Wednesday, May 6, 2009

The Grand Finale

For the last blog of the semester (yeah, bummer) the topic is a reflection blog about the concepts that were covered this semester along with how they tie in with the Insight/Experience Audit & Prototype group project that we have been working on.

The first topic which I feel that I understand better by as a result of working on this group project was the "Paradox of Choice" which was discussed earlier this year after listening to the Podcast by Barry Schwartz. For the project, our team was given the freedom of creating an item which would be tailored to fit the needs/insights of a segment chosen by our group members. The segment my team chose was the "Stay at Home Dads" - especially those with younger children. The dilemma then became... what product should we create in order to satisfy their underlying wants and needs?

SAHDs are, according to our findings, technologically savvy individuals who enjoy and cherish their time spent alone. These two insights provided an ENDLESS amount of possibilities when it came to attempting to design a product for them. Technology? Time alone? So many options, we just could not bare down and choose one. We could hardly even pick a direction up until about a week and a half ago. This predicament is the complete embodiment of the Paradox of Choice and its nature. After having listened to that podcast, discussed the topic in class numerous times, and blogging about it, I fully experienced the phenomenon first-hand (as if I hadn't already been experiencing it on an every day basis).

The second most important takeaway from this course in my opinion was the ability to evaluate insights from customers. Obviously, this is the entire point of the course (given by the title - Customer Insights). However, I feel that one really does not have an idea of how to really delve into insights until reading, listening, and seeing all the materials in this course. After having worked on the Stay at Home Dads segment, I began to realize how much we had to put ourselves in the shoes of a SAHD in order to come up with the most innovative, useful, and gratifying product geared towards their specific preferences. Before this course, one somewhat overlooks the phases of evaluating insights. You have got to be able to cater to the needs of a certain group or demographic, particularly that of your target segment, and prior to this course, I just did not fully understand how significant of a step this was.

Lasty, after having worked on the group project I can definitely say that there was a lot of value added to the course from the project itself as well as the updates along the way. This project was one of the most liberating and fun activities I have done since probably elementary school. I almost felt like a kid again when we were building the prototype - it was truly an experience that, as a college student, liberated me from this "grown up" world we live in and allowed me to be creative and artistic in a simple way once again.

As always, Stephen was very helpful throughout the process of coming up with this new product offering. I truly enjoy Stephen's style of teaching, I feel as if he allows for a lot more freedom than most professors do. He kind of just tells you what you need to ultimately do, and lets you run free from there. The most interesting experience was running ideas by Professor Walls, and just witnessing his reaction - I think he thought everything was a good idea when framed the right way :)

I kind of touched on it earlier, but the project really allowed for a further understanding of evaluating and attempting to cater to the insights of a customer. In trying to create a new product offering, it was extremely vital that the needs of the segment were met while at the same time keeping in mind everything we learned about the segment through web research, interviews, and surveys.

Overall, it was probably the most fun group project I've ever had to do at any level of education. I am definitely glad I had a chance to take this course while I was in college here at the McCombs school of business.

Signing out one last time,


Tuesday, April 21, 2009

Blog #9: MY iTunes Critique

I read Michael Yang's "The Era of the iPod: The iTunes Rant" on his Insights De La Customer blog. After reading this interesting piece, I thought back on the days where I used to listen to tracks on the radio and record songs using my very own boom box--actually it was my sister's boom box which had been passed down to me.

Either way, we have come a long way both technologically and mentally in terms of how we gather and collect our music. We now use the internet and digital recordings of songs--MP3s--as the main source of music storage. In addition, portable music (MP3) players have become extremely prominent. Of these, the iPod has particularly skyrocketed in popularity and usage. Apple has created a virtual music store through its iTunes program. Personally, I have never purchased a song from iTunes, and do not plan on doing so anytime soon. Why pay $1 per song when most CDs that I listen to have 15+ tracks and I can purchase the entire thing for $10 retail? Not to mention the fact that I'm a savvy shopper and I will usually get a CD (in the rare occasion that I do actually purchase one) off of eBay for no more than 5 bucks.

Yang wonders in his blog "What happened to the good old days where I was able to record songs off the radio for free, shouldn’t technology make recording songs freely easier now?" While bringing up a good point there that there is a lot of red tape when it comes to downloading and loading music onto your digital music player, Mr. Yang fails to acknowledge the fact that the internet era has made downloading and storing music easier than ever. Way back when, a person would have to sit by their stereo and wait for the right moment for their favorite song to come on, and then be fortunate enough so that the tape was ready to go. Then, if all else prevailed, they could only hope that the song wouldn't be cut short... or that the DJ wouldn't start commentating while the song was playing.

