Using Marketing Research & Insights Intelligently To Avoid Poor Decisions
Updated: Jan 21, 2020
Do you run a marketing research and insights department, or does a function like this report to you? Having a solid research and insights function is worth its weight in gold – if it is staffed properly and has an adequate budget to complete key research tasks. But if your department is not running as smoothly as you feel it should, or if there have been missed hand-offs or errors, maybe it’s time for a tune-up – but first a little background.
Marketing research and insights teams exist because the world is an uncertain place, and the mitigation of risk (or alternatively, support of successful businesses) is an important business function. Marketing research and insights teams work best when they have the resources and autonomy to investigate customer behavior, explore trends, and the authority to (respectfully) challenge marketing assumptions that may be sub-optimal or simply wrong.
From an organizational standpoint, the head of research and insights should report to a business unit leader. Optimally, this is the President or CEO who is responsible for multiple functions, such as strategic planning, sales, marketing, R&D, customer service, and production (this assumes a traditional manufacturing model – but similar functions can be substituted for categories such as software development, financial services, e-commerce, etc).
The point is that the eyes and ears of the consumer/buyer need to have a direct pipeline to the stakeholder/business owner and key decision-makers. Research should not be beholden to the marketing function per se: the pressures of day-to-day marketing activities can easily usurp the willingness to listen to objective, fact-based decision-making found in great research departments. This is especially problematic in ad agency business models, where research and insights reports to an account team. One must ask: is the goal to understand the consumer and build the business, or simply solidify the client-agency relationship? The conflicts are obvious.
At the outset, let me make it clear that this is not a competition, nor an attempt to say one function is somehow “better than” another. Marketing research and marketing are integral to one another, yet each requires a different skill set. Marketing research is there to help marketing (and the company) succeed, working hand in glove, but with independence.
No one can argue that the pace of business is breakneck. It is unfortunate that business leaders and marketers are overwhelmed with day-to-day fires, absorbed by executional details, and frantically racing to meet promotional or product deadlines. The downside: this can severely limit their ability to focus on larger strategic and business issues, and overall brand health. The marketing function is often a casualty of limited bandwidth, strapped for resources to get even basic tasks completed.
On the flip side, marketing research is also under assault from multiple angles of attack, most notably in-house DIY research and untrained staff. A lack of thoughtful discussion and thinking can produce misleading results. This further diminishes the value and promise of what a research function could be. In today’s environment, an over-reliance on questionable algorithmic approaches, such as social listening and AI solutions, also misses the larger need to understand consumer behavior and how to build brands from that learning. At the same time, there seems to be less and less questioning of data sources and data quality: the assumption is that if it exists in digital form, it must be true. This is simply wrong.
The notion that a marketing research or insights team knows less about marketing principles than the marketing function is also a long-standing fallacy. Marketing research and insights experts have in-depth knowledge of consumer behavior, brand history, and category dynamics. Marketing research and insights can also leverage knowledge accumulated over time to guide better decisions, rather than to assume that no facts exist, so we’ll invent everything from scratch.
Here is a simple checklist to see whether you are really leveraging your marketing research and insights team to the max:
How do you feed your new product funnel? What role does research play in helping you generate new ideas and opportunities for future business development?
Do you have a planning and strategy session or process (i.e., annually) to anticipate future marketing activities? Is your marketing research and insights team invited to these meetings? If so, what role do they play? If not, why not?
Do your plans specify various stages of product testing, such as idea screening, concept development, or positioning and communications research?
How do you go about new product development and prototyping to align with your idea screening? Whether you are building a product from scratch or creating a wire-frame for a new e-commerce site, what process are you outlining?
Do you have an in-house product testing or evaluation function (typically part R&D), internal or external UX or sensory testing panels, or processes in place to optimize your offering?
Who is your target audience: what kinds of strategic research have you conducted to determine who your target audience is?
How do you evaluate new product introductions? Simply throw them into the marketplace and hope for the best? Or do you have a comprehensive marketing research and analytics plan to assess performance?
How do you benchmark ongoing business performance - are you simply looking at whether sales or units go up or down? What do your buyers say - and what do you do about it?
We know, questions are easy! But if you don’t start asking the questions about how your research function fits within the broader context of your overall new-product and innovation initiatives, chances are that you are going to go sideways rather than forward.
Needless to say, I believe in research. There are some things that research simply cannot answer: the products of genius, the subconscious, and the truly gifted inventor or designer. Research does not have all of the answers. But in the majority of cases, a business needs insights to run. Without the right team in place, your chances of success are significantly reduced.
If any of this intrigues you, or you would like to discuss the idea of building your research function into the powerhouse it needs to be, give us a call. We like discussing ways to make the research and insights function a truly beneficial one for companies of all sizes.