market research

Research PART II: Competitive Analysis: Secret Weapon – The Mystery Shopper

In our last blog we discussed Market Research – Your Roadmap for Success. Today I’m going to delve into competitive analysis and more specifically, using mystery shopping to conduct competitive research. This blog will explain the importance of mystery shopping as a key approach to learning about how your business can be differentiated and why it’s equally important to hire a professional to conduct mystery shopping research.

Do you know your competition? How are they different from you? What are they doing that you’re not? How are they perceived in the marketplace? More than any other marketing approach, I have found that conducting a competitive analysis for our clients has proven time and time again to be so crucial to the success of a marketing strategy. Mystery shopping is a tried and true research method used to conduct competitive research.

What is mystery shopping?

Mystery shopping is a research methodology that uses trained, professional mystery shoppers (not your mother, your aunt or your junior marketing assistant) acting as prospective customers to ascertain particular aspects of your competitors’ businesses. While posing as customers, mystery shoppers perform a series of assigned tasks designed to elicit a particular type of behaviour or information. They observe, measure and report back on their findings.

Types of mystery shopping

Mystery shoppers may employ several techniques to achieve their goals.

  • Visit in person
  • Make phone calls
  • Send emails
  • Create custom ‘customer’ websites

How mystery shopping can benefit your company

In order to fully understand how to compete in the marketplace you must first understand your competitors:

  • What are they offering?
  • What are their prices?
  • What is their value proposition?
  • What is their brand experience like?
  • How is their online experience?
  • How effective is their customer service?

Once you understand your competitors you can make informed business decisions on how to differentiate your company. And you can use mystery shoppers to see how your company fares against the competition using the same set of criteria.

Use a professional agency to conduct mystery shopping research

It’s very important to use a professional agency when conducting mystery shopping research. There is a strategy to competitive research. Based on the information you’re trying to elicit, you pre-assign tasks to the mystery shoppers. They must be professional or they will be detected, wasting whatever time and money you’ve invested in the effort. The information they return needs to be analyzed and a marketing plan created on the basis of those results.

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Market Research – Your Roadmap for Success

What exactly is market research? Why is this powerful tool important for your business? Market research provides valuable insights on what people will buy, why they’ll buy it, and how to incite them to buy. It’s also used to answer the age-old question, why do your customers choose YOU? In this blog, I’ll highlight why market research is so critical to your business, as well as provide you with key reasons why you’ll need to hire a professional marketing agency for unbiased research.

Why conduct market research?

Market research sets your company up for success by providing the information that you need to make informed business decisions. Experience alone is not enough; arm yourself with research and facts to understand your market and your customers. Market research can help you:

  • Understand your customers and their preferences
  • Identify potential issues you may not be aware of
  • Understand how your customers define your brand
  • Identify ways they value the services/products you provide
  • Learn how your customers compare you with your competitors
  • Test new products/services and/or new markets
  • Gauge the success of a new advertising campaign
  • Identify performance, pricing and/or promotion opportunities
  • Monitor the competition in your market
  • Keep up with the changing marketplace and economy
  • Mitigate risk in your business decisions

Market research methods

When conducting market research, there are basically two types of methodologies:

  1. Qualitative researchis information that comes from conducting deep “quality” research through the use of discussion guides, and is typically gathered via phone interviews, face-to-face interviews, or focus groups. Questions are typically developed by use of a discussion guide outlining issues or concerns you’d like your customers to weigh in on. The answers can help you understand why they chose your company to work with, what they value in your service/product, what they think of your brand, and how they respond to your marketing/advertising. This type of research is best used when you want to understand the needs of your customer so you can better target your marketing and messaging to their needs and values.
  2. Quantitative research is usually numeric, and done through a survey. It is far less detailed and there is no discussion with actual customers. It involves sending out a survey to customers and gathering statistical information, which can then be extrapolated to give you averages and percentages, e.g. 9 out of 10 customers are satisfied with your level of customer service. This type of research is best used for measuring customer feedback on an ad or a new service, or the launch of a new offering.

