Branding Strategy Insider

What Drives Consumers to Buy?

Category drivers are predictive of how consumers will behave in a given category. These drivers have shifted this year, and all brand-related characteristics are making larger contributions to the consumer engagement and loyalty process, specifically in the areas where consumers expect the most in the category.

Category drivers, and the attributes, benefits, and values that make them up, including brand-related values, are critical to a marketers understanding of product and service engagement and getting it right when dealing with consumers.

Properly configured, category drivers will tell you far more than who a consumer is, which is the marketing research typical (demographic and attitudinal) point-of-view. They tell you what you really need to know: how consumers will behave in the marketplace, and most importantly, what will get them to behave more positively toward your offering versus your competitors. This only matters, of course, if you’re keeping score by counting your sales and profits, and not merely tracking awareness levels.

Maximizing Research Budgets in a Recession

 
Clearly, this deep global recession has taken it toll on marketing departments and market research and competitive intelligence budgets. Senior executives, strategic planning and marketing departments face the following challenge of how to continue the following initiatives with a reduced research budget:

Global expansion plans

Customer satisfaction tracking

Competitor intelligence monitoring

Market opportunity/market sizing projects

Customer and brand loyalty projects

New product development tests

Ad tests

The Challenge and Opportunity of a Reduced Research Budget

A reduced research budget forces executives to re-think their long term and tactical strategy. It also forces them to prioritize initiatives in this downturn. To this end, global expansion plans may be curbed. On the other hand, this presents a risk as their competitors may still move forward into global and emerging markets, thus putting them at a strategic disadvantage when the market turns up. The key is to prioritize and to “get the most from your reduced research budget” so your firm will not fall behind in the next few years. This paper will discuss general strategies on how to efficiently utilize a reduced research budget and to provide this intelligence to senior management during this market downturn.

Indirect Influencers and Purchase Decisions

 
A company has multiple constituencies when it offers the same product to different market segments. Why is this an important discipline in Marketing? Often times, your direct buyer is not the most important influencer. Children, doctors, relatives and social referential leaders often assume major positions in the purchasing decision.

As a result, it is important to understand these indirect customers and influencers and integrate this understanding into marketing strategy. Multiple Constituency Marketing applies to a wide number of industries including the Pharmaceutical, Hospitality, Consumer Goods, Toys and Entertainment sectors.

Multiple constituencies = Actual buyer + Influencers (doctors, accrediting agencies, children, relatives, referential leaders in society)

One example of Multiple Constituency Marketing is in the Pharmaceutical sector. Take for example Viagra as a drug. Pharmaceutical firms target not only the doctor who is the gate-keeper in the prescription purchasing decision. Pfizer targets customers directly to inquire from their doctors about getting the drug, appealing to their psychological needs of potency and "scoring" (indicated by its communications). Beyond this, it also targets wives via television communications, appealing to their needs of intimacy. It also appeals to referential leaders like Bob Dole.

Companies that manufacture foods also consider how to appeal to not only the adult that will purchase the product, but also the children and significant other that heavily influence purchasing.

How Stakeholders Perceive Benefits

When dealing with perception, it is often helpful for clients of research firms to understand not only what the perceptions are, but what are they based on. Building on this idea, it is further helpful to understand how perceptions are diffused within a group of stakeholders.  Depending on the culture, perceptions are derived from the following forms of knowledge:

    * Influence from respected source
    * Personal Experience
    * Intuition
    * Empirical Evidence

Whereas for example Germans and Americans culturally regard empirical knowledge as the most important form of insight, Brazilians will likely attribute more credibility to a “referential leader” such as a respected person.  Applying this insight to a market research study, it could mean crafting a flexible research design that can elicit core insights on how perceptions are diffused within each country. Thus for example in Mexico, a market research firm can focus on how stakeholders build perceptions, be it through intuition, personal experience, influencers or empirical information. Research firms can incorporate into their data gathering approach how the 4 forms of knowledge contribute to the diffusion of perceptions.  

