The purchase funnel: that theory is so 1898.  Our friends at the Marketing Leadership Council recently blogged on HBR about changes in consumers’ purchase processes, and it looks like all of the information barraging consumers has caused them to adapt their shopping habits to cope with the noise.

For almost one-third of consumers the information is too much and rather than conducting a considered search they drop the work altogether and just zero in on a single brand.  And MLC research has found that decision simplicity in the purchase process is the #1 reason why consumers are likely to buy a product, do so repeatedly, and recommend it to others. 

In fact, brands that simplify customer decision making are:

• 86% more likely to be purchased
• 115% more likely to be recommended

The Council created a 15-question quiz to help you determine how simple—or complex—you’re making your customers’ purchase decisions.  And you can also access their HBR article on the new Decision Simplicity strategy.

Related resources:

• To Keep Your Customers, Keep it Simple
• Boosting the Impact of Shopper Insights

Related blogs:

• Stretching Shopper Insights Resources
• Setting Up a Shopper Insights Shop
• Santa Won’t do your Insight-Shopping for You

With all of the Oscars handed out we have made it to the end of another award-winning awards-show season.  But thanks to the folks at Brandchannel there is one more round of awards, and these might be the most interesting to you: the Brandcameo Product Placement Awards.

Congratulations to Apple for appearing in almost half of all #1 movies (according to US receipts) last year.  And a shout-out to Transformers: Dark of the Moon for squeezing 71 identifiable brands and products into its 91 minute running time—that’s almost 1 product every one-and-a-quarter minutes.  I’ve seen commercials struggle to get to that concentration of product featuring!

The Brandchannel article also provides a few takes on the return on these movie investments.  Do you have questions on measuring the success of product placement, sponsorship, or other types of advertising?  Learn from your peers by posting your questions to our Primary Research Forum.

Guest blogger Judy Wang is a researcher at the Customer Contact Council, a sister program of the Market Research Executive Board. 

I moved to DC a little more than a month ago, and I can’t even tell you how many different bars, restaurants, and salons I’ve tried. And who’s to blame me? With dozens of Groupon-like deals flooding my inbox every morning, my attention and loyalty are at an all-time low. But what happened to the idea of being a “regular” at an establishment? Has that gone out the door in this era of large data and choice, or am I alone in my unfaithfulness to stores and brands?

Interestingly, research conducted on customer loyalty shows that my behavior is a part of a larger trend: loyalty varies widely by demographic, and a person’s age and occupation can be a strong predictor of their purchasing behavior. Knowing this relationship—and more importantly, understanding its causes—can have important implications on how you engage with customers.

So here’s what the research said:

More mature age groups are significantly more loyal than younger counterparts. When behavioral loyalty (as measured by the number of other like-service providers the customer visited in the past two years) and repurchase intention are considered among a diverse age group, those who are more mature (ages 35-54 and 55+) exhibit significantly more loyal behavior than those who are younger (18-24 and 25-34). This finding can be attributed to three age-dependent reasons.

• Mature consumers have different social constructs and social needs. Whereas younger cohorts have large social circles, mature consumers tend to have fewer, but deeper, more meaningful social relationships. As a result, this “older” cohort relies more on social support—the recognition, familiarity, and sense of belonging that being a “regular” service customer offers.

• Older consumers experiment less with new brands. Of those in the older age brackets (65+), 65% maintain loyalty to familiar brands. Meanwhile, only 47% of the younger brackets (20-24) do so. This is due to differing levels of confidence in service and quality. With age, people become more skeptical of providers, and therefore older customers tend to stick with tried and true brands.

• Customers differ in their optimum stimulation level (OSL). This concept explains an individual’s level of affinity for environmental stimuli. High OSL individuals engage in exploratory and switching behavior, while low OSL individuals seek constancy and familiarity. Here’s where it gets cool: OSL has been shown to negatively correlate with age, and as a result, the younger customer is more likely to seek new brand experiences and sample new service providers.

Customer loyalty differs according to occupations. The same metrics of loyalty were analyzed along occupation, and retirees and home makers were found to be significantly more loyal than students. While occupations don’t perfectly capture income and situation, they have strong implications for the two.

• Low-income groups are less loyal than high-income groups. Perhaps not surprisingly, customers who have low income (and, thereby, high price-consciousness) tend to seek the next big deal. As my colleague noted, daily deals draw bargain-hunters, and bargain-hunters are disloyal customers. In fact, one study found that only about one in five daily-deal-buyers returns to the business as a full-price customer. It makes sense, then, that students (who typically have the least income and highest price-sensitivity) would be significantly less loyal than retirees (who tend to have larger budgets).

