McKinsey & Company

1. BRAND MANAGEMENT ANDNEW PRODUCT DEVELOPMENTSECTION 7ABrand Management and the FirmMarket Research - 1ALAN L. WHITEBREAD

2. McKinsey & Company • “Breakthrough Thinking from Inside the Box”, HBR, December, 2007, pp.71-78. • Create new boxes to think inside • Bound the range of acceptable ideas • Tailor the questions accordingly • Select participants capable of original insight • “21 Great Questions for Developing New Products”

3. ELEMENTS OF A GOOD QUESTIONNAIRE • Most are short, simple, and quick – but some can be quite long • Precise wording of questions and answers • Avoids leading questions • Does not ask unreasonable questions • Does not alienate the respondent • Sensitive topics = ? • Readily lends itself to statistical analysis

4. THE QUESTION MUST BE VERY CAREFULLY WORDED AND STRUCTURED!THE STRUCTURE OF THE ANSWER IS JUST AS IMPORTANT AS THAT OF THE QUESTION!

5. TYPES OF QUESTIONS DICHOTOMOS QUESTION THE RESPONDENT MUST ANSWER ONE OF JUST TWO CHOICES DO YOU THINK TIDE GET CLOTHES CLEAN WITHOUT INJURING THE FABRIC? YES NO YES = CLEAN AND WITHOUT INJURY TO THE FABRIC NO = WHICH? CLEAN, INJURES, CONFUSED, … ?

6. TYPES OF QUESTIONS OPEN-END or COMPLETELY UNSTRUCTURED QUESTION OBTAINS INFORMATION WITHOUT BIAS IT IS LIKE AN ESSAY EXAM IT IS VERY HARD TO ANALYZE FREE RESPONSE QUESTION ANSWERS ARE LIMITED TO A WORD OR A PHRASE

7. TYPES OF QUESTIONS SENTENCE COMPLETION QUESTION THE ______ IS OBTAINED BY DIVIDING ______ BY ______. GOOD FOR ROTE MEMORY MEASUREMENT THE RISK IS THAT IS ALL THEY MEASURE!

8. TYPES OF QUESTIONS MULTIPLE CHOICE QUESTION – you must know everything about an issue to properly write these structured questions. VERY EASY ANSWER SET ONE CORRECT ANSWER TO MEDIUM HARD ANSWER SET SEVERAL ANSWERS ARE ONLY SLIGHTLY DIFFERENT TO HARD ANSWER SET COMBINATION ANSWERS ONLY SLIGHTLY DIFFERENT

9. TYPES OF QUESTIONS RANKING, RATING, and CONTINUUM QUESTIONS FORCE A MORE PRECISE SCALE OF MEASUREMENT SCALE DETERMINES TYPE OF STATISTICAL ANALYSIS PROBLEM IS THE MEANING OF THE SCALE OF MEASUREMENT CHECK QUESTIONS

10. QUALITATIVE RESEARCH • Words and images • “Soft” data • Exploratory in nature • Understand unmet needs • Heuristic analysis: search for themes and deeper meanings

11. PRODUCT LINE EXPLOSION • Look at what happens with only a little changes to the previous slide. • Brands*types*sizes*collars*colors • 1*4*8*2*4 = 256 varities • 3*4*8*2*6 = 1,152 varities

12. CONTEXTUAL RESEARCH CONTEXT -Activities -Environment -Interactions -Other products -People -Processes -Relationships

13. CONTEXTUAL RESEARCH:PRINCIPLES • Empathy for understanding • Rapport for true behavior and values • Subjects lead the session and identify what is important • Focus on what subjects do more than their opinions • General patterns should emerge

14. CONTEXTUAL RESEARCH:THE PROCESS Defining the problem and research objectives Developing the research plan Collect the information Marketing Decisions Present the findings Analyze the information

15. QUALITATIVE TECHNIQUES • INTERVIEW USERS • FREE ASSOCIATION • What does _________ mean to you?

16. QUALITATIVE TECHNIQUES • FOCUS GROUPS • How do they work? • PROJECTIVE TECHNIQUES • Completion and interpretation tasks • Comparison tasks • To try and uncover true opinions and feelings • Example: Rorschach Test [inkblot] http://www.stupidstuff.org/main/rorschach.htm

