One of the ways that an organization can improve its return on investment for marketing is to base its marketing activities on a well-considered, empirically-based strategy for its unique situation. Among the factors that should be considered in the development of this strategy are the assets and skills possessed by the organization, the drivers of the particular market, the nature of the competition, the stage of the life cycle of the industry or market, and any strategic windows that affect the organization's ability to successfully compete in the marketplace. Marketing strategies tend to focus on providing lower cost products or services than or differentiating their offerings from those of their competition, or by focusing on a market niche. Two examples of industries that have had to change their marketing strategies in response to the changing demands of the marketplace include the automotive industry and the pharmaceutical industry.
"Build a better mousetrap," the saying goes, "and the world will beat a path to your door." However, as all too many established businesses with new products, entrepreneurs with better mousetraps, and Internet hopefuls have found through bitter experience, if the world does not know that the new mousetrap is, indeed, better or that it is available, it is unlikely that a path will be beaten to one's door. Further, marketing is much more than getting the world out. Both our snail mail and e-mail boxes tend to overflow with advertisements for products we may or may not want, most of which are unsolicited. To send out a flyer announcing one's better mousetrap is unlikely to bring one the success desired. In addition, different types of products require different marketing strategies. For example, an advertisement for a new walker is much more likely to yield positive results if placed in the AARP Magazine (which has a target audience of people 50 years of age and older) than in Seventeen Magazine. Similarly, readers of Sports Illustrated are more likely to pay attention to an advertisement for sporting goods than are readers of Ladies Home Journal. In each of these examples, the cited marketing effort is probably doomed to failure because it is not reaching potential buyers. Further, many businesses find that a single approach to marketing is insufficient for attracting customers. Even if an advertisement is placed in an appropriate magazine, for example, it is unlikely to reach other potential customers who do not read that magazine. Part of successfully marketing a product is to determine the target market that one wishes to reach and then determine the right marketing mix to get the target market to purchase one's goods or services.
To improve the return on investment that an organization receives from its marketing efforts, it needs to develop a marketing strategy. This is a plan of action to help the organization reach its goals and objectives. A good business strategy is based on the rigorous analysis of empirical data, including market needs and trends, competitor capabilities and offerings, and the organization's resources and abilities.
Factors to Consider when Developing a Marketing Strategy
Each organization needs to develop its own marketing plan based on a number of factors. Although there is no such thing as a one-size-fits-all marketing strategy, there are a number of factors that should impact the development of a unique strategy for an organization or product line and the development of a concomitant strategic marketing plan (see Figure 1).
- First, one needs to consider the assets and skills that the organization already possesses or that it can readily acquire. For example, if an organization has a significant engineering department, it would be feasible for it to work on new projects that require engineering skills. However, if these personnel are already involved in other work and are not free to work on a new engineering project and the organization cannot afford to hire additional engineers, starting a new hardware line would be inadvisable at best.
- In addition, one needs to consider the market drivers when developing a marketing strategy. These are the various political, economic, sociocultural, and technological forces that may influence the wants and needs of the consumer base. For example, a technological force that has influenced the way that many people do business in recent years is information technology. Advances in this area have led to the need for businesses to be able to handle increasing volumes of information and data and the widespread use of information technology in many industries.
- In addition to market drivers, another external factor that one must also take into account is the nature of the competition in the marketplace so as to determine whether or not a marketing effort will be successful. Even businesses that start as innovators in their field soon find themselves with competition. For example, when buying a computer, one may choose between a Mac and a PC. Similarly, most soft drinks on the market are manufactured by one of two companies that offer very similar products. There are also a variety of choices available when deciding where to fill up one's car, yet most of the fuels available at the pump are virtually the same. Each of the businesses within these industries has its own market position and strives to keep its market share through marketing efforts. Part of their strategic marketing efforts is to decide how best to differentiate themselves from the competition.
- Another external factor that impacts how a business can best position oneself in the marketplace is the stage of the market or the industry life cycle. Some organizations excel as innovators, for example, being the first on the market with an innovation or new product. Other organizations excel at taking the innovation and adapting it to the needs of the marketplace (e.g., lower price, different features).
