Archive for the ‘Marketing Research Practices’ Category

Nylon from Shrimp – A Marketer’s View

Monday, February 11th, 2013

NOTE to Readers:  Please don’t assume that I’m ridiculing this particular line of research.  The search for sustainable alternatives to fossil derived raw materials is necessary and laudable.  The ref’d article, however, provides an excellent lesson in how marketing and business strategy principals can and should illuminate the pursuit of new technology.

The Fraunhofer Institute in Germany has announced the (perhaps not-so-surprising) discovery that discarded shrimp and lobster shells can be used as raw material to make nylon polymers.  It’s some clever and interesting science, for sure – but it’s also a proposition that begs for quick application of some marketing and business development strategy principles.

First, a little background – “Nylon” is the genericized trade name for a small family of polyamide polymers invented and commercialized in mid Twentieth Century.  Small monomer molecules carrying an amine group readily react with other monomers carrying carboxylic acid groups to form long polyamide polymer chains.  Worldwide usage of these nylon polyamide polymers – mostly in textile fibers and in strong molded parts – is on the order of 5 million metric tons, 10 billion pounds, per year.

Know what other long polymer chains are linked by polyamide bonds, built from monomers with carboxylic acid and amine groups?  (They’re more commonly called peptide bonds in biological molecules.)  That would be the proteins and their amino acid building blocks!

Thus, it is “not so surprising” that, with some chemical wizardry, it’s possible to regenerate small molecules that have amine and carboxylic acid functionality from bio-wastes.  (In the reported case, the chitosan extracted from shrimp shells is broken down into glucosamine.  A few more steps of chemical wizardry then lead to Fraunhofer’s shrimp-shell nylon.

So, the technology side of this equation is, in principal, not so mysterious.

But, answering that other question – “Is this line of research worthwhile?” – is where we need to apply marketing and business development strategy fundamentals.  And the answer, in turn, depends upon articulating the goal of the research:

– A cheaper route to the existing nylon polymers?

– An exotic new polymer with uniquely valuable properties?

– How to get rid of some of those piles of old shrimp shells?

– Furthering the frontiers of basic academic science?

If the goal is academic science, then this project seems as worthy as any.  If, however, it’s driven by a commercial motivation, especially one with a firm time horizon, then the market and business developer in me says “Wait a minute!”

– The total crustacean shell resource is reported to be less than a million tonnes in Europe, presumably only a couple of million tonnes worldwide.  Probably not enough material to substantially impact the current nylon marketplace, even if you could overcome the logistics hurdle of collecting all those old shrimp shells.

– Currently used nylon intermediates – adipic acid, hexamethylene diamine, caprolactam, for instance – are relatively inexpensive and easy to make from oil, coal or natural gas.  Finding a cheaper, shrimp based, route to those materials will be a tall order indeed.

– The targeted shrimp shell raw material, glucosamine, is readily available today.  An R&D lab program focused on making samples of polyamides from glucosamine or its derivatives will reveal formulations with unusually useful properties.

One of our obligations, as marketers, is to help our organization focus upon the most productive targets for our development resources.  As this story illustrates, applying sound marketing fundamentals at the very beginning of an R&D project can point the work in the right direction and avoid some costly dead ends.

Managing a Successful Consultant Engagement

Monday, January 21st, 2013

Selecting the consultant that’s right for your project is just the first step in creating a value-adding consulting engagement.  To assure success, you and your consultant will need to write an unambiguous description of the expectations, deliverables, and project scope-of-work, and you will need to follow a solid project management plan.  Here’s how …

1. Write down clear, concise, yet detailed, project specifications – overall objectives, the subjects and questions to include, an outline of the methodology and level of effort, geographic or other limitations, the expected depth and detail of the analyses, deliverable, timing, etc.  Do it carefully – you should consider this document to be your contract with the consultant.

Building a good scope of work is an iterative process.  Use the first draft as the framework for discussions with consultant candidates.  Then, collaborate with the selected consultant to refine and focus your objectives and plan.