Nowadays, users are able to download numerous versions of the hottest song out - all in CD quality and full length. Most of the time, it will be the same exact song that you would find on the artist's CD, all without paying a dime. The digital age has created a dilemma for both musicians and consumers alike. Musicians have to worry about their music being "stolen" from the free music sharing sites Michael mentions: Napster, Kazaa, Imesh, and Limewire. Consumers have a different predicament--whether or not they would like to download free music and run the risks of getting viruses on their computer and possible fines, or just abide to biting the bullet and paying for the music they obtain the "right" way.

All in all, my colleague Michael makes an overall great point with his stand on iTunes' promotion strategies. Michael argues that Apple and iTunes "should implement discounts or promotions to better advertise their songs and increase market share." By providing the reader with a innovative ideas on how to better promote song sales, Yang delivers on his premise of conveying better overall value for its customers. He goes as far as suggesting a 'buy-one-get-one-free' style of promotion, along with packaged discounts and emphasis on album artwork and the likes. Michael indirectly - but strongly - argues, in my words, that iTunes does a poor job of differentiating the music it offers as opposed to its unofficial competitors... the internet music sharing programs. His stance is that consumers would only be driven away from the free downloads which they are all susceptible to only by better product offerings from Apple/iTunes. Michael is indeed a savvy marketer.

Sunday, April 12, 2009

Research Paper Outline

I. Introduction

a. Thesis: Nike has evolved the way it uses its unique ability to gauge insights from customers and incorporate them into its branding through communications and offerings through the years

i. Advertising

ii. Experience

iii. Product Customization

II. Body

a. Advertising

i. Changes over the years

1. Nike started moving towards television ads in the early 1980s

2. Back then the company focused more on track and other Olympic-geared American sports, however, its product line expanded towards many other sports throughout the world

3. Late 80s saw the creation of the slogan “Just Do It” as well as the Michael Jordan era of athlete endorsements

4. Nike has garnered a tremendous amount of athletes for sponsorship—most famously Pete Sampras, Tiger Woods, and now LeBron James

ii. Nike uses advertising to draw customers closer to the brand

1. Brand creates an image that resonates with a customer whether it’s through emotional appeal or by using one of the many endorsed athletes

2. Nike lures customers with a marketing strategy centering around a brand image which is accomplished by promoting a distinctive logo and its world-famous advertising slogan

b. Experience

i. Nike has made a point to utilize the experiential part of their offerings towards making a connection with customers and their feelings

1. Niketown is a place where true Nike fanatics can find just about any product offering they desire

2. In addition to finding just about any Nike product, they can talk to other Nike followers as well as employees and managers and get more acquainted with the brand spirit

3. Nike also promotes usage of products under different functionalities

a. EX: Air Nike Cole Haan dress shoes

b. This allows customers to fall in love with the brand and use it in all facets of life

c. Product Customization

i. Nike has now shifted towards a completely customizable line of products

1. Nike allows its customers to go online on their website and use NikeID in order to create their own product out of an existing one

2. This customization feature allows the user to choose colors, styles, and personalized inscriptions on their preference of Nike items

3. Such a product offering truly allows for company to gain understanding of what customers truly want in a shoe, shirt, jersey, or accessory

4. Nike has also teamed up with Apple to create a new technology called Nike+ which allows users to track the way that they run

III. Conclusion

a. Restate thesis and how it is addressed through the paper

b. Summarize main points as well as key research findings

c. Conclude with a detailed summary of the key insights Nike utilizes as well as how the paper applies towards customer insights issues

Tuesday, March 31, 2009

See these ice cubes? See these Ice Creams?

I am currently working on a project for my Marketing Policies class, and the client which my team is working with is none other than Amy's Ice Creams. Having met Amy herself, and proceeding to think about the business and its intricacies, I began to wonder more about the interesting world of ice cream vendors. The thing that intrigued me, and ultimately inspired me to blog about the topic, was the fact that eating ice cream is all about the experience.

Ice cream is readily available to those who want it. Good ice cream is available to those who look in the right places. Premium ice cream is... well, I'm not entirely sure what or where it is, but Amy's Ice Creams (along with Marble Slab, Cold Stone, etc.) claims to offer it.

The premise that I write this blog upon, however, is what drives a person (or a group of people) to eat ice cream at a vendor such as Amy's or Cold Stone. Why not just eat the ice cream at home? Why not buy a container and enjoy it over a movie - it's cheaper that way.