17. CONCEPT TESTING:What ideas should we pursue? • Test as many ideas as possible • Test before any feasibility analysis • Do not mix innovative and very futuristic ideas in the same test set

18. BRAND ATTRIBUTES AND BENEFITS User imagery Usage imagery Product-related attributes Brand personality PRODUCT OR SERVICE Symbolic benefits Functional benefits Experiential benefits

19. TTU DELOITTE PROJECT, FALL 2008

20. SCALES OF MEASUREMENT SCALE STRUCTURE EXAMPLE(S) 1:1 correspondence Subjective data  Football numbers Lottery drawing numbers NOMINAL ORDINAL  A scale exists No distance relation is known (e.g. 3-2 <> 4-3)  Military rank Quality of lumber, beans Upper-middle-lower class • Ordinal scales are often used to evaluate consumer satisfaction. [Likert scale] • How satisfied are you with PRODUCT X? • Not satisfied • Neither satisfied or dissatisfied • Satisfied • Very satisfied • Extremely satisfied

21. SCALES OF MEASUREMENT SCALE STRUCTURE EXAMPLE(S) Equal distances between items (e.g. 4-2=4-3)  Calendar days Temperature  RATIO  A continuous scale of measurement Definite relationships A true zero point Measurement Loudness scale INTERVAL Equal distances between items (e.g. 3-2=4-3) Calendar days Temperature Interval scales are often used to rank items. Which products do you prefer the most? Assign #1 to the most preferred and #5 to the least preferred product. PRODUCT A PRODUCT B PRODUCT C PRODUCT D PRODUCT E

22. BRAND PERSONALITY IF PRODUCT __________ WAS YOUR FRIEND, HOW WOULD IT TALK TO YOU? Do this for the class project.

23. THE BRAND PERSONALITY APPROACH SUPPORTING THEME: Personality SUPPORTING THEME: Brand-self congruence BRAND PERSONALITY SUPPORTING THEME: Consumer self

24. BRAND PERSONALITY Brand Personality Central Theme Sincerity Excitement Competence Sophistication Ruggedness • Hallmark • Coke • Pepsi • HP • Wall Street Journal • BMW • Lexus • Grey Poupon • Nike • Wells Fargo

25. THE POWER OF PASSIONS • The brand is what makes a product more than just a product – it makes it unique. • The brand goal is to be more than brand preference – a passionate brand insistence! • This is done through engagement and fulfilling self-concept and image to others. • VIDEO: “I am Canadian”

26. CONNECTING WITH CONSUMERS • B2C • Needs and wants • Emotions and self-actualization • Hopes [dream realizations] • Fears [risk reduction, safety] • Familiarity and trust [brand loyalty] • Understanding demographic trends

27. CONNECTING WITH CONSUMERS • B2B connections • Performance and reward [best solution] • Fears [risk reduction, improve safety] • Familiarity and trust [consistency → brand loyalty] • Understanding trends

28. BRAND MANAGEMENT ANDNEW PRODUCT DEVELOPMENTSECTION 7BBrand Management and the FirmMarket Research - 2ALAN L. WHITEBREAD

29. QUANTITATIVE RESEARCH Numbers based “Hard” data More confirmatory in nature Optimize the appeal of new products Statistical analysis

30. QUANTITATIVE TECHNIQUES ANALYSIS OF VARIANCE [ANOVA] Closely related to multiple regression Can examine multiple variables and their influence on some response including interactions. Analysis of - 1:A, 2:B, 1: [A & B], [1 & 2]: [A & B], etc. CONJOINT ANALYSIS Many tools including variance and regression analysis Allows many variables and aspects to be analyzed simultaneously Human perceptions and preferences to single attributes and interactions such as price point, sales likelihood, and cannibalization CORRESPONDENCE MAPPING Graphically represent the relationship between brands or products and other variables such as psychographics, media, etc.. Can be a preliminary step to cluster analysis, used in determining the most discriminatory psychographic statements

31. QUANTITATIVE TECHNIQUES FACTOR ANALYSIS A data reduction technique to explain variability of factors Finds commonality in sets of variables Used to identify consumer lifestyle and personality types PRINCIPAL COMPONENT ANALYSIS [PCA] A type of factor analysis Used to identify the most independent variables and relative strength/position of a set of linear variables MULTIDIMENSIONAL SCALING Similar to factor analysis Human perceptions and preferences in relative perceptual space [e.g. perceptual map]