When you’re selling something, some questions that come up in your mind are, are people going to buy what you’re selling? Are they going to respond to it? What features do they value? A great way to answer that is market research. Market research expert, Laura Hazzard, has worked with big brands like Target, Starbucks, Disney, Fox, and Sony. She’s done everything from plus size women’s apparel to cat food and everything in between. Laura shares that it’s so critically important to ask questions because then you have a better understanding of why people purchase the things they do. She says that big brands and small companies should both dive deep into market research. They should have a process that they run to see if people will buy their products so they can cut down on costs by avoiding mistakes and optimize their sales.
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I’m excited because our introduction is to another Hazzard. This is my sister-in-law, Laura Hazzard and she is an expert in market research. I’m so excited because I promised you that we were going to protect you from the other hazards of product launching and critical to that is the market research hazard. Do people want to buy what you have to sell? Are they going to respond to it? What features should be in this? What do they value? All of these questions come up in your mind and market research is a great way to answer that. I’m not only excited that you are being able to read this important topic, but you have a Hazzard who’s going to help you to go through it. She is married to my little brother, that’s who I consider him because he was four when I met him.
I want you to know her because she is brilliant and she has this great background and expertise with very big brands, and big brands make a lot of mistakes. If you’ve heard me speak before, they make tons of mistakes and they still do this stuff, so when you’re not doing it, you have an even greater risk for making mistakes. This is why she’s going to be such a critical expert for you to utilize her services and things like that. I’m going to have her tell you a little bit about how she got started in market research, came right out of college and went into it, and the clients she’s worked with and the brands she’s worked with because it’s going to astound you.
Laura, I’m so glad we’re finally doing this. Please tell us about how you got started in market research.
I am a Midwestern girl, grew up in Ohio. I went to school at Indiana University. I studied marketing and I opted to go the research route. I am a curious girl that’s nerdy too. I love to ask questions. I’m not afraid to ask questions, so that’s why I went the consumer research route. Since college, I moved to Los Angeles, met Chris. I’ve been working for consulting firms in Los Angeles ever since then. Big brands were my clients. I worked with Target, Starbucks, Disney, Fox, Sony, the products I’ve worked on ranged. I’ve done everything from plus size women’s apparel to kitten food and everything in between; grocery, bakery, electronics, bath and body, perfumes, things like that. I worked with a gamut. These big brands, when you’re working with your mass merchandisers, they sell a lot of different types, so I have worked across it all.
This is important because what goes on at mass market is hard and a lot of them have what I call very frequently the shotgun approach. It is like, “Let’s throw it out there and see if it happens,” but it’s not cost effective for big brands to do that. That’s why they dive deep into market research. That’s why they have a process for test marketing, so they don’t even take what people say. They then test run it and see if people will buy it. Having a process yourself is so critically important when you’re a small business, you’re an inventor, you’re an Amazon seller, you’re eCommerce seller in general, and you’ve got very limited bandwidth to make a mistake. That’s why it’s more and more critical to ask the important questions.
We’ve talked before and I’m a little more in the know than most people, so I want to do a little bit of a deep dive on some of the definitions of things you’re going to say over time because that’s my job to demystify what’s going on with market research. I know you throw out some terms called qual and quant and I hear it all the time from other people in the industry and in big brands and in the know, but what does that mean?
Both are important. Don’t let anyone tell you one is more important than the other. Quant is your data, it’s your numbers, it’s your return on investment. It tells you can size the market. It gives you something to grip onto and benchmarks. It’s a starting point. It’s important for brand health. It’s data and it’s talking to a lot of people, at least 500.
That’s a statistical size that works?
You can go a little lower, but it’s what I feel most confident in. It all depends on lots of things. As most things in product launching, everything has a story and a different nuance, but 500 is where I feel comfortable. It’s representative. We want to hear from every age, every ethnicity, income group, your different cities, in the country or in the world, start with 500, it’s statistical and you can extrapolate from there. That’s your data side. That’s usually done with something as easy as an online survey and it’s typing it. A lot of this maybe you’ve had a touch point here with political polling. That’s your data, that’s an example, or your satisfaction, you go to Best Buy and they say, “Take this survey, give us one through ten.” That’s quant in a very basic way but to put it in perspective.
