Branding Strategy Insider

Marketing Challenge: Analytics Versus Creativity

Just over a decade ago, Douglas Bowman launched an interactive consultancy called Stopdesign. His work for clients such as Capgemini quickly made him one of the most respected creative directors in web design.

In 2006 Bowman made a big announcement on his Stopdesign blog: he was off to Google to become its head of visual design. Bowman signed off the post: 'Here's to hoping and wishing for a successful adventure and many great things to come.'

Three years and several hundred blogs later, Bowman made another announcement. He was leaving Google for a specific reason: his time there had been blighted by a stultifying focus on data. 'When a company is filled with engineers,' he concluded in a blog this year, 'it turns to engineering to solve problems. Reduce each decision to a simple logic problem. Remove all subjectivity and just look at the data. Data in your favour? OK, launch it. Data shows negative effects? Back to the drawing board. And that data becomes a crutch for every decision, paralysing the company and preventing it from making any daring design decisions.'

Bowman might be working at the new frontier of marketing, but his experiences at Google are just the latest manifestation of an ancient question: is creativity constrained or catalysed by consumer data? In advertising agencies this debate plays out in the constant power struggle between planners and creatives. In market research, it's the qualitative- vs quantitative-method tussle. For brand managers, it's when you either trust your gut or commission another survey. And if you want to go all the way back, it's Plato's conviction that creativity is sent down from the heavens versus Descartes' belief that any challenge can be best answered by breaking it down into its constituent parts. Unfortunately for marketers, we can legitimately find ourselves attracted to both schools of thought.

The Best Marketing is Fluid

When Jerry Springer: The Opera opened at The National Theatre in London almost every critic raved that this most unlikely of operas would become a worldwide smash.

Its success was surprising for two reasons. First, who would have imagined that an opera about Jerry Springer would prove so popular. Second, the way in which the opera was developed offers a best practice approach to product development.

A best-selling opera and a slice of marketing genius were unlikely propositions when Richard Thomas sat down at the piano at the Battersea Arts Centre in 2001. Thomas ran 'scratch nights' where he improvised around the ideas for imaginary and unlikely productions that the tiny audiences suggested.

An opera about Jerry Springer proved to be a fun and fruitful concept and slowly over these sessions the idea solidified. Comedian Stewart Lee attended one of the evenings and the pair agreed to co-write the opera.

Twelve months later the opera was performed at the Edinburgh Fringe.

It was a huge hit with audiences. Critics were not quite as impressed and despite the audience acclaim, Thomas and Lee read each and every review in great detail. They met with many of the critics to discuss their reactions and to collect suggestions for improvements. With a huge amount of input the pair revisited the script and made major alterations to the structure and content of the opera. One audience member who had been particularly impressed was Nicholas Hytner, artistic director of the National Theatre, and it was he who commissioned its London run.

Marketing is traditionally seen as duet of interactions with the potential consumer.

Pre-testing Versus Marketing Instinct

Marketing's age of accountability began in the early-90s. Prior to this, marketing activities were widely seen as a cost and marketers were regarded as 'fluffy'.

These marketers espoused the idea that marketing was an art and an inherently creative endeavour. All a marketer needed to succeed was gut instinct, an extensive vocabulary and an unburdened imagination. They certainly did not need a qualification in marketing, because, hey, marketing is instinct.

With the age of accountability came a focus on metrics, measurement and evaluation. Leading marketers were told that if you cannot measure, you cannot manage, and they set about creating a more systematic and strategic approach.

It became relatively easy to identify whether a company had evolved or not. One classic means of identification was how a company approached its advertising planning. Marketers used to approach their advertising agency with a bundle of strategic goals - none of them derived from research - and then set about directing the agency to create an ad that they (rather than their target) perceived to be acceptable. Consequently, the first time a marketing manager found that their ad budget had been wasted was after it had been invested - sorry, spent.

Evolved marketers use their own research to brief their agency and then review its creative output using the voice of the customer. They do this through pre-testing. Pre-testing is a century-old tradition of taking a fraction of the total ad budget to test whether a campaign will actually work in its present form before that campaign is completed and aired.

In the US, pre-testing has effectively been the norm for decades. In the UK, it remains a contentious and much misunderstood activity.

The Fall Of The Focus Group?

