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BCG Consumer Insight Process 2012
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BCG Consumer Insight Process 2012


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  • 1. expect great answers An unfiltered perspective of the roles and interactions between stakeholders of the consumer insight process TMRE November 2012
  • 2. A consultant, researcher and client walk into a bar… 1998 2 2012
  • 3. It all started with a conversation, but evolved quickly Qualitative Research Initial hypothesis generation Review of recent collective experiences Interviews with 25 practitioners Quantitative validation BCG on going insights benchmarking Additional worldwide survey in progress 3 "Call to action" packets • Management Consulting • Specialized Research firms • Corporate insights organizations
  • 4. Our motivation: what can we learn from each other to become an increasingly relevant function? 4
  • 5. Climbing the ladder not easy, specially alone... 90% of benchmarked companies in levels 1-2 4 3 2 1 Traditional market research • Little access to senior execs • Mix skewed toward tactical • Little involvement outside marketing • Focused on hindsight Business contributors • Stronger consumer focus mandate by senior execs • Mix has strategic focus • Influence encouraged to extend outside marketing • Focused on individual insights Strategic insights organization • Senior execs consumerfocused • Influence extending outside marketing • Growing knowledge base • Focused on synthesized insights across sources Insights as a competitive advantage • Strategic research priority • Involved across functions • Able to build knowledge base to become a learning organization • Focused on foresight/ prediction across source Evolution requires more than just skills improvement, it demands better interaction with industry players Source: BCG benchmarking study; Press searches; Company web sites; Analyst reports
  • 6. Improving together requires celebrating and reinforcing what each of us do well... Corporate Insights Institutional knowledge Consulting Business driven insights 6 Research Firm Managing the intricacies of research
  • 7. ... while finding the areas that will make our interactions increasingly successful Corporate Insights Institutional knowledge Consulting Business driven insights Engage experts "Less" black boxes ... and no one best than a friend to speak honestly 7 Research Firm Managing the intricacies of research
  • 8. What we learned Consulting Selected findings 8
  • 9. Structurally, consulting firms can influence key decision makers ... Focus on insights Research firm Corporate Insights organization Consulting Insights organization Core insight customers Extended brand team e.g., Mktg, R&D e.g., Finance, sales Illustrative organization 9 Executive suite Typical Influence
  • 10. ... so insights are directly tied to the business  Thinking how the insight will be used is as important (or more) than the process to get it The client need... The criteria... The questions to answer... Size of the opportunity Several options to reposition the brand... Which one to choose? • • • • Ability to differentiate • Is it a white space for brand? – Concentrated vs. Fragmented – Presence of major competitors • Is there value of differentiation ? Starting position Ease of execution Source: BCG project experience (sanitized) 10 What the research tool must be able to do... ... ... ... ... • ... • ... • ... • ... • ... • ... Brand association Brand indexed share of visits
  • 11. What we've learned is that we are not always infallible in assessing complexity of the tools Sometimes we are too optimistic.... Day 1 Day 14 Brand 1 - MBC Brand 1 – MBC Brand 2 – MBC Brand 1 – CBC + MaxDiff Brand 2 – CBC + MaxDiff Brand 1 – CBC + MaxDiff Brand 2 – CBC + MaxDiff Brand 5 – BYO + MaxDiff Brand 6 – BYO + MaxDiff Brand 1 - MBC Brand 1 – MBC Brand 3 – MBC Brand 1 – CBC + MaxDiff Brand 3 – CBC + MaxDiff Brand 1 – CBC + MaxDiff Brand 3 – CBC + MaxDiff Brand 6 – BYO + MaxDiff Brand 7 – BYO + MaxDiff Brand 1 - MBC Brand 1 – MBC Brand 4 – MBC Brand 1 – CBC + MaxDiff Brand 4 – CBC + MaxDiff Brand 1 – CBC + MaxDiff Brand 4 – CBC + MaxDiff Brand 6 – BYO + MaxDiff Brand 8 – BYO + MaxDiff 3 Models 6 Models 12 Models 24 Models 4X Cost Source: BCG/SKIM project experience (sanitized) 11
  • 12. What we've learned is that we are not always infallible in assessing complexity of the tools Sometimes we don't want to tradeoff.... Original design Final design "We need to test everything, on everyone" "What we need as burden of proof" Screener Brand experience funnels Last purchase map Price optimization (CBC) Emotional claims Purchase drivers Brand perception Category attitudes Source: BCG/SKIM project experience (sanitized) 12         Screener Brand experience funnels Last purchase map Price optimization (CBC) Emotional claims Brand perception
  • 13. Key to bring in experts early to save the team (and our research partners) from heartache Who helped evolve the thinking? 2 weeks before turnaround by Insights expert team + vendor 13 Complete reprogram of survey and field delays before turnaround by insights team
