Are You Betting Your Success On Out-Of-Date Insights?

How current are your consumer insights? Do you know? For some companies, investing in market research to gain consumer insights is an annual strategic investment. For other companies, there is no market research budget and research is run on an as needed basis. In other companies, market research is one of the first budgets cut in a downturn and important questions are never answered. 

When was the last time you updated the insights on which you base your key strategy decisions? If it has been more than a year since your last strategic market research study, consider making this a near-term priority. Do not assume your consumers have not changed in significant ways.

Why you ask do I need to spend money on fresh insights? Don’t consumers pretty much behave the same way year after year? Why invest in repeating a research study I have done in the past when I know I can spend that same money on programs such as a sales promotion and see results right away? This is a good question and an important question.

Most companies will invest in gaining consumer insights to learn what consumers think about their company’s product and brands and why they behave the way they do—either shopping for or using their products. These insights are used to guide strategy development, marketing planning and new product development efforts. If these insights were important at one point of time to guide strategy development, it is likely they are still important to benchmark current consumer behavior and attitudes to guide strategy today. A modest investment in research today can unlock new consumer and shopper insights that provide new and unique competitive advantage in the marketplace.

When asking why to invest new money this year, consider the dramatic changes with consumers that have occurred in the last couple years. The economy and 9% unemployment have transformed how and where families spend their discretionary income. Food and fuel spending take up a larger percent of a family’s total income—what is “normal” for consumers has been evolving in the last couple years. Spending for daily needs, food choices, lifestyle products and services have all evolved. 

Who is shopping has changed. Consider the insights from a study by GfK, MRI and ESPN: 31% of men nationwide were the primary household grocery shoppers in 2011, up from 14% in 1985. A 1,000 person nationwide 2011 study from Yahoo and DB5 showed a higher number—51% of men reported being the primary grocery shoppers in their household. With a larger percentage of the male population being affected by unemployment, more men are staying home and are taking on new shopping roles in their family. How does this affect your category?

Now add the rapidly evolving integration of technology into consumers’ lives via smartphones and tablets like the iPad. Consumers are researching, shopping, comparing prices and buying products and services in new ways. A comScore study at the end of 2011 showed that 38% of smartphone users used their phone to make a purchase at least once on their phone during the course of their device ownership. This included 47% who purchased digital downloads of songs, movies, ringtones, ebooks, etc, 37% who bought clothing and 32% who bought electronics on their phone.

Phones are enabling shopping in new places—37% of consumers made purchases while in transit and 42% made purchases while at a location away from home, including work. When you consider that 20 million new smartphones are expected to be sold in 2012, this behavior will only expand. How does this affect your shoppers and your selling effectiveness? Do you know?

If you are developing new strategies to grow your sales in the next 1-3 years, you can be much more effective if you have fresh insights on your consumers’ behaviors, attitudes, priorities and purchase criteria. Without these insights, you may miss a key emerging opportunity or simply fail to communicate and promote your products in a way that engages today’s shoppers. If your key competitor unlocks those key insights before you, they can gain a new advantage with your customers.

Make an investment in market research a new priority this year. You would not take a long road trip without a current map or a GPS to guide your way. Be sure to start your 3-year planning with current insights to guide you on your journey.

GrowthSpring Group is a market research, marketing strategy and innovation firm focused on accelerating your sales and profit growth. We help you identify new business growth insights & opportunities and execute winning strategies & plans. www.GrowthSpringGroup.com