For expensive or complex projects, you might use your initial draft to solicit competitive bids.  This is a great way to identify alternative methods and to judge the candidates’ experience and insights.  Just be careful not to place too much weight on quoted price.  The value to be gained from an especially insightful consultant or innovative approach can easily outweigh the few Dollars you might save on the front end price.

2. Good communications between the consultant and your designated project manager will keep your project on track.  The trick is to decide how much communication is ‘just right’.  Too little, and the project risks wandering off on rabbit trails; too much, and you’re likely to bog down in minutia.  The main aims of your communications plan should be to 1.) demonstrate the consultant’s continuing progress, 2.) identify and resolve any unexpected difficulties or surprises and 3.) discuss and agree upon any changes to the scope of work, timing or budget (to be subsequently confirmed in writing).

You should carefully and fully document changes that you and your consultant agree to.  Some of the worst consultant project fiascos that I’ve witnessed were the result a failure to clearly describe and document changes.

3. Document the results.  Your project will generate a mass of information, call reports, data tables, charts and graphs – the WHAT of the consultant’s analysis.  Insist that your consultant go beyond the data to dig into the SO WHAT? – the implications of the findings and what they mean to your business.

Remember to keep an open mind.  The reality that the consultant discovers may not look much like your preconceptions

Add more value by collaborating in this SO WHAT? analysis.  Meld the consultant’s intimate and detailed knowledge with the company and market-specific context that you can bring.

Despite all the care you put into writing the project plan, and the conscientiousness of your communications and project management, you’re likely to run into a few bumps over the course of your consulting project.  Insist that you get what the consultant contracted to deliver, but be fair, too, and don’t ask for more than you originally agree to pay for.

Practical Advice for Selecting the Ideal Consultant

Tuesday, January 15th, 2013

Okay – You’ve decided that engaging a consultant is right for you (Should I Use a Business Consultant? )and now you want to make sure you get the most from your investment  (Maximize the Return on Your Business Consultant Investment ).

There’s a broad range of perfectly competent consultants out there – from loose networks of individual experts, to small ‘boutique’ companies, to large highly mechanized consumer survey houses, to the management consulting giants.  Here are practical guides to selecting the ideal consultant for your unique situation.

1. No single consultant is best for every situation.  Determine what sort of insights you need to address your business problem or opportunity:

– If you need to understand the desires and motivations of your customers or the strategic thinking of your competitors, you’ll need the experience, professionalism and high level contacts of individual experts or boutique agencies.

– Candid, off the cuff comments and opinions of potential customers?  Boutiques that specialize in group interview techniques (eg focus groups and their on-line analogs) or on-site surveys (mall or in-store intercepts, for instance) can efficiently orchestrate the complicated logistics of execution and documentation.

– If you need deep statistical analyses across thousands of potential customers, then you need the survey construction and administration infrastructure, and analysis expertise of the specialized survey houses.  In addition to the Big Name consumer and political survey houses, there are lots of perfectly competent boutique agencies who can execute statistical surveys (often at significantly lower cost).

– Need the horsepower (and the aura of credibility) to work with Top Management on major acquisitions, restructuring, or high risk, high Dollar initiatives?  The well known Big Names in management consulting provide the breadth of resources and experience, and the high level name recognition, that are often required to successfully sell and execute game-change initiatives.

Industry insider or consulting generalist?  In many cases, the breadth of experience and perspective of a talented and experienced generalist consultant – and their lack of industry specific preconceptions – will provide superior results.   Sometimes, however, there’s no substitute for an industry insider, someone intimate with the technical nature of your project and the idiosyncracies of the people they must interview.

2. Locating and screening candidates and selecting the right one – Get suggestions and refs from people you respect, within yours and other companies; search business networking sites like Linked-In; look for guest authors of interesting articles in business magazines, scientific or trade journals, on-line blogs, etc; search the web for ‘market research consultants’ and the like.  Armed, thus, with a list of potential consultants, it’s your responsibility to dig deeply enough to confidently answer two questions:

– Does this consultant clearly understand what I need, have the skills and experience to accomplish the necessary tasks, and the business acumen to interpret the results in terms that a useful to me?