I, personally, am not an avid ice cream eater. I know plenty who are though, and they seem to specifically enjoy ice cream runs in groups of two or more. They are willing to pay more for ice cream at say Amy's (from here on out, I will focus on only Amy's Ice Creams) than they would for a big tub of ice cream at HEB which tastes probably just as good--just without the fixings. My question then becomes: what about this experience makes you want to pay a premium for ice cream? I have begun to compare it to engaging in consumption of alcoholic beverages downtown (come to think of it, almost anything is an example of this... food, movies, etc.) You are in a social setting with friends and you all decide to go out for some drinks. You end up paying probably about at least double what you could have paid if you bought a bottle and mixed the drinks yourself at home. This very insight is the driving force behind the blog topic. Why do consumers purchase items or services at a premium when they have the choice of a cheaper alternative at their disposal?

Focusing on ice cream, specifically Amy's, is the experiential aspect of eating ice cream there. Amy's is supposed to be a fun-loving, cooky, and zany type of atmosphere which patrons are supposed to enjoy to the fullest. This is arguably the reason why people go to eat ice cream there. The customer is given multiple options to choose from, especially when throwing the "crush'ns" in the mix. At home, the consumer has only 1 maybe 2 flavors at the most (I don't suppose many people have 3 different types of ice cream in their home unless... they just splurge). Still to me, the very-occasional-ice-cream-eater, these reasons are simply not enough.

As a result, I have been led to conclude that eating ice cream at a shop like Amy's is entirely emotional/experiential. Perhaps eating Amy's reminds people of eating ice cream after baseball games when they were a kid. Maybe people's parents used to buy them ice cream after getting all As on their report card. I'm convinced emotion has so much more to do with it than the combo of flavor and toppings. In addition, experiencing ice cream at a vendor with your friends during a study break or after a long day out playing sports is part of the Amy's experience. These emotional drivers are the aspect of the project which most interests me.

Tuesday, March 24, 2009

Rapaille-tilian Hot Buttons

The reptile in you.

Dr. Rapaille is a former European Psychologist turned Market Researcher who believes consumers are driven by "unconscious needs and impulses." He claims people make up reasons which attempt to try to make sense of or justify their behavior when in reality they truly have no idea why they act a certain way. He has developed a 3-stage technique which consists of:
  1. Past reason
  2. Through emotion
  3. Primal core
In the first of the stages, Rapaille conducts a series of focus groups in order to gauge what types of responses the subjects will give from the word "luxury." These responses are meant to draw upon associations that the participants may have with the mere thought of luxury. Rapaille looks for and embraces any response, no matter what it may be, in order to allow the respondents to feel like they did a good job and are comfortable with the study.

In the second stage, Rapaille attempts to draw emotional queues from respondents by asking that they tell a story as if they were speaking to a 5-year old from another planet. He explains that by doing so, the participants no longer try to use logic or sound intelligent but instead begin to use simpler means or thoughts in order to provide an explanation and convey a message or meaning. His intention is to confuse them while putting them in this completely different mindset.

Lastly, the third stage hunts for the "primal urges" which consumers often feel when making a purchase decision. Rapaille insists that all purchasing decisions really lie on one's primal core. In order to accomplish this task, the participants are asked to lay down and relax in the room which has had all of its chairs removed and proceed to take a frame of mind similar to one of waking up in the morning. He then attempts to capture these thoughts that would otherwise not display much prominence given a different set of circumstances. By doing so, he can "unlock the luxury code" through the means of obtaining something he dubbed the "reptilian hot buttons" which he believes ultimately encourages individuals to take action.

Mr. Rapaille went on to discuss the importance of finding the "code" and how everything suddenly makes sense afterward. It was mentioned that a French cheese company trying to market cheese in America was "off code." He did not mention what the code was, but alluded to the fact that in France, cheese is "alive" and is therefore not stored in a refrigerator--compared to the U.S. where almost all cheese is refrigerated, hence "dead." The fact that the company was promoting the cheese off-code, according to Rapaille, caused for inappropriate marketing tactics.

That song, so-so-so song.

Song Airlines was supposed to be a new fashioned, low-cost airline under the ownership of Delta Airlines. In my opinion, the experience that Song is trying to create was a good concept--however, it became too much of a concept and not enough of a service. Song wanted to target a certain type of customer, and that was a good idea, however, Andy Spade failed to put enough of a tangible aspect of the product and service that Song was offering which therefore made the consumer lack knowledge about what Song really was: an airline provider.