- Further, there are often various strategic windows that can affect an organization's ability to successfully compete in the marketplace. These are limited time periods during which there is an optimal fit between the needs of the marketplace and the competencies of the organization. For example, advances in computer technology have been accompanied by advances in data storage methods; although cassette tapes for data backup were innovative in their time, that time has passed. A new type of tape backup for home computers would be unlikely to meet success because the strategic window for that type of device (and type of home computer) has passed.
Once goals and objectives have been set, most businesses develop a competitive strategy to help them meet these goals and to increase competitive advantage. The three basic approaches for developing a competitive strategy are to focus on:
- The provision of low cost products or services;
- Differentiation of products from those of the competition; and
- Focus on the market niche.
Although there are generic approaches to developing marketing strategies, in order to be successful, a business's strategy needs to revolve around the nature of competition in the marketplace, stage of the market or industry life cycle, impact of market drivers, assets and skills that the organization possesses or can readily acquire, opening and closing of strategic windows, as well as other factors regarding the nature of the product or service being marketed. For example, if two companies are competing in the marketplace to sell virtually identical items, they will more than likely need different competitive strategies. One of the companies may have a longer track record for the excellence of its products or customer service while the other company may offer the product at a substantially lower price. Each marketing strategy, therefore, would be...
Marketing Research White Papers
Free white papers and articles on different marketing research techniques. Topics range from advertising research, to innovation, to concept testing and product testing, to win-loss evaluation. These articles detail the best practices for research. All articles were written by marketing research professionals.
Capturing offline, organic word-of-mouth episodes via an online word-of-mouth tracking program.
A comparison between in-person qualitative and online qualitative techniques and methods.
The advertising industry, as a whole, has the poorest quality-assurance systems and turns out the most inconsistent product (their ads and commercials) of any industry in the world. Unlike most of the business world, which is governed by numerous feedback loops, the advertising industry receives little objective, reliable feedback on its advertising.
A summary of recent insights about advertising, based on the latest research findings.
The promise of media advertising is great. It's an opportunity for a brand to tell its story directly to the ultimate consumer. It's an opportunity to build awareness and project a powerful brand image.
Jerry W. Thomas discusses what has lead to the success of Decision Analyst (Published in the Wall Street Transcript).
The B-to-B Brand Equity Monitor is a strategic tool for assessing the strength of a companies brand relative to competitors in its market. Through the use of advanced analytics and modeling, it offers insight executives need to make better strategic decisions that will drive business success.
If you need to hire a marketing research firm but have never done so, here are some tips to get you started.
Over the past decade, some companies have set up private online panels as an economical way to conduct marketing research projects. A private research panel (sometimes called a custom panel or customer panel) is one set up by a company solely for its own use. While many private panels are a success, an equal number are deemed failures. This article outlines some basic guidelines to help you decide if a private panel is right for your company.
A look at the future of Online Marketing Research.
What is a brand, and why do brands matter? What is brand equity or a brand franchise? And how do you measure and manage brand equity to maximize profits over the long term?
The strategic implications of the Internet are far reaching—for global commerce, for global marketing, and for global marketing research.
Most analysts define operations research and management science to mean the application of the scientific method and advanced analytics to the solution of business problems. OR/MS almost always involves building a mathematical model of some business process or system. There is an objective function; that is, a mathematical definition of the object or thing to be optimized (to maximize profits or sales revenue or minimize costs, typically).
Conducting opinion research among businesses is problematic. This is particularly evident at the simplest level of analysis, customer segmentation. However, segmentation techniques are evolving and techniques that were common practice in the recent past are rapidly being supplanted by newer, more meaningful segmentation techniques.
While this white paper will focus on clinics to evaluate new cars and new trucks, the same concepts and methods can be applied to a wide range of durable goods (bulldozers, construction cranes, lawn mowers, chain saws, vacuum cleaners, refrigerators, washing machines, and hundreds of other long-lasting products).
A look at how the calibration of survey-based choice models can make a substantial difference in predicted demand and revenue resulting from price changes. Calibration of brand part-worth utilities based on in-market data such as that derived from store scanner data can deliver more accurate measurement of price elasticity and better market predictions of demand response due to price changes.
An overview of the benefits of several technical advances in choice analysis, including experimental design algorithms, segment- or customer-level models, and model calibration. The recent advances discussed in this paper have the potential to reduce survey length for choice modeling research and deliver more accurate market simulators to measure bottom-line revenue impacts.
