Don't Know How to Use Customer Research to Increase Sales."
Also look at: Creating
Consumer Research and Focus Groups
to improve Sales
By Gary Witt, Ph.D.
Research is one of those activities which most businesses want
to do, but somehow never get around to doing. Instead, they tend to
rely on "gut instinct," customer feedback, and monthly
product sales figures. Part of the reluctance to do research is an
unstated fear that research is hard to do, hard to understand, and
expensive. It's for the "big boys." Of course, research was
often one of the things that helped them become big boys.
This article looks at some of the fundamentals of research which
every business person should be aware of, then looks at one useful,
simple research tool: the focus group. A separate article looks at
creating a simple but effective survey and picking the people to take
it. (Click HERE.)
Why might consumer research be useful to you? Would you like to know
which consumers are most likely to buy your product or service? What
criteria they are most likely to use in deciding? What your brand
image is in their minds? How they feel about your brand versus your
competitors? What price they would be willing to pay? Of course you
would. That's the value of research.
Don't shy away from research. If you can run a business, you can
do the basic research that will help you understand your buyers and
see your product through their eyes. If you can afford
professional help, you'll learn more. But with even a little money,
you can learn enough to give you valuable ideas about what you're
doing wrong, and how to sell more.
TYPES OF RESEARCH: There are two basic types of research:
Qualitative and Quantitative.
If you want to understand in depth what your buyers want, like,
dislike, fear, and need from your product, product class and
industry, you want to do Qualitative research. There are several
ways, but the most common is the Focus Group. In the last part of
this article you'll find some basic guidelines for doing a Focus Group.
If you want specific, numerical evaluations of your product's
features, you want Quantitative research. The most common method is
the Survey, which we'll construct next month. A survey uses a set of
questions, often with a selection of answers, to learn more about the
buyer's attitudes and behaviors. Surveys allow you to collect data
from a lot of people and combine it into average scores. For example,
if you wonder about people's attitude toward Real Estate agents, your
Survey could quickly collect evaluations on a dozen different
attributes, like honesty, reliability, courtesy, and so on. The
average score could show you where your profession is strong, and
where it needs improvement in the minds of your customers.
FIRST STEPS: Like anything else, good planning yields better results.
If you want to do research of any kind, here's how you need to proceed:
1. Go someplace quiet where you can think. Take a notepad. Ask
yourself, "What are my five biggest problems related to
buyers?" It might be poor sales in one line, or poor response to
direct mail ads, or not enough store traffic. Then ask yourself for
each problem, "What should I know about my buyers (or desired
buyers) that would help me figure out what to do?" Your research
should have a specific purpose grounded in its value to your
business. That way you can judge what is important to know, and what
is just "interesting."
2. Call a meeting of all the people who will use the results of your
research. Tell them to bring a list of ways in which they could use
some good consumer research data. Marketing will have one set of
ideas, while sales will have a different set, and long-range planning
will have a third set. If you have managers who wear more than one
hat, tell them to prepare lists for each type of responsibility they have.
This is a brainstorming meeting. Have someone write down all the
ideas on a white board or large pad. Consider your current customers,
and those you want to attract. Then as a group, put the ideas into
three categories: Must Know; Should Know; and Nice to Know. Be tough.
Every idea on the Must Know list should be justified.
3. Compare the Must Know and Should Know list with the one you did,
and create two final lists. Turn each idea into a question, like
"What do customers think of our self-service drink island?"
Review the questions to be sure they cover all the topics you'll need
to know about. That list gives you the target you want your research
to hit. Knowing the target inside the buyer's mind is the bedrock of
SECONDARY RESEARCH: There is probably some data out there
about the topics you're interested in. Looking for it is called
secondary research. Usually there are four major categories to look
in: (1) Research you've done before. (2) Government publications,
like the Statistical Abstract of the U.S., the Annual Survey of
Manufacturers, or the Beige Book. (3) Trade and marketing
periodicals, like Journal of Marketing, Journal of Consumer Research,
or your industry's trade magazines. (4) Commercial Sources. These
companies specialize in providing research, such as A.C. Nielsen does
on TV ratings, retail sales, and magazine circulation. Other
well-known companies include Market Research Corporation, Market
Facts, and Simmons Market Research Bureau. There are many others. The
Internet is a great place to start searching for secondary research information.
The value of secondary research is that someone might have already
found the answers to some of the questions that concern you, or that
the information will help you to create better questions.
FOCUS GROUPS: Focus groups are very useful in generating new
ideas for product improvements, new products or new ways to use
existing products; understanding your buyers' perceptions of your
brand and competing brands; testing new concepts, like an advertising
approach, packaging, a new distribution channel, a new brand name,
and so on.
Focus groups will help you understand a lot about how consumers
feel and think. The disadvantage is that the results are usually
not quantifiable (you can't turn them into percentages or averages),
and they are not generalizable to your entire target consumer
population because the sample size is so small. But the depth of
ideas and attitudes focus groups uncover make them one of the most
popular forms of research.
Focus groups usually consist of 8 to 12 people from your target
consumer group. They are selected on the basis of certain shared
characteristics (like "smokers" or "over 65,"
etc.) Size is important because you want the group small enough so
everyone has an opportunity to talk, but large enough to give a
diversity of perceptions. Try to stay away from members who would
naturally dominate the others, like a boss with his/her employees.
That reduces spontaneity and increases the number of "safe"
ideas. Whenever possible, its preferable that no one in the group
knows the others. Members are often paid a nominal fee for their
help, and provided with food and drink at the meeting.
The meeting should be in a quiet room with a table and comfortable
chairs. Professional focus group researchers use a room with a
one-way mirror so the client can watch unnoticed. No outside
distractions, like telephone calls, crying children or street noise,
should be permitted. Give everybody a name tag and be sure they can
all see each other.
Your moderator is important. The moderator exercises a mild,
unobtrusive control over the group, guiding the topics, raising
questions, keeping the group on track, but never injecting his or her
own ideas into the session (including such comments as
"great," or "wonderful.")
Some of the most important qualities of a good moderator are that
they appear interested in the topic, treat all the guests with
respect, have enough knowledge about the topic to explore useful
areas of concern, and be a likable person without distracting
attributes like bad breath or poor grammar. The most common type of
comment the moderator makes is "Could you explain your idea a
Usually no more than a dozen questions or topics are raised by the
moderator during the 90 minute session. The moderator encourages all
members to voice their opinion, and to respond to the opinions of
others. The session is recorded, with the permission of the group,
either on audio or videotape, for further study and analysis.
You can learn a lot just by listening or watching the tape a couple
of times. However, keep in mind that the opinions of two or three
people aren't necessarily representative of the majority of your
target buyers. Think of focus group ideas as springboards for
investigation, rather than signposts for change.
There are a number of more sophisticated techniques to use in
evaluating the responses. These and a great deal of other useful
information can be found in several books on focus group research,
including Focus Groups, a Practical Guide for Applied Research
by Richard Krueger.
Focus group results often provides good ideas for changes in the
product or marketing strategy. These specific ideas can then be
pre-tested using quantitative research, such as a Survey.
Click HERE to learn more about
constructing an effective research Survey.
(c) Gary Witt, 1998
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