Cord Blood Registry & Social Media
Today’s blog will focus on a narrow sliver of the social media world, The Cord Blood Registry. I will discuss the social media strategy they have employed, its features, and apparent strategies. Before getting into these more complex elements, it would be best to first provide a primer as to what the Cord Blood Registry is.
The CBR (as I will refer to it) is a private company that generates revenue by storing stem cells derived from the umbilical cord that is frequently discarded following the birth of a baby. These stem cells may become valuable for treatment later in life should the child have a disease, cancer, or organ failure issues. Since these cells have not yet been proven to actually save anyone, the product they’re selling is largely peace of mind to mothers and fathers that they have done everything in their power to protect their families. Presumably, treatments that employ stem cells, once developed, will be compatible with the stored stem cells that can be thawed out at a later point. At that point, the CBR will become a legitimate medical service. It is unclear when that point in medical history will occur, but they do seem to be sincere in their efforts to save people with their technology.
Regardless of your viewpoint on the future of this technology, it becomes immediately clear how important promoting their services on a logical and emotional level will be. The emotional component is the most important, because the exact future treatments this service can be used with are not entirely clear. So the business must truly engage with potential new parents in a way that fits closely with their hopes and fears. Specifically: hypothetical situations that create fear. Both fear of the “mad scientist” behind the product and fear for their child in hypothetical medical issues in the future.
The CBR has engaged potential customers and new parents through both Facebook and Twitter. However, their Facebook page is the more effective tool of the two in terms of fit with their business. The CBR offers a fairly static service: Storage. So the “news” the company would want to release is few and far between. In fact, the less news from CBR the better for parents, because the product needs to be considered safe. No news is essentially good news when it comes to storing stem cells for 20-50 years. Once the service is sold, there is not much room for upselling, unless perhaps they can eventually DNA sequence your children. So the type of news that CBR chooses to release is largely related to A) Stem cell technologies (which indirectly show future benefits from CBR) and B) diseases, afflictions, conditions that present future hazards (increase perceived probability customers will have need to use frozen cells from CBR). Twitter serves to distribute this type of news to their followers.
Facebook on the other hand offer greater benefits. The Facebook page for CBR offers much of the same information as their Twitter feed, but it also has information posted by users. In fact users often post stories before the Associate Marketing Manager of Social Media (Erika Gessin) can post them to the CBR wall. When CBR posts information directly, it often leads to reinforcing conversation among its users with each other. This two way communication has significant advantages to CBR. The three main benefits are evident. First, users/fans become information agents, notifying CBR of events relevant to their business. Even the Social Media Manager cannot be fully omnipotent to events that impact CBR around the world. Users can benefit the company by providing eyes and ears to important issues to young parents. Second, a forum is created for discussing stem cell storage issues. By creating such a forum, it avoids its creation elsewhere. You cannot control whether people talk about your brand, but you can ensure that it takes place in a place you can actively monitor it. Third, since you have access to the conversations taking place, you can also have back and forth communication with social media users. When product misconceptions exist, you can correct the issue. If new fears spread about stem cells, you can act to calm those concerns. Moreover, you will hear about and be able to get out ahead of stories before serious issues arise. Rapid response capabilities are quite valuable. Each of these three advantages are present on the CBR Facebook page wall by examining both the CBR additions and user posts. For a firm of its size, it appears Social Media is particularly effective for this business.
Applying the Elaboration Likelihood Model to the CBR business explains exactly why Social Media was so effective for their business model. ELM divides message processing into Central Route and Peripheral Route processing. Messages apply Cognitive (reason, logic, facts) or Affective (emotions, fears, desires) tactics. The product/service CBR has is one that is high involvement (keeping your family alive) and affective (dangers are unquantifiable, safety, security, uncertainty). Social Media is predominantly central route due to the direct interaction required to connect with and post anything. But the message style is often (but not exclusively) affective in nature. Unfortunately, its difficult to “prove” that Facebook is more Affective than Cognitive, but for the moment I will rely on my reader’s experiences with Facebook and assume that you agree. Putting all the pieces together, we have a product that uniquely fits the interaction level (Central Route) and communication style (Affective) of the medium. And the postings that CBR and users make on Facebook reinforce this affinity.
