Category — Competitive Research

One of the great uses of market research in general, and technology market research in particular, is getting G2 on what your competitors are doing.

Market research organizations usually have much greater access to your competitors’ customers, and the anonymity of a formal market research process allows participants to be much more open.

As technology market research experts, we get a lot of inquiries about competitive research projects. Here are answers to three of our most frequently asked questions:

1. Can you find my competitor’s customers?

Yes, with only one caveat – they actually have customers!!! Getting participants for any market research project is a bit of a numbers game. There will always be some percentage of people who don’t have the time or simply aren’t interested in participating. If your competition only has 20 customers in the entire world, we probably will struggle to find them all and get them to agree to participate in a project.

But with this one caveat, we have tried-and-true methods for finding users of any particular technology. In fact, at Dimensional Research we have actually had clients with such bad internal data and complex internal processes, that it’s been easier for us to find their customers!

2. Will my competitor’s customers talk to you?

Yes, absolutely. Not only do we motivate them with appropriate compensation but people like to be heard. And technology professionals know that strong competition drives innovation, so they want their vendors to have competition, and they want to have options.

3. How specific will competitor customers get with their info?

That of course depends on the participant and how open they are, but the majority of participants will tell you everything they know. It depends to some degree on the goals of the project. If your goals are to understand the motivation for purchase – such as a win/loss project or a lost-deal analysis – those are very straightforward questions and it’s straightforward to get clear answers from customers.

If your goal is to understand weaknesses in your competitor’s product, that can also be done, but you do need to be prepared that existing customers have often worked through weaknesses, have figured out workarounds, and no longer perceive those as problems. Having some sense of what the weaknesses might be so you can encourage the participants to recall their initial response to those problems will give better results.

Remember though that this is a good news/bad news situation. It’s just as easy for YOUR competitors to talk to your customers, so at Dimensional Research we strongly recommend that you get feedback from your own users in addition to your competitors’ customers!

Scott Anthony recently advised, “In Market Research, Use Numbers with Caution.” He added, “Companies too frequently default to quantitative research because they think there is safety in numbers. It’s a lot easier to justify a strategy by saying, ‘The data suggests’ than by saying, ‘My intuition suggests.’ But sometimes numbers provide false confidence and obscure real opportunity.”

Anthony’s point of view is quite different than the point of view presented by Robb Mandelbaum, who recently said in Inc., “Given limited resources … it generally makes sense to go quantitative.”

Both articles are excellent  – and both present very different points of view.

So how do you choose between quantitative (surveys) and qualitative (focus groups, in-depth interviews) when performing market research projects with technology participants?

Sometimes, quantitative (surveys) research is better

1. When you need data to support a claim with investors, press, or internal stakeholders.  Dimensional Research has done a number of Web surveys that our customers have used for PR purposes, including these recent ones on anti-virus and desktop power management.

2. For trending purposes, quantitative studies are also the best.  Dimensional Research has a number of clients that follow the “Would you recommend this company to a friend?”  question promoted by HBR, and watch the responses to that trend over time.  It’s a great way to track trends in customer feedback.

3. Of course, if time is the greatest consideration and you need some kind of quick feedback – Web surveys have a big advantage.  The are FAST.

Sometimes,  qualitative (focus groups/in-depth interviews) research is better

Numbers can be deceiving and there is no better way to find that out than to talk live to people who give you numbers.  I was recently doing a competitive study, speaking to end users of a client’s competitor’s product.  My client, as is natural, was most interested in the negative feedback about the product.

So to introduce the topic of what was good and bad in the product, we started by asking the customers to rate the product being discussed on a scale of 1-5.  And of course, asked the important market research follow up question, “why?”

I was consistently surprised by users who had raved about the product, saying it was perfect and there was nothing they would change about it given the chance – and they’d assign a 3 out of 5.  And other users who basically spent the whole conversation whining and complaining about the product would give it a 5!

Numeric scales can be misleading and in these cases, qualitative studies such as focus groups or interviews are better.  I would always recommend qualitative studies when you are looking for thoughtful answers including:

-          Messaging validation for products that are new to the market

-          Market validation

-          Understanding objections and barriers

-          Product feedback for enterprise products (web surveys do a better job with consumer products that are simpler to understand)

Qualitative vs. quantitative is a good conversation to have with your market research provider – although of course you should understand their expertise. If you only have a hammer every problem is a nail, so expect a qualitative-focused research house to tell you to survey thousands of prospects, and someone who only does focus groups to emphasize quantitative approaches.

A good research firm will know if they don’t have a fit with your needs and will point you in a better direction.  For example, Dimensional Research does not do conjoint analysis, but we have a great partner that we can refer you to if that’s what you need.

At Dimensional Research, we are big fans of social media. We blog here.  You can follow us on Twitter @DimensionalR. We’d love it if you fanned us on Facebook.

So what is the place of social media in market research? 

This is a topic that is constantly evolving as social media changes, but let me make one important observation about research bias. 

I think Twitter is an AMAZING way to get feedback from people who are on Twitter. The ways to interact and test are absolutely revolutionary and should be evaluated as a potential component of any company’s arsenal of feedback mechanisms. Now the question is - is my target market on Twitter? 