One thing that song did really well, in my opinion, was the fact that they were able to obtain a deeper understanding of the customer and their wants/needs when it came to flying. Song relied on focus groups and other means of research to figure out how women viewed flying and what sort of issues they felt were commonly ignored on a typical airplane provider. Women and their insights became a driving force for Song airlines, they went as far as creating a profile for their target consumer and naming her. This emphasis on insights and what the consumer really wanted in an airline provided Song with an ability to truly tap into the desires of the target audience and ultimately drove most of Song's features such as satellite TV and organic meals.

Song's real flaw in my mind was its inability to truly exhibit to the consumer its true benefits and what differentiated the airline from other airlines. Spade wanted to pursue a more intangible type of benefit as opposed to highlighting the airlines features. While this is great in its own way, it was not a good idea given the circumstances which Song was dealing with. The airline industry was a struggling one, and consumers knew that. In addition, anyone who is a purchaser or has any sort of purchasing power will be more likely to purchase a product whose features and benefits are well laid out and tangible yet useful. In Song's case, not only did the advertisements as well as the other means of promotion fail to lay out the features, they also failed to deliver the message that Song was an airline provider. Almost 50% of people who had "heard" about Song did not know that it was an airline. If your consumer does not know what product or service you offer, how can they purchase it, or, more importantly, why will they purchase it?

No one is going to fly on an airplane because of some subliminal emotional message they saw on a commercial--they are going to decide on which flight to purchase by evaluating first the price, and then the features that the airline offers. Spade had a good idea, but it just was not right for what Song needed to do. It was too early for the young airline to try to tap into consumers' emotions. The airline had to differentiate itself through its consumer-friendly features such as organic meals, satellite TV, and most importantly low-cost fares. Most importantly, the airline had to show the consumer what it was--an airline.

Monday, March 9, 2009

A Marketer's Dilemma

After reading "Kenna's Dilemma" I became convinced that sometimes the public just does not know what it wants. Consumers not only react and feel differently when using a whole product over an extended period of time (as in the home-use tests used in the Pepsi vs. Coke battles) but they also tend to have difficulties explaining feelings about unfamiliar things. These two issues are what I feel are the most important takeaways from the chapter in regards to a marketer trying to gain insight from customers.

When testing products, a simple sip allows for subjects to get a sample of a product (in the case of the reading, it was Coke or Pepsi). As mentioned in the reading, people react differently when trying out an entire can as opposed to just a sip--especially when testing a product over a longer time frame, say, a week. Market research is a tricky thing. Sometimes, subjects answer or react differently to a product under a controlled experimental atmosphere than they would under no supervision in the privacy of their own homes. This is why sometimes you've got to trust your gut.

The first example the popped to my mind was the beverage Snapple. Throughout Snapple's history, the bottler has rolled out over 75 different flavors. As far as my understanding goes, not one of them had been subjected to any type of market test. Snapple simply rolls out a new flavor, puts in on the market, and sees how buyers respond and use performance as a benchmark. The reason Snapple was able to do this for so long was because of the economies it had built through its distribution network. It was relatively inexpensive to create a new flavor, put it on the shelves, and see how well it sells. Consumers were able to purchase and drink Snapple, garnering the full experience of the product--not just a sip. To me, real-life performance is the best way to measure the strength of a product or service--not a bunch of simulations to constituents who (hopefully not) may not ever use the product in the first place.

In the case of Kenna, his music was so off-the-wall that there is, in my mind, no way that a group of music analysts would have been able to identify the type of listeners who would enjoy Kenna's unorthodox style. Kenna is definitely the type of artist who would develop a cult following (known to market industrialists as a niche). This, to me, taints the effectiveness of market research. Yes, a lot of the time, market research is highly useful and a decent predictor of performance. However, a good amount of times (and with today's extreme diversity in tastes and preferences) the tested subjects' perception does not truly account for the outside variables that affect how great a product or service can truly be. Kenna's different style of music appeals to a different style of audience. Personally, I hardly ever love songs right off the bat--they have to grow on me, and that takes time. How can that ever be accounted for through a listen-and-respond 15 minute questionnaire?