Sunday, April 18, 2010
Sunday, April 11, 2010
Walmart to the Rescue
Walmart to the Rescue
Constance Hays tried to write a balanced article. On the topic of Walmart data collection, her research was sound and informative. On her depiction of Walmart’s market power, her reasoning was sound. On privacy and the potential for abuse, she is largely borrowing hearsay and vague insinuations that have been leveled at Walmart for years. In her article, at no point does she provide any evidence that 1) Walmart has abused its data, 2) Walmart could abuse its data, or that 3) Walmart has any motive for abusing its data. In laying out a string of unsubstantiated doubts to fan fears, we see her channeling Glenn Beck in a way that, “…some privacy advocates worry about the potential for abuse.” Take that Constance!
Observations about Walmart from the Article:
1. Just because Walmart collects more data than the others, does not mean that it is collecting a disproportionate amount relative to the others. Divide the data by the number of customers they serve and how often they visit the store and we may find that it is Target or other firms that collect more data about you. Target has the loyalty program that collects user identifiable transaction data. Since Walmart does not do this program, they simply cannot put a name with the shopping data. Constance speculates that Walmart could figure out a way to add this information to its records. But she offers no rationale for *why* they would do this.
2. Just because Walmart collects the data, does not mean they can extract uniquely valuable insights from it. Figuring out that certain SKUs sell well before and after a hurricane is very simplistic insights into their customers behaviors. And it requires no invasion of privacy to accomplish – in fact, this could have been done before computers existed.
3. Just because you can prove that certain power could be abused does not prove that that power will be abused. While it may be possible for Walmart to do something bad with its data, it does not mean that they have an incentive to abuse it. What advantage does Walmart get by knowing the value of my house? This information is publicly available. Why is it any more dangerous for Walmart to know personal information than it is for my neighbors to google me? It is not.
4. Walmart has a consistent Rollback policy. There is no evidence that when Walmart is seeking to increase their margins. If data mining is not used to increase gross margins, then it would appear that it is impossible for the firm to use their power for dastardly purposes. Thanks.
Walmart’s Success at using its data to create an Experience:
It appears that Walmart is not very successful at using its data. If the best case study Walmart has on using its data is the Hurricane example, then this does not bode well. Analyzing SKU sales data for stores near Hurricanes could have been done in the 1960s. Speed might have been an issue, but stores in 1960 should be able to say what products sold well on what week. This indicates that Walmart may have limited talent or manpower working to harvest the data they collect. It also may imply that the architecture of the database could inhibit investigation. However, Walmart does not talk about its data harvesting activities, so we may not have an accurate picture of internal success stories. Given this reporter’s negative Walmart attitude, I am not surprised she didn’t gain access to higher level examples.
Trusting Walmart with Personally Identifiable Data
This question was a trap. Several implied assumptions were within the question itself. First, it is unclear whether Walmart has personally identifiable data. Yes, they have credit card transactions, social security numbers, and driver’s licenses. But many other firms have that information. The question is whether they have a disproportionate number of these. Corner check cashing services require the same information, charge higher prices, and are run by people who exploit the poor. Comparatively, Walmart has more controls in place, software to prevent data theft and so forth. Large companies do not perform “identify theft” – individuals do. By storing people’s social security numbers, they reduce the chance that people watching could steal the number. Clerks at stores and many retailers have been caught doing this. Reducing the people-centric risk is of higher concern.
The issue of trust is another false dilemma. I do not need to trust Walmart. So whether I trust them or not is not really an important issue. Walmart simply does not have much incentive to use my information to cheat me. They have rollbacks and their gross margins have been steady around 20% for a decade. Even Constance can not think of something dastardly for Walmart to do with this data even if they could put my name next to my shopping order.
Impact on Suppliers
We are moving from a world where the manufacturers had all the power to one where the retailer has all the power. I trust a retailer who has a fairly locked Gross Margin over manufacturers like P&G who perfected the “razor blade model” for extracting profits. These manufacturers have been doing all kinds of shady practices over the years, like cutting portion sizes and pushing high caloric foods/drinks for years. I have huge distrust for manufacturers. But I can trust a firm with Rollbacks who do not mess with coupons and promotions very much. This concentration of power has increase the standard of living for many people and I am very glad that Walmart has been pushing their suppliers hard. One of the big things about this is their ability to force change. Walmart has asked for things like reduced packaging weight/cost on to improve margins and reduce environmental impact. Without a push from Walmart, these firms may never have taken these action independently.
However, I am somewhat concerned that the private label business they have might go too far and stifle future innovation. It is difficult at this point to see where the logical conclusion of the war between premium brands and private labels will go. Some pressure on manufacturers may be a good thing. Too much and brands could exit the category. We cannot rely on the private labels to invest in new products ideas, at least not yet.