Contributed by: Ruth Stanat, President of  SIS International Research and research partner of The Blake Project.

Sponsored By: +2 Marketing Consultants

Advertising Research

While advertising is part art and part science, there is more science to it than one might realize.  There are many “rules of thumb” that ad agencies and advertisers have developed over time, based on experience or research or both.  I have found the following types of research to be important to creating strong brand advertising:

•    Qualitative research (focus group, mini-group, one-on-one, anthropological, etc.) to better understand the target customer’s hopes, needs, desires, aspirations, fears and concerns

•    Brand preference testing (before and after exposure to the ad).  Asking people what they would tell others about your products and services before and after exposure to the ad is also insightful. (David Ogilvy’s book, Ogilvy on Advertising, states that people whose brand preference increase after having seen an ad are three times more likely to purchase the brand then those whose preference does not change.)

•    The split-run technique.  This technique allows you to test two forms of the ad in the marketplace to determine which one is the most effective.

•    Occasionally, you may want to understand how existing loyal customers are responding to your ads, especially if your ad’s intent is to attract new customers.  For instance, are the ads offering new customers something that you are not offering existing customers?  Are the ads promising something that current customers have found not to be true?  Are your ads helping existing customers to feel better about your brand?  Are they reinforcing the wisdom of having purchased your brand?

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.

BRANDchild

You may be surprised to learn that close to 80 per cent of all brands purchased by parents is controlled by their offspring. But what will undoubtedly startle you are the figures that show a whopping 67 per cent of all car purchases is also determined by the children of the home – and not by the parents. Tweens (8- 14 year olds) are an increasingly powerful and smart consumer group, which in 2002 alone, spent and influenced an astounding €1.88 trillion.

Did you know that an average British kid between 8 and 13 years of age is exposed to 22,000 television commercials a year? In fact these kids are exposed to more than 300,000 commercial messages each year if we include radio, television, print ads, billboards, and the Internet. These figures are from project BRANDchild – the world’s largest study on tweens and their relationship with brands.

So it’s not surprising that research from the BRANDchild study indicates that on average, kids are 40 per cent more difficult to communicate with than adults. The challenge then becomes how to cut through the clutter in order to gain the attention of this generation, while at the same time ensuring that your message is perceived as relevant, honest and on the right side of the law.

1. For you and me, there are three communication channels: offline, online and wireless. For kids there is only one – a combination of all. Kids don’t distinguish between chatting online, text messaging on the phone or watching television – it’s one and the same thing. It is important to bear this in mind when you develop your direct strategy Direct shouldn’t be seen as classic direct mail or just magazines, it should include every channel which creates a direct relationship with kids – covering everything from chat rooms to product placement in computer games.

2. Why? Because today’s kids expect to see an integrated flow across all channels. The BRANDchild study clearly shows that brands, which only use one, channel – or maybe use several channels but don’t create a synergy in the message between the multiple channels will lose. I call this Domino Branding. If all the bricks are correctly in place, they will lead to a chain effect of events. Each one an independent entity although totally dependent on the whole. Leaving out one brick may destroy the total outcome.

The Marriage of Neuroscience and Market Research

For those of you who have not heard of this (and those who have) it is worth mentioning. Neuroscientists are collaborating with market researchers to measure levels of attention, memory encoding, memory recall, and attraction and revulsion to ads using the electroencephalograph (which measures electrical activity by brain region).  General Motors, DaimlerChrysler, Ford of Europe and Camelot (the UK’s lottery operator) are all exploring this relatively new technology.  Preliminary results suggest that memory and emotion play key roles in brand loyalty.  Other high tech techniques for identifying consumer response to advertising: eye tracking, measuring galvanic skin response, and magnetic resonance imaging (MRI).

Where will we go next?

Source: “Pushing Your Buy Button: Neuroscience Meets Marketing” Forbes, September 1, 2003, pp. 62-66, 70.