Hamilton Beach talks to consumers before introducing small appliance lines in Mexico and Europe

Seeking the right mix

“In Europe we had a brand name that is virtually unknown, or so we thought, and we wanted to confirm if that was true,” says David Israel, international marketing manager at Hamilton Beach, Richmond, Va. “We had a product line that had been designed for the American consumer and we wanted to see how it would fare against European designs and with European consumers. We went to Mexico doing the same thing, knowing that the Mexican consumer is a little more prone to buy U.S. products and hoping to confirm that the brand was much better established and had a higher awareness and power as a maker of small electrics.”

The research in Europe involved focus groups; in Mexico it was a mixture of qualitative and quantitative. “The European research was more taking that first step to see if our line would work with the brand and the pricing we were thinking about,” Israel says. “In Mexico we were looking to confirm specifics and determine what features we were going to put on a product, knowing that the brand is strong and that we have a pretty good retail environment in which to sell these products. We really wanted to dig deeper in Mexico, in terms of refining that product selection.”

Because of the low brand awareness in Europe, one of the research objectives there was to understand how important brand was in the purchase process, says Stephen Phillips, senior vice president of BAIGlobal, the Tarrytown, N.Y., research firm that conducted the focus groups in the U.K.

“When we were showing the items to the focus groups, we showed them by type. We got them to look at and touch the products and then come back and talk about them in general, spontaneous terms and then talk about purchase interest before prompting them on any particular aspect. In this way we could see how important brand and design were in terms of pushing overall reaction and purchase interest.”

For the most part, brand wasn’t very important in Europe, Phillips says. “Brand held some sort of trust value in this category but the purchase point is low enough for casual purchases to not matter too much. So if you buy a brand that isn’t trustworthy, it’s OK because it’s not too much money. But that’s not true in other markets such as Mexico where the amount of money spent is far more important.”

In Mexico, the brand awareness was much higher, Israel says. “We thought we were in a much better position to bring the line into the Mexican market, because of several factors. Obviously Mexico is a lot closer geographically. And Mexican consumers also have a lot of the same tastes as Americans and have been exposed to the same types of products trickling in from the U.S.

“Additionally, this is a country where our brand had been present, and people not only recognize but have very high associations of it with quality products that they would want to put in their shopping carts. So we wanted to confirm that, figure out which categories had the highest opportunities, and within those categories which products would give us the most bang for our buck.”

Focused on design

The research showed that European consumers are much more focused than American consumers on design. They like colors, rounded shapes, and good-looking appliances, especially those they plan to leave out on their kitchen counters. “U.S. appliances tend to be white, off-white or black. In the groups with European consumers, the one product that we tested that had color in it was the one that was most favorably received. It was a bright blue kettle,” Israel says.

European consumers are also not as interested in product features. “That was a huge surprise to us,” Israel says. “They took one look at an 18-speed blender and said, ‘Wow, that’s going to confuse me. I have no idea what to do with 18 speeds. Give me two or three and I’m good.’”

“We thought that product features may not be as powerful a determinant as it is in the U.S., where if you double the number of speeds, that is definitely added value,” Phillips says. “But in Europe it became a negative.”

Commenting on the overall design of the Hamilton Beach products, respondents used terms like “clunky” and “sturdy.” “The word ‘American’ meant almost professional use. It meant large, big capacity…the stereotypical huge American kitchen with an enormous fridge/freezer in it. And when they were evaluating the designs and using the word ‘American’ it was quite appealing to people but as a trendy, niche product, as opposed to a generic mainstream product,” Phillips says.

“Which is an opportunity,” Israel says, “but isn’t going to generate any significant volume, at least not when you are competing against companies that have been in the marketplace for a long time.”

Natural setting

The groups in Europe were designed to give consumers ample opportunity to examine the products. “From going around to the shops in the U.S. and Europe you see how easy it is in a retail environment for consumers to examine these products,” Phillips says. “We tried to make it similar to what they would experience while shopping so they would have the opportunity to really think about the products in as natural a setting as possible, given the set up of the focus group environment.”