Constance Hays tried to write a balanced article. On the topic of Walmart data collection, her research was sound and informative. On her depiction of Walmart’s market power, her reasoning was sound. On privacy and the potential for abuse, she is largely borrowing hearsay and vague insinuations that have been leveled at Walmart for years. In her article, at no point does she provide any evidence that 1) Walmart has abused its data, 2) Walmart could abuse its data, or that 3) Walmart has any motive for abusing its data. In laying out a string of unsubstantiated doubts to fan fears, we see her channeling Glenn Beck in a way that, “…some privacy advocates worry about the potential for abuse.” Take that Constance!
Observations about Walmart from the Article:
1. Just because Walmart collects more data than the others, does not mean that it is collecting a disproportionate amount relative to the others. Divide the data by the number of customers they serve and how often they visit the store and we may find that it is Target or other firms that collect more data about you. Target has the loyalty program that collects user identifiable transaction data. Since Walmart does not do this program, they simply cannot put a name with the shopping data. Constance speculates that Walmart could figure out a way to add this information to its records. But she offers no rationale for *why* they would do this.
2. Just because Walmart collects the data, does not mean they can extract uniquely valuable insights from it. Figuring out that certain SKUs sell well before and after a hurricane is very simplistic insights into their customers behaviors. And it requires no invasion of privacy to accomplish – in fact, this could have been done before computers existed.
3. Just because you can prove that certain power could be abused does not prove that that power will be abused. While it may be possible for Walmart to do something bad with its data, it does not mean that they have an incentive to abuse it. What advantage does Walmart get by knowing the value of my house? This information is publicly available. Why is it any more dangerous for Walmart to know personal information than it is for my neighbors to google me? It is not.
4. Walmart has a consistent Rollback policy. There is no evidence that when Walmart is seeking to increase their margins. If data mining is not used to increase gross margins, then it would appear that it is impossible for the firm to use their power for dastardly purposes. Thanks.
Walmart’s Success at using its data to create an Experience:
It appears that Walmart is not very successful at using its data. If the best case study Walmart has on using its data is the Hurricane example, then this does not bode well. Analyzing SKU sales data for stores near Hurricanes could have been done in the 1960s. Speed might have been an issue, but stores in 1960 should be able to say what products sold well on what week. This indicates that Walmart may have limited talent or manpower working to harvest the data they collect. It also may imply that the architecture of the database could inhibit investigation. However, Walmart does not talk about its data harvesting activities, so we may not have an accurate picture of internal success stories. Given this reporter’s negative Walmart attitude, I am not surprised she didn’t gain access to higher level examples.
Trusting Walmart with Personally Identifiable Data
This question was a trap. Several implied assumptions were within the question itself. First, it is unclear whether Walmart has personally identifiable data. Yes, they have credit card transactions, social security numbers, and driver’s licenses. But many other firms have that information. The question is whether they have a disproportionate number of these. Corner check cashing services require the same information, charge higher prices, and are run by people who exploit the poor. Comparatively, Walmart has more controls in place, software to prevent data theft and so forth. Large companies do not perform “identify theft” – individuals do. By storing people’s social security numbers, they reduce the chance that people watching could steal the number. Clerks at stores and many retailers have been caught doing this. Reducing the people-centric risk is of higher concern.
The issue of trust is another false dilemma. I do not need to trust Walmart. So whether I trust them or not is not really an important issue. Walmart simply does not have much incentive to use my information to cheat me. They have rollbacks and their gross margins have been steady around 20% for a decade. Even Constance can not think of something dastardly for Walmart to do with this data even if they could put my name next to my shopping order.
Impact on Suppliers
We are moving from a world where the manufacturers had all the power to one where the retailer has all the power. I trust a retailer who has a fairly locked Gross Margin over manufacturers like P&G who perfected the “razor blade model” for extracting profits. These manufacturers have been doing all kinds of shady practices over the years, like cutting portion sizes and pushing high caloric foods/drinks for years. I have huge distrust for manufacturers. But I can trust a firm with Rollbacks who do not mess with coupons and promotions very much. This concentration of power has increase the standard of living for many people and I am very glad that Walmart has been pushing their suppliers hard. One of the big things about this is their ability to force change. Walmart has asked for things like reduced packaging weight/cost on to improve margins and reduce environmental impact. Without a push from Walmart, these firms may never have taken these action independently.
However, I am somewhat concerned that the private label business they have might go too far and stifle future innovation. It is difficult at this point to see where the logical conclusion of the war between premium brands and private labels will go. Some pressure on manufacturers may be a good thing. Too much and brands could exit the category. We cannot rely on the private labels to invest in new products ideas, at least not yet.
