Recently, I got into a little debate with a market researcher I’ve known for years.
He said, “Don’t you think marketing research and strategy should be kept separate? Clients should be outsourcing market research to one objective firm. That way it won’t be compromised or biased to support a certain strategy.” I always had a feeling he felt this way, but this was the first time he came right out and said it. In other words, he’s telling me he thinks Tenato’s business model is flawed at the core. Is his “research only” approach really more objective, or better somehow?
To start with, by strategy, we mean making decisions about overall vision for your company or brand, deciding what your offering should be, deciding what your pricing structure/level should be, choosing ideal target markets, refining a message, selecting channels to reach targets, and building a budget/goals and measurement methods.
So let’s look at a few scenarios here to see if the market researcher’s argument holds water!
Scenario 1: Outsource Research & Insource Strategy
Let’s say your research is being outsourced, and you’re not getting any help in building a strategy, i.e. you’re not hiring a strategy firm to help develop it, but doing it yourself. Let’s say you sort of already have a strategy in mind. You just want the research to back you up so you can get other people in the company to agree with you.
So you go to a research firm and tell them to dig up market research about this and that…all of which supports what you want to do. They’re an objective market research company, and yes, they only do market research, but they can still be compromised anyway. Why? Because you’re paying their bill, you’ve told them the data you want gathered, whether or not that data is the complete picture. If you spec it out, you’ll get what you ask for. The research firm isn’t responsible for helping you make a good decision, just in giving you what you ask for, so this can lead to a lack of objectivity that can lead to any disaster. Do you think Eastman Kodak didn’t have market researchers hired to help them? Of course they did. Every company has reams of data to support whatever decisions they (already) want to make.
Scenario 2: Insource Research & Outsource Strategy
Let’s say you do the research yourself, but you get a strategy firm to help you develop the best strategy based upon that research. The problem here is that you may or may not have gathered enough of the right kind of data; and the strategy firm relies on the assumption that your data is telling the full and complete picture. What’s more, if you have biases (say, your “research” is covering up weak salespeople, your customers are not happy, and your product doesn’t perform like you say it does), then a good strategy firm would be very uncomfortable guiding your decisions and developing messaging that they could be sure was true. This is why most marketing strategy firms that don’t do research are just as happy to tell “whatever message you want to tell” or give you something “creative”, regardless of accuracy. They are paid to say whatever you want them to say, whether or not it is the most authentic message for you. They may make it sound good and look good, but if it’s not true, the success of the messaging and everything around it will ultimately fail in the marketplace.
Scenario 3: Outsource Research & Strategy Separately
This is the scenario my research colleague was most likely advocating, and we’ve certainly been in this boat with clients. The problem is this: Market research firms who do NOT do strategy simply don’t understand what data is truly needed to develop a complete marketing strategy. Nor do clients often know what research they really need to develop a complete strategy, so they fail to ask the market researchers to gather the right information.
For example, the most common problem is this: putting out hundreds or thousands of customer satisfaction surveys so they can see whether satisfaction ratings are better or worse than last year. The question is, does that help you develop the key message that will compel people to buy? No! To get the answer to that question, you need to ask people why they chose the client’s offering versus competitors. You’ll also need to establish who those people are, and why the tone and style of the brand appealed to them, so that you can carefully select target customers and set a tone for the brand. These questions CAN be answered with research, but unless you do the right kind of research, and know exactly what you’re looking for to build a strategy, you’re bound to feel lost and confused, even if a research firm has given you back hundreds or thousands of surveys!
What’s more, clients that take this route often spend far too much on the research, which doesn’t tell them what they need to know, and then aren’t able to afford the help they really need to develop the strategy.
Scenario 4: Outsource Strategy & Research Together
Now, what if a hybrid firm, that does both research and strategy, and who knows the decisions you’re going to have to make, could look at the situation and say, “Here’s what research needs to be gathered to uncover all the answers you’ll need to develop the strategy.” So let’s quickly review this again. By strategy, I mean making decisions about overall vision for your company/brand, what your offering should be, what your pricing structure/level should be, choosing ideal target markets, refining a message (overall, and target-specific), and selecting channels to reach targets, and building a budget/goals and measurement methods.
Well then, the research you’ll need better be able to answer questions like this:
- Why do your customers buy from you?
- How are you different from competitors?
- How do customers make decisions (price, various qualities)?
- What characteristics do those customers have that support their reason to buy?
- What habits/roles do they have that led them to your solution?
- If you’re seeking to diversify into a new market, what kinds of prospective customers might be interested?
Only when these questions are answered can you build a complete strategy.
That said, this doesn’t mean you’ll need a TON of research. In fact, you might be able substitute a few hundred meaningless online surveys for a few dozen more in-depth conversations with customers. It doesn’t take a ton of information to feel confident in the responses, it just needs to be of high quality. The information you require will need to reveal important truths about your uniqueness as a company and your role in the world.
There is another bonus to having the strategy and research together – by speaking directly to your customers and researching competitors directly, a strategy-minded researcher will know when enough information has been gathered (clients keep repeating the same things) or when more is needed (clients keep saying different things), or when the answers can lead to new opportunities (clients suggest interesting ideas).
Another side effect is that great creative ideas pop out of everywhere. Good customers say phrases that can become great slogans and make compelling messaging. Competitive research reveals what is or isn’t a “me too” message. The research shows the strategy firm how to really build a winning strategy. The research has all the answers. And it literally FIRES UP the strategy. There is something about doing the first-hand research that makes everything raw, real, and compelling….and then the strategy can be absolutely killer, on target, truthful and reach right into the hearts of new prospective customers.
Think about how great it is then as well to have your research/strategy firm carrying forward into the implementation of creative, writing, design, and branding! Connection, connection…
Marketing Strategy is a difficult service to sell, and to do right. You are tinkering with a client’s entire company – who they are, what they sell, the price they sell it at, who they sell it to, and all the money they spend, and this is a great responsibility. Doing it without research first is irresponsible. Doing the research first hand creates certainty that the strategy is exactly on the mark, and that it is honest.
So, with research and strategy being separate, how much passion and confidence in the messaging would YOU get by reading someone else’s research report?
From our point of view at Tenato, there’s nothing like talking to our clients’ customers to help us buy in deeply that are clients ARE the best at what they do, whatever that may be. That’s how we can sell our clients so well. We gathered the proof ourselves. We believe.