To understand Europe’s different retail environment, the research probed the buying process. For example, in the U.S., mass merchandisers like Wal-Mart and Target are often where consumers buy their kitchen electrics, whereas in Europe, consumers can also go to specialty shops.

“One of the things we did to understand the purchase decision-making process was get people to talk through, in a case history manner, their last purchase,” Phillips says. “For example, ‘Describe for me the last purchase you made in this particular category. When was the first time you thought about it? Who was there when you were thinking about it? What was the prompt to buy a new one? Was it at home with your husband and someone was moaning about the rust on the kettle? Or were you in the retail environment and you looked over and there was an attractive toaster?’”

What makes a line?

The research also highlighted the differing ways consumers and Hamilton Beach product designers define a product line. To the designers, uniformity of things like the color of the knobs on the appliances and the fonts used in the instructions makes a group of products into a product line. But European consumers felt product attributes such as color and shape defined a product line.

“At one point during the discussion guide we were talking to people about ranges of appliances, asking whether they were interested in a range and if the products they were being shown constituted a range. There was a lot disagreement. People did not see it as a range because the overall design pattern wasn’t the same,” Phillips says.

“The products were designed from scratch to be a range. We felt that details such as the fonts, knob shapes, and colors made it a range,” Israel says. “On the other hand, I think Europeans are used to more dramatic ways of making things look alike by using the same types of curve, dramatic colors, or accents that go beyond just changing the color on a knob or a button.”

Many notes

Though a thorough discussion guide was developed prior to the European groups, Israel says, respondents raised a number of interesting points and prompted the dispatching of many notes to the moderator from the backroom. “I think we had become a bit deadened to [the focus group process] in the U.S. and somewhat in Mexico because we have a pretty good idea of what the consumer wants and needs and what their attitudes are. But in Europe, the respondents would say something and we would have to run in with a note that said, ‘We want you to probe this a little more because we hadn’t even thought of that!’ This really kept us on our toes and made the experience fun and interesting.”

No matter where in the world the research is being conducted, Israel and Phillips reiterate the importance of making sure moderators are fully briefed on the research and business objectives behind the interviews. “That gives them the ability to respond to and latch onto specific comments and take them and run with them. So if something comes up - for example respondents saying they want fewer speeds on a blender instead of more speeds, which is kind of counterintuitive - you allow the moderator the time and flexibility to explore those kinds of things,” Phillips says.

Helping retailers

In both the European and Mexican research, one of the goals was to explore the role that research can play in negotiating with retailers. “In the U.S., you would be taking some of your research results and using that as leverage with retailers. That’s not really the case in Latin America,” Phillips says.

“U.S. retailers expect you to research a product to death before you even offer it to them,” Israel says. “An idea we fully support because it increases the chance that your product will succeed. But that practice is not as nearly as prevalent in Europe, which was a little surprising. Perhaps the manufacturers do the research but don’t share it with the retailers in Europe. In any case, the retailers certainly weren’t used to a manufacturer coming to them and saying, ‘Here is what my consumer said and here is why I think you should sell this product.’ In the States it’s common practice.”

Two outcomes

Two research projects, two parts of the world, two different outcomes. In one case, the research gave the go-ahead to proceed with the product launch; in the other, it raised a stop sign. “We went in knowing that we didn’t have an ideal line for Europe. We were hoping to be pleasantly surprised and we weren’t. There was hope that you could launch the line as a price-driven line with good retailing. But it became clear that that wasn’t really an option,” Israel says.

“On the Mexican side it was the complete opposite. We found that it would have great acceptance. The name is strong, the products are good, the features are right. The line has been launched and we just have some preliminary results right now but it’s doing quite well.

“In the case of the European line, we will change the whole line and go back and do the same kind of research, knowing what we know from the first groups. That would put us where we were during the groups in Mexico, defining what we would put on the product, where we would sell it, how much we would ask for it, instead of getting a global view of what consumers think.”

Larger part

Research in the international arena is becoming the larger part of designing products, Israel says. “I think it might be where the U.S. was a few years ago. You can’t just put products out there and expect people to buy them just because they have your name on them and are sold at a recognized retailer. More manufacturers every day are catering to specific needs or wants that consumers have and I think that trend is going to continue.”