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Customer Focus - From Laundry to Lager
This morning's main session at ESOMAR Congress gave delegates an update on major companies' attempts to put customers' views and needs at the heart of their business. Some like it hot - watching consumers in their kitchens - while others take a cool look at customer loyalty stats. DRNO News Editor Tessa Russell reports live from Cannes.
Kitchen Ethnography
Analysing videos of people doing their ironing might sound like the equivalent of watching paint dry, but it's all in a day's work at Maritz. Edeltraud Kaltenbach, Project Manager at Maritz in Germany and Ji-Seun You, LG Electronics' Europe Product Planner, talked about their forays into ethnographic research, focusing on projects designed to see how people use their domestic appliances across different European countries.
In addition to qualitative depth interviews, Maritz uses two main methods to find out how consumers really cook, clean and wash their clothes. Participant observation and video diaries allow the researchers to uncover information and trends they would 'never have uncovered just by asking' and 'answers to questions we wouldn't have thought of asking'.
Delegates were treated to snippets of the video evidence, including children climbing into fridges, obsessive dishwasher loading and reloading and - most oddly of all - a Swedish housewife ironing banknotes. Look out for irons with a special 'banknote' setting in a shop near you soon...
From C-SAT to Loyalty - What the Stats Say
Another electronics company, Philips in the Netherlands, set out its very different approach to focusing on customers, with the emphasis on graphs and statistics rather than understanding domestic habits. Ton Otker, Manager, Customer Satisfaction Management and Maarten Schellekens, VP, Consumer and Market Intelligence, described how they undertook two waves of customer research with Netherlands agency Interview-NSS. The analysis concluded that customers' willingness to recommend a brand provides a significant predictor of a company's success - more so than straightforward customer satisfaction measures. One model found that, where 50% of customers intend to recommend a brand, expenditures on that brand increase by 25%.
The pair concluded that 'only performance significantly better than competitors will lead to increased business growth'. As a result of the research, Philips has embarked on a programme of measuring and improving performance at all customer touchpoints, reworking its customer questionnaires, and including propensity to recommend the brand as a key performance indicator. Future research will include more analysis of word of mouth influence, and measuring the impact of customers who advise against a brand.
Satisfaction for Beer Drinkers
It may have been Monday morning (after a champagne reception the night before) but this didn't stop the delegates thinking of beer - thanks to presentations from both Heineken and Fosters. Sjoerd Koornstra, Senior Knowledge Manager at Heineken International, and Gert Nooij, Director of Netherlands firm Scanmar explained the company's creation of a worldwide 'brand dashboard' to consolidate, co-ordinate and streamline customer satisfaction research across 80 countries. The system incorporates a standard questionnaire (with local variations where necessary) and guidelines for sampling, measurement and delivery. The company now conducts a global analysis of consumer brand surveys twice a year, and the results are discussed at Executive Board meetings.
Kristin Hickey, Business Development Consultant at The Leading Edge in Australia, told delegates how her company's research had helped to put consumers at the heart of another brewing company - this time Carlton & United Beverages (most famous for Fosters lager). A Leading Edge survey among CEOs earlier this year found that 'customer-centricity' was seen as the number one need for business success. Hickey sees this as a significant departure from a world where 'marketing had been hijacked by branding'.
She went on to define customer-centricity as 'the organisational embracing of the consumer as its primary focus, with a shared understanding and accountability for the development and delivery of products, services and brands'. She believes that exploring the customer perspective presents a big opportunity for MR, but demands new skills, tools, structures and models. The company's 'consumer centric blueprint' is still a work in progress, but is already proving profitable.
David Jenkinson from Carlton & United explained the effects of employing the blueprint: his company used to spend 70% of its research budget on ad hoc projects, but is now committed to a program of consumer-centric research, which includes sending sales staff on 'immersion workshops' to help them understand consumers' perspectives.
'Hyper-Consumers' Seek the Experience
Gilles Lipovetsky, Philosopher from the University of Grenoble, who presented the second of the day's keynote addresses, looked at consumers' motives from a broader perspective. He described the evolution of the 'hyper consumer', who has moved away from conspicuous consumption and the need for products that are purely functional. Instead, he says, today's consumers, are interested in products and services that make them feel better emotionally, allow them to express their own personality, and save them time.
Using our growing passion for interior décor, gardening, yoga, feng shui and extreme sport as examples, he suggested that hyper-consumers buy goods 'with a view towards personal sensations and satisfaction', and are driven more by emotion and amusement than by functional needs or the view of others. The challenge for marketers, he says, is therefore to develop products that offer pleasure, aesthetics and fashion in addition to functionality. No longer is it enough to sell a product. Instead, companies must 'sell an experience - something that affects the senses', and advertising has to get the consumer to 'love the brand', not simply remember it.
The ESOMAR home page is at www.esomar.org . More from Tessa Russell in Cannes in tomorrow's and Wednesday's DRNO..
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