Monday, March 1, 2010
Dominos Pizza - Sandwiches and Pizza Reformulation
Possible Paper Title:
Dominos Pizza: The Insights behind the Sandwich Launch and Pizza Reformulation Initiatives
(Title length needs work)
I have been a fan of Dominos Pizza for a long time. Yes, I do know a few shops that make better pizza, but Dominos has been consistent enjoyable for a long time. I am a loyalist. I can even admit that I have had Dominos pizza as far away as Bangalore, India. In the last few years, Dominos has been making interesting changes. Some interesting and some that irritate me personally.
First, Dominos launched sandwiches: This struck me as a clever play to create a product that uses their dormant store resources (ovens, etc) during the daytime. This could make their stores quite a bit more profitable, even if these are only moderate successful. I am curious about whether this was A) An attempt to differentiate away from pizza (like Pizza Hut => The Hut & Wingstreet), B) A response to a specific customer insight or emerging trend, or C) An attempt to utilize store assets during non-peak times of day. Exploring this will be interesting, but it could lead to marketing/branding, customer insights, or operations directions. It will likely lead in several directions. I will need to follow this where ever it goes.
Second, Dominos began to reformulate their pizzas. This is a curious idea. My true interest with this is whether a reformulation could actually help a big chain. It has seemed to me (my opinion) that for a long time, that people just seem to like their local artisan pizza. In Berkeley, it was Fat Slice, Blondie’s, and Zachary’s. In Austin, its Home Slice, Austin Pizza, etc. The names change, but they’re normally pretty simple pizza formulations. Some people swear by New York pizza, presumably because of the water in the city. But Dominos has a huge number of stores, and has large amounts of resources to funnel into actual pizza R&D, testing, etc. They should be able to crush any local pizza shop. In fact, if they wanted, they could just buy a local pizza shop with a good formula and roll it out nationally. But they could have done that decades ago. This makes me wonder whether people operate under a cultural myth that big chain pizza is lower quality than the local guys. Perhaps it is a human bias that their lower prices mean lower quality. Perhaps competition with Pizza Hut over the decades has led to price wars fueling suspicions about quality. I’ll need to dig to get at the issue.
Some personal details on my experiences with the reformulation at Dominos:
I was against the reformulation from the start. In my case, I experienced the new pizza before I saw the ads explaining what was going on. My first experience: They had applied this oil/parmesan to the crust to presumably give it a more artisan feel. The effect – for me – was that I could not eat a single slice without my fingers getting extremely messy. The crust was a “handle” by which I manipulated my favorite pizza, and they had eliminated the function. As it happens, I didn’t like how it tasted like, but it is hard to distinguish between my annoyance and the taste. At the time, I assumed that the pizza shop had just accidentally given my pizza one of the promotional crusts that they offer from time to time. But when I ordered another one the following week, they had done it again. On the third pizza, I had finally seen the Dominos ads explaining their rationale – so I specifically asked the operator *NOT* to apply the oil/cheese to my crust. They complied. The sauce is different, but not tremendously. I didn’t have any strong opinion on the sauce.
Questions I’m interested in:
1. Was the Sandwich launch an attempt to differentiate away from bad pizza stigma?
2. Was it an insight into customer wishes/needs?
3. Was it a play to sweat the pizza-making assets at stores at lunch meals?
4. What was the story behind the Pizza Reformulation?
5. How much of Dominos pizza perception was real, how much was imagined?
6. Can a chain pizza establishment ever be perceived as higher quality than an independent artisan pizza shop?
7. Can large chains with their larger resources devise the perfect pizza? What would cause them to *not* choose to rollout the perfect pizza if they did? (cost, installed base, etc)
8. BIG QUESTION: If they change the sauce, ingredient, etc – Can it *ever* work? Or will tastes simple migrate away from whatever their new formulation is rolled out? Do people just hate pizza chains? Could consumers ever believe that a chain was better than the local restaurant?
While those above questions are nice puzzlers for the paper and indicate my direction…
These are the ones I can commit to inclusion in my paper:
1. What’s the story behind the sandwiches? What insight triggered it?
2. What’s the story behind the pizza reformulation? What insight triggered it?
3. What’s interesting about these stories?
4. What insight from these situations can be made use of by business managers of large chains?
Sources:
1. No B.S. Business Success in the New Economy. Dan S. Kennedy. Entrepreneur Press, 2009
Content: Contains good example about how Dominos took off because it had mastered *deliver* which could be took advantage of a key need that people had at the time. Because delivery mastery is an “enabler” rather than a differentiator, it could explain why the “taste” of the pizza has risen to the top of Dominos executives radar screens. This author is not in the slightest bit prestigious, but his example works well for what I might write about.