If you sell to corporate IT, I’m going to make a bold claim: Twitter is NOT the best way to get feedback from your target market! I’d argue that the people spending money on enterprise technology are particularly under-represented on Twitter.   (Now all the Tweeps can argue with me – please do!)

Using Twitter is a great way to reach the part of your target market that is on Twitter.  Maybe your early adopters are on Twitter.  And you may sell a solution that is more likely to be discussed on social media.  But caveats aside, think carefully about how your overall target market can be reached for feedback.

Bottom line: Know where your audience can be reached.  Execute market research that represents your entire audience – both the portion of it that is active on social media and the part that isn’t.

According to a recent survey from a specialist PlayStation 3 site, geeks make the best lovers.

Let me clarify right from the start that as someone with distinct geek-ish tendencies, who is married to a confirmed geek, I have no intentions of arguing with the study’s conclusions – just with its methodology.

The problem with the survey is that it was biased. Given the audience likely to peruse a PS3-specific site, it’s fair to assume the respondents skewed more toward the “geek” end of the spectrum.

When conducting research you must know who you’re talking to in order to interpret the conclusions correctly. If they had done the same survey with a running site, would they have found out that marathoners are the best lovers?  

In technology market research, identifying your research target audience is especially important.  Customers will give you different insights than prospects, employees, partners, or even the customers of direct competitors! 

If you’re talking to your customers, you need to acknowledge that by definition they have the pain that you’re selling to, or they wouldn’t be using your product. So, you shouldn’t do a customer survey and then announce, “100% of the MARKET does this.”  Of course, it’s completely fair to say, “100% of our CUSTOMERS do this.”

In comparison, if you’re talking to the general market who isn’t as fully educated on your solution, you’ll need to tailor your questions accordingly. If you ask questions that are too detailed and specific to your solution, you’ll get uninformed answers. The type of questions that are appropriate for customers who are familiar with your product, are not the same ones to use for the general market.

For example, if you’re asking about product features, you will get vastly different answers from existing customers who know your product, and from your competitor’s customers who know an alternative approach. Both of these will be different from the answers you’ll get from prospects who don’t have any product experiences.

As with everything in market research, it comes back to goals. Your very first step should be figuring out your business goals. Then, figure out what you need to know in order to achieve these goals. Next, figure out who has that knowledge, and who doesn’t. Only once you’ve answered all these questions, you can dive into the details of the market research project.

So, to be honest- it really depends.  But I know that’s not an answer to a very pragmatic question, so let me give more details here, bearing in mind that it really does depend on your specific project. 

A typical market research project takes six weeks. This is pretty standard for a small to mid-sized project, say 10-30 in-depth interviews or 4-8 focus groups.  Larger projects take longer, of course.  And we’ll talk about Web surveys later.

Here’s a pretty typical schedule for a single stage project with one series of focus groups or in-depth interviews - excluding unforeseen “bumps” or unique requirements:

Week 1: Project go-ahead. Write and approve recruiting guide. Identify source for recruiting participants - internal or external.

Week 2-3: Recruit participants. Write and approve interview guide or moderator’s guide.

Week 4-5: Conduct research. This may take less than two weeks, depending on your goals. Four to six focus groups all in the US are usually done in just one week.

 Week 6: Write and present market research report.

WARNING: The biggest schedule slippage that happens, aside from getting all the approvals in place for the project go-ahead of course, is with identifying internal participant contacts.  Using in-house lists or asking account managers to give us their contacts for recruiting may be time consuming and the schedule should be adjusted as needed.  

Web surveys are usually faster. A typical schedule for a web survey project is three weeks:  

Week 1: Project go-ahead. Determine goals. Identify lists for participation.  Write and approve questions. Upload them to survey tool.

Week 2: Field survey.

Week 3: Close survey. Do analysis including filtering and correlating findings. Write market research report.

If the survey is being conducted as a collateral piece to support outbound marketing efforts such as PR or lead gen, add another week for copy-editing and layout.

We just completed an extensive series of in-depth interviews with great IT participants from around the globe. These participants were smart and articulate. They knew their job, and were very good at it.

But as smart and capable as these participants were, we discovered during the interviews that many of them – at least half -  held a completely false belief about my client’s product.

During the interviews with these participants, they kept repeating the same idea.  The details are confidential to that client, of course, but the important point is that this audience really believed that their perception of the products was true. This wasn’t a minor technical detail – it was a major assumption about environments the products operated in.  But the problem was IT WASN’T TRUE! This was verified by my client, by independent evaluations that we found while investigating the conflict, and by some of the other participants in the study.

So here you have a very well established fact about a product, but at least half of the customer population believes something else. In other words: even if something is not logical, and even if your customers and prospects are technology vendors who tend to be logical, they may still believe in something wrong. And it could negatively affect their buying decisions.

This type of dynamic is extremely important for vendors to understand. If there are things that your audience believes about your solution that are not true, you’d better know about it so you can take action.

You’ll notice that I’m referring to this as a “belief”. Beliefs are harder to respond to than competitive FUD or outright lies.  These are things that your target market thinks are true because they’ve never really thought about it.

A formal market research methodology is the best way to uncover and to root out these false beliefs across your target market. You can’t rely on day-to-day conversations with customers, because if these issues do surface during such a conversation, you tend to correct them immediately with that specific customer and then forget about them since it didn’t make any sense to you to think that way.