  • 14. We've also learned that sometimes our insights counterparts are left in the dark Focus on insights Given our usual stakeholders... "Your team left us with an enormous piece of research ... but nobody in the team had any idea how to replicate, let alone how to use going forward and explain to the organization" -Senior Director of insights, Retail Research firm Corporate Insights organization "We need to learn to be able to replicate this, otherwise it will die very quickly. We need to be able to respond to the organization when they ask us to understand" -Insights VP, CPG Consulting Insights group Core insight customers Extended Executive suite brand team Typical Influence Source: Qualitative interviews; BCG analysis 14 ... there isn't a obvious process to close the loop with the insights team "We need to understand how this will impact our brand tracking studies, our syndicated data requests and our metrics for success" -Insights Director, CPG
  • 15. Need to formalize a process to leave our corporate counterparts to carry the torch 1. Joint project team 2. Capability build 3. Coaching 4. Process facilitation Strategy / planning BCG team leads Implementation Project Structure Corporate team leads Project Scope Source: BCG Enablement center 15
  • 16. What we learned Research firm Selected findings 16
  • 17. Agency as a center of research expertise for the client, help navigate complexity Reassurance research firm competency Peace of mind Reassurance reliability of answers Capabilities Standards • Quantitative/Qualitative skills • Insight extraction • Analytical mindset • Ability to translate business question into appropriate methodology and analysis plan 17 Proven Methods Quality Assurance • In market validation (case studies) • Body of academic research (back up) • Proven expertise (in house) • Identifying potential pitfalls • Project roadmap • Data quality • Database • Checklists (design, /benchmarking programming, fielding, • Templates data prep, analysis) • Mock-up outputs • Manuals
  • 18. Choice-based conjoint roadmap to guide client 1 2 3 4 Set up / Design Survey design & inputs 5 Conjoint experimental design 6 Programming Fieldwork 7 Processing Choice file output 8 Choice file recoding 9 Utility estimation (HB) 10 11 Analysis / simulation Simulator building Analysis of simulator outputs Optimization algorithm Reporting Key interactions with client 18
  • 19. What we are not 19
  • 20. 20 What we are not
  • 21. More integration is required in the industry, become a learning organization • Meta analysis of results across studies • Develop frameworks for more effective research & marketing • Improve inputs before testing / decide without testing 21
  • 22. Meta-analysis examples *Examples courtesy of SKIM 22
  • 23. Old ways of presenting data giving way to new generation of storytellers/iconographers  New recruitment needs and profiles within the function 23
  • 24. More of… *Examples courtesy of SKIM 24 Less of…
  • 25. *Examples courtesy of BuzzBack, Hypothesis, CognitiveMedia, and SKIM 25
  • 26. What we learned Corporate client Selected findings 26
  • 27. Privileged position to impact business decision making by institutionalizing knowledge Business stakeholders & processes Close to key stakeholders • Marketing • Finance • Sales • R&D • Planning and key business processes • Innovation (new products, restages, line extensions) • Communications & media • Pricing • Portfolio rationalization • Production (cost reduction) 27 Insight source & network Access to sources of information • Internal company data (sales) • Syndicated reports • Industry publications • Ad hoc quant/qual research • Consumer panels • Social Media Access to the insight network • Research firms • Consulting • Panel administrators • Online scrapers • Visual designers Insight Function
  • 28. However, noticeable gap in capabilities needs to be addressed: business impact Insight personnel Business line personnel Delta in percentage points All respondents across 40 companies Top 2 box favorable (%) 74 73 -33 71 -39 -27 +16 53 44 41 58 -26 -13 40 34 41 51 -14 35 32 27 0 Understand the business issues as well as the folks in "line roles" Consistently answer the question "so what?" about data they provide Only commission and share topquality research Translate research findings into clear business recs. for senior executives Are viewed as thought leaders within the organization Source: BCG "Driving Consumer Insight " survey (as of March 31, 2009). N=819 responses (392 by CI/MR personnel and 427 by business line personnel). 28 Have best in class capabilities within this industry Our business sponsors determine the scope and objectives before a study is commissioned by the CI/MR team
  • 29. Often gravitate towards method without stating or understanding the business issue Research skills What are the most relevant gaps in skills for research practitioners? Business Application Communication Trendspotting Acquiring insights Driving insights Source: SKIM qualitative survey for TMRE among MR practitionerrs 29 56 “I need a conjoint to test pricing…” 28 22 17 “the Brand aims to maximize revenue; one of the levers to do so is optimizing price to consumer of the product portfolio. What do you suggest?”