Qual, on the other side, is just as important. This is the people, the feelings, the emotions, the stories. You can’t necessarily make a judgment call on qual alone just like you wouldn’t make one on quant alone. Qual is your focus group where everyone sits around the table and you have a moderator and you ask questions. It’s also in-depth interviews or even observation. Sometimes you have to stand in the Target store and watch people shop the aisle. That’s qual, so we can all say, “How satisfied are you with the product one through five?” if I give you a four, “How do we improve? What does that mean?” Qual tells us the why. Here’s a little bit more, here’s the consumer voice, and this also helps for marketing messaging, so how does your client or your prospective buyer talk about your widget?
We talk about this all the time on my shows. You get caught up in your what, the thing that you invented, what you sell, you’re in the know on it. You have the industry terminology, you have shorthand, you call it these things, but that doesn’t mean the consumer perceives it that way, and that’s not the terms they use. That’s where your messaging can go wrong in that you think, “I’ve got the best thing here,” but if it’s not communicating to them, if they’re not perceiving it, and so I use this term, I’m wondering what you think of it. My definition of brand is that while it’s not what you say you are, it’s how people perceive that you are.
Ultimately, it doesn’t matter what you think about your product because you’re not going to make money doing that way.
You’re not going to buy it day in and day out yourself.
If it’s a passion project that’s totally different, but if you want to make money, if you want to grow a brand and make something, it matters what other people think about you and your product.
Let’s talk about what that looks like though in practice. I know a lot of inventors, a lot of designers out there, they get all upset about the term ‘focus group’ because they see focus groups as being not innovating, not getting it, not happening, and so that’s where they have this dissatisfaction and say, “No, I’m not interested in market research,” because that’s the only thing that they know.
Focus groups can be old school. There are SNL spoofs about focus groups. They’ve changed a lot and it comes down to the moderator and the questions you’re asking and how you are including everyone. Consumers are not dumb. If anyone who’s done even a little bit of research knows consumers are not dumb and they are creative thinkers. We will screen for that to make sure they’re articulate and are thoughtful and emotional, but they can absolutely be creative. I have seen some incredible ideas come out of focus groups that I have designers in the back room saying, “I never thought of that,” because they’re in their own little world, their own little box.
Here are my guidelines that I like. I like to do focus groups earlier rather than later. This is why I think it gets a bad name. It’s that old school style of focus group that you’re referring to. It’s like, “We’ve got this widget and it’s going to market.” Someone at the top goes, “What did the focus groups say of it?” They were like, “We skipped that part,” and so now, you’ve gone so far down the road and then the focus group says something negative and they’re all like, “It’s too late,” “They’re wrong,” and it gets to be this war instead of if you do it early on, you can design into it. That’s where I like to be.
With that, at the very early stage, even doing a small group, a group of moms in the living room, I mean focus groups have changed. We meet at coffee shops. We meet in homes. We meet at different places that are inspiring. Start there and you’ll have your answers. You’ll have big answers and a-ha moments from the very early phase. If it falls flat there, there’s a lot of work to be done before you go into prototyping and further into distribution and all of that.
There are lots of different ways to approach that. The number one thing that I always say is that you shouldn’t ask your own questions. Tell us why that is from a making market research significant and important.
It also is why big companies, like Disney, have outsiders write their questions for them too. These are smart Harvard MBA people that don’t even ask their own questions about their own products. The reason is because you’re biased, you love it, you’ve been living and breathing it. Sometimes your job is staked on it, your livelihood, your family, the food on your table, you want it to succeed. When you write your own questions, first you’re going to have a bias.
You may forget about some of the criticisms that could be coming up and you also might be missing something, especially if you’re not totally ingrained in the industry yet. If it’s new and you’re still learning, you might not know all the questions to ask, you might miss something, especially when you have a conversation, you can take so many different tangents. As a moderator, because I do moderate a lot of my own focus groups, sometimes tangents are bad, but sometimes they’re powerful.
You know when to stop it and when to move on, “This is drowning on here. Let me fix that.” We were working with you for a part of our business called customer satisfaction survey, but at the same time, it also is getting a better understanding of why they chose to work with us and that is something we think we know why, but is it true? Sometimes you need that validation to understand, “Is it the way we said it? Is it the way it’s happening?” Let’s validate that in the process because we might be able to design better market materials, we might be able to design better products, services, whatever that might be around that if we understand those things.
