c3centricity

The first step of any business is to identify the category in which they are competing. This may surprise you, but you’d be amazed just how many brands are not in the category they think they are. When was the last time you checked how your customers saw you?

Just think about the consequences of an incorrect attribution; you would be concentrating on competitors that your customers never compare you with! And you would waste resources defending yourself against the wrong brands. Talk about squandering valuable resources! That’s why I decided to dedicate a whole post to this important topic.

But before I get started, I suggest you first read the post (Customer Centricity is Today’s Business Disruptor, Insights its Foundation) as background information. In it you’ll discover the full description of the seven steps of the CATSIGHT™ process, which I know will also be useful to you. In the article, I summarise the very first step of Insight development, that of category definition, like this:

C = Category

Whenever you want to develop an insight, the first task is to decide on the category you want to study. This may seem obvious to you, but in many cases, it isn’t as clear as you might have thought.

For instance, suppose you are planning on launching a new fruit-flavoured soft drink. You may think that you are competing with other juices or perhaps other soft drinks. But rather than just assuming the category in which you are competing, I highly recommend that you check; you may be very surprised.

In working with one client who was in this exact situation, we actually found that their main competitor was an energy drink!

The reason for this was because this category is seen as being for lively, energetic, fun-loving people who need a boost. Whether this comes from the caffeine of an energy drink, or from the added vitamins and minerals of real fruit juices, which was my client’s offer, it didn’t seem to matter.

If we’d only looked at other fruit-flavoured soft drinks, we would have missed a whole – and much larger – segment of potential category consumers. By starting our analysis as wide as possible by looking at all beverages, and then slowly zooming in as we learnt more, we were quickly able to discover this perhaps surprising positioning for the new drink.

This shows the power of taking the consumers’ perspective, especially when segmenting a market. But more about that in a moment.

The above example is a great start. But so many clients ask me to help them with their own category definitions, that I decided to detail the five most important steps in defining your category, so that you can do it for yourself for each of your brands and products.

[bctt tweet=”Never underestimate the power of taking the consumers’ perspective, especially when segmenting a market. #Brand #Segment #Marketing #Segmentation” username=”Denysech”]

Step 1. What is the category definition you are currently using?

What’s your gut response to the title question about Market Research Departments? Yes? No? Being Swiss I would say it depends!

I am probably in the third camp. Yes, if it is a department that integrates and analyses information from multiple sources, and then delivers actionable insights and recommendations to the organisation. No, if it is the traditional market research department, whatever that is.

I first asked this question a few years ago and it generated a lot of – sometimes heated – discussions. Now after so many changes in the past couple of years, I thought it was worth revisiting. Please add your own perspective into the comments below and let’s get those discussions started again.

Thanks to social media and websites, the IoT (Internet of Things) and smart products, companies are inundated with information these days. Who better than market research to help in its analysis? But in order to become this new business decision support group, new skills are required.

Insights 2020 by Kantar-Vermeer ran some interesting research into the future of market research and insights. In their report, they spoke about the need for researchers to have five critical capabilities:

Research & analytics mastery
Business acumen
Creative solution thinking
Storytelling
Direction setting

The fieldwork is now a few years old but I still think it makes good background reading to make companies think about their own needs in terms of data analysis. Also, the world and business environment has changed dramatically in the last eighteen months.

Another study by BCG and GRBN resulted in an Invest in Insights Handbook to help organisations report on the ROI of the insights function. They reported that those who measure the ROI of their information have found a seat at the decision table, increased budgets, and more control. Those are the department objectives that the FMCG world in particular desires today, be they in a manufacturing or retail environment.

As the handbook mentions:

“Architecting a world-class Insights organization requires executive, cross-functional commitment/engagement”

To do this, the report mentions the following six points:

Vision & Pace
Seat-at-the-table and leadership
Functional talent blueprint
Ways of working with the Line
Self-determination
Impact and truth culture

The analysis concludes that:

“The biggest barriers to experimenting with innovation in CI are resources, both time and money. A lot of times there’ll be [a need for] an innovation project but it can’t find a home.”

This seems to suggest, at least to me, a chicken and egg situation. Resources are insufficient because the business doesn’t see the benefit of investing in market research and insight development. But the Market Research Department is struggling with insufficient budget and personnel to provide the support that they should – and often could – provide.

In the GRBN report, they mention the largest barriers to the measurement of the ROI of market research and insight. These were found to be:

Difficult to do – studies are used in many different ways
Difficulty in isolating impact of consumer insights
Time

… Click to continue reading

Tag: actionable insight

You’re Not Competing In The Category You Think You Are! (The 5 Steps to Category Identification)

The first step of any business is to identify the category in which they are competing. This may surprise you, but you’d be amazed just how many brands are not in the category they think they are. When was the last time you checked how your customers saw you?

C = Category

Step 1. What is the category definition you are currently using?

Do Companies Still Benefit From Having a Market Research Department?

What’s your gut response to the title question about Market Research Departments? Yes? No? Being Swiss I would say it depends!

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