2. The Power of Saying 'We Blew It' By: Lencioni, Patrick. BusinessWeek, 2/22/2010, Issue 4167, p84-84, 1p; (AN 48068177)
Content: Does admitting a mistake actually work in business?
3. The Domino Affect: Time to Change. By: Sanson, Michael. Restaurant Hospitality, Feb2010, Vol. 94 Issue 2, p6-6, 1p; (AN 48000932)
Content: Trade publication. A magazine editors take on what they’re doing and how customer standards have changed. He talks about how “Its 2010. Everyone has tasted a really good pizza.” But he claims Dominos got where it is by other means.
Dominos Pizza: The Insights behind the Sandwich Launch and Pizza Reformulation Initiatives
(Title length needs work)
I have been a fan of Dominos Pizza for a long time. Yes, I do know a few shops that make better pizza, but Dominos has been consistent enjoyable for a long time. I am a loyalist. I can even admit that I have had Dominos pizza as far away as Bangalore, India. In the last few years, Dominos has been making interesting changes. Some interesting and some that irritate me personally.
First, Dominos launched sandwiches: This struck me as a clever play to create a product that uses their dormant store resources (ovens, etc) during the daytime. This could make their stores quite a bit more profitable, even if these are only moderate successful. I am curious about whether this was A) An attempt to differentiate away from pizza (like Pizza Hut => The Hut & Wingstreet), B) A response to a specific customer insight or emerging trend, or C) An attempt to utilize store assets during non-peak times of day. Exploring this will be interesting, but it could lead to marketing/branding, customer insights, or operations directions. It will likely lead in several directions. I will need to follow this where ever it goes.
Second, Dominos began to reformulate their pizzas. This is a curious idea. My true interest with this is whether a reformulation could actually help a big chain. It has seemed to me (my opinion) that for a long time, that people just seem to like their local artisan pizza. In Berkeley, it was Fat Slice, Blondie’s, and Zachary’s. In Austin, its Home Slice, Austin Pizza, etc. The names change, but they’re normally pretty simple pizza formulations. Some people swear by New York pizza, presumably because of the water in the city. But Dominos has a huge number of stores, and has large amounts of resources to funnel into actual pizza R&D, testing, etc. They should be able to crush any local pizza shop. In fact, if they wanted, they could just buy a local pizza shop with a good formula and roll it out nationally. But they could have done that decades ago. This makes me wonder whether people operate under a cultural myth that big chain pizza is lower quality than the local guys. Perhaps it is a human bias that their lower prices mean lower quality. Perhaps competition with Pizza Hut over the decades has led to price wars fueling suspicions about quality. I’ll need to dig to get at the issue.
Some personal details on my experiences with the reformulation at Dominos:
I was against the reformulation from the start. In my case, I experienced the new pizza before I saw the ads explaining what was going on. My first experience: They had applied this oil/parmesan to the crust to presumably give it a more artisan feel. The effect – for me – was that I could not eat a single slice without my fingers getting extremely messy. The crust was a “handle” by which I manipulated my favorite pizza, and they had eliminated the function. As it happens, I didn’t like how it tasted like, but it is hard to distinguish between my annoyance and the taste. At the time, I assumed that the pizza shop had just accidentally given my pizza one of the promotional crusts that they offer from time to time. But when I ordered another one the following week, they had done it again. On the third pizza, I had finally seen the Dominos ads explaining their rationale – so I specifically asked the operator *NOT* to apply the oil/cheese to my crust. They complied. The sauce is different, but not tremendously. I didn’t have any strong opinion on the sauce.
Questions I’m interested in:
1. Was the Sandwich launch an attempt to differentiate away from bad pizza stigma?
2. Was it an insight into customer wishes/needs?
3. Was it a play to sweat the pizza-making assets at stores at lunch meals?
4. What was the story behind the Pizza Reformulation?
5. How much of Dominos pizza perception was real, how much was imagined?
6. Can a chain pizza establishment ever be perceived as higher quality than an independent artisan pizza shop?
7. Can large chains with their larger resources devise the perfect pizza? What would cause them to *not* choose to rollout the perfect pizza if they did? (cost, installed base, etc)
8. BIG QUESTION: If they change the sauce, ingredient, etc – Can it *ever* work? Or will tastes simple migrate away from whatever their new formulation is rolled out? Do people just hate pizza chains? Could consumers ever believe that a chain was better than the local restaurant?