– Can I develop a productive working relationship with this consultant, and will the candidate’s personality and ‘style’ engender a sense of confidence within my company?

Here, there’s no substitute for talking with the candidates – probably more than one extended, searching conversation.  You’ll pose open-ended questions – to describe how the candidate has approached similar projects, to suggest alternative approaches to your situation, to outline their range of experience across companies, products and markets.  When you’ve narrowed your list, you may want to talk with one or two of their former clients, to confirm your good impressions.

Next step – and next blog post – planning and managing the consulting engagement.

Maximize the Return on Your Business Consultant Investment

Friday, January 4th, 2013

In my last post we talked about when you should consider engaging an independent consultant:

> to accomplish things you can’t accomplish with your own resources, skills, and marketplace connections

> to ‘test the waters’ without ‘tipping your hand’ to your competitors or future customers

> to provide an independent and unbiased assessment of tough, contentious issues

If you haven’t engaged a consultant before – or have been less than satisfied with the experience – here’s a practical recipe for earning the best return on your consulting investment.

1. Select a consultant that fits your need – There’s a broad range of perfectly competent consultants out there, from loose networks of individual experts, to small ‘boutique’ companies, to large highly mechanized consumer survey houses (think Gallup and Harris), to the management consulting giants (Boston Consulting Group, McKinsey, and the like).  Selecting the right one for your unique needs will depend on issues like the nature of the business problem or opportunity you face, the particular industries and customer groups relevant to you, and your budget and time constraints.

2. Manage the relationship with your consultant – Your consultant is the expert, but you’re the boss.  You are ultimately responsible for the success of the consulting engagement – by setting clear expectations and deliverables up front, by monitoring and facilitating timely progress, and by sticking to agreed upon project goals and resisting the natural urge to pursue ‘rabbit trails’ and ‘scope creep’.

3. Monetize the results – No matter how insightful the results and recommendations of your consulting project, they’re essentially valueless until you use them to change your operations and the role your business plays in the marketplace.  Identify up front the problems you need to solve and how to use project results to solve them, make sure the rest of your organization is on-board with your goals, and follow through with a plan to change your product line, your marketing and business plan, or the way you operate.

Coming up … Posts with practical advice on how to select the proper consultant, how to plan and manage an effective consulting engagement, and how to transform insights from your consultant project into fatter profits.

Maximize Your Research ROI

Friday, April 20th, 2012

Research is expensive.  Whether you’re in the lab (measuring the properties of your new polymer, for example, or the selectivity of the catalyst you just invented) or out in the marketplace (testing consumers’ reaction to your new product prototype or measuring customers’ level of satisfaction with you and your competitors), you’re spending precious time and dollar$.

Here are 5 Rules of Research Strategy that will assure you get a handsome ROI from your research investment, whether you’re in the lab or out in the marketplace.

1.  Precisely define the business problem you need to solve or the business opportunity you’re trying to capture.  Is solving this problem sufficiently important and valuable to justify the resources you’ll need to solve it?

2.  Specify the information – technical, market, competitive, etc – that you must gain to be able to resolve the problem or realize the opportunity.  What are the key questions your research must answer?

3.  Identify key information sources.  What resources and which people are most likely to have the information you’ll need?  How will you know that the information you’re getting is objective, reliable, and complete?

4.  Develop a detailed ‘experimental design’.  What methodologies – what experimental plan – will most effectively extract, organize, and make sense of the information you need?  How will you actually execute your ‘experimental design’?

5.  Organize and present your research results in a way that maximizes their impact on solving the problem or realizing the opportunity.  How can you work with the rest of the team to make sure your results are most effectively integrated into the solution?

An independent consultant – like Marketing Intelligence & Strategy Assoc – can bring you the specialized expertise you need to optimize your Research Strategy, design and execution.

The Essence of Marketing Research

Wednesday, May 4th, 2011

The essence of marketing research is ‘reducing business uncertainties by learning more about the markets you participate in’.  It’s about improving your odds when you’re trying to predict the future:  “How will customers respond to my new ad message?  What message would be more effective?”  “Which features of a potential new product are valuable and attractive to customers.  How much are they worth, in the price of the new product?” “Who has most / least influence on buying decisions at Company ABC?”  “If we do X, how will competitors respond?”

