Most of my consulting projects include a research component. Since clients generally call on me to help them make key decisions about markets, products, customers, or channels, working from the right information is critical. Knowing what kind of research, and how much, is needed to fill in the gaps thus has a major impact on the quality of the business advice I can provide and my clients’ success.
Traditional quantitative research has its place, especially if I’m testing a specific hypothesis. Focus groups and ethnographic profiles also have their place. If I’m setting a specific price point or trying to reach millions of consumers, these are good tools and worth the cost.
However, if I’m trying to learn what I don’t know or how buyers will react in more complex situations such as licensing scenarios, I typically use a series of structured, in-depth interviews. I can gather additional insights such as enthusiasm and hesitation, I can “go fishing” to test boundaries and fringe ideas, or I can re-focus the conversation on-the-fly to concentrate where the interviewee can provide the most information. A small number of rich interviews will not provide a scientifically valid sample, so I need to keep my grains of salt handy, however, they offer deep insights for a modest cost and can be done quickly. Each conversation is different and, taken singly, is incomplete. Viewed together, however, they form a mosaic with a surprising level of detail and provide a rich source of insight that surveys and market data can’t match. In theory focus groups can do this, but they introduce a level of group dynamics that must be filtered out.
Using an expert third-party is a good move because you’ll end up with better insights.
- Customers, partners, and even employees generally are much more open when talking to an outsider. However, the conversation needs to be “safe and comfortable” for them to open up. Experience has taught me how to sequence conversations and how to approach sensitive subjects gracefully.
- Ok, this sounds cynical, but not everything I hear needs to get passed along. For example, sales reps will always complain about pricing. How they complain, however, speaks volumes. Knowing the difference comes from operational experience, years of doing this, and the opportunity to talk to their customers. The key is how a change, such as to the price, service level, or comp plan will affect their behavior.
Decision making is about having enough of the right information to be able to move ahead. Even if you can’t model the exact demand curve, knowing that you could raise prices significantly without hurting unit volume is tremendously valuable and highly actionable information. Engineers like to optimize. The best marketers focus on satisficing—being good enough to accomplish a given goal in a specific situation.