garlik.

This book is about leadership and driving extraordinary ideas through your organisation and creating somethign that will attract more customers.

Behaviour and psychology

Daniel Kahneman reveals why and how people’s decisions and behaviours are not entirely conscious or rational. He discovered that we have two systems in our brain, System 2 is the one we all know about, it is conscious, rational, slow and cautious. System 1 is actually the driver of many decisions, it is unconscious, instinctive, fast and very importantly, we could not function without it.

This book helps you understand why people buy, why emotion matters, what triggers a purchase and you will think differently about how to attract customers when you have read it.

Advertising and marketing communications strategy

This report analyses the results of 998 marketing campaigns. These campaigns were all submitted to the IPA Annual Effectiveness Awards. They were all assessed on the basis of the results and the effectiveness rather than subjective critieria like creativity or design

This report updates an important study called Marketing in the Era of Accountability. It tells you what worked and what did not work so well.

This highlights and confirms the importance of increasing market penetration (i.e. strategy speak for “getting more customers” ) and the role of share of voice in building market share. They also discuss and demonstrate why generating emotional response to campaigns is important to get value for money from your marketing

Looking to the future

Nassim Nicholas Taleb shows us that looking to the future is a bit of a mugs game. The most likely thing to happen in the future is an improbable vent that you cannot predict. So stop worrying about it.

His writing is dense and a bit inaccessible, he is a mathematician and ex stock trader with a big brain. But what he writes about is important and has implications for strategy and practical decisions. I wrote about what we should do about this in 2008 in this post.

My conclusion is we should spend less time worrying about the future. We should spend more time strengthening our ability to withstand unexpected shocks. Read here

Social Media

There is increasing evidence that digital marketing and social media are attracting a disproportionate share of advertising revenue as these new media have become more fashionable “must haves” in your marketing plan.

Penny Power takes a different approach and shows us what social media is really for and how to use it to build a following and create a network that will help you and your business and even how the network will help each other.

Penny’s approach echoes the whole Attractive Thinking ethos. It is about attracting people not broacasting to them and capturing them.

This book is a classic, it may be 7 years old, but it is not out of date. It reveals some fundamental truths about who we are, how we interact and what that means for your business, brand and marketing plan.

Strategy

Richard Rumelt has studied many strategies and the book has loads of examples. This makes this very practical and well grounded. Richard invites us to look inside the business for what we can do and what we are good at.

Rumelt dispels popular misconceptions about strategy – such as confusing it with ambitions, visions or financial goals – by very practically showing that a good strategy focuses on the challenges a business faces, and providing an insightful new approach for overcoming them.

Remember a strategy is merely a set of actions designed to achieve a particular goal. This book will bring you back to what really matters, so you create a plan that will work

Getting recognition and being recommended

This book together with the KPI programme showed me a whole buch of stuff that is known by entrepreneurs and not so well understood or taught in large corporate environments.

Daniel Priestley highlights five steps that are essential if you and/or your business are to gain recognition and be recommended. Daniel has talked with thousands of entrepreneurs and gained insight into the problems they have to overcome. The KPI method is an effective way to overcome them.

If you want to develop your career and be secure in your ability to attract customers or employers, then read this.

He has followed this up with another book called Oversubscribed how to get people queuing up to do business with you.

Avoid being misled by common sense

In the 2001 election, William Hague created the Common Sense campaign for the Tories. It did not work.

“Why is the Mona Lisa the most famous painting in the world? Why did Facebook succeed when other social networking sites failed? Did the surge in Iraq really lead to less violence? And does higher pay incentivize people to work harder? If you think the answers to these questions are a matter of common sense, think again.

Common sense is one of the most dangerous ideas that pervades general thinking and our decision-making. Yet science nearly always demonstrates that many ideas that were common sense were plain wrong. (e.g. sun goes round the earth). Duncan Watts will help you fine tune your antennae to detect common sense ideas that are misleading or just plain wrong.

And another 5 books

Inevitably I found it difficult to nail this list down to 10. But the list above is my top 10. Here are my next 5.