  • 30. Corporate should rely on vendors for execution, refocusing on business impact 38 34 10 Only 10% of time devoted to insights "call to action" 38 15 24 Research Execution Connecting to business Team Management 7 8 7 15 8 Method’s and Vendors Other (e.g., Meetings) Q. In a typical week, how much time do you spend on each of the following? Source: SKIM qualitative survey for TMRE among MR practitionerrs 30
  • 31. Internal stakeholders are often not involved early enough in the research process, leading to… 31
  • 32. The true question is rarely just about insights...  Example: Price strategy Assess Consumer sensitivity Down or upsizing to extract willingness to pay Focus efforts on price perception to avoid price wars Shelf SKUs Promotions on different SKUs limit price erosion Promotions Accelerate Product renewal agenda and blur comparability Source: BCG illustrative example; Center for Pricing Impact 32 Track retailer margin to monitor strategy alignment Align to design product to cost while fitting consumer demand Illustrative example: FMCG Pricing
  • 33. Be the spider on the web coordinating with and involving all internal stakeholders 33
  • 34. Accountability required to drive ownership No real measure of research impact Respondents (%) "It is unacceptable to have someone say they did absolutely nothing wrong when the launch failed miserably and then explain they would use the exact same research approach again...researchers must be held accountable for their work and its business implications." -VP Global Insights, CPG 100 80 60 Aligning incentives with outcomes can help drive ownership 53% 45% 40 26% 20 "When researchers are rewarded based on the success of the business unit they are responsible for, it drives them to value the business impact of their research more, which has the complementary benefit of making the business partners value them more." -VP Consumer Insights, CPG 0 Measure impact of CI/MR Reward CI/MR personnel based on performance of BUs they support Line managers provide feedback about CI/MR partners Strongly agree Disagree Agree "Once metrics and measures related to awareness, brand attributes, and customer satisfaction were included in both our performance targets and the senior executives' compensation scheme, they instantly became more receptive to our research, motivating my team to perform." -Strategic Marketing Director, FS Strongly disagree Neither agree nor disagree Source: BCG "Driving Consumer Insight " survey (as of March 31, 2009). N=819 responses (392 by CI/MR personnel and 427 by business line personnel). 34
  • 35. What did we learn? Corporate  Institutionalize knowledge + Stakeholder involvement Action: Ownership through business accountability Focus on business implications (hypothesis driven) Consultant  Client enablement + Manage research complexity Action: Design enablement scheme to work with insight organizations More discipline involving experts early in the process Research Firm  Powerful data visualization + Knowledge Integration Action: Broaden recruitment profile (graphic designers, media) Improve client engagement: discuss possibility and feasibility 35
  • 36. Where do we go from here? • • 36 An ongoing honest conversation needs to take place between key players and stakeholders of the insight process, in order for the function to evolve and avoid perpetuation of counter-productive behaviors Realization and leverage of what every part brings to the table is a necessary condition to collectively enable Insights as a source of competitive advantage in the organization
  • 37. A consultant, researcher and client walk into a bar… For further questions you know where to find us Mauricio Bermudez Sr. Director - Consumer Insights at Burger King Corporation Gabriela Barrios Project Leader - Center for Consumer Insight at The Boston Consulting Group Juan Andrés Tello Director - SKIM Americas 37