The way you phrase the question could give you totally different answers.
That’s what I was thinking. Your niece, Lannea, she’s almost nine and I went to her school for that parent-teacher conference idea. She said, “I know Lannea reads well but she doesn’t seem to do as well on reading comprehension.” I said, “Is it because she’s not answering the questions or she’s answering them wrong or is she answering them in a different way than you imagined?” She goes, “Yeah, she’s creatively answering them.” I said, “I don’t think it’s because she’s misunderstanding the question. Her perception is though that that question means something else.” That’s what happens a lot when we pick our own questions. It is like we’re an adult and we’re choosing these questions for reading comprehension and we think they’re at a kid’s level but not a creative and innovative kid like my daughter. You can go, “You don’t mean that.”
Different ages perceive things differently, different groups, depending on where you are in the country. If you’re designing something for a teenager and you’re 50 years old, you may not know how to ask the question properly or you might not be thinking about another piece in the context of their world. That’s why we do both quant and qual because we want a representation of everyone in every thought process. This is America. There are all different ways we construe questions, but you want to keep things basic and open and have a direction as well.
This is an interesting area because it also comes to bias in the data. We have a lot of bias in our data. It’s becoming more and more clear as we move into artificial intelligence, an AI world at which the data is very important. If the data is already skewed and biased to begin with, then do we need to have the qual to offset it and validate it and question it? That’s where I come into the world saying, “That data is interesting but is it reflective?”
Question everything, and so I was writing an article on an interesting research report that was put out maybe a year and a half ago on brand perception and how there was this gap between how big brands perceive themselves. Procter & Gamble, Johnson & Johnson, Target, all of those level of brands and they perceive themselves and what their executives in the organizations think of themselves as how they rank in the industry or what consumers think of them. They have this rating scale that they utilized and then they did that with consumers and so wanted to assess the gap between the perception that internal has and the gap that the external has, pointing out this perception issue.
There was this significant gap between how highly rated it was internally. I would say probably at least a 35% to 40% differential lower across every one of the different ways at which they were perceiving it, like perceiving their service, perceiving their quality, perceiving their product line, and the perception in all the categories, and they were always different. It was that much lower than how they thought of them themselves. I asked the researcher and he was excited about it. He was proud of it. It was a statistically big research, it was not small at all. It was thousands.
I said to him and this was my last question, “Do you think that the difference is that, consumers are made up of 86% or more of women?” The executive, we know from all the surveys of retail and big consumer brand executives that the mix is very low and that they have a very small percentage of women there, “Do you think there’s a perception gap because of that? Did you filter out for gender?” He went, “No, I’ll have to get back to you on that,” and he never did. You got to weigh that data. It was a bias in how they took the data too because they didn’t screen out for that because I guarantee you when they did the survey and they said, “We surveyed a thousand executives,” that’s great, but were you not matched with the same gender?
Anytime you’re doing benchmarking, from the beginning, you have to know the context of everything. For that example, when you’re looking at corporate employees to consumers, you need to make sure you understand the context is the same and same goes with when you’re looking across brands or looking at your competitors or comparing the different regions. All of that has to be taken into consideration.
There has to be balances that happen in that or shifting of it and massaging the data a little bit but then confirming it, “Is this true?”
Such an important piece to research as well is the gut check. You are an expert in this product, I am not. If I am your moderator, I’m not the expert, you are. There’s always that piece after we talked to everyone and collect the data, does it make sense? Does it pass your gut check? Is it what we thought? We always go into every research study with an idea of what the results will be. You need to know where you have it.
Have a hypothesis?
Have a hypothesis and what story do you think we’re going to tell. If it’s totally different, that’s an interesting finding, but you have to ask why then. There’re more red flags. It’s always good to have a gut check. Is this right or is there an error? That happens too.
One of the episodes that is going to be coming up is what I call the 80/20 color rule. You have 80% of your volume come from 20% of your colors. It’s the same thing with any product line. The issue is what happens when you remove the rest of the line of the colors and you only put out those 20%? Your context changes and that’s problematic. If you’re thinking about doing something like that in variables, this is something to communicate to your research team about because if it works in one scenario but then you remove all of those pieces, does it still work? That’s always a good question to ask.