• Occupations affect socialization. Similar to age, occupation is a strong determinant of social context. Those who are exposed to larger social circles, like students and professionals, require less additional social support than those who have relatively smaller circles, like retirees and home makers. Therefore, students and professionals are likely to be less loyal than retirees and home makers.

What are your thoughts? Have you noticed a relationship between customer loyalty and demographic? Has your company changed its strategy in response to this relationship?

Related Resources:

• Driving Action with NPS® and Other Loyalty Metrics: Focusing on Key Success Factors
• Conducting Customer Loyalty, Satisfaction, and Profitability Research
• Six Myths of Customer Loyalty
• Maybe Your Customers Don’t Want to Talk to You
• Stop Trying to Delight Your Customers?

Summer, for most of us, is a time to recharge our batteries, to relax, to enjoy some calm before the demands of life pick up again.  Unfortunately, investors have made that a good deal harder recently as they collectively removed over a trillion dollars in value from financial markets over the course of a few days.

Why the sudden volatility?  Consumers haven’t suddenly changed spending behaviors, nor have business customers. And suppliers look healthier than in some time, beating earnings estimates and sitting on plenty of cash. Credit availability has drastically improved. Inflation is hardly threatening.

The answer seems to lie in the health of developed economies. While many appeared to be on the mend for the past year (albeit slowly), it’s become clear the recovery is far more fragile than was thought, especially in the US.  We’re not in a recession, but we’re also not in a recovery that is self-sustaining.

In such an unstable place, most signals (economic data) are too weak or confusing for investors to proceed with confidence.  Even small pieces of information have outsized impact and prices gyrate.  Markets, after all, are just groups of people trying to discern future value and in this case they are struggling.

So, what are executives doing in the face of this volatility?  Some are being tougher on discretionary spending.  Many are revisiting assumptions for 2012 planning.  But the executives we’ve spoken with are not deviating from the strategies and tactics they put in place following the recession.

There is one thing all executives should be doing right now – getting used to operating in an uncertain environment.  Fortunately, that doesn’t require telling the future.  It does require, however, a structured exploration of what could be, and flexibility to respond regardless what becomes.

Most companies can stand to improve in this area.  Want to learn more?  Join your peers in our upcoming webinar, Taming Uncertainty, on 25 August at 11:00 am EDT.  We’ll clarify why volatility has become “normal” and how the best companies are working around it.

Which generation has the most discretionary spending power, leads all generations in traditional media consumption and technology spending, stands at a population of roughly 76 million strong and will account for an unprecedentedly large community of people 65+ in 2050?  That would be the Baby Boomers, a unique mix of Alpha Boomers to Zoomers aged 47-65 who are simultaneously the most influenced—and influential—generation in recent American history. Once dubbed “The Me Generation,” Boomers today have morphed into the “The Everybody Else” generation, raising young kids, funding college, nurturing grandkids, and helping aging parents.  To keep it covered, Boomers are still “workin’ it” by scaling careers, planning semi-retirement, and launching small businesses of their own, coming into their second act with no intention of fading away. As lifelong doers, do-gooders, learners and buyers, they’re worth getting to know again as aging adults who will re-invent themselves and every category in the process.

On July 21, Iconoculture will host a deep-dive into the Boomer market, bringing observational and psychographic insights to guide action for reaching this cohort during their next stage of life. During the session, we’ll examine the financial shifts, health solutions and tech innovations shaping their expectations, and we’ll explore the social and emotional relationships that influence them. As Boomers brush the dust off their changed financial outlooks post-recession, we’re tracking their new views for the epic life and all it may hold with Iconoculture trends such as Leading Hedgers, Simply Perfect and The Exponential Experience.

In addition to exploring trends shaping Boomer behavior, we’ll also share implications that will help brands apply insights to their Boomer marketing strategies. We’ll look at best practices for ensuring cultural resonance, and examples from brands that are successfully exhibiting these trends in the market today. Council members can register to join the conversation on July 21 by clicking here and read more about recent trends and observations of Boomer consumer behavior on the North American Trends page.

By Kirsten Robinson

It’s no secret that the millennial generation is a game-changing force. We’ve talked about how millennials impact the workplace as employees—but who is the millennial consumer?

Our sister company, Iconoculture, recently conducted a study on millennial consumers, their attributes, and how Research and marketing teams can reach them. Here are some takeaways from the webinar:

Who is the millennial consumer?