What unbiased research means

Almost every business owner I know says that they know their customers, that they speak to them on a regular basis and if there was a problem, their customers would tell them. Sorry to say, but this is rarely the case. Just like we don’t tell the server that the food was really bad, our customers may very well give us a truthful answer, but more likely they will give us a version of the truth. When a third party speaks with your customers, they feel this is their opportunity to really share the “truth” without hurting any feelings. If you are asking your customers directly then this is 100% biased research and is considered invalid because you have a vested interest in them being satisfied customers. Unbiased research doesn’t allow opinions, nor preconceived notions or preferences to affect the research. It is conducted with an entirely open mind and not biased in any way towards a desired outcome.

Market research benefits to your business

We’ve been conducting market research for almost two decades and I know how it can positively impact a business by providing actionable insights that can act as a catalyst for organizational growth. These insights will equip you for better decision-making and provide you with a greater understanding of customers, and competitors. Market research can help you to maximize the potential of your current business activities and create a roadmap for targeted marketing strategies and future growth. Every business, large or small, can benefit from having market research in their arsenal. 

Use a professional agency to conduct market research for your company

Market research is not a DYI project. It’s very time consuming and requires trained and skilled resources to perform, analyze and deliver results without any research bias. Set your business up for success and hire a professional marketing agency with proven processes, resources and analytics to maximize the potential of your market research.

CreativeWorks Marketing will work with you as a trusted partner in achieving your business goals. As a first step, we’ll establish clearly defined goals for market research in addition to determining what you need to know and why. We’ll perform, analyze and deliver results of the highest quality and keep the data confidential. Contact us today and let’s discuss how market research can benefit your company.

Knowing Your Customers: A Market Research Case Study

 Several organizations I have worked with over the years claim to know their clients inside and out, but is that really the case?

Many of them often tell me they know how their clients perceive them because they explicitly ask for their opinion. However, I would argue that much like we rarely tell the waiter/waitress that we don’t like our meals, our clients are unlikely to tell us the truth unless there is a real issue. However, if third-party sources ask the same question to your clients, your clients are more likely to tell the truth. This fact alone is why unbiased market research is a crucial step in any marketing strategy.

In this blog, I’d like to share with you a case study that perfectly illustrates the importance of market research and how it helped them better define who they are to their customers.

Overview

Our client, a mid-sized educational toy distributor in Toronto, wanted to conduct research to identify their customers, the views they have of their brand, and the values they tie to the brand and its products. Specifically, they wanted to determine if there was a difference in buying behaviours between the company’s two key markets, establish any product leakage, and validate their brand recognition in the marketplace.

 Conducting the Research

Based on the client’s goals for this research project, we determined both qualitative and quantitative research was needed in order to receive the answers we were looking for.

First, we started by conducting preliminary qualitative research. Qualitative Research is the process of talking to someone through open-ended questions about a particular subject to gain insights into their thoughts and opinions. This can be done through a conversation, phone call, or focus group.

To complete this research, we conducted eight discussion guide-driven phone calls with a targeted cross-section of buyers within our client’s target audience.

With the results of the pre-field research, we crafted a highly customized survey that allowed for each audience to only see questions specifically directed at them. We further segmented the questionnaire by programming it based on the role of the individual by type of organization and then by responsibility. This type of research, called Quantitative Research, allows us to track data with closed-ended questions and more numerical information.

Findings

After analyzing the gathered information, we were able to provide our client with an in-depth analysis of their customers. The key findings indicated that their customers with the most purchasing power in their target audience reported the least amount of brand exposure. It also clearly identified that their brand was very well known in one of their key target markets and less known in the other, and lastly, their catalogue is highly utilized and highly regarded. 

Next Steps

Once the deeper analysis was complete and revealed more about their customers’ buying behaviours, preferences for price vs. product quality, and delivery times, our client was able to develop a marketing strategy for 2017 that was truly in line with their customers’ needs and wants.

Market research is a crucial step in your marketing strategy. It provides you with insights you would not be able to get by just asking your customers yourself. Market research helps you get to know your customers better, and what is more valuable than that?