Viral marketing, The science of sharing. Shows what goes viral and why
Switch, How to change things when change is hard: Argues that we need only understand how our minds function to unlock shortcuts to switches in behaviour.
Contagious: How to Build Word of Mouth in the Digital Age: Does what it says on the tin
Marketing Manifesto: The booklet from the Marketing Society on what marketing leaders must focus on to increase their effectiveness and impact download here. I helped the team to create this book.
The One Thing You Need to Know: This helps you discover the question you need to answer, get the right answer and then get everyone else to agree with you. You will be better at pitching within a corporate environment.

What is your customers problem? And how will you solve it?

Posted on June 11, 2013 by Chris Radford

Have you noticed that you only get your credit card out to buy something when you have a problem you need to solve? You don’t buy something just because you like it, or because you think it is clever or beautiful. Funnily enough, your customers behave in the same way.

People only buy things when the product or service helps them solve a problem that they have.

Only once they realise they have a problem they need to solve do they choose the one they like or think is clever or beautiful. As a business leader you need to understand the customer’s problem that your product or service will solve. The product most likely to be chosen is the one that does this the best.

Often marketers explanations of a brands success or failure does not discuss whether the business is really helping to solve customer problems and does not consider the real motivations that cause people to want to buy products and then how they go on to choose your brand. Emotional engagement or appeal may well draw customers to choose one brand over another when there is little difference between the choices, but it cannot persuade people to repeatedly buy things that do not offer good solutions to the issue. Emotional engagement tends to be stronger with brands and products that do the best job. It is hard to have a strong emotional engagement with someone who does not help you in some way.

‘Banks should forget about profits and focus on service…’

In Marketing Week last week (6^th June 2013), Anthony Thomson, founder and former chairman if Metro Bank develops on this thinking further by focussing on the needs of the customer before the needs of the bank; ‘profit should be a by-product of giving customers a better product, service or experience, not the reason for being in business…’

http://www.marketingmagazine.co.uk/article/1185327/why-banks-forget-profits-focus-service

Likewise Google’s dominance could be driven by the functional experience delivered to customers. Their search engine strives to do a better job for customers than the others. They apply this principle not just to search results but also to the display of paid for advertising. They do not allow advertisers to be at the top of the page just by paying more money for the ad. The pay for click ads at the top of the list is the best available ads that deliver the best answers to search queries. In contrast Yahoo, Microsoft and Overture all have allowed advertisers to buy their way to the top of the list. Advertisers and search engine optimisers often appear on the press and on web forums debating the fairness or wisdom of Google’s policies for advertisers and for producing search results. Their analysis often assumes Google wish to maximise short term revenues rather than enhance the user experience. But really advertisers wish to manipulate the system to their advantage. Despite the fact that advertisers are the paying client, Google resist this. What Google seem to keep remembering is that consumers of the search engine are who they must please the most.

What this insight shows us is the value of being a truly customer led business that never loses sight of its mission to deliver the best customer experience.

To read more about customer insight and how to effectively apply this to your business visit http://www.differentiate.co/

How do you feel when some asks…So what do you do?

Posted on February 6, 2013 by Chris Radford

This picture shows how I have felt inside for many years.

hair-out-714605

If you have an easily recognised job and you are happy with it, this emotional response may be puzzling to you. The answer is straightforward for you. How you feel about giving this answer depends on how you feel about your job. E.g. I am a doctor, architect, marketing director of xxx, consultant with McKinsey etc.

But when you have set up your own business, or if you work in a field that people don’t easily understand, then it can be a scary or tricky moment. At Differentiate we have been working with clients for 16 years and often struggled to “label” or “describe” what we do as a business.

Why is this a struggle?

Sometimes I am worried about sounding undifferentiated and generic and what to be special and distinctive. So I come up with something that is “different”. But what I have found is that in doing that, all too often I just come across as unclear.

A solution
So I have spent some of the past 12 months working with Mike Harris to be better at answering this question. Mike was founder of First Direct and Egg Money and developed pitching skills in doing this. He now has an approach to solve this problem. He calls it Perfect Pitch.

