The new hunter-gatherers of data
Editor's note: Morgan Molnar is senior manager, product marketing, SurveyMonkey Audience.
In these days of cloud software tools and lean startup methodologies, DIY market research is making an impact in more and more functions and use cases. Departments in big organizations, small teams and individual professionals who formerly had no access to the budget, time and internal resources to get market research studies done for their initiatives now see that they can become hunter-gatherers of their own data.
They can arm themselves with DIY market research software tools – online surveys and audience panels, Web site feedback mechanisms, SEO analysis suites, social listening platforms and others – and listen to real consumers, prospects, customers or employees. Without having to wait for an agency presentation, they then bring home the prey: the much sought-after actionable insights that can power their strategies and drive growth and innovation in their organization. Yes, it is a whole new world out there.
In this article I’ll take a closer look at examples of how these disruptive dynamics are altering five specific market research use cases: consumer behavior, concept testing, brand research, competitive intelligence and market sizing.
We’ll look at companies gigantic and tiny, e-commerce startups and CPG titans, businesses on both the East and the West Coast. By looking at real stories from the trenches, from actual companies living this revolution, I hope to illuminate how transformative this new era of DIY market research is turning out to be.
Consumer behavior
Many knowledge-industry jobs these days are based on knowing what others don’t know and knowing it sooner than anyone else. Such is the case with research analysts at investment services firms, who are tasked with finding exclusive insights about the markets they cover so that they can share them with their investor clients.
Aaron Kessler, managing director and senior internet analyst at investment services firm Raymond James, studies online trends. For him it’s crucial to know, for example, what social or music apps young users are downloading this month or even this week. The data points he can hunt down will make it into research reports that will influence investment decisions, provide credibility to the firm and establish trust with clients.
But Kessler faced a problem he hadn’t been able to solve: surveying customers in a cost-efficient way. So it was extremely helpful when he discovered that he and his team could run their own consumer research without outside help and within a research budget that wasn’t huge. They started using an online survey panel to target the population they needed feedback from and soon they had their own proprietary consumer insights to share with investors. “It was,” Kessler says, “an invaluable tool in helping us provide unique research to buy-side clients.”
These days, understanding consumer behavior can take many forms and it can appeal to many types of companies other than investment firms. DIY market research tools can help track consumer sentiment towards a brand, uncover the whys behind a product’s good or bad fortunes and in general tell you where consumption is going in real time.
Key takeaway: Using DIY market research tools can be a cost-effective way to keep your finger on the pulse of consumer trends when an agency isn’t an option.
Concept testing
Concept testing is another – and very popular– market research use case that benefits from a DIY approach. Used to be that only the consumer behemoths like Coca-Cola or Procter & Gamble had the resources and the time to invest in deep research into what potential new product lines might become hits once out in the market. In the last couple of decades, tech start-ups using cloud software tools showed the world the way to test all sorts of concepts quickly and affordably.
First it was software itself, as in software apps that can be quickly iterated and improved according to real-time user data. But these days you can submit even physical product ideas to quick-and-easy concept tests, for example by using video and images in an online survey or user-testing platform. You can test ideas for new offerings, specific product features, messaging claims, ad campaigns and more.
Companies of any size can increase their chances of success in the market by becoming more customer-centric thanks to DIY concept testing. That’s what Helix Sleep, an e-commerce start-up from New York City, did recently. Helix Sleep competes in the crowded field of online mattress sales and its product team needs to decode very subjective sentiment data. “Sleep is so subjective,” says Jerry Lin, the company’s CEO. “Everyone is really unique as to what is soft or what is firm.”
When a start-up like this wants to launch a second product line (pillows, in this case) it doesn’t usually have the luxury of being able to commission an agency market research study. Instead, the team members roll up their sleeves and do their own quantitative and qualitative research to validate the assumptions and hypotheses they have about where their product ideas will intersect with consumer needs. Lin and his team launched online market research surveys and talked to consumers through the firm’s Web site and social media presence.
These consumer feedback mechanisms led them in an unexpected direction: people wanted a pillow of varying thickness, so the company created one with inserts that can be added or removed. It also followed consumer feedback to develop a cooling cover for the pillow and to find the right price point for the finished product. Using fast, DIY market research methods, Helix Sleep was able to get to market in half the time compared to previous products, launching “the best product that we could,” Lin says. “And in fact we sold out in the first month of our launch.”
Key takeaway: DIY market research allows you to get frequent consumer feedback as you refine your product ideas, which can ultimately shorten your product development cycle.