One of the ongoing things that I like to do is I clean up people’s product lines all the time. Sometimes they get to thousands of SKUs and they’re panicked about it. I have a good experience to know which ones if you pull them out, the whole thing isn’t going to tumble down, but I still like to have that gut checked. When they say, “This one is so important. We can’t take this one away.” I’m going to be like, “But it’s draining your bottom line. Are you sure?”
That’s the time where you should go in and you say, “We built our foundation of our business on this, let’s confirm that it’s not because your heartstrings are in it and it was your baby and it was the first one.” Let’s confirm that that’s the perception of the community that you’re serving and if it’s not and it’s hurting your bottom line and it’s draining your resources and adding complexity, these are the kinds of things that you want to check. There’s more than just launching a product that you may want to do research for.
It’s a constant. It’s a moving target. A check point in time is when we do the research and report out, but as soon as we hit that report and hit send, it changes, especially if your demo is younger. That changes every couple months. Every age is different. I’ve done a ton of generational research and every three years or so, you have a different little human and the way they think about and interact, but it’s always important to refocus every year at least. “Let’s check in again, have a pulse on what’s happening to make sure we’re not missing something.” Time goes by, your competitors are coming in, you have to know about it.
One of the things people ask me all the time, “What kind of market research services do you offer?” I support market research services, but if you want to know, “I’m going to subcontract to Laura,” so you’re going to get her anyway, so you might as well go direct to her if you don’t need me. That’s what’s going on behind the scenes here. We do three types that we recommend for startup brands. If you’re a new brand, if you’ve got some new products going in, we recommend three things and then we recommend a different set of things if you’re an established brand that’s growing though you’re on a fast growth or in a fast growth industry, and I’ll talk about the second.
The first three that we do is we want to make sure that you’ve tested that people will buy whatever it is. Whatever questions you’re going to, ask however you’re going to do it, whatever the most low cost ways, we need to test buying of something, not whether or not somebody who likes it. Will they plunk down money because you need to build a sustainable brand? Everything centers around trying to get those answers as early as possible and what are the key features to make that buy happen? If we need to ask those early on and then we do that. That’s where all the research we do and the initial stages circulate around, testing that out, and sometimes that’s focus groups, sometimes we don’t have a prototype. We don’t have a product to show anyone, we can’t ask them questions yet, so we need to ask them around the idea. That’s where we survey, host a little very targeted market survey though, so we’re always specific.
Then the second thing we test is let’s say we do already have a product that’s pretty refined and decent on our idea and we feel pretty strongly that we’ve gotten good indicators along the way. Now, we want to make sure that we’re focusing on the biggest right market, is this moms of preschoolers or is this grandparents? We want to make sure that we understand the who and we have this idea that lots of people go into it saying, “Everybody will buy it. Everybody needs it.” I can tell you, you cannot spend the money. You don’t have the budget to get everybody to see it, to buy it. If you’re going to focus your dollars and be focused, let’s go with the market that is most likely to buy it first. Dialing in and finding that, that’s our second thing that we try to do.
The third piece that we do is we include some survey. I’m going to call it a customer satisfaction registry card, like a warranty card if that’s what you’ve got and your thing. We want to make sure that we add good questions to them or post-purchase survey if you just email it, whatever that might be, we like to dial in questions around that once we get out of the testing phase of it. Testing, we’ll pick up the phone and ask people because we know the handful of people who bought it.
Beyond that, we want to do something that’s a little more ongoing so that we can maybe track over time, “Are answers starting to change? Are they the same? Are they different?” but getting good questions is a critical part of that. The where we would utilize someone like you to put in and that’s what we’re working on, it is setting in those initial set of questions that happens with every client we bring in.
I know I threw out the 500, but ten is better than zero. We reach for the stars.
Ten who are not your friends and family.
Ten honest people that aren’t going to care if they hurt your feelings.
Ten people who plunked down money, even better because they obviously made a purchase decision.
All of that is right on. You’re still in the early phases getting some type of data. If it’s only ten people, that’s considered qualitative, but still very important. It’s still very useful and impactful.