Choice modeling makes it possible to simulate the shopping and decision-making process, with all of the important variables carefully controlled by rigorous experimental design, so that the new product's sales revenue can be accurately predicted. Equally important, choice modeling helps marketers understand the many variables that underlie that forecast.
Segmentation approaches can range from throwing darts at the data, to human judgment, to advanced cluster modeling. We will explore four such methods: factor segmentation, k-means clustering, TwoStep cluster analysis, and latent class cluster analysis.
Successful win-loss research programs are built around a well-tailored research tool that collects crucial information from decision makers and influencers who are involved in the sales decision process. The overall goal of the research is to determine what factors are used as decision criteria in selecting a company for a project.
A well-designed, new product concept testing system, overseen by experienced and knowledgeable researchers, can vastly improve a company's ability to develop successful new products or services. This article suggests some guidelines and best practices on improving new product concept testing.
Consumer Behavior by Leyla Namiranian
A case study using ethnographic research to provide today’s consumer in order to optimize brand positioning.
The focus of this paper is to examine the major decision-making models, strategies, and theories that underlie the decision processes used by consumers, and to provide some clarity for marketing executives attempting to find the right mix of variables for their products and services.
Most word-of-mouth (WOM) marketers would agree that having a great product is a major key to the success of a word-of-mouth campaign. However, coming up with and developing great product ideas that will be talked about can be a daunting task. Additionally, how can a marketer know that an idea is really “great” and will be talked about by consumers?
The study of customer satisfaction, or customer experience, or whatever the latest moniker is, does not occur in a vacuum; typically, it takes place in the context of the large corporation. Large organizations have tendencies, or peculiarities, that often complicate the process of measuring, understanding, and using customer satisfaction or customer experience data. Let’s look at some of these corporate complications.
The advertising media landscape is aglitter with new possibilities. Websites are universal. Social media is everywhere. Mobile is pervasive. Massive shifts of media dollars away from traditional media (television, radio, print) to the new digital media are evident everywhere. A brief look at advertising tracking research in the age of social media and the internet.
An executive understanding of eleven multivariate analysis techniques, resulting in an understanding of the appropriate uses for each of the techniques. This is not a discussion of the underlying statistics of each technique; it is a field guide to understanding the types of research questions that can be formulated and the capabilities and limitations of each technique in answering those questions.
PepsiCo and Decision Analyst recently presented the results of ground-breaking endcap optimization research at a large annual U.S. conference (TMRE, The Marketing Research Event, by IIR). The goal of the research was to identify endcap displays (by type and mix of SKUs) that would maximize sales of PepsiCo’s snack and beverage products in a major U.S. retail chain.
Communities can be a viable open innovation source. This article contains six simple steps to making an innovation community effective.
Even though the focus group has become a widely used research technique in the past two decades, a lot of folks still don't know what goes on behind closed doors.
Even though the focus group has become a widely used research technique in the past two decades, a lot of folks still don't know what goes on behind closed doors.
So what is marketing research? Marketing research is collecting data in an unbiased manner and translating that data into information, which can help solve marketing problems. Marketing research includes experiments, surveys, product tests, advertising tests, promotion tests, motivational research, strategy research, customer satisfaction monitoring, and many other techniques.
Is There Such a Thing as “Early Adopters Fatigue”? by Leyla Namiranian and Renee Hopkins
This paper uses the “Diffusion of Innovations” model to explore the concept of new technology adoption by consumers, in light of recent reports that the early adopters are becoming fatigued with the fast-paced rate of technological change. By examining early adopters of new technologies from a number of countries, an understanding can be gained of whether fatigue has set in, how, and why. (Presented at the ESOMAR NetEffects Conference in Germany, January 2002)
Developing segmentation solutions that are global in scope requires dealing with cross-cultural differences in scale usage. Given cross-cultural differences in scale usage, marketing research analysts frequently develop ways to adjust survey responses, so that a particular survey response value means the same thing regardless of country of origin.
In today’s short-term, highest-profit-margin world, most corporations, unfortunately, don’t use iHUTs like they did back during the golden age of consumer packaged goods. Many of the corporate leaders in iHUTs 75 years ago, if still in business today, have lost the art of in-home usage testing, or lost the budgets to do serious in-home research. What are some of the best practices CPG companies should pursue to fully exploit the value of iHUTs?