While those above questions are nice puzzlers for the paper and indicate my direction…
These are the ones I can commit to inclusion in my paper:
1. What’s the story behind the sandwiches? What insight triggered it?
2. What’s the story behind the pizza reformulation? What insight triggered it?
3. What’s interesting about these stories?
4. What insight from these situations can be made use of by business managers of large chains?
Sources:
1. No B.S. Business Success in the New Economy. Dan S. Kennedy. Entrepreneur Press, 2009
Content: Contains good example about how Dominos took off because it had mastered *deliver* which could be took advantage of a key need that people had at the time. Because delivery mastery is an “enabler” rather than a differentiator, it could explain why the “taste” of the pizza has risen to the top of Dominos executives radar screens. This author is not in the slightest bit prestigious, but his example works well for what I might write about.
2. The Power of Saying 'We Blew It' By: Lencioni, Patrick. BusinessWeek, 2/22/2010, Issue 4167, p84-84, 1p; (AN 48068177)
Content: Does admitting a mistake actually work in business?
3. The Domino Affect: Time to Change. By: Sanson, Michael. Restaurant Hospitality, Feb2010, Vol. 94 Issue 2, p6-6, 1p; (AN 48000932)
Content: Trade publication. A magazine editors take on what they’re doing and how customer standards have changed. He talks about how “Its 2010. Everyone has tasted a really good pizza.” But he claims Dominos got where it is by other means.
Wednesday, February 17, 2010
Storytelling, Gurus, and Processes
I had the pleasure of reading three articles (Gladwell, Zaltman, Ulwick) that address the search for meaningful understanding of what people want. Each offers a critique (in their own way) of how direct research of customer preferences is insufficient. Malcom Gladwell (as always) teaches through masterful storytelling examples. Zaltman is a talking-head academic guru selling trademarked vapor proprietary research methods, a book, and is probably on the public speaking circuit. I immediately do not trust this guy. Ulwick offers a direct, simple, useful, applicable method - I would probably like this guy in person.
Gladwell has an outstanding written voice that explains complex ideas in the form of stories. In this chapter he exposed the conflict that often occurs between instinct (spontaneous and often accurate decision making) and quantitative research. He wove a tale of a musician that by experts opinion should be successful with consumers and by industry standard data-driven investigation should not be successful. I suspect that the typical readers are driven to feel sympathy for the artist and outrage that he never got his chance in the spotlight. I feel differently. I think Gladwell pulled an “Outlier” story to prop up the idea that instinct can dominate detailed investigation. Gladwell explicitly suggests that the music industry is less sophisticated than CPG firms in their research methods. I disagree. Music companies cannot spend vast sums of money researching single artists the same way a CPG company can for a new product idea because of the revenue at stake, the lifespan of the average artist’s successful career, and cost of more sophisticated research. If the industry has a test that can predict with 85% certainty whether a song will be a hit, they would at least rival the success rate of CPG firm product launches.
Zaltman has a “shotgun” approach. He applies elements of many disciplines into one comprehensive test. It emphasizes images selected by a survey participant and interviews to determine a form of mental map of how people thing about an organization or issue. I do not doubt that his qualifications are substantial (Harvard) or that his methods sound impressive on the surface. But the idea of condensing 20 images per participant and a host of qualitative answers in an interview format down into meaning insights sounds remote. The mental map created for PG&E appear fruity and blue sky to me. You could construct a similar map that would make similar sense in many different ways. It has all the features of Tarot card drawings and horoscopes in that people can see elements of truth in many configurations. Again, I don’t doubt that the questions he asks could be meaningful ones – I doubt the integration of these tests has any repeatable statistical significance. It appears to me a complex methodology designed to sell a lot of billable hours that can be carefully hidden off stage behind the curtains from an unsuspecting client.
Ulwick offers an approach that on-face makes a lot of sense to me. They are proposing a “begin with the end in mind” method, whereby research is directed at the *end-goals* of consumers rather than the *means* (product attributes) that get there. The outcome of this approach is essentially a spec-sheet set of constraints for engineers and designers (They love this) that gives them maximum flexibility in figuring creative ways of obtaining these goals. Most engineers will tell you that with a set of specs (and unlimited time/money) they can do just about anything. This approach has a particular weakness however: Most firms have specific resources/capabilities. A company that specializes in, say, yogurt cannot product crackers. So asking consumers for their end-product needs might lead to some unproductive research about product ideas they have no competitive advantage in solving.