The millennial consumer—most commonly thought of as born between 1982 and 2000—can’t be confined to one box. They embody a variety of identities at one time, which are constantly in flux—the “me of the moment.” Some other attributes at a glance:

-They stand out to fit in—fitting in with their tribe of friends, while maintaining individuality.

-They choose to adapt over adopt—they may not be the first product adopters, but when they get their hands on a device or service, they find ways to adapt it to their personal needs.

-They are some-conventionals—millennials are interested in traditional values, just not in the “traditional” sense; they twist values to fit themselves.

Nancy Robinson: “The definition of this group is so fuzzy because it’s a generation we’re still watching in process. There’s already a big difference between today’s 32-year-old and today’s 16-year-old. It’s a smaller group to watch, within a smaller timeframe. Millennials are still in the process of emerging and going through those same stages. And they’re not going through those stages in a predictable way.

They really are that kid who thinks, this looks great, it doesn’t have to be super flashy, but it looks like it’ll work, and it better work. They’re very forgive-me-not in that respect. If it doesn’t work, it’s never their fault—they think that there’s something wrong with the product.”

How can you appeal to Millennials?

-Tap into customization. Millennials are all about personalization—they need to feel like products were made for them. Even product upgrades don’t have to represent a major change; they’re interested in small, incremental changes.

-Be accessible. Millennials are convenience consumers. But, the convenience needs to be fun, and the right fit for the right moment. They want to know what the product is, how quickly they can get to it, and how soon it can be theirs. It’s not about being impatient—it’s about access.

Nancy Robinson: “No, absolutely not. What’s interesting about Millennials is they are equal opportunity information gatherers. They still pay attention to print, particularly magazines, as well as listening to the radio. It’s less about the channel and much more about the content. But they’re looking across a variety of channels. You never just want to jump into one boat, because that one boat will sink. You want to be invested in a variety of approaches to them, and you want to keep those approaches fresh.”

MREB members, learn more about the millennial consumer and how you can reach them by accessing our event replay.

By Aaron Field

I was just shopping for a blu-ray player. Being conscientious and confused I devised a research plan (sound familiar to anyone?).

This is what the Internet taught me:

• The information density of the DVD format was limited by the wavelength of the laser diodes used. (Wikipedia)
• The LG BD670 is not the prettiest Blu-ray player on the block (PCMAG.COM)
• “I bought the Sony BDP-S1 for the house for Christmas and we really got a lemmon (sic).” (Amazon.com user review)

as the kids would say. Utterly confused on what to buy.

Social media-based research feels eerily like my pathetic blu-ray research. A tremendous amount of information is Irrelevant, Opinionated by idiosyncratic “experts” and Unrepresentative of average consumers (with indifferent spelling).

Happily Social Media provides its own answer. Passionate communities are hubs for well-defined demographic segments (see http://babies.com/) and high-value customers (http://www.flyertalk.com/).

Essentially you know who is talking – a major advantage in the internet world. No wonder Insights teams increasingly find passionate communities reliable, truly expert, and representative of a specific consumer.  Whether you build these communities , find these communities on the internet, or create your own (see how Charles Schwab did it), they are a valuable asset alongside MROC’s.

And if you know anything about blu-ray players drop me a note. I am still searching.

By Anthony Bell

Consider all the screens you interact with on a daily basis: smart phone, tablet, desktop, laptop, in-store video, big-screen TV, screens at sports events, screens in automobiles/ airplanes, and many others.  Total adult daily viewing devoted to watching all of these screens: 8.5 hours (for those age 45-54, its 9.5 hours). That’s a lot of time spent peering at a screen and a great place for marketers to reach consumers. But what about all the marketing communication we receive on these screens every day? Do we absorb them all the same way? Do they stick with us equally, regardless of the format?

According to the neuroscientists at Neurofocus, the brain receives video stimuli in an identical fashion, no matter what the source, but the subconscious responds to video differently in different formats. The neuroscientists identify three primary measures of neurological effectiveness: Attention, Emotional Engagement, and Memory. They find that the second and third are extremely powerful predictors of purchase intent and marketplace success. To tap into these latent emotional drivers, Research should capitalize on innovative implicit research techniques. They also identify three screen categories: TV, Internet (desktop/ laptop viewing), and mobile (small portable screen based devices). Here are some of their findings from their testing of advertisements across the different screens:

• Attention: Attention is highest for most of the ads in the mobile platform. Voluntary attention is higher on the mobile platform because the smaller screen size requires more focus to understand the message.
• Emotional Engagement: The larger screen sizes of TV help the human elements (human faces) shown in commercials to have the highest emotional engagement. The mobile platform has lower emotion due to its smaller screen size, which does not clearly depict human faces and other emotional elements in commercials.
• Memory Retention: The mobile and internet environments give a significant boost in memory retention. This benefit derives from the intense need to focus voluntarily on the smaller screen.
• Purchase Intent: Both TV and mobile screens – where focus is on video without distracting elements – motivate viewers very well.
• Overall Effectiveness: Ads with high dynamism, fast paced action, and banner-like messaging treatments perform best in the internet setting

Our conversations with various neuroscience experts points to a regular theme: the brain will only afford your message a brief window of time to gain its notice. Therefore, it’s critical that messaging be well crafted to grab the attention of the subconscious. MREB Members, for more, here’s an overview of emotional, sensory, and natural observation techniques.

China is the world’s most populous country and the fastest-growing economy.  With 1.3 Billion people, it’s a giant piece of future market potential for global brands.  As marketers try to tap into the growth offered by the Chinese market, many are watching Chinese brands beat them to the punch, making rapid inroads into established, western markets.   Haier is a noteworthy example: an established home appliance brand in China, this brand has carved out a prominent space in the highly competitive US appliance market.  Watching Haier we can learn a few lessons that might inform our own strategies for entering growth markets outside of our current footprint:

• Finding White Space: Haier Group made initial inroads in the U.S. market by focusing on novel product categories such as refrigerated wine cellars; Haier has since captured 50% of the market for these devices, gaining a foothold that they can use to migrate from niche to big ticket purchases.
• Leveraging The Halo Effect: After establishing itself in compact refrigerators and wine coolers, the company has entered other categories—it now sells 2% of all full-size refrigerators in the U.S., 16% of window air conditioners, and recently introduced a line of flat-screen TVs and DVD players.
• Playing to Local Perceptions: The name Haier was adapted from German to deliberately obscure the company’s Chinese origins and play to North American perceptions of German quality and reliability.

So what about western brands entering the Chinese market?  Join Iconoculture’s lead Consumer Strategist covering East Asia, Jeff Yang on May 3^rd, for an overview of recent trends, developments, and shifts in consumer behavior in China. We’ll unpack the unique “cultural DNA” of this incredible market and take a closer look at brands that have successfully captured the mindshare of Chinese consumers. Board members can register here.

For a quick look into what consumers are doing in China, Board members can also check out a few of Iconoculture’s latest global consumer observations.

By Anthony Bell

Emerging markets will certainly be the driving force behind any growth in consumer demand across the next decade. The Economist Intelligence Unit’s five-year compounded growth rate for 2014 to 2020 shows that average private consumption per country in the BRIC group could quadruple to surpass those of the G7 nations, and shows that total private consumption in emerging markets will likely triple its current level to match the G7 countries in 2020. Although most of the growth will come from elsewhere, rich world consumers will still undertake the lion’s share of global spending across the next 10 years. The chart below shows that, on current trends, the U.S. will still be home to the world’s most active consumers in 2020 but that China, India, Russia, and Brazil will all have joined the top 10.

Chart 1: Top nations by consumption, 2009 and 2020 Economist Intelligence Unit, Corporate Executive Board Research

This means that firms should continue to pour time and effort into understanding and operating in emerging markets, both the obvious ones, such as the BRICs, and some of the less obvious (Indonesia, Chile, and Thailand for example). But they shouldn’t neglect their developed-world consumers, who will still account for a high proportion of firms’ revenues. These consumers’ tastes might change over time but they’ll still reward firms handsomely for providing good products and services at the right price.

It is difficult to make an accurate one-year projection, let alone an accurate 10-year projection but Research has become adept at identifying important market changes. The challenge is, however, while Research is the voice for insight into future market conditions, we struggles to drive stakeholder action. Progressive research organizations have shifted trends conversations away from abstract mega-trend ideas to more vetted market opportunities that provide better context for business decisions. Instead of boiling the ocean, with a broad net across the market, refocus your change-sensing efforts to identify a manageable number of new opportunities grounded in analysis of the company’s market share. A customer driven scenario ranking grid is a good way to prioritize potential scenarios’ likelihood based on customer views to ground discussions around market scenarios’ probabilities rather than internal perceptions. Research will be in the driver seat as company’s pay more attention to emerging markets in the next decade. We just have to make sure we deliver on the right opportunities, rather than mega-trends, to provide line partners with the confidence and context necessary to act.