Customer satisfaction and loyalty surveys typically track brand perceptions both overall and with respect to specific performance areas. For example, a survey might ask customers to rate brands based on overall satisfaction, likelihood to purchase again, likelihood to recommend, customer service, product performance, and brand image. Time-series cross-sectional (TSCS) modeling incorporates both across-units and across-time variation in data variables. The results from this application illustrate the value of adding the time-series component to the analysis.
A humorous article about how advertising agencies can defend their advertising from marketing research attack.
While you can control many factors that influence consumer satisfaction and perceptions, other factors are beyond the control of even the most attentive store manager. In this time of rising prices and uncertainty, it is helpful to understand what external market and economic factors are impacting the attitudes and perceptions of consumers.
The the solution to marketing and business problems—and the identification of strategic opportunities—often lies in the realm of little data, not big data. You don’t have to boil the ocean to determine its salt content. You don’t have to eat the whole steer to know it’s tough. Most times a doctor only needs to take your temperature with a $20 thermometer, not a $10 million scanning machine. The great opportunity is not more data faster, but better data—and better analytics.
Looking For Ideas In All The Wrong Places by Gwen Smith Ishmael and Renee Hopkins Callahan
A look at in-the-box creativity versus outside-the-box creativity techniques in new product/services development.
The magic of idea-centric creativity offers a new way for corporations to re-invigorate their new product development programs using consumers who are exceptionally creative individuals who posess idea-centric creativity
When the term "market segmentation" is used, most of us immediately think of psycho-graphics, lifestyles, values, behaviors, and multivariate cluster analysis routines. Market segmentation is a much broader concept, however, and pervades the practice of business throughout the world.
An summary of the different elements of marketing.
A look at how marketing mix modeling can assist in making specific marketing decisions and tradeoffs, and also create a broad platform of knowledge to guide strategic planning.
Marketing is tricky business and a dangerous career. It’s almost impossible to measure the effects of advertising, packaging, distribution channels, media expenditures, sales organization, etc., on brand share or sales revenue. Without good data and absent any trustworthy feedback loop, marketing managers often turn to the security of marketing myths, pop culture marketing fads, fawning at the feet of consultants, and polishing up their résumés.
Measuring Animal Spirits: Economic Indices and the Future by Michael Richarme, Paul McDonnold, and Edward Carnal
Using the Decision Analyst Economic Index to track consumer sentiment and predict the future through the use of forecasting models.
The earth is shifting beneath our feet. Smartphones, iPads, and tablet computers combined have surpassed PCs in number of units shipped annually. These highly portable devices, and the new technologies embedded in them, represent tectonic shifts in research possibilities. Despite the shock and rubble of tectonic upheaval, new opportunities are visible through the clouds of confusion.
A look at the role of mock juries in the legal process, along with guidelines for their conduct.
The utilities industry has seen a great deal of consolidation, restructuring, and deregulation of late. Any one of these events has the possibility of negatively affecting the level and quality of service. As this paper shows, it is also critical to understand the different customer segments and the level of attention required to maintain satisfaction.
A rationale for moving telephone tracking studies to the Internet.
An explanation of motivational research and how it is conducted.
Regardless of the length and complexity of a survey, the overarching task is to glean actionable business recommendations from the research you implement. This paper presents a case study to demonstrate how you can steer through what may seem like too much data, using a technique we call multidimensional segmentation (the intersecting of multiple segmentation solutions driven by different consumer characteristics and attitudes).
The development and introduction of a new product is an inherently risky venture. In an effort to reduce the risks associated with new products, the forecasting of year-one sales has become an established practice within the marketing research industry. The goal of this article is to take a bit of the mystery out of the methods used to derive year-one sales forecasts for new consumer packaged goods.
An examination of the secret to successful development of new products.
Every change in the marketplace creates opportunities for successful new products. One way to keep new products flowing to market during tough times is to rely on “hyper-creatives” and idea-centric creativity. This is the creativity of innovative individuals with relevant product category experience. Hyper-creatives can help generate hundreds of new product ideas to keep companies driving forward through tough economic times.