If we move on to people who are growing brands, let’s say they already are in a great niche, and because you mentioned Starbucks before, they’re in the coffee niche. We all know coffee and this is easy, so we can talk about that. Everybody gets that idea. We’re already in this niche, we already have market, we already have people buying our product, whatever it is around coffee, and so we’re in that and now we want to, “Are we getting useful data? Are people filling out the warranty card?” or whatever that might be or survey is plugging away, “Is that survey still serving us?” Let’s refine that. Then the second thing we do is we do a much more concerted market study and so that’s where we study the competitors, “What are they doing? What are the features? What are they saying about their products? What are their price points?”
When we do a product within a marketplace, we’re looking online and on the shelf because when something hits the shelf, it’s an indicator that it sold better and it’s in that 20% that’s doing 80% of the volume. Otherwise, they wouldn’t spend the money putting it on the shelf. We watch that and we see that, but it’s no good if we do it as just a snapshot. For a big brand, we watch it over time, because micro trends happen, seasonal trends happen, and overall though we want to see if the market is shifting into a particular perception and things and we want to be aware of it rather than following a trend that isn’t there.
We want to be ahead of the things that are important but not at the things that aren’t. Then when we see these micro trends or see stuff happening, we design into it something that’s representative. We go out there and we do a good focus group and market research and validate, “Is this a flash in the pan and by the time I get this to market, it’s going to be gone? Is this something that’s tapping into an opportunity gap that people are starting to merge on,” and that’s where we start to find ways to stay innovative or grow our product line more in a smart way that serves the consumers we have and will grow that base of consumers.
People get bored. Things are changing and as much as they love your product A to start, they’re excited about the next one or the new finish or the new color or whatever is going to be different. People get bored very quickly. Loyalty to product specifically is hard to get. Brands, you can get and you can hold. Look at Apple, those loyal Apple buyers, you got them for the rest of your life, but product loyalty is a little bit harder than brand, so I like your point, especially for adding colors or adding other products, we need to know a little bit more and we need to stay current, so everyone seems excited about what’s coming out.
If you’re getting stale and getting old already, that can happen in eighteen months. It can happen in a year nowadays and there are product lines. To be honest with you, most often I would say we do not test apparel because there’s no point in it because the fashion will be so in and out, we would waste more money testing it, than we would putting it out and discounting it and disposing of it after. You were talking about doing a plus-size study, you’re talking about a significant shift in sizes, in styles, in shape, and all kinds of things that affect everything about what you’re making and its effectiveness in selling in the market place. Those are important trends to pay attention to, but the little trends of, “Do we want a blue shirt or a pink shirt?”
Specifically for that one, there are tons of influences happening, culturally, politically, celebrity, that stuff hits not just apparel but many product lines. When you have the Kardashians on Instagram selling products, things are changing quickly.
I was talking about that and I’m curious about your thoughts on this. I read this article about how Kim Kardashian is doing her own line because she got sick of hocking other people’s lines because they weren’t good enough or they didn’t meet her needs. I thought that that’s an interesting trend happening and we see it more and more because I do get a lot more celebrities who contact us and are looking for doing their own label. It used to be that in order to do their own label, all they did was take the regular one and slap their name on it.
We stepped up into this place at which influencer shift was, “I’m going to show this off. I don’t even have to stick my name on it because my name being associated with it is good enough. I don’t have to do all this work, so I’ll make more money this way and it’ll be easier on me,” but It gets to a stage at which what’s happening is that the celebrities aren’t making enough money at it, the brands aren’t getting enough value for it, and it’s starting to fall apart.
Now, these celebrities are going in but what I’m concerned about is that they aren’t doing the good research behind it and they don’t understand. They are like, “I have a million followers,” but how do you understand who are the ones that are going to buy out of that million followers? Who’s going to convert? Who’s going to care? Do you understand what they want? “I pay attention to you, but you’ve got millions of dollars and your value is very different than my value. It’s not just the cost of the product, it’s what the product does for me.”
When you see the, the influencer selling products, it’s very easy to get your 30 million subscribers to buy it once. Are you going to make enough money to sustain that business with the one-time buy? I don’t know. Every product is different, but that is what they run into. They have an established brand and everything they do, their followers will listen and do as they say, but most of the time that’s not enough to sustain a brand, to sustain a product on a shelf. You see that a lot with the perfumes. Whenever a celebrity comes out with their perfume, there’s a new one every year because people aren’t buying Britney Spears Curiosity anymore. They are buying her new stuff every year, but that original one is done.