Brand research
Few brands have captured the world’s imagination in recent years as action camera company GoPro, a truly innovative outfit that practically invented a new consumer product category.
When a company is charting new territories like that (and growing extremely fast), one obvious challenge is that there isn’t a lot of certainty about what consumers want or need – because consumers don’t really know either! So obviously you engage in a dialogue with them and you listen to their answers.
Michael Zoglio, a former head of analytics at GoPro, was part of the brand’s international expansion. Outside the U.S., he used online surveys and other DIY market research tools to listen to customers’ views and understand the new markets where GoPro wanted to expand. International sales quickly grew as a percentage of the total based on that customer feedback data. “A lot of people go into a room and bring opinions, only a few teams come in and bring facts,” Zoglio says, fully embracing the DIY spirit. “The insights we were looking to gain were not only understanding brand health but also market potential: Being able to understand opinions from people in India or China or Japan, which may be right on the cusp of becoming big markets for GoPro.”
A benefit of online DIY tools is that they allow brand teams to keep a constant pulse on brand health, brand awareness, brand perceptions and more. A great example is the traditional brand-tracking study that many big companies run once or twice a year. Setting it up on an online platform that allows you to design the study, launch it and analyze the results quickly without outside help lets you increase the study’s frequency for a lower cost. Goodbye, information void; hello, real-time brand health.
Key takeaway: DIY solutions allow you to tap into more markets, more frequently for the same cost as one large study with a full-service firm – a strategy especially popular when assessing international markets for expansion.
Competitive intelligence
Turmeric chai and cinnamon ice cream, anyone? With changing consumer preferences and the constant emergence of new trends, the food industry is a permanently shifting field of innovation and experimentation. That can be scary for established brands, who have more to lose than their scrappy upstart rivals.
But global giant Unilever, owner of well-established brands like Ben & Jerry’s, Magnum and Breyers, decided to embrace the lean innovation spirit and launched itself into an agile market research experiment. It was the opposite of what you imagine when you think about a century-plus-old company trying to create something new.
Aware of the growing trends of ice cream with innovative flavors and healthier ingredients, Unilever tasked a five-person team with developing ideas for a new brand. According to Thomas Buckley, a Bloomberg Businessweek reporter, “They pitched ideas to focus groups of employees, tested names online through SurveyMonkey and studied social media and search data with Google Analytics to find places with lots of consumers curious about digestive health.”
This lean approach led the company to create a new label, Culture Republick, in less than a year to be able to compete for the minds of health-conscious consumers who previously may have been out of reach. Having paid attention to the trends taking place in its competitive field and having measured consumer preferences through its own DIY market research, the Unilever team was able to react quickly to shifting consumer taste and match it.
Key takeaway: Agile market intelligence isn’t just reserved for small, scrappy start-ups. Even large companies can break away from traditional methods to innovate using DIY market research.
Market sizing
We all know the stories of huge companies that were one day born in a garage. Many entrepreneurs start out with some mixture of certainty and faith that their big idea will turn out to also be a big business opportunity. But how can you know for sure before you plunge your life savings into it or quit your job in a hurry?
Doing your own market research is one great answer. Jamee Herbert was a Seattle consultant who was getting ready to leave a stable career track to launch her own company. From her own situation and from her friends, she felt there should be a market for a financial services company focused on helping parents pay for childcare.
Before she took the final step, however, Herbert launched a market research study online. She surveyed working parents of children under 5 years old across the country and picked their brains about childcare services, career aspirations, daily needs and more. When she started receiving responses, she pretty much saw her hunch getting validated in real time. “It was my future that I was seeing coming in, essentially,” she says.
Getting data from real parents helped her estimate the size of her addressable market, which was a compelling data point to show venture capital investors. “When I’m backing an entrepreneur, one of the things that I’m looking for is unique market knowledge that no one else has access to,” says Zoe Schlag, managing director at Techstars Impact, an accelerator that backed Herbert’s start-up, BridgeCare Finance.
Key takeaway: DIY market research is a quick way to get representative validation of an idea. If it’s between going with a hunch or getting unbiased feedback, reliable data will make stakeholders much more confident in your path forward.
Weren’t really possible
There you have it. These five examples, to me, are a window into trends that weren’t really possible a few years back. Cloud software tools that are ever-improving and the widespread availability of technical knowledge in this information age make it almost guaranteed that these trends will keep strengthening.
DIY market research is an effective tool for today’s savvy professionals and companies and anyone who’s not paying attention risks forfeiting a great competitive advantage. With market research that can be fast, easy and cost-effective, who would choose not to get actionable insights every time, all the time?