The emotional revelation for me is that creating an elevator pitch is liberating and confidence building. This means if the situation is just social then I am more relaxed and not worried that I might come across as selling inappropriately. If it is a business context then this is, of course, the first step in marketing a product or service. Be clear what it is. Your customer has to understand what is you offer. Only then can they decide if it helps them solve a problem that they are grappling with.

This post shares my answer to the question “what do you do?”.

All feedback welcome. Please email, tweet @chrisradford10 or comment here.

Is it clear?
Does it make sense?
Is what we did for you?

Here is the shortest one for the elevator (probably still too long)

Clarity
I’m a strategy consultant who helps business leaders create growth strategies that everyone is convinced will work. We work with big firms, but are re-engineering our product to work for smaller businesses as well.

Credibility
I was a marketing director at Pepsi. In 1996, I founded Differentiate to work in consumer products and B2B. Most notably we helped Mars to create CELEBRATIONS and then turn GALAXY into a $200m+ brand in the Middle East. More recently we helped MIRACLE GRO transform its performance as well as reposition some professional service businesses.

Problem
Business leaders have lots of ideas but can be unsure how to pick the winners. And then when they do they struggle to convince everyone the ideas will work.

Solution
We created the EFFECTIVE GROWTH LEADERS programme to address this. This is about coming up with and picking winning ideas and convincing the whole business team the ideas will work.

Mission
We are known for getting results and on a mission to reignite growth in established products and services.

If they seem interested then talk more about the problem and solution……..

Problem – what is the problem I am trying to solve?
We have researched the problems faced by 300 business leaders. They told us they have many insights and ideas but struggle to see the wood from the trees. They sometimes lack the CLARITY they need to pick the winners. Then when they choose a potential winner it is hard to CONVINCE the business to go ahead. This is because BIG GROWTH ideas are disruptive. And disruption creates risk. The business needs convincing the RISK IS WORTH IT. This is not easy. It takes an ENTREPRENEURIAL mindset and determination to do this. We call these people INTERNAL ENTREPRENEURS.

Solution – how do we solve this and why is it believable?
We have a 5 step method to address this. We create clarity and evidence using research, analytical tools and workshops. This 5 step method is the Effective Growth Leaders programme. At the end of the process, you know which changes to the product, the branding, the marketing or the distribution strategy will be most EFFECTIVE at driving growth.

What is our next game? Where is this going?
This is high end consulting that works, but it costs over £50K. Many mid-sized businesses cannot afford this. The GAME CHANGER will be to make it affordable to mid-size businesses.
To do this I am taking the analytical tools online. I am restructuring the approach to run 10 clients in one EFFECTIVE GROWTH LEADERS programme rather than just 1 at a time.

Mission and purpose.
We are known for getting results and on a mission to reignite growth in established products and services.

What is you experience of answering this question. Do you have a pitch that is both clear and interesting?

Why social media can be a distraction

Posted on January 17, 2013 by Chris Radford

Cranfield School of Management are repeating a study that they conducted 1 year ago amongst marketing directors. This study explores the operational and strategic priorities for marketing directors.

You can contribute to the study if you are responsible for strategic decisions click here

The previous Cranfield study from 2012 revealed that marketers priorities were around media and especially around the new fashion for social media. The writers think this is worrying and I agree. Will it be different in 2013? I suspect not.

Read the results click here

The reason for my post is to reflect on why marketers seem over preoccupied with media strategy in studies like this rather than the real growth drivers of product strategy, distribution strategy and innovation.

For as long as I have been in marketing, marketers have complained about their lack of influence at the top table. It is clear that finance, sales and operations have the power when it comes to major strategic decisions. The observations made by Cranfield in this study describe this problem. Yet then when asked about their priorities, marketers still focus is on a narrow part of growth strategy.

I have consistently noticed that the most effective growth leaders prioritise product strategy, distribution strategy and innovation ahead of media. They see media as a part of the marketing mix and often a secondary part.

As an example of this, I have recently been involved with a group at the Marketing Society who are working on a marketing manifesto that exhorts marketers to focus on business fundamentals. We also have been looking at the ways marketers build their credibility within the business so they can be more effective. The experienced marketers on this working party know that media is important but not the fundamental driver of success.

