Bureau West

We all know that most consumers are concerned about spending in the current recessionary atmosphere.  But how does that concern affect their shopping habits?  In some cases, consumers are buying cheaper items, but more of them, spending the same amount of money as before.  For example, the Herald Tribune reported that at wine.com, the average price of a bottle of wine purchased in December was 17% below the average of the year before, but the number of bottles sold was 15% higher than a year ago.  Similarly, at 9 Mile Schoolhouse Christmas Market in Montana, customers tended toward the smaller and less expensive Christmas decorations, but total revenue per customer was 18% higher than the previous year.

We’re not ignoring the fact that revenue and profits are indeed down for many retailers in this recession.  But is there anything marketers can learn from the sales of wine and Christmas ornaments?  We think those examples may represent a trend toward small indulgences.  That is, consumers are forgoing some luxuries and trading down, but then compensating themselves with a small reward. 

Marketers can benefit by repackaging products and services to fit this trend.  This can work at different ends of the economic spectrum.  For example, companies that offer high-end Baltic cruises might want to also offer a weekend getaway in the United States.  Note that high-end customers don’t want ostentatious displays of wealth right now: consider offering less flashy destinations.  Perhaps a quiet pampered getaway including gourmet food and wine. 

And companies appealing to more mainstream customers may want to consider offering less expensive options.  For example, a company offering activities for kids may have a full-day option that costs $75, which might scare away many parents at the moment.  But a three-hour workshop for $40 could seem very appealing, especially when that alternative is presented alongside the $75 option.

What are the best options to offer your prospects?  We are able to find the answer to this question by conducting market research that asks about trade-offs.  “Which would you prefer: option A for X dollars or option B for Y dollars?”  We then discuss the options further with respondents, and sometimes it turns out they actually prefer some other combination that hadn’t initially been considered!  To discuss how to uncover the most appealing offers for your prospects, give us a call at (818) 752-7210.

Sources: “Buying less expensive wine, and more of it,” International Herald Tribune, January 1, 2009; 9 Mile Schoolhouse, www.9mileschoolhouse.com

Social media is a hot topic nowadays.  Most marketers know it is important, but many are unsure how social media should fit into their marketing strategy.  First, let’s define what social media is: typically, social media refers to websites where users create most of the content.  Of course, that short description covers a wide range of web properties: social networking websites such as Facebook and MySpace, opinion sites such as Reddit or Epinions, customer review areas on web sites, content sites like YouTube, blogs, fan websites and various combinations of the above.

There is no doubt that social media are becoming a very powerful tool in reaching consumers.  People frequently turn to social media when they’re in the market for a product or a service.  And a recent study by branding agency Cone found that social media are particularly effective in connecting with hard-to-reach audiences such as men and high-income households.  Marketers’ challenge: how to effectively utilize social media for marketing when there are so many different options?

There are a variety of approaches.  For example, Dell is investing in social media to turn around perceptions of its customer service.  It has a squad of 42 employees who spend their workdays engaging with the communities on Facebook, Twitter, and other social media, addressing customers’ concerns.  They’ve also added blogs and message boards to their site in the hope that irate customers will talk to the company rather than gripe to the whole Internet.  And they’re actually using the feedback to improve their products and their service.

Some marketing agencies try to simplify the process for clients by offering integrated campaigns that target multiple social media at once.  For example, Centric creates campaigns that might include acquiring “friends” on various social networks and developing a downloadable widget which is then seeded on various relevant websites and blogs.  They say their clients have achieved better results than they did with traditional online advertising for a fraction of the cost.

My very smart friend and colleague Jenka Gurfinkel adds that social media marketing also requires a change in marketers’ overall approach:

“Social media strategy is not just about using the latest social networking site to promote a campaign once it’s done. By then it’s already too late. I think it’s easy to get stuck thinking about ‘social media’ in the mindset of traditional media–as something that you put the advertising/content ON, like seeding online forums, for instance.  Really effective social media strategy is about integrating methods for generating exposure through social media and online communities into the campaign strategy from the beginning. It can be as simple as making sure to incorporate a ‘share this’ button, or offering an ‘embed’ option for online videos, or more complex strategies like, for instance, leveraging experiential marketing to generate content that can be used online to extend the lifespan of the campaign further. Ultimately social media strategy is about creating ways for the advertising content itself to become social.” [emphasis added]

Sources: “Cone Finds That Americans Expect Companies to Have a Presence in Social Media,” September 25, 2008, http://www.coneinc.com/content1182; “Michael Dell ‘Friends’ his customers,” September 4, 2008, http://money.cnn.com/2008/09/03/technology/fortt_dell.fortune/index.htm; Centric – Agency of Change, http://www.centric.com/; Jenka Gurfinkel, http://social-creature.com/

 

Our clients are always looking for ways to understand how their customers truly interact with their product or service.  One way to do this is to go to where the customers live, work or shop and observe and interview them there.  This can be very effective, but we always have to consider how the researcher’s very presence could affect the respondent’s behavior.  In some cases, we’ve found another option that can be less intrusive: video diaries. 

We send respondents a webcam, ask them questions (either in a video clip or in writing), and when it’s convenient and appropriate for them, respondents answer by talking to the webcam.  They tend to be more natural, open and honest, since they don’t have a stranger in the room with them, and they’re participating at a time that makes sense to them, not on the researcher’s schedule.

Now we’ve started using a new method that combines the strengths of video diaries with the benefits of group interaction.  It works like an online bulletin board focus group, except it uses video.  Respondents answer questions by talking to a webcam, and then they watch the video responses recorded by other participants.  So we still get the benefit of participants’ unbiased responses, but we get the added richness that comes from the “cross-fertilization” of a group discussion (e.g., “oh yeah, now that you say that, I forgot to mention…”).

To find the optimal research method to learn about your market, give us a call at (818) 752-7210.

As we’ve mentioned in the past, when companies say they want to conduct “website usability testing,” they usually want to know about more than just usability.  They also want answers to questions such as what users think of the site and what would motivate them to use the site versus other options.  That’s why we typically include a qualitative interview along with our usability sessions.  But in some cases, clients want to focus on usability issues and gain a deep understanding of how users move through their website.  In these cases, we recommend conducting quantitative remote usability testing.

With remote usability testing, several hundred respondents interact with websites from their own homes or offices, and we record all their clicks and their paths through the sites.  We can also ask them questions about their experiences (both typical survey questions and open-ended questions).  Now in the old days (and by “the old days,” I mean 1999!), this required that respondents download special software.  But nowadays, it’s possible to record respondents browsing any website without downloading software and without any programming on the website.  That means that companies can even learn how users interact with their competitors’ websites!

Costs have come down, too.  Usually, a remote usability study with 200 respondents can be conducted for about the same cost as an in-person study with 15 respondents.  This provides a large enough sample to enable us to analyze the behavior of different segments, or what we call “personas” – that is,  different groups with distinct ways of interacting with a given website.

To discuss the best way to conduct research to make your website more effective, give us a call at (818) 752-7210.