Bureau West

In marketing circles, “social media listening” or “social media monitoring” refers to the practice of collecting and analyzing comments made in various social media outlets (such as facebook, Twitter, blogs, etc.) that are relevant to a company or a product.  There can be a great deal of value in those comments, since they enable us to learn how people discuss a topic among themselves in a natural and unprompted manner.  This type of analysis also enables us to see the rise and fall of “buzz” around a certain topic.   Dell, for example, has allocated significant resources to the practice; a few days ago, it opened its “Social Media Listening Command Center,” which will track 22,000 daily topic posts related to Dell.

That’s impressive, but also highlights one of the challenges of social media listening: handling the great volume of data.  Several providers have developed software that attempts to automate the process of analyzing the data.  Dell is using a popular tool provided by Radian6.  These tools are very helpful, but it’s important to understand their limitations.  For example, one of the functions provided by the software is measuring the volume of positive versus negative comments.  But how would the software classify the following comment?  “I hate when people say they don’t like Dell computers.”  Most likely the comment would be classified as a negative, because of the phrases “hate” and “don’t like.”

This is not to say these tools don’t have value.  But it’s important to remember that social media listening provides qualitative data on a quantitative scale.  So the quantitative analysis provided by the software should be done in conjunction with a real live person reading a good sampling of the comments.  It’s also important to remember that the people posting comments online may not be a representative sample of your target market.  They tend to skew young.  And they tend to be people who are particularly happy or particularly unhappy with your product, who have strong enough opinions to take the time to post their comments on the topic.  While those opinions can be valuable, we need to keep in mind that they usually represent the ends of the continuum rather than the middle.

To utilize social media listening for your market research, give us a call at (818) 752-7210.

Sources: “Social Media: A Game Changer for the Qualitative Industry?” Kathy Doyle, presented at QRCA Annual Conference, 2010; “Dell To Launch Social Media Listening Command Center,” Mashable, December 8, 2010; “Is Social Media Monitoring the Next BIG THING in Research?” SmartPoint Research Blog, December 13, 2010

Vitamins are nice to have.  They’re good for your health.  But when you have a headache, you need an aspirin.  It’s a must-have.  In an article in this month’s Fast Company magazine, Dan Heath and Chip Heath discuss turning vitamins into aspirin.  Changing the market’s perception of your product from “nice-to-have” to “must-have” can mean the difference between success and failure.

Netflix is an example of a company that did just that.  When Netflix started out, its fee structure was the same as Blockbuster’s: you paid a fee for each movie you rented, and if you didn’t mail it back within a few days, you’d rack up late fees.  Sales were weak.  But the business turned around when Netflix eliminated late fees and moved to their subscription model.  That was the “aspirin” that eliminated the “pain” of the late fees.

Another example: NetApp was offering digital storage to large companies. Their offer wasn’t significantly different than their competitors.  They were a little cheaper, but that wasn’t an important enough motivator for their prospects to switch to them.  NetApp conducted in-depth research with its existing clients, and discovered that reliability and redundancy were their urgent needs.  For them, lower prices were a vitamin, but reliability and redundancy were an aspirin.  NetApp responded by creating storage systems in pairs so that if one failed, the twin could take over. And they built in enough redundancy that even if a data center burned down, the client’s data would still be safe.  Their business from enterprise clients shot up.

When marketers get too close to their products, it’s easy to mistake a vitamin for an aspirin!  How can you make sure your target market regards your product as an aspirin rather than a vitamin? Learn about what’s important to your prospects.  Ask about their pain points.  Find out how your customers actually use your product and why.

To learn about your market’s “must-haves,” give us a call at (818) 752-7210.

Source: “Turning Vitamins Into Aspirin: Consumers and the ‘Felt Need,’“ Fast Company, November, 2010

Because of social media, the voice of an individual consumer can be many times more powerful than it used to be.  That’s why companies can’t afford to ignore social media; they must actively monitor social media outlets and engage with their customers and prospects there.

There are also important implications for market research: conducting research with “influencers” is more important than ever before.  While influencers might differ somewhat from your typical customers, it’s more important than ever to know how they think.  When designing research, we frequently look at influencers as a separate segment to be studied.

How do we define influencers? When recruiting research participants, we might ask how frequently they post their opinions about companies online or how often friends ask them for advice.  But a company called Klout has a more scientific approach: they have developed a sophisticated ranking system that analyzes an individual’s activity on social networks and assigns them a score based on their ability to influence others.  For example, they don’t just look at the number of people following the individual on Twitter, but also how often they click on posted links, respond to, list, or retweet that user.

Virgin America used Klout scores to locate influencers to receive a free flight to get the word out about its new Toronto route last spring, which generated 4,600 tweets about the new route. That led to more than 7.4 million impressions and coverage in top blogs and news outlets like the L.A. Times and CNN Money.  One benefit of this approach: the recipients of the free flights had already established a credible voice which made them believable despite the free gift.  They had “earned” the special treatment.

To utilize social media for your market research, give us a call at (818) 752-7210.

Sources: “Social Media for Market Research,” Ben Smithee, presented to QRCA So. Cal., September 10, 2010; “Need a Reservation? That Could Depend On How Big You Are on Twitter (Really),” adage.com, September 30, 2010

A new Pew Research survey shows a majority of consumers have cut back on their spending.  But at the same time, the survey shows more optimism than it has found since before the recession started: 62% of adults say they expect their financial situation to improve in the coming year, compared with just 19% who say they expect it to get worse.

In order to obtain more depth on this topic, Bureau West conducted qualitative research with consumers from a range of socio-economic groups.  We asked if they’ve cut back on spending and if so, how.  Similar to the Pew survey, we found a “new frugality” attitude.  Consumers are placing much more emphasis on obtaining value for money.  They’re looking for deals and using coupons much more than they used to.  Many are paying closer attention to the difference between “wants” and “needs.”

• “When buying, I’m thinking more about whether I really need what I’m considering buying, and if so, whether there’s an opportunity to save money by waiting or finding a deal.”
• “The best thing to do is stop spending on stuff you don’t need. If it isn’t an immediate need don’t spend the money especially if you don’t have it. I looked in my closet and realized I really don’t need any more clothes or shoes.”

At the same time, many participants are also splurging from time to time.  These may be small luxuries, but may indicate some pent-up demand.  For example, while many participants said they eat out less, eating at a restaurant is still a favorite way for people to treat themselves.  Consumers also mentioned home improvement projects and trips (both local and international) in the “splurge” category.

• “Instead of eating lunch from home, I’d go out to a nice restaurant or if it’s been awhile, I would buy myself a new pair of shoes.”

For marketers, all of the above may indicate an opportunity: consumers are willing to spend if they’re convinced they’re receiving value for money. Of course, when we conduct research to learn how consumers define value for a specific product, we need to be careful not to ask leading questions.  Rather, we like to give them choices, perhaps comparing different combinations of features and costs.  In some cases, we may use a mix of individual and group research methods in order to learn about consumers’ independent opinions but to also see the influence of group dynamics, which of course play an important role in consumers’ perceptions of value.

To find out how your prospects and customers define value, give us a call at (818) 752-7210.

Sources: “How the Great Recession Has Changed Life in America,” Pew Research Center, July 23, 2010; Bureau West consumer research, July, 2010