So in a Blink: Gladwell makes me suspicious – he’s writing a book about spontaneous genius after all – so its straightforward that he would want to go after quantitative research that overrules expert-spontaneous opinion. Zaltman appears to be incorporating too many things at once to achieve meaningful conclusions. Ulwick offers a research method I immediately like, but I can see situations where it might not make as much sense where firms have narrow product constraints.
Gladwell has an outstanding written voice that explains complex ideas in the form of stories. In this chapter he exposed the conflict that often occurs between instinct (spontaneous and often accurate decision making) and quantitative research. He wove a tale of a musician that by experts opinion should be successful with consumers and by industry standard data-driven investigation should not be successful. I suspect that the typical readers are driven to feel sympathy for the artist and outrage that he never got his chance in the spotlight. I feel differently. I think Gladwell pulled an “Outlier” story to prop up the idea that instinct can dominate detailed investigation. Gladwell explicitly suggests that the music industry is less sophisticated than CPG firms in their research methods. I disagree. Music companies cannot spend vast sums of money researching single artists the same way a CPG company can for a new product idea because of the revenue at stake, the lifespan of the average artist’s successful career, and cost of more sophisticated research. If the industry has a test that can predict with 85% certainty whether a song will be a hit, they would at least rival the success rate of CPG firm product launches.
Zaltman has a “shotgun” approach. He applies elements of many disciplines into one comprehensive test. It emphasizes images selected by a survey participant and interviews to determine a form of mental map of how people thing about an organization or issue. I do not doubt that his qualifications are substantial (Harvard) or that his methods sound impressive on the surface. But the idea of condensing 20 images per participant and a host of qualitative answers in an interview format down into meaning insights sounds remote. The mental map created for PG&E appear fruity and blue sky to me. You could construct a similar map that would make similar sense in many different ways. It has all the features of Tarot card drawings and horoscopes in that people can see elements of truth in many configurations. Again, I don’t doubt that the questions he asks could be meaningful ones – I doubt the integration of these tests has any repeatable statistical significance. It appears to me a complex methodology designed to sell a lot of billable hours that can be carefully hidden off stage behind the curtains from an unsuspecting client.
Ulwick offers an approach that on-face makes a lot of sense to me. They are proposing a “begin with the end in mind” method, whereby research is directed at the *end-goals* of consumers rather than the *means* (product attributes) that get there. The outcome of this approach is essentially a spec-sheet set of constraints for engineers and designers (They love this) that gives them maximum flexibility in figuring creative ways of obtaining these goals. Most engineers will tell you that with a set of specs (and unlimited time/money) they can do just about anything. This approach has a particular weakness however: Most firms have specific resources/capabilities. A company that specializes in, say, yogurt cannot product crackers. So asking consumers for their end-product needs might lead to some unproductive research about product ideas they have no competitive advantage in solving.
So in a Blink: Gladwell makes me suspicious – he’s writing a book about spontaneous genius after all – so its straightforward that he would want to go after quantitative research that overrules expert-spontaneous opinion. Zaltman appears to be incorporating too many things at once to achieve meaningful conclusions. Ulwick offers a research method I immediately like, but I can see situations where it might not make as much sense where firms have narrow product constraints.
Sunday, January 31, 2010
The Mortensen Urban Dweller Persona
Applying Pruitt & Adlin's suggestions, I gathered data for the phase1/phase2 planning/gestation steps built a list of facts that are broadly useful in understanding me and people like me. Phase 3-5 are not applicable in this case, so I will progress into an examination of the implications of these facts for my persona.
What a marketer needs to know about a person like me as I would be before or after MBA school...
...I'm a young, single, heterosexual, professional with high discretionary income and no dependents.
...I have a high appetite for risk-taking, travel, nightlife, unique cuisine.
...The most valuable thing to me is free time.
...I own a passport.
...Immediate family live in another state.
...I have a gym membership.
...I drink more than 10 drinks per week outside the home, often with meals.
...I have a graduate degree.
...I live in a US top 20 sized city within 2 miles of the downtown financial district and within 2 miles of work.
...I am a frequent business traveler.
...I am liberally inclined.
...I do not possess any firearms.
...I do not take part in organized religion.
...I did not grow up within 100 miles of where I currently live.
...I am 29 year old, and will never turn 30!