Second Place Is A First-Rate Strategy

With almost 20 years in this business, it’s not that often that I come across a TV commercial that actually gets me excited, but Classico’s pasta sauce competition commercial has done it. It’s not because of the creativity or the out-of-the-box thinking, but because of the strategy! The commercial establishes a pasta sauce competition, the opponents being a group of Italian “Nonnas” and Classico pasta sauce chefs. When the winners are announced, the Italian Nonnas take home the gold, while the Classico group stands cheering. It ends with a voiceover that says:

“Homemade pasta sauce will always win, but with inspiration from the regions of Italy, we’re a close second.”

WOW! I wasn’t expecting that ending! And that is why the commercial is so effective. The commercial has the ad sponsor, Classico, celebrating the fact they didn’t win a pasta sauce competition, and promoting the fact that their brand was, indeed, second place in the pasta sauce game.

Brands usually don’t take this type of risk by admitting defeat, but by doing the unexpected and taking this risk, and creating a strategic approach, it’s a win-win.

Classico hasn’t created a major marketing campaign for over 10 years, so this ad needed to create some serious dialogue. After conducting some market research, Classico found that their consumers frequently make homemade pasta sauce on the weekend and believe that a store-bought pasta sauce will never live up to something made from scratch. They also found that; while their consumers appreciate homemade sauce more, “for those nights when they want to deliver a great meal, but don’t have a lot of time, they want a high quality pasta sauce alternative.”

Knowing this, Classico launched their “Second only to yours” campaign. Admitting their sauce will never beat a delicious homemade sauce appeals to consumers looking for brand honesty, and as I discussed in last week’s blog, honesty is key in a marketing campaign. Classico knows their consumers value high quality sauce, so by informing them that while they are not going to beat their homemade version, they are still a close second, appealing to this busy target market.

In 1962, this strategy was also met with great success when Avis embraced their second-place status as a way to hype the brand’s customer service with the tagline, “When you’re only No. 2, you try harder.” They retired the slogan last year after finally slipping into third place behind Hertz, 50 years after the tag line was created.

As we can see, this risky strategy worked well for both companies. Classico’s ad has now become a viral video, and Avis produced a popular slogan that was used for half a century. However, if everyone started a marketing campaign claiming they were number two, we might be in trouble. These two case studies are great examples of how well-researched marketing strategies can go against the grain and pay off big time.

Why is Marketing one of the Least Respected Business Disciplines?

persuasionMany business owners consider marketing to be a necessary evil, you know you need to do it, but you’re not exactly sure why or what you need to do.  Marketing is an indefinable grey area covering the various activities you might do between producing a product, offering a service and selling it.

Although online marketing has helped to improve this, it’s often hard to directly attribute revenue to marketing, it’s always been one of the least-respected business disciplines — poorly measured activities that are deemed “not necessary” and are the first to be cut when times get tough.

I like to think of marketing as all the steps that lead up to the sales conversation — whether it’s market research, branding, pricing and distribution, packaging and promotion, market segmentation or advertising.  All of these disciplines help to bridge the gap between the product/service and the customers who either buy them or ought to.

Simply stated, marketing is everything you do to place your product or service in the hands of potential customers.

You might think of marketing this way: If business is all about people and money and the art of persuading one to part from the other, then marketing is all about finding the right people to persuade.

No matter how terrific or unique you company is, people (consumers) don’t just “buy” a product/service.  It is not happenstance that they want to buy YOUR product or service. They “buy” the concept of what that product/service will do for them, or help them do for themselves.  For example people who are overweight don’t join a franchise diet centre to eat pre-packaged micro-meals.  They “buy” the concept of a new, thin, happy and successful self.

People have their own unique perceptions of the world based on their belief system.  The most innovative ideas, the greatest products, or a superior service succeed only when you market within the context of people’s perceptions. Once you understand and accept this premise, you are ready to start marketing your brand to your audience.

I leave you with the immortal words of Aretha Franklin, “All I’m askin’ (oo)
is for a little respect…”

Do you feel you have a good understanding of what role your marketing plays in your company?  Do you feel your marketing should increase your sales or that your marketing should you’re your audience to the sales conversation? I look forward to hearing from you in the comments below.