How To Get Off of the Hamster Wheel Of “I Already Knew That” Market Research

Many marketers with excess budget funds at the end of the year will choose to use it to fund a market research project. Unfortunately, many of these same marketers will find that, when the research results are reported, there are no significant new insights.

If this happens, it likely won’t be the fault of their research firm. Market research is a scientific process, and the first step in any good experiment is the creation of a good hypothesis. The problem lies in the fact that marketers don’t often look at their role in the research process as hypothesis-generators.

But this is exactly the part a marketer must play to enhance the odds of uncovering potential game-changing insights from market research. They need to identify what their company already knows about the issues being researched, and give the research companies some new rocks to turn over when querying customers. Otherwise, most or all of the findings will be repetitive and/or underwhelming.

We’ve found the following three concepts to be helpful to marketers in creating much better research hypotheses. Follow these and your market research partner will thank you – and be better equipped to assist you in fully understanding your customers and markets.

1. Get Specific About Your Research Hypothesis

Stephan, a business-to-business product manager wanted to know how his target market’s decision-making processes were changing. He hired a moderator to facilitate a very time-constrained customer panel at an industry conference site.

Prior to the panel session, Stephan convened a working session with some of his most-experienced colleagues from different parts of the company. They worked together to create a model of what they believed to be the typical, current decision-making processes in the industry.

The internal team also created a hypothesis of how they thought the model might be changing. For example, they believed that a certain finance-oriented stakeholder group was starting to play a bigger role in product selection decisions at many of their customer’s companies.

The moderator for the customer panel was then coached by Stephan to ask specific questions about the prominence of this financial stakeholder group in decisions, and how this was affecting other stakeholder’s decision-making roles.

The result was that Stephan and his team not only got a better fix on the role of this emerging financial stakeholder, they also learned about some surprising changes in decision-making authority amongst others in the influence chain.

The standard approach to this type of inquiry is to ask general b-to-b focus group questions like “how is decision-making authority changing in your companies?” However, using the type of non-standard approach just described uncovers much more new, actionable knowledge.

2. Get Creative In Building Your Research Hypothesis

An agricultural business-to-business company wanted to understand its independent distribution channel’s needs better. Similar research studies in the past had repetitively uncovered the same basic set of economic needs. According to the research, distributors seemed to only care about was how much commission suppliers paid them.

At the same time, it was well known that the introduction of new technologies in the industry was having the effect of overwhelming these distributors, many of whom were definitely not early technology adopters.

To try and uncover some ways to enhance distributor relationships, the lead marketer on the project, Erin, tried a new research approach. She convened a group of technology and sales personnel from her company with a specific purpose: to review promising new and emerging technologies and brainstorm which distributor functional needs each technology could potentially fulfill.

After the brainstorming but prior to fielding a quantitative research study on distributor needs, Erin sent a sales team to visit a number of distributors. Instead of talking about the company’s products, the sales reps were coached to have a conversation with the distributors about some of the new technologies and their potential use in the distributors businesses.

Then, the reps handed the distributors a set of index cards, each card articulating either an emerging functional need from the internal brainstorming session or one of the old economic needs. The distributors were asked to place these “needs cards” in order of importance to them.

In analyzing the results of this pilot test, Erin and her team discovered that some of the emerging functional needs – for example, learning how to leverage new inventory management tools to improve distribution efficiencies — ranked higher than economic needs. Indeed, distributors cared about things other than compensation.

In the follow-up quantitative analysis, Erin and the team asked a large sample of distributors to rank a combined list of these same economic and functional needs in order of importance. As in the pilot test, the research study illuminated a broader set of needs than past studies uncovered. This led the company to create new value propositions that focused on helping the channel fulfill important functional needs in their businesses, enhancing their distribution partnerships.

3. Plan For Differences In Your Research Responses

The proliferation of competitors in all industries is leading many customers to shop around until they find providers who can give them exactly what they want. This is hard on businesses looking to create economies of scale, because different customers want different things.

The best way to deal with this is through the strategy of segmentation – specifically, figuring out how to treat different segments differently. Marketers struggle with finding insightful ways to segment customers, but many customer research studies can be designed to reveal potential segmentation strategies.

If you don’t have an approach for segmentation currently – or if you want to challenge the approach that you already have — your quantitative studies can be set up with a cluster-analysis component. Through this technique, research companies can highlight subsets of customers who answer research questions similarly – and differently from other subsets. This can reveal several new ideas for defining — and ultimately serving — needs-based segments of customers with a tailored value proposition that they feel was created just for them.

 A Note of Caution: Don’t Let Your Hypothesis Make You Rigid

 A research hypothesis can be wrong and still be valuable. It catalyzes a customer dialogue that covers new territory. But you must be open to the paths that diverge from your line of inquiry.

One of our clients was tied too tightly to their hypothesis and missed the opportunity that their research uncovered. The company was a leader in the entertainment industry in the 80’s and 90’s. As they moved into the 2000s, they ramped up their market research efforts.

However, instead of using the research to create an open customer dialogue inspired by their hypothesis, senior management made it clear that they expected the research to validate their theories about emerging needs.

As a result of not having the flexibility to explore the hypothesis fully with customers – and potentially refute it with some insightful findings — the research team asked narrow questions and buried unsupportive data. Not too surprising, the company made several bad investments and lost its leadership position for over a decade.

A Better Hypothesis = More Insights and Better Strategy Alignment

In short: if you create a hypothesis designed to uncover emerging customer needs – while remaining open to whatever you find out — the odds of learning something new and valuable increase. A side benefit is that the findings will help “entertain” internal audiences as well, who are as tired as anyone of seeing the same old research reports over and over. This will help align internal resources and generate momentum for the strategic plan that follows.