Focus groups, the beloved method of many British and American marketers, are under attack in the US. An article in New York Magazine drew up a long list of focus groups run in Manhattan. They included groups for people who grew up in Long Island, victims of severe asthma, travellers who had back-packed through Mongolia, people of Italian descent, Johnnie Walker drinkers and sufferers of profuse, gland-related perspiration.

The catch was that there was one person, Will Leitch, the author of the article, who attended all these groups, but had absolutely no legitimate reason to do so because he had no experience of the topics.

Leitch has learned how to get on the call-sheets of many of Manhattan's leading research agencies. By lying in the initial qualification interviews about his background and how many groups he had attended, he was able to earn as much as $300 (£214) a session, up to four times a week, as a professional focus group participant.

For years, many marketers have whispered about the single biggest weakness of focus group data - the validity of those being focused upon. Finding participants can be a difficult task, and research agencies can be less than stringent in selection procedures. There is a growing army of semi-professional focus group participants, particularly among retirees, who will happily give their assent to any and all pre-screening questions to pick up some extra income.

Focus group veterans are bad for insight because they usually agree with the moderators' questions and can embellish or invent experiences to fit the bill. By doing so they will be invited back for more sessions and more rewards. Leitch even describes the 'cardinal rule' of focus group faking: don't offer your opinion, just confirm whatever they want you to confirm.

The article could not have come at a worse time for focus group adherents.

Sensible Brand Research Has Only One Formula

I recently completed consulting work for two US companies. The first, which we will call Midwest Stores, is a big grocery store chain. A year ago it repositioned its retail brand based on the findings of a conjoint study.

Conjoint research is very revealing. It allows a company to find out what consumers most want from its operation. In this case, Midwest asked 2000 customers to rate the importance of price, products and service.

While all were important, Midwest's discerning customer base actually valued product range above price and service.

Midwest repositioned accordingly, with the slogan 'Every brand under the sun', and increased prices slightly to offset increased distribution and marketing costs. However, sales have shown no discernible increase.

The second company, which we will call Baxters Yoghurt, also had problems with sales. Baxters is a mid-sized dairy, which has lost more than 20% market share in the past three years and was unsure what to do about it.

Its ad agency conducted focus groups with existing customers, which revealed a growing sense of dissatisfaction. Everything from flavours, quality and product sizes to its latest ads were cited as reasons for unhappiness.

Baxters marketing director was unsure what strategic decisions to take to restore the brand's health. There were so many issues and, worse, the managing director was openly dismissive of the 'fuzzy' focus group results.

Both companies were struggling because their market research was deficient, but ironically each held the solution to the other's dilemma. Midwest is a classic example of a company that solely uses quantitative data.

Focus On Consumer's Behavior, Not Their Words

For a man on the verge of victory, Barack Obama was looking increasingly tense on Monday. With the latest Gallup poll putting him 11% ahead of John McCain, you'd be forgiven for thinking that leading the US through the biggest brand-repositioning job in history was already starting to occupy the thoughts of the junior senator from Illinois. But the real reason for Obama's nerves was more immediate: he did not trust the research. If he did, the presidency would be in the bag. However, two words cast a shadow over the optimistic outlook for Obama's team: Tom Bradley.

In 1982, Bradley was the dynamic African-American politician leading the polls as he stood to become governor of California. He was shown to have a clear lead over George Deukmejian, his white Republican rival, and on election night the exit polls predicted a Bradley victory. Early editions went to press with Bradley on the front page as the next governor.

Then the result was announced. Deukmejian had won narrowly. Later analysis suggested that many of the white voters - who had claimed they would be voting for Bradley when asked by a pollster - had actually opted for his Republican rival once they had entered the privacy of the voting booth. Similarly, a large proportion of self-described 'undecided' voters had also voted for the white candidate when the moment came. As Obama contemplates an apparently insurmountable lead, the disappointed face of Bradley looks back at him. There are, of course, many differences between the events of 1982 and this week's election. The social stigma of voting for a black man is surely less, and Obama is in a much more commanding position than Bradley found himself in California. Nonetheless the worries remain. The punditry and predictions are based on a simple, but unreliable, assumption: that people know their own minds and will do what they say they will do.

Nothing could be further from the truth. While many marketers struggle to understand even the most basic issues of their target segment, the consumer in that segment is often equally unclear about their own preferences. I have umpteen war stories of focus group findings and opinion surveys that sent me and my client in the wrong direction from the consumer behaviour we were trying to predict.