There are 4 essential steps to any successful marketing research project:

1. Collaborate with business leaders to define a significant business problem or opportunity, and describe the information, insights and understanding which will be needed to solve it.

2. Identify the most likely sources of the necessary information, and design a methodology to gather, analyze and interpret the information.

3. Execute the methodology.

4. Use the resulting information, insights and understanding to help decision makers solve the original problem.

 The sources and techniques selected in step 2 depend strongly upon the nature of the problem you define in step 1, so there’s no single answer to your question about “…what types of questions they ask and what type of an expert do they seek when performing primary research.”  Most projects tap into the experience and opinions of multiple important groups, including:

– Direct customers and non-buying potential customers, always including a spectrum of job functions – R&D, brand management, operations, logistics, purchasing – and management levels.

– The customers of our direct customer, and other companies that operate in the chain of turning raw materials into end products – other guys who play a big part in determining our customer’s success or failure.

– Suppliers of other materials or equipment to our customer

– Competitors (This can be tricky.  Hiring a consultant to get information or use techniques that would be illegal for you directly is no protection for you (or the consultant) under US anti-trust, trade and espionage laws.)

– Government employees and academia.  For example, people in the Department of Commerce and regulatory agencies are nearly always knowledgeable and helpful, and US government libraries, publications and databases are generally excellent.

The optimum techniques to use and the most productive questions to ask are dictated by the business problem you’re trying to solve and the nature of the groups whose opinions and experience you focus on.  Large groups (owners of single family homes, consumers of laundry products, independent auto repair shop owners, for example) might be sampled with statistical survey techniques, while individual in-depth interviews might be more appropriate for smaller groups (for example, makers of kidney dialysis machines, designers of office furniture, or paint chemists).  Group techniques (like focus groups) may be great for gathering initial impressions, but are less useful sources for detail and reliability.  

In almost all cases, the real value-adding capacity of marketing research comes from its ability to answer questions that impact the future – questions like “What if …?” and “Why?” – NOT  from its ability to execute a methodology and answer the more simplistic “How many?” and “Who?”.

Market Research: DIY or Hire an Expert?

Thursday, February 10th, 2011

 It’s a fair question that doesn’t have an easy answer ….

– Some say that engaging a consultant is simply too expensive, an exercise in paying someone else to do what we can and should be doing ourselves.

– Others argue that consultants more than pay for themselves by bring to bear a world of experience, a breadth of expertise, and an analytical objectivity that stretches beyond the capabilities of any company.

Having sat on both sides of the desk – as a buyer and as a provider of marketing research consulting services – my perspective may add some real-world wisdom to your “DIY or outsource” discussions.

Managers sometimes shy away from engaging a consultant because of the expense (or the worry that calling in an outsider may hint at some hidden inadequacy).  In many cases, however, hiring an expert is the smart business decision. 

Here are six situations in which the value that a consultant creates can justify the expense, many times over:

1. When your capacity is limited.

2. When a consultant brings specialized industry knowledge or contacts that you can’t easily duplicate

3. When anonymity is important – when your identity as the study sponsor would reveal too much about your plans, or where your name could influence the answers you hear

4. When you really need a dispassionate objective assessment, free from internal biases, preconceptions and office politics.

5. When a consultant can provide specialized techniques or methodologies that you don’t have – conjoint analysis or focus groups, for example

6. When a consultant can perform tasks more cheaply and efficiently, as is often the case with telephone surveys and data crunching, in-store interviews and mall intercepts, etc

In addition – unfortunate but too often true – an external consultant often brings an aura of credibility, authority and influence with upper management that an internal employee may not carry.

On the other hand, the out-of-pocket costs for consultant fees and expenses is a legitimate reason to consider doing market research projects with in-house resources.  More important, by outsourcing information gathering and analysis, you could pass up a chance to know your marketplace more intimately:

– The party that conducts the marketing research interviews naturally ‘owns’ the resulting relationship with the key players in the value chain.  These relationships may soon become the foundation for expanding your customer base, entering new markets, or introducing product innovations. 

