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...