Dissecting Market Segmentation

"Everyone from Australia is stupid."

It's a glaring statement and it's wrong. It is incorrect because it assumes that everyone in Australia is stupid. It makes a further assumption: that everyone in Australia is exactly the same. Obviously nobody, in their right mind, would ever utter or accept such a statement.

Yet when we turn to market segmentation, most companies make these kinds of idiotic assumptions on a daily basis. Market segmentation is one of the fundamental components in a strong marketing strategy. Most companies accept the fact that different people want different things and that, therefore, they should have different segments in their marketing plan.

The problem becomes apparent when we explore the criteria that most companies use to segment their market. Take a look at the names of the different segments in your company's market-segmentation pie chart. Chances are you will discover segments that are divided by age, by gender, by social class or, if you work in B2B, by turnover and SIC code. Dividing up the market by a combination of these factors is simple, cheap and it looks effective. Unfortunately, it rarely works.

You do not segment a market because the people in the segments are different.

Building Emotional Connections with Research

The most compelling brands usually connect with consumers at an emotional level. Their benefits are often experiential, emotional or self-expressive.  Certain types of research can help marketers understand which benefits will have the greatest emotional impact.

Following are some of the types of research that one could use to identify these sources of emotional connection:

Laddering – this helps one understand the following links: product or service features and attributes → functional benefits → emotional benefits → underlying consumer attitudes and values →  self-image → self esteem (“I feel good about myself.”). The researcher leads the research participant from brand or product features and attributes to self-esteem through a series of “why” questions. The most powerful levels at which to communicate with the consumer are at the emotional benefit, attitudes/values and self-image levels.

Projective techniques – these help the marketer uncover brand associations that the average person cannot or will not articulate unless asked indirectly. Typical projective techniques include:

o    Sorting (into two piles: “This is the brand,” and “This isn’t the brand” or “This is the brand’s consumer” and “This isn’t the brand’s consumer”) – can be done with the products themselves, images, colors, flavors, textures, sounds, etc.
o    Analogies, including “If the brand were an animal, what kind of animal would it be and why?” or “If the brand were a car, what kind of car would it be and why?”

The Research Trap

One of the pitfalls of the multibillion-dollar marketing research industry is that researchers don't get paid for simplicity. Instead, they seem to get paid by the pound. A true story may be in order.

The scene: The office of a brand manager at Procter & Gamble. The problem is what to do with one of their largest brands. I ask a simple question as to the availability of their research. I'm surprised by the answer: "Research?" We've got a computer full of it. How do you want it? In fact, we've got so much of it that we don't know what to do with it."

A flood of data should never be allowed to wash away your common sense and your own feeling for the market. You'll never see that obvious solution. It's worth reviewing what this flood is washing ashore. I checked in with Robert Passikoff of BrandKeys, my favorite research company. Here are some of his and my observations.

Awareness studies neither link to real customer behavior nor reinforce (let alone create) brand differentiation. In fact, although the phrase, "That's nothing that a whole lot of awareness won't cure" has become something of a research industry joke, those studies keep getting done. Note to everyone: Everybody is aware of General Motors and few are buying their cars.

Segmentation studies get fielded by the sector. True, segments are ultimately identified but are they segments you really want? Or need? Or can actually market to? Often these studies end up identifying individual segments that you can't actually reach via any known media. But there they are. And then there's the problem of changing your strategy to appeal to different segments. When you become everything for everybody, you become nothing in the mind.

Behavioral Targeting: Into the Abyss

The Association of National Advertisers held their annual conference recently. Speaker after speaker addressed the growing popularity of what is known as behavioral targeting as opposed to basing pitches on consumer attitudes, opinions or perceptions.

The ability of the Internet to monitor what consumers are doing by tracking what Web sites they visit is fueling interest in what many call understanding our customer better. I call it getting totally confused by your customers. The result, according to one speaker, will be different messages in different media for different customers. While admitting it will be terribly complex, they feel that this is the way it will be. I say many will be led by all this into the abyss of blurred brands and hopeless confusion from which they may never recover.

Anheuser-Bush dived in by studying "use occasions." Then they launched an ambitious online project that offered entertainment programming named Bud.TV. It turned out to be a bust, so the "content is being rethought." But here's my favorite line from their presentation. "The programming had nothing to do with our brands." I say then, what's the purpose of all this money and effort?