Key driver analysis is used by businesses to understand which brand, product, or service components or attributes have the greatest influence on the customer’s purchase decision or a physician’s prescribing decision. The focus of this paper is to discuss the potential application of a relatively new tool, Ensemble Prediction, which combines thousands of regression models to produce a prediction of the overall market performance based on attributes that influence the purchase decision or physician’s prescribing decision.
Nutrition and Eating Out: Getting Inside the Consumers Head by Diane Brewton
A look at the difference in health and nutrition attitudes and behaviors between heavy restaurant visitors and light restaurant visitors. The data is from our Health and Nutrition Strategist™ syndicated study.
An article about the psychological principles that underlie successful advertising.
Messaging and positioning choice modeling is recommended when the primary research objective is to obtain information that would allow a company to develop the most effective communications message to consumers, maximizing attraction to its specific brand, product line, store, or department within the store.
A look at using advanced analytics, including perceptual maps, in determining the brand positioning in the minds of consumers. The article includes a perceptual map of national restaurant chains. This data is from the Health and Nutrition Strategist™ syndicated study.
The term “positioning” is often used nowadays as a broad synonym for marketing strategy. However, the terms “positioning” and “marketing strategy” should not be used interchangeably. Rather, positioning should be thought of as an element of strategy, a component of strategy, not as the strategy itself.
Positioning has emerged as a significant area of consideration, serving as a marketer’s bridge between the levers of the 4 P’s and corporate strategy. This article will examine the basis of positioning from a nontechnical perspective, exploring the conceptual foundations of positioning and developing some prescriptive recommendations for marketers.
A summary of product testing techniques and guidelines for testing consumer products.
Much has been written about how to conduct qualitative research (that is, the techniques of moderating and interviewing), but comparatively little has been published about the far more important task of analysis and reporting. The purpose of this primer is to share some basic ideas on how to achieve the greatest learning and the most profound insights from qualitative research.
While many quantitative methods are utilized in package design research, sometimes we overlook the importance of the softer side of research—the qualitative techniques. So, the purpose of this article is to share some basic ideas and best practices for the use of qualitative research as a component in the package-design research plan.
A Quality Promise system helps you establish accountability with your manufacturers and upgrade the quality of your private brands over time.
The analysis of survey data is a massive topic, and most of this exotic landscape is beyond the purview of this article. The purpose of this paper is to offer some suggestions for the novice researcher, but even those with experience might find one or two of the tips useful.
Derived importance is a hammer that, if aimed wrong, can hit not the nail, but the fingernail. This piece discusses the assumptions and the limitations of derived importance in order to help market researchers and marketers make thoughtful decisions about whether and when to rely on them. Our focus is particularly on “professional purchase decisions,” but most of the points made here have application for consumer products research as well.
Over the past decade or so, many corporations have renamed and repositioned their research functions. What used to be called the marketing research is now often called consumer insights. This renaming and repositioning of the marketing research function might well be a great strategic marketing blunder. Read the French Version of Research Defanged
Diabetics constitute a very large market, with the health and nutritional choices of as many as 20 to 25 million households influences by one or more members suffering from diabetes. A comparison in the health and nutrition habits of diabetics and nondiabetics aged 45 or over using data from the Health and Nutrition Strategist™.
American consumers utilize financial services from a wide variety of sources. The notion of a bank is dramatically different than it was 50 years ago and is going to change even more in the near future.
A look at the growing importance of low-fat foods and restaurants’ failures to develop low-fat menu items.
Some thoughts and ideas for creating a high-growth, sustainable economy in the U.S.
The two most common methodologies used in neuromarketing are electroencephalography (EEG), which measures changes in brain waves, and functional Magnetic Resonance Imaging (fMRI), which creates images of the brain based on the flow of oxygen in the blood. Although there may be an intuitive appeal to the concept of using brain imaging techniques to expose customer motivations, a critical analysis suggests that the financial and intellectual yield of neuromarketing research remains entirely unsubstantiated.
The U.S. consumer is presented with many new and exciting models that possess alternatives to the standard gasoline engine. We will soon see how the public responds to the Leaf and Volt, but consumer reception given to hybrid vehicles to date has been less than enthusiastic. A look at how new vehicle intenders view hybrid vehicles.
