Playing mind games

Who doesn't dream of living on the cutting edge of business or to have the power to turn things around? As global business becomes increasingly competitive, many companies believe there's only one way of staying ahead of the competition.

By Deepika François

Consumer knowledge, in other terms understanding what people want may be the answer to business growth. But what may seem relatively simple is a mind game that few are truly capable of playing.

Those who play know the stakes are high and the consumer is a tough customer. Making leeway into a person's emotional landscape is not easy and market research may play an important role on the way to deciphering the needs of the elusive consumer. While some may frown on market research, more companies, both large and small are putting their money behind research and in turn, research is evolving to meet their demands.

As Matthew Carr, research director of Illuminas APAC tells me, research by itself has evolved and "been forced to abandon its ivory towers and get vernacular". He explains that one focuses less on theories or methodologies today but more on producing insightful outcomes. Kevin Reagan, executive VP of the Research Pacific Group feels research has been historically treated as data and the beauty of research lies in its interpretation. He says, "Interpretation goes a long way in how you apply data and understanding the needs and concerns of various stakeholders is of immense benefit in interpreting information in a relevant way."

Consumer insights or picking a consumer's brain go a long way to creating new product solutions, facilitate market entry and help one comprehend one's presence in the marketplace. Research also helps companies assess the risk factor and ensures that marketing dollars are not wasted. It serves as insurance for your decision-making, points out Grant Bertoli, MD of TNS Singapore.

However, being obsessed with risk reduction may lead companies to misuse research, generating examples of poor thinking, warns Carr. He gives the classic example of advertising development, explaining that a focus group of consumers shouldn't be expected to "deliver brilliant, original advertising". This should rest within the realm of the "brilliant, original creative director", he adds. While research may not always be the solution, more often than not, it helps analyse the pulse of the market.

Glenys Taylor, marketing director, APAC of Watson Wyatt believes it is one of the company's primary foundation stones. The firm conducts a broad range of research, particularly for market entry in countries like Bangladesh and Vietnam. While it is self-evident that no one methodology works across all markets, she observes that some research forms work better in certain countries. For example, online research may work well in developed markets like Singapore or Hong Kong, whereas face-to-face interviews may work better in North Asian countries.

A large part of research success would have to do with cultural sensitivities and the nature of the research conducted. Simultaneously, research questionnaires would have to be formulated in an interesting manner to help cull out the best responses. Jill Telford, CEO of Synovate North Asia thinks it takes a lot of effort and skill to get one's questionnaire right and is a joint effort between research firms and their clients.

As consumers become more sophisticated and clients more demanding, another major trend TNS observes is increasing specialisation across both categories and functions. Researchers are expected to not only understand a specific industry but to be very knowledgeable about it. Having said this, many of the large research firms are investing in recruitment and training with different interviewers designated for different tasks. For example, The Research Pacific Group gives employees interacting with clients the opportunity of participating in an online marketing research certification programme conducted by the University of Georgia.

Bertoli also identifies a certain pressure on research firms to contribute more than "purely survey data driven research". This could account for insight driven methodologies that no longer focus on qualitative or quantitative research alone. While the "old favourite" or focus group, as Telford puts it, is still alive and well, ethnographic studies help one understand consumers by studying them in their homes or as they shop. Dominic Lefebvre, regional director Asia, The Leading Edge, says ethnography "provides a truer in-situ picture of consumer behaviour" but traditional research methodologies continue to provide the fundamental insights that drive marketing and business strategies.

Aviva Asia for one relies on the traditional market research model, conducting both quantitative and qualitative research. Tim Beardsall, marketing director, Aviva Asia explains that the quantitative part of it gives them insights on where they are today, whereas the qualitative aspect of it adds value to their business.

Traditional models may prevail but technology has left its imprint on market research. It may not be possible to define online as a valuable tool, as Telford says, but it is "simply a reality today and one of the many methods available to them". As often said, the method used depends on a marketer's objectives, the target audience and the country in question, but online facilitates data collection. Bertoli explains how report automation technology has vastly increased the speed and accuracy of report generation, allowing for larger projects to be conducted in shorter periods of time.

Online is also used to target higher socio economic groups and young people who have more access to the internet, Travyn Rhall, CEO, Millward Brown, APAC and Africa says. Carr calls it a fantastic tool when used appropriately but feels it's generally not suitable for studies looking at any aspect of channel preference.

Like any other methodology, it's bound to have its flaws but its interactive nature may prove advantageous. Discussions can be held with target groups sitting at home or work through the internet and often with people who shy away from face-to-face contact. Traditionally, research has been done by "interruption", Bertoli says. Online research, when conducted through "managed" online access panels can take away the interruption from the picture. He believes this is an advantage as people answer questions based on their convenience, leading to higher response rates and better quality.

Roger Moy, regional research and planning manager, Yahoo Southeast Asia argues that online is still very much in its infancy in SE Asia, but it's becoming increasingly popular for its cost efficiency and quick turnaround. So should everyone ride on the online wave? Not necessarily, points out Rhall of Millward Brown. "An online survey of older people for a category that is targeting down market groups done online could be very biased."

Other methods being tested include SMS, blogs, and social networking. Carr also talks about really new techniques such as eye-tracking technology and fMRI (Functional magnetic resonance imaging) that are still in a nascent stage. But what could work well is a mix-n-match attitude, combining a variety of techniques to approach different sets of consumers.

Market research set aside for a moment, companies like Dow Jones are creating solutions that provide businesses with timely, reliable and comprehensive information about the marketplace. According to Bruce MacFarlane, MD, Dow Jones APAC, "this enables traditional market research to play its purer role." One of its solutions, Factiva Insight provides analysis of mainstream media, websites and consumer generated media. This enables companies to track their brand as it is being told in a world of social branding.

