5 Myths about Marketing Research

Two questions that management teams ought to ask themselves periodically:

The answers to those questions often lead to marketing research projects, and the information marketing research unearths can be invaluable. But to enable that research to do what it needs to do, let’s explore some myths surrounding it.

Myth #1: Marketing research solves marketing problems.

No, it doesn’t–not all by itself at least. The value of marketing research, properly conducted, is that it gathers information–qualitative and quantitative–and identifies issues that can guide decision-making. And it does this by answering questions. Those questions can be fundamental and provide important facts:

They can be more sophisticated and provide valuable insights:

Part of the skill and art required to get the right information is to ask the right questions.

Myth #2: Marketing research is too expensive.

“We’ve heard this time and again from companies of all sizes,” says Brian Arnold, principal of Clear Point Research Group and the author of the  Custom Market Research Guide. “But it’s simply not true. It’s not just about actual cost. It’s also about risk. You can invest money in properly designed research now or spend it-and probably a lot more-later to correct mistakes based on unsupported assumptions.”

In other words, purchasing marketing research services must be evaluated based on the value they provide-just as any other purchase your company makes. Even if you perform research using internal resources, you’re investing time, effort, and money.

“Market research can be conducted to fit most any budget,” Arnold explains. “A good research partner should be able to get information you need at a price point you can afford.”

For example, a leading manufacturer needed feedback about its brand from its auto technician customers to determine which of several advertising concepts would be used for a new campaign. Traditional focus groups would have been ideal, but the manufacturer’s marketing team didn’t have the luxury of three weeks to recruit three groups of eight participants and get them together to collect feedback. And the team’s budget probably wouldn’t have supported that approach.

“Yet we were able to get the information that enabled our client to select what turned out to be a successful campaign,” says Arnold. How? Clear Point took its methodology and expertise to customer locations-several locations, in fact: “We interviewed groups of three participants at each of eight firms. We delivered the equivalent of three focus groups in half the time and half the cost.”

Key Point:  Market research doesn’t have to “cost too much.”

Myth #3: We can do our own research.

Known as “mother-in-law” or “convenience” research, the often informal process is to talk to customers, internal staff, salespeople, even friends and others who are not members of your targeted customer segments. While possibly helpful, the insights can be severely limited. At best, they are not as revealing as they could (or should) be. At worst, they can be misleading and even wrong.

“The key is to use an impartial third party,” explains Arnold. “We simply can’t emphasize this point enough: It is much easier for customers to tell an unbiased researcher how your brand let them down than it is for them to tell you. It’s just human nature.”

Trained, professional researchers are highly skilled in designing effective research studies whether it’s for a qualitative focus group or a larger, more complex online quantitative study. Not everyone can structure questions properly or design a study that delivers reliable insights that can be used in a practical, profit-producing way. It’s just common sense.

Myth #4: An outside researcher could never understand my business.

For the most part, regardless of the industry, a good researcher can design a study that will deliver insights against agreed-upon objectives. Research practitioners don’t need to understand all of the complexities of your business to provide valuable results. They need to understand research.

True, it helps for researchers to understand a little bit about your business and you should provide that detailed information. Keep in mind that professional researchers know the questions to ask you about your company that will enable them to conduct the research effectively.

Key Point:  Just as you’re the expert in your field, professional researchers are experts in theirs. That expertise is what you’re buying, not knowledge about your industry. In fact, lack of knowledge about a topic is often an advantage.

Clear Point, for example, has researched topics for a wide variety of consumer and business-to-business companies across industries. “We’ve learned,” explains Arnold, “that experience in other businesses and product categories can provide a fresh perspective on the challenges faced by other companies.”

Myth #5: We know our customers. Research would only tell us what we already know.

You’ve no doubt heard the expression, “You don’t know what you don’t know.” Most of the time, the point of marketing research is to alert-even warn-you about what you don’t already know.

Two companies come to mind.

JC Penny:  Attempting to revive sales, new management assumed that the company’s heavy price promotion strategy needed a new direction, along with a change in merchandise. The new pricing strategy was “Every Day Low Prices.” In retrospect, the company apparently didn’t research or test probable customer reaction–or at least didn’t test enough–to what turned out to be significant and unsettling changes to the business model.

The new pricing and new merchandise did not fare well with Penny’s customer base, which liked finding bargains and getting “deals.” If prices were always the same at the stores, no “good deals” existed. Shopping lost its appeal to the bargain hunters–and they rebelled.

Tropicana:  On a smaller scale, Tropicana hired a package design and branding expert to provide a new look for the popular orange-juice brand. But, again, the new look didn’t seem to have been adequately tested with customers. After the new packaging hit the grocery shelves, sales dropped dramatically. Here, the problem was that the company assumed it knew what motivated consumers to buy the brand. In other words, they didn’t know what they didn’t know. Eventually, the tried-and-true brand design was reinstated.

As always, if you want to learn more about whether marketing research can help your business, please give us a call at 847-446-0008 or e-mail us at  pkrone@productivestrategies.com.

Productive Strategies is a management and marketing consulting firm that helps business-to-business companies and professional services firms grow their revenues. We solve such problems as too few sales, not enough qualified or “ready to buy” leads, and poor recognition or credibility in the marketplace. To learn more, call us directly at 847-446-0008. Our business is to grow your business.

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