Implications of these features for the Urban Dweller persona:
The 3 most important facts about me from the list above are 1) free time is hugely important to me, 2) high discretionary income, and 3) single without dependents. This leads to the important insight that I am willing to spend extra to save time. I am willing to have a smaller home to save time and live closer to activities and people I enjoy. This means I choose apartments closer to where I work and shop. I take cabs frequently. I shop infrequently and often through online shopping channels. Because of these things, I am rarely exposed to few children and families in my immediate environment . People like me live close together around other people like me.
Due to demographic changes over time, people like me are a growing segment. The demographic transition that comes with greater wealth has led more people to choose to have smaller families or remain single voluntarily because it allows more free time. Perhaps as a bioproduct of increased urbanization, more people are choosing to rent apartments in good locations rather than larger homes farther from work.
There is an international component here to observe. The features that define me are very similar to what groups of people exist in other countries, particularly in countries who have migrated the farthest along the demographic transition. Countries like Korea, Japan, UK, France, Germany all have large segments like me in greater % than we would expect in the United States. The US has an overall population density of about 83/sq mi versus about 1200 for South Korea. We would expect more single urban dwellers with habits like mine to exist in a country like that.
The travel component is also key. I am a mobile member of the workforce that has lived in several major markets between growing up, studying, and career. The messages that appeal to me are different than people who live where they grew up and will have families in the same markets they currently live. Themes of legacy, family, stability, the home are certainly important to me, but they are less important to me than consumers who stay close to their immediate family. Advertising messages that work on others might not appeal to people like me the same way.
Summary:
A team that designed a product for a customer like me would need to know what kind of tradeoffs I tend to make so they can optimize the perfect design for me. They need to concentrate on the time-saving aspects of products that will enable an Urban Dweller like myself (who never has enough time) to live life that has more risk, excitement, travel and fun. People like me will be willing to pay or give up other things to achieve those goals.
What a marketer needs to know about a person like me as I would be before or after MBA school...
...I'm a young, single, heterosexual, professional with high discretionary income and no dependents.
...I have a high appetite for risk-taking, travel, nightlife, unique cuisine.
...The most valuable thing to me is free time.
...I own a passport.
...Immediate family live in another state.
...I have a gym membership.
...I drink more than 10 drinks per week outside the home, often with meals.
...I have a graduate degree.
...I live in a US top 20 sized city within 2 miles of the downtown financial district and within 2 miles of work.
...I am a frequent business traveler.
...I am liberally inclined.
...I do not possess any firearms.
...I do not take part in organized religion.
...I did not grow up within 100 miles of where I currently live.
...I am 29 year old, and will never turn 30!
Implications of these features for the Urban Dweller persona:
The 3 most important facts about me from the list above are 1) free time is hugely important to me, 2) high discretionary income, and 3) single without dependents. This leads to the important insight that I am willing to spend extra to save time. I am willing to have a smaller home to save time and live closer to activities and people I enjoy. This means I choose apartments closer to where I work and shop. I take cabs frequently. I shop infrequently and often through online shopping channels. Because of these things, I am rarely exposed to few children and families in my immediate environment . People like me live close together around other people like me.
Due to demographic changes over time, people like me are a growing segment. The demographic transition that comes with greater wealth has led more people to choose to have smaller families or remain single voluntarily because it allows more free time. Perhaps as a bioproduct of increased urbanization, more people are choosing to rent apartments in good locations rather than larger homes farther from work.
There is an international component here to observe. The features that define me are very similar to what groups of people exist in other countries, particularly in countries who have migrated the farthest along the demographic transition. Countries like Korea, Japan, UK, France, Germany all have large segments like me in greater % than we would expect in the United States. The US has an overall population density of about 83/sq mi versus about 1200 for South Korea. We would expect more single urban dwellers with habits like mine to exist in a country like that.
The travel component is also key. I am a mobile member of the workforce that has lived in several major markets between growing up, studying, and career. The messages that appeal to me are different than people who live where they grew up and will have families in the same markets they currently live. Themes of legacy, family, stability, the home are certainly important to me, but they are less important to me than consumers who stay close to their immediate family. Advertising messages that work on others might not appeal to people like me the same way.
Summary:
A team that designed a product for a customer like me would need to know what kind of tradeoffs I tend to make so they can optimize the perfect design for me. They need to concentrate on the time-saving aspects of products that will enable an Urban Dweller like myself (who never has enough time) to live life that has more risk, excitement, travel and fun. People like me will be willing to pay or give up other things to achieve those goals.
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