Most of the people I meet in business seem to understand this and understand what are the real growth drivers. But then this study arises and I wonder why we get these results? It remains a bit of mystery to me as to why we still see results such as are seen in this Cranfield study.

Tip of the week

I am a big user of social media. It has a role to play and you ignore it at your peril. It is true that for some new and smaller businesses they built their customers with social media, so it is a priority for them. But many businesses built their business in other channels and social media cannot deliver the reach and penetration that they need to get growth.

We all know that we don’t buy stuff because we find it in social media we buy stuff because it helps us solve a problem we have got and it is available to us and we can find it when we need it. This is why product strategy and distribution strategy are the growth drivers

Be clear on your business fundamentals. Make your priorities on the real growth drivers. they usually lie in product strategy, distribution strategy and innovation. Experiment with social media, but do not be distracted.

Why is market research so expensive and so slow?

Posted on November 13, 2012 by Chris Radford

Market research is nearly always sold as customised to your needs

Because it is assumed that every situation is a bit different and customising the study is therefore essential. But is this really necessary and is this that the best way? It certainly keeps it high cost. It also slows things down as the survey has to be designed and the results need custom analysis.

Image from www.techiemania.com

If you ask for a custom study then the market research provider will offer it.
Agencies do this because they believe it is what their clients want. And we all like to feel our unique circumstances are being attended to. So studies are presented as customised and custom flexibility is provided.

This is most obviously true of high end market research firms. This is not surprising it is in their interests to provide a good service and charge accordingly. But surprisingly it is also true of self-survey software like survey gizmo and survey monkey. They present their product as something that you can customise to your needs. The whole emphasis is on flexibility and customisation.

But is customisation the best way?

Yes it is easier to flex it to your market situation. bUt it also leads to market research forms and their clients endlessly reinventing the wheel and learning from mistakes that others made before them.

Maybe it would be better to stick with proven best practice

This has learned from the mistakes of others in the past. This means using fixed formats of research recruitment, survey design, data collection, analysis and reporting. So this is not just in how you manage the study and the analytical tools but also extends to exactly how the study is delivered, analysed and reported. Fixed survey formats also have the potential to reduce the human error factor (dodgy presentations!) and create more reliable insight and decision making.

Now in reality many research studies use proven methodology and repeat it many times. But a lot of customisation is allowed in how it is done and delivered. Is this wise?
How many formats should there be. Maybe not very many.

The only point of market research is help you make a decision

Thus you reduce the risk you make the wrong decision. The goal is not to gain an insight (often stated as a goal) but to make a decision that transforms your business performance. When you examine all the research that is done for business organisations. It all boils down to three decisions. Maybe there are only a few formats needed.

Ask what should the business be doing e.g. change the product, message, service, packaging, media to meet customer needs (e.g. U&A, trend data, exploratory research).
Ask how well the business is doing what it should be doing? Know how to do a better job to delight customers. (e.g. tracking studies, retail audit, customer satisfaction).
Decide which product customers will buy more of or pay more for? (e.g. concept test, market test).

There are lots of different ways of tackling these questions.

Discovering which is the best , standardizing the method and making it even better offers the prospect of much better research at much lower cost and with much greater speed.

This would benefit existing market research users. But it would also enable smaller businesses to access tools that were previously kept back for large firms. Presently smaller firms are left to build their own surveys in self survey tools and make all the mistakes that a novice will stumble across.

Web technology makes this feasible. It enables standardisation, it reduces cost, it opens up new ways to collect data, it makes things quicker.

So far the market research industry has struggled in its use of the web. It has not sought to change the business model which remains based around high cost personal service. Market research has treated the web as a replacement for face to face quantitative fieldwork. Other industries have been more ambitious. Maybe market research can go much further than it has.

At Differentiate we are working on how to make a contribution to this kind of breakthrough change. Any comments or thoughts would be really helpful.

Attractive Thinking

Blog and website from Chris Radford

Category Archives: Effectiveness