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Consumer Behavior

market-research-without-biasThe Economist Magazine did an analysis of political book sales on Amazon to see if there were any patterns. Anyone who uses social media will not be surprised that readers tended to buy books from either the left or the right...not both. This follows an increasing pattern of people looking for validation rather than education and of course it adds to the growing divide in our country. A few books managed a good mix of readers from both sides, though often these were books where the author found fault with his or her own side (meaning a conservative trashing conservatives or a liberal trashing liberals).

I love this use of big data and hopefully it will lead some to seek out facts and opinions that differ from their own. These facts and opinions need not completely change an individual's own thinking, but at the very least they should give one a deeper understanding of the issue, including an understanding of what drives others' thinking.

In other words, hopefully the public will start thinking more like effective market researchers.

We could easily design research that validates the conventional wisdom of our clients.

• We can frame opinions by the way we ask questions or by the questions we asked before.
• We can omit ideas from a max-diff exercise simply because our "gut" tells us they are not viable.
• We can design a discrete choice study with features and levels that play to our client's strengths.
• We can focus exclusively on results that validate our hypothesis.

...

how-to-green-marketingDo people buy green products? Yes, of course. The real question for green marketers is whether they buy enough. In other words, are green sales in line with pro-green attitudes? Not really, as huge majorities of consumers show at least some green tendencies while purchases lag far behind. Why is that? Economics tells us that consumers buy based on value (trading off cost and benefits). Since eco-friendly products are seen as being more expensive, higher prices can lower the value of a green product enough to make a conventional alternative more attractive.

While the cost trade-off is clear, it is not the only one. The benefit side has at least two major components. One is the environmental benefit, which may or may not seem tangible enough to make a difference. For instance, a dozen eggs at Acme goes for less than a dollar, while some cage-free varieties can run north of $4 at Whole Foods. So, an environmentally conscious consumer has to make a trade-off at the time of purchase – is the product worth the additional cost? For items like food, the benefits may seem small enough, and far enough out, that many may decide the value proposition does not work for them. In other product categories (say, green laundry detergent), the benefits may seem both long term and impersonal, making the trade-off even harder.

The second major component is the effectiveness of the product in performing its basic function. If consumers perceive green products as inherently inferior (in terms of conventional attributes like performance), they are less likely to buy them. So a green laundry detergent (that uses less harsh chemicals) could be seen as more expensive and less effective in cleaning clothes, further dropping its overall value. (A complicating issue is that the lack of effectiveness itself could be a perceptual rather than real problem). Unless the company is able to offset these disadvantages, the product is unlikely to succeed.

A direct way to increase demand is to offer higher performance on a compensatory attribute. In the case of LED TVs, for example, newer technology consumes less power and provides better picture quality. (Paradoxically, this can sometimes lead to the Rebound Effect, whereby greener technologies encourage higher use, thus clawing back some of the benefits). But in reality, most products are not in a position where green attributes offer performance boosts.

And of course, as it is with every other market, there are segments in this market as well. Consumers who are highly committed (dark green) are willing to buy, as the value they place on the longer term environmental benefits is high enough. And, often they are affluent enough to afford the price. But a product looking for mainstream success cannot succeed only with dark green consumers (who rarely account for more than 20% of the market). Other shades of green will also need to buy. Short of government subsidies and mandates, green marketers have to find ways to balance out the components of the value proposition for the bulk of the market.

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recycle market research pricingIn my two previous blogs about recycling, I reported on gender gaps in recycling behavior and general knowledge about what is curbside-recyclable and what isn't.

Now we turn to the real question: why aren't consumers recycling on a more consistent basis? Again we turned to our online consumer research panel and asked those with curbside recycling access who don't recycle regularly a simple question: Why not? What behaviors and attitudes can Recyclers act upon to educate their customers and encourage more recycling?

Well, like any complex problem, there's no one single answer. Lack of knowledge of what's recyclable and being unsure how to get questions answered play a big part (28%). Recyclers can raise awareness through careful and consistent messaging.

But just as significant as knowledge is overcoming basic laziness (29%). Sorting your recycling from your trash takes effort, and not everyone is willing to expend energy to do so. Recyclers may not be able to motivate them, but another concern is addressable, and that's scheduling – having trash and recycling pick-up on different days can de-motivate consumers to recycle (15%).

Another challenge is forgetfulness. Some folks are willing to recycle, but it slips their mind to do so (25%).
Education could help promote a feeling of responsibility and elevate recycling's importance:


•  I don't feel that whether or not I recycle makes a difference (14%)
•  Recycling isn't important to me (10%)
•  I'm not convinced recycling helps the environment (8%)

...

pollsters-went-wrongThe surprising result of the election has lots of people questioning the validity of polls…how could they have so consistently predicted a Clinton victory? Further, if the polls were wrong, how can we trust survey research to answer business questions? Ultimately even sophisticated techniques like discrete choice conjoint or max-diff rely upon these data so this is not an insignificant question. 

 
As someone whose firm conducts thousands and thousands of surveys annually, I thought it made sense to offer my perspective. So here are five reasons that I think the polls were “wrong” and how I think that problem could impact our work.

 

 

5 Reasons Why the Polls Went 'Wrong'


1) People Don’t Know How to Read Results
Most polls had the race in the 2-5% range and the final tally had it nearly dead even (Secretary Clinton winning the popular vote by a slight margin). At the low end, this range is within the margin of error. At the high end, it is not far outside of it. Thus, even if everything else were perfect, we would expect that the election might well have been very close.  

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Recycling market researchIn my previous blog, we determined that people with access to recycling services don’t necessarily recycle. And men were far less likely to recycle regularly than women.

One problem potential recyclers face is there is no federal standard for what is collected and how. Services vary from one contractor to the next. Items deemed recyclable in one municipality may not be the next town over. As a general rule, bottles, cans, and newspapers are curbside-recyclable. Also as a general rule, prescription drugs, electronic devices, CFL bulbs and batteries are not – they shouldn’t go in the trash either - they require special handling.  But does the average consumer know this? We asked our online panelists who have access to recycling services how they believe their trash/recycling haulers would like them to handle certain items. And here’s what we learned:

  • Knowledge of recycling the Big-3 (glass bottles – aluminum cans – newspapers) is quite high. At least 80% of our panelists with access to recycling services know each of these should be recycled as opposed to trashed. And men and women are equally knowledgeable.
  • Word has spread that electronics do not belong in the trash. But our consumers are divided as to where they should go – 35% believe their contractor wants them in their recycling bin while just 46% believe electronics require special arrangements.
  • When we get to other items, things get a bit murky:
    1. Our panelists are as likely to believe that batteries can go out in the trash or recycling (45%) as believe batteries require special arrangements (41%). The rest aren’t sure.
    2. 19% aren’t sure what to do with compact fluorescent light bulbs.
    3. 22% believe that prescription drugs can be put out in the trash. 17% aren’t sure.
  • Meanwhile, some items that are traditionally “trashed” make consumers take pause – 26% of our consumers believe their hauler wants them to recycle linens and towels.

Focusing solely on those who say they recycle, women are more likely than men to know what goes where…

Recycling Market Research part2

Ladies, you may want to re-think having your gents handle the trash and recycling - or give them a quick lesson on what you've learned!

Recent Comments - Show all comments
  • Sheridan
    Sheridan says #
    How many people were in the "panelists"? I mean, 80% of the panelists know the Big-3 but 80% of how many? Thanks!
  • Michele Sims
    Michele Sims says #
    Thanks for your question! We surveyed 507 adults in the US.
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