In 1985, market research was nowhere near as sophisticated as it is in 2009. I do not know if there was any market research done when Nike's team worked on developing the Air Jordan I. These shoes were definitely the first of its kind. Historically, basketball shoes had been white or black solid colored shoes with a more traditional, conservative look. Nike literally put all of its eggs in one basket with these revolutionary kicks. People had never seen anything like them before, and thus would probably react negatively to them--initially--due to unfamiliarity. Michael Jordan was the man they would depend on to save their company. Now, even to a pure basketball lover such as myself, the shoes are somewhat unattractive (I have always wondered what I would have thought of them if I was a teenager in 1985). They are bright, loud shoes with a boxy yet plain design. I'd be willing to bet that if a group of respondents were surveyed and asked "How likely are you to buy these shoes?" the results would tell a whole different tale than what actually took place. Jordan was a rookie in the NBA at the time, and the NBA banned the shoes because the league felt that it violated uniform codes. Jordan (prompted by Nike management) continued to wear the shoes, and begin to receive fines from the league (which Nike gladly paid for). This created a buzz so definitive that the shoes began flying off the shelves and fans could not wait to get their hands on a pair of forbidden basketball shoes. It boded well that Jordan was a... decent... basketball player and was playing well at the time. Couple this fact with the aided publicity and you've got yourself a knockout product. This anecdote serves as an example for both how consumers will react and feel differently over an extended period of time and tend to have difficulties explaining feelings about unfamiliar things.

Consumers do not always know what they want-especially as their preferences begin to change over time. There is no cut and dry way to simulate a human brain and how it will react to a new song as it plays more over time, a new drink as they begin to experience it while doing their everyday things, a new shoe as it gains popularity among different human channels, or a new style of chair as they see it gain prominence. Sometimes, you've got to trust your gut...

Monday, February 23, 2009

Just do it.

Surprise, surprise. When debating on what topic I should choose for my Customer Insights Current Topics Report, I wanted to do three things:

a. I wanted to do something that I would be really passionate about
b. I wanted it to be sports related
c. I wanted it to involve Nike

Lo and behold, I had already made my mind up without really thinking twice. My three points really (purposely) left me with no other choice. I have managed to make some sort of Nike shoe reference in all my previous blogs. Now I finally have a chance to actually make it the focal point.

In case it's not already clear, I plan on discussing Nike for my report. However, it is not entirely clear to me yet as to what exactly I will be focusing on.

Nike's a global marketing giant. The artist formerly known as Blue Ribbon Sports fascinates me in ways even I can't really completely understand. Nike's an athlete's way of nearly achieving invincibility. Throughout Nike's evolution, it has done things that are beyond abstract. Nike's advertising has always captivated me, particularly because of its versatility. Contrasting two Lance Armstrong commercials, one appeals on inspirational aspect, another aims to make you laugh.

The evolution of Nike from the late nineties' ways of targeting young basketball players to the 2007 way of targeting young basketball players really intrigues me. How is this segment different roughly 10 years later? Maybe more headbands and trash talk--however, how is the mindset different from the previous? How does Nike capture this? As far as I'm concerned, Nike is head and shoulders above the competition in terms of targeting young athletes and capturing their desires then ultimately channeling them onto a product to build a brand.

In my mind, Nike truly does it all. The ultimate definition of versatility, Nike always goes one step further in order to remain embedded in the consumer's mind. Brian Morrissey talks about how Nike allows its users to connect and share data through social networks in his "Why Nike Embraces Brand Utility" article. He talks about how Nike launched the "Ballers Network" on Facebook strictly for its young basketball addicts. Nike's goal is to "provide a useful service that enhances an athlete's enjoyment of his sport." To me, this goal corresponds with what Nike provides me on a mental, physical, and spiritual level.

The last question I would like to pose is how does this differ from, say, Adidas or Reebok? For the sake of argument, I will stick with Adidas because it does own Reebok.

Adidas appears to target a whole different segment. Interestingly enough, Adidas owns the license to make and distribute NBA products through a deal with the league about 2 years ago. Yet, I feel that when a young basketball player thinks Adidas, the associations that most often come to mind are soccer and "not cool" (just kidding... sort of). I own a pair of Adidas basketball shoes, and they are definitely not on par with my Nike basketball shoes. As a "baller" nowadays, Nike is your haven.

Adidas has inspirationally driven spots as well. Why do they not appeal on the same level as Nike's? I love Gilbert Arenas and his story, yet, his commercial would never make me go out there and buy his shoes. As a matter of fact, his shoes are far below appealing. Furthermore, this commercial is exemplary of Adidas basketball advertisements' unoriginality. It is the same concept as the Nike commercial from before (the second coming one under the "2007" link). However, it just does not appeal to me in nearly a similar fashion.

As time progresses, I hope to find more answers as to why Nike's able to capture pathos as well as why Adidas does just the opposite.