– It is much easier to understand the context of your interviewees’ comments, and to internalize and ‘own’ the insights, conclusions and recommendations when you actually execute the study.

In an ideal world, then, the ideal answer is often “DIY.”  Few of us, however, live in an ideal world, and hiring a competent marketing research consultant is often the most practical, economical and timely alternative.

Coming soon:  “Successful Consulting Engagements:  How to Select a Consultant, Plan a Consulting Engagement, and Manage the Consulting Relationship”

What’s Happening in Your Marketplace?

Tuesday, February 1st, 2011

Entrepreneurs just starting out, owners of growing small businesses, corporate marketing managers – business people in general – need a clear understanding of what’s happening in their marketplace:

– of what customers want, what’s frustrating them, and what makes them happy

– of what customers like and don’t like about you and about your competitors

– of the forces creating changes in the marketplace, and what will be their impact

Gaining objective, fact-based answers to questions like these – and using the resulting insights to drive better decisions – is Marketing Research, the key to making any business stronger and more successful.   

Whether your Marketing Research budget is large, small or hardly there at all, here’s what you need to know to get smarter about the market environment you’re operating in, and how to use that knowledge to guide your business to greater success.

Plan Your Project:  A little forethought will assure that your efforts are focused on the issues that really matter – that you get ‘the most bang for your marketing research buck’.

1. What big problem or opportunity are you facing?  What sort of information would help you face it better?

Not getting enough customers through your doors?  Want to attract more?

– What do potential customers know about me – and just how many potential customers are really out there?

– How do they learn about products and services like mine? 

– What do they really care about, and what really upsets them?  How do I measure up?

Wondering about introducing a new product or service?

– Why will customers care?  What’s bad and good about what they’re using today?

– How dissatisfied are they today?  Upset enough to spend real $$$ to change to your new offering?  How many would likely buy your new product, and for how much?

– How will your competitors react?

Worried about competitors eating your lunch?  

– What do customers like about you, about your competitors?  What have you done to make them mad?

– What do customers really think about your competitor’s latest ad campaign / new product / expansion?

2. Methodologies – What types of information will be most helpful in solving your problem?  What sorts of people are most likely to have the information, and what’s the most efficient way to get the answers you need?

Who has the info you need – not just your direct customers, but anyone else who influence their decisions and anyone who has a bearing on your success for failure.  Ex-customers or people who decided not to buy from you are often your very best source of ideas for improvement.

Different questions require different data, and different data implies different methodologies …

“Should I stock red, blue or green?”  A simple survey and simple statistics will tell you how many customers prefer which color – and what else they might like or dislike.

“How do all the players in a complex value chain interact to make or break a new product?”  Better have deep, searching conversations with a number of people who make decisions up and down the value chain.

“What’s the right price for my new product?”  Ask directly and you’re likely to hear numbers you don’t like, but some special techniques and analyses can get your very close to the truth.

3. How much is solid, comprehensive understanding worth?  How painful are the potential consequences of not knowing?  How much should you invest in getting it right?

What would it be worth – Dollars and Cents – to have 25% more customers?  What’s it worth to know the best way to attract them … and what ways would be ineffective?

How expensive and damaging – Dollars and Cents – would it be if your new product fizzles out after you introduce it? 

Execute Your Project:   The big question “Pay someone else or do it myself?” doesn’t have an easy answer.  A ‘hired gun’ consultant can bring special methodologies, they can usually get things done more quickly and efficiently, and they they’re less likely than you to look at the marketplace through those ‘rose colored glasses’.  But then, there’s that out-of-pocket price tag.

Engage a consultant when you don’t know the specialized techniques or just don’t have the time; when anonymity will help get unbiased answers and results; when your issues are complex and the stakes are high

– Carefully agree upon the scope of work before you begin.  Most problems with consultant projects result from a mismatched expectations that could have been avoided.

– To make sure the project stays on course, be actively engaged during the project – but think long and hard before you substantially change direction.

– Challenge your consultant to give you not just the facts, but interpretation and recommendations.