No company or corporation can do much about the financial panic, credit contraction, or recession. But while times of turmoil pose great threats to a business enterprise, turbulence also creates opportunities. If only companies could find a Silver Bullet to solve all their woes. If you are using the Silver Bullets correctly, you improve your odds of success and also position your company for greater gains when the economic crisis draws to an end.
Innovation is legitimately hard to predict. But there must be a way to gain a clearer picture of an unknown future. Based on in-depth studies of 20 innovation stories—both successes and failures—we propose a six-question framework that helps companies gain a clearer picture up front of what factors they must consider to make their innovation efforts successful.
An article on how small companies can survive and thrive.
A discussion of telephone surveys as a way to monitor marketing performance over time.
Some ideas to help underdog companies defeat their larger and better-funded competitors.
A review of Charles Darwin’s theory “survival of the fittest” and how it applies in today's business world.
Forecasts of future social trends can only be developed with an understanding and utilization of underlying demographic and economic trends.
Focus groups are rarely predictable. Sometimes groups know embarrassingly little about a given topic.
Expect the construction industry in Texas to grow by roughly 6 percent overall and at least 5 percent in all but a few sectors in 2006, unadjusted for inflation.
The market is changing, and the time has come to redesign the package of that old established brand.
A groundbreaking international case study proving that a much larger number of relevant, actionable, and original ideas can be generated by using creativity techniques that encourage “in-the-box” thinking as opposed to “outside-the-box” creativity techniques more typically used.
A look at what different research techniques that could help your business avoid the next speculative meltdown. The future belongs to the informed, to the rational, to those who make decisions based on objective, research-based realities.
Perhaps nowhere in the marketing domain is our thinking more fuzzy and flawed than the on-going debate between the Rational and the Emotional. The phrase “rational versus emotional” (or variations of it) is found in textbooks, articles, and common everyday usage in the marketing and marketing research spheres. And, as with so many other topics, we all tend to copy what others are saying and writing—without stopping to really think about what it all means or implies. All too often in books, magazines, blogs, and conference pronouncements, the assumption is made that “emotions” are non-conscious and all “rational” thinking is conscious. What’s the harm in these presumptions?
This paper presents a series of preventative measures that researchers can and should take to reduce vulnerabilities of survey cheaters. The measures are based on consumer behavior, statistics, and psychology theory with empirical support. The measures have also been successfully utilized in practice by Decision Analyst and other professional research firms.
Green, or renewable, energy sources—biothermal, solar, wind, and others—are emerging, but too slowly to as yet make a noticeable impact on U.S. energy use. And therein lies a major problem facing our economy—what if green energy sources aren’t ready to fill the gap when the gasoline runs out, or when the traditional electric power plants run out of fuel?
The Internet represents a major paradigm shift that will dramatically change the marketing and advertising landscape, but it has also brought forth new research capabilities to help businesses adapt to and exploit the tectonic changes now underway.
The Net Promoter Sscore is not a magical formula, but a flawed formula that loses much of the information in the original answer scale. If you like the concept of measuring the influence of customer recommendations, you might want to consider the Net Recommendation Score™, but please remember that the Net Recommendation Score™ is only one measure—and you will need other questions to fully measure and understand the customer experience.
Guidelines for when its best to conduct a focus group
The idea that there are factors that, singly and in combination, drive innovation (successful innovation in particular) has just begun to be discussed. An effort to understand innovation drivers—those factors that motivate and shape innovation efforts, and in no small way determine their success or failure—seemed to us to be a promising way to discover what factors make for success and failure in innovation.
In-depth research of homeowners verifies the importance of HVAC contractors becoming indoor comfort experts and personal comfort advisors.
Are you consciously aware of the image you project? Is your image geared toward success? Here’s a list of questions to consider.
A look into online ethnography. This article describes what online ethnography is and how to analyze it. Online ethnography provides a snapshot of respondents’ real-life experiences in order to truly understand not just what they report they do, but what they are actually doing and how that behavior drives their decisions.
Internet research has its skeptics but continues to grow at a fast pace, providing believers with a valuable alternative to traditional data-collecting sources.
If you would like more information on Marketing Research, please contact Jerry W. Thomas by emailing firstname.lastname@example.org or calling 1-817-640-6166.