What we don’t survey enough of big brands and anywhere is customer attrition, why someone didn’t buy or why someone was buying, and now stops buying. I saw this interesting video with Isabella Rossellini who I absolutely adore. She’s amazing and beautiful and smart and all of these things. When I was much younger, she was the representative for the perfume line, Trésor, which is Lancôme. She was their representative and that company was to me like my mom’s company. It was old to me at the time, but she made it young and she made it relevant and she gave it this quirkiness that I appreciated about it and I thought, “If they can put someone on there who is not Photoshopped perfect, then that brand has some values in it that I liked.”
Then she hit my age and they dumped her. I was like, “How could they do that? She’s still beautiful. She’s still funny. She’s amazing.” They told her that she was no longer relevant to their audience, but they asked her back and she said to them, “I would like to meet with you because I want to make sure that you don’t think I’m still in my 40s because I have aged since the last time you saw me, so I want to make sure you don’t think that you’re getting that woman because I’m different now.” When she met with the new woman CEO of Lancôme, they said, “We made a mistake. We didn’t understand whatever that brand stood for and we understand it differently now and we look at it as a more expensive brand and you represent that, and by bringing you back, we believe that it’s a statement to say we can make a mistake and we can fix it.”
I guarantee you that came out of research. They were doing some groups and some women in there were like, “What the heck happened? Why?” They didn’t have an answer.
It’s a great thing to ask, “Why not?”
“Why not?” or, “Why did you change?” or, “What happened?” How do we get you back? Is it even possible to get you back? Sometimes the world changes and your consumer changes as well and you’re going after someone different.
Not asking doesn’t help you understand that, doesn’t help you capture that, so that is a good thing. There is a case of what I call buying under duress because there’re no other options and you got to have something. You hate all the laundry detergents out there, but you’re going to buy, you buy this one. Why? Because it’s the cheaper one or it’s this or it doesn’t smell as fruity as the other one, whatever might be your criteria, but you could care less, like if a new one came out tomorrow, you’ll check it out. That’s where you buy under duress because you got to have something, but the minute something new comes along that might have solved that problem, you’re going to test it. That’s where opportunity lies, so you got to find out what that is, what is that critical factor? Market research.
Those are the stories that you hear. As much as we hate focus groups, there’re so many other ways than a focus group to get that exact story of what you said, that boredom, someone who is saying, “I guess I’ll buy it.” Is that how you want people to feel about your brand? I don’t know.
You’re going to deep dive into so many of these subjects on here and I’m super excited. Everyone, I know you have lots of questions for Laura, so make sure that you go through the platform, send an email, message us, let us know what you like or join into her next Office Hours because they’re going to be great. One of the significant things you should cover is the timing when you should do some of these things. We touched on that here a little bit and the process, but timing is such a critical factor for many people. It’s like, “Am I ready yet? Is it too soon? Is it too late?” You’re going to get a lot of questions on that. That’s a good reason to join and ask Laura those questions, “Am I timed right?”
Ask a question, totally fine, don’t worry about that.
You’re asking a professional person who develops questions, but that’s okay.
It’s totally fine. I’m here to answer.
Make sure you participate, make sure you do that. I want to make everybody aware that there’s a tab in Laura’s expert profile in the expert section and that tab will have all of her videos as she records them. They’ll be added into that area, new ones all the time. We want to make sure that if you want to deep dive into market research, go ahead and watch a ton of videos, binge-watch. We are all used to that, binge-watch, get some background and then set up an appointment with her if you need to. That you can do as well. You can reach out to her email.
All her information on how to contact her is in the expert profile and reach out to her and find out because, not to sell her, but her pricing is useful and it’s low for the amount of money it could save you from making a mistake. To not budget for that is a mistake, so that’s also something else. If you’re planning your launch, have a chat with her about what she thinks you need, “Do you need a moderated panel? Do you need a survey? What is best for you?” because you want to plan that into your budget and spend it at the right time. Make sure you save for that. Those are great questions to reach out to her for.
I am here whatever you need and every product has its own nuance, so I think a conversation one-on-one can be very valuable. We can set an action plan.