While traditional market research may never lose its foothold, the need to respond to market trends is being pushed towards the end user, MacFarlane argues. Social networking seems to be omnipresent in the vocabulary of most marketers, with consumers tasked with monitoring brand movement or brand equity. The world of social networking is also throwing up new target groups like the prosumer, or "the much more savvy consumer who acts as a professional in a consumer sense", as MacFarlane defines this group. Prosumers also set trends and are considered to have tremendous influence, but as Lefebvre puts it, "Anybody can be a prosumer depending on the category we are in."

While the focus may be shifting from traditional target groups to prosumers and bloggers, one can't ignore the AB demographic or the baby boomers. The AB demographic is often broadly applied to those with the most disposable income, the top "10 to 20% of the population in terms of incomes". Often a group targeted in developed markets, it is seen as an increasingly important segment within Asia.

As the number of High Net Worth Individuals (HNWIs) increases exponentially in Asia, Lefebvre identifies a greater focus at the top end of this segment. Telford of Synovate explains how it is hard to use the class system as a differentiating factor within Asia, with the exception of India where a class system reigns. This makes household income a more definable metric, increasing the usage of the AB demographic.

On the other hand, baby boomers may not really apply to Asia, explain many of the research heads and marketers I speak to. Lefebvre explains that in many developed countries, "baby boomers stand to inherit the greatest transfer of intergenerational wealth in history". He feels that in developing markets, "it is the aspiring generation of the 70s that will immediately reap the benefits of a buoyant economy".

Another main reason why baby boomers may not apply is the relatively young Asian population, with marketers laying emphasis on those aged 25 to 40. Interestingly, a growing target is the ‘silver market', particularly within the financial services industry in both Singapore and Hong Kong.

Different target audiences and studies require different methods, so how reliable are the methods currently available and those still in their infancy? "If a researcher tells you what the most reliable method is for your category before you have asked them a question...do not hire them, they are not listening", Carr of Illuminas says.

Reliability would also depend on one's target audience and market as much as the methodology, so they'd all need to work as one. When discussing reliability of research, it may be important for clients to define their objectives right from the start so the survey makes sense. Another important component linked to reliability is that of data and its interpretation when conducting a study. As most of market research is about interpretation, it may not be 100% accurate. Reagan of The Research Pacific Group highlights that "while quantitative research may be more reliable when done correctly, qualitative research can actually yield more rich insights."

How reliable it is would also depend on the surveyor and the surveyed and how tightly the research brief or sample was built, adds Taylor of Watson Wyatt. Another tricky thing is when people don't know they're filling in surveys as there's so many of them being done today. As people are more solicited, response rates are on the decline across all markets and Singapore is no exception. With the average work week of a Singaporean on the increase, it would be rather naïve to expect them to answer a difficult and uninteresting questionnaire.

Moreover, Singaporeans are willing to share information but not specifics, Kang Eu Ween, enterprise marketing director, APAC, Juniper Networks says. But he states that 75% of research data proves useful to the company. While no different from other markets, Singapore tends to be a rather privileged area for companies conducting research as it serves as regional headquarters for so many of them. Taylor feels there is a risk of being over-surveyed in Singapore because of this.

With response rates on the decline and consumers becoming more knowledgeable about research, comes the issue of privacy and respect for those lending themselves to research study. Industry standards set by ESSOMAR define a code of conduct that makes it essential to respect the privacy of consumers. Privacy is a big concern in this field and particularly across certain markets like Australia, Korea and Japan. Raising the professional standards of research is a necessity, particularly with the way data gets sifted around. When I ask researchers like Carr about privacy, he believes they're amongst the most conscientious of all marketing services when it comes to protecting the rights and confidentiality of respondents.

While consumers may worry about their privacy, most of them love to be heard and view research as a way of voicing their concerns or just sharing their opinions. Even though the business of getting an interview may be hard, many of those I meet have been in the business a decade or more and are still rearing to go. But has anyone ever refused to do market research, I wonder? Some companies may not see the utility of research, only using it when they're afraid of not knowing where they tread and it doesn't come cheap either. However, some companies like Watson Wyatt set aside considerable budgets for both in-house and external research. With more and more firms conducting all forms of research, I wonder if marketers and researchers are not becoming co-dependent.

It would be fair to say that good marketers can sense the market and may only need research for certain areas and concepts that they don't understand. Even researchers don't know every market trend or every single mindset. This makes the job of a researcher a fascinating one and that of the marketer a challenge. Be it for product development, testing, advertising or brand awareness, there's always something new on the horizon.

What differentiates valuable research from one that isn't, is its capacity to help marketers find their feet and glean insights that could help them craft future marketing plans. Neither could exist without the other and no theories can help the researcher probe a person's mind. Many marketers believe that behavioural analysis and understanding a person's needs, wants and desires may simplify reaching out to them. But sometimes, the subject of study may be simpler than it seems on the surface. Good research should delve deep enough to gain insights but not rock the balance of things. After all, too much knowledge can be a dangerous thing.

Box out

A quick history of the research industry

(courtesy of Matthew Carr, research director, APAC, Illuminas)

§ Founded in the 1920’s and rooted in top level strategic consultancy work such as markets and consumers

§ Got lost in data collection and branded products (pre-internet era)

§ Merger mania and industrialisation in the 1990’s

§ Large agencies struggle to retain their key staff- results in a plethora of smaller firms

§ Client requirements move from reportage to insight…and on a global scale. Small agency structure more suited to deliver this – but no global coverage

§ Online research- data collection is now fast, cheap and easy in many markets