DIY works just fine when the questions and analyses are simple and straightforward; when the consequences of uncertainty are not so high; or when the value of enriching your relations with customers outweighs the potential value of the answers you gain.

– In person or on surveys, phrase your questions in neutral language – don’t subconsciously lead them to the answer you want to hear

– In your conversations, ask open-ended questions that invite discussion.  Practice ‘active listening’ and follow up questions.

– Keep surveys short and simple.  Test ahead of time to make sure customers won’t be confused.

Most consultants will be happy to talk through your options with you, without any fee or obligation.

Apply the results:  Any research is too expensive if you don’t put the results – even results you don’t like or didn’t expect – to good use.

Forty percent of your customers like ‘blue’ but only 20% like ‘green’?  Make sure that store shelves and your production run aren’t overloaded with ’green’.

Customers like to rely on sales reps for product info and recommendations?  Consider less consumer focused advertising and more support to retailers and distributors.

Customers mad because your deliveries are too slow, even though you met your 3-day promise?  If 3 days isn’t good enough, then you’d better figure out how to do it in 2 or 1, of kiss those customers good bye.


Competitive Intelligence – Consensus?

Saturday, April 3rd, 2010

My two previous Competitive Intelligence posts (here and here) generated a lot of discussion – but a surprising convergence of views about the scope and limitations of competitor intelligence, and about how insights about competitors fit into the larger universe of what I believe is most accurately termed “Business Intelligence”.

Debra D (from the healthcare insurance field, commenting at a Linked-In group) perhaps summarizes it best:

“Competitive intelligence is about understanding the broader market dynamics which includes understanding customers’ and suppliers’ motivations and drivers, not just competitors…. The point of CI is well beyond just understanding what the competitors are up to. Woe to the company whose CI efforts and resources just focus on the competition.”

Interestingly, the usage of the term ‘competitive intelligence’ to lead her definition highlights the semantic confusion around terms such as business vs market vs customer vs competitive intelligence that seems to obscure a general sense of agreement among all of us commentators.

The underlying message seems to be that too narrow a focus – a fixation, if you will – on a single dimension of business intelligence (even if you excel in that dimension!) will blind you to important and eventually dominant events in other dimensions.

I suspect there’s an even deeper message here, too –that creating and maintaining business success is a lot like building a healthy life. It comes not from doing one thing (be it cardio workouts or vegan diets, customer service or applications research, for example) exceedingly well but by doing an excellent job of orchestrating the smooth and symbiotic functioning of all the supporting parts and functions. It’s a message I’d like to think about some more and to write about soon.

Go here to read verbatims from many of the best comments

Left Brain versus Right Brain

Thursday, July 2nd, 2009

For those of us who believe that marketing – even in the hard facts, industrial B2B world – is as much about psychology as it is about science, John Tierney’s article on the ‘Science’ page of the 29 June NEW YORK TIMES will be no surprise. More than a contrasting of hard science vs soft, Tierney’s article underscores how important – and how unusual – it is to capture the best of the “left brain” and of the “right brain”, whether you’re a marketer of industrial widgets, a PhD economist assessing why people spend as they do, or a medical scientist doing cancer research – or the grant review committees who fund the research!).

Too often, people look across the left brain – right brain divide and see the enemy – or at least a suspicious and unfathomable alien. A listing of some of the key left brain – right brain characteristics suggest why each side has such a difficult time understanding the other:
LEFT BRAIN: Logical, Sequential, Rational, Analytical, Synthesizing, Objective, Looks at Parts
RIGHT BRAIN: Intuitive, Randon, Holistic, Synthesizing, Subjective, Looks at Whole

All but the most entrenched left-brainer or right-brainer would concede, however, that there are certainly useful traits on the other side of the divide.

It’s not so surprising – human nature being what it is – that the left brains and the right brains of society or of an organization often disagree. What is surprising is that so few organizations recognize or take advantage of the complementary strengths of left and right hemispheres.

How about sharing some uplifting examples of organizations taking advantage of left brain – right brain synergies? Some particularly egregious examples of squashing one side or the other?