So why are millions spent on measurement and research

Still on the topic of measurement - I was recently in a class listening to ( with my "marketing with common sense" hat on) research experts talk about how they track, evaluate and measure advertising with complex models and tools that cost millions of dollars.

Now, the sticker price for this media analysis and measurement has always intrigued me, especially since the results often match the initial hypothesis. Makes me wonder - did you really need to spend all that money to get this answer? This question has come up before but no one ever did a good job responding to it - until this time around. And the answer put things in perspective.

This senior research executive who manages a multi million dollar research budget said - "Yes, in most cases the research may show you what you may have known intuitively. But what you are getting when you spend hundreds of thousands of dollars if not more on research is - the ability to quantify that intuition. And when you are dealing with marketing budgets of hundreds of millions of dollar, saying its working isn’t enough. One needs to be able to quantify it.”

I see it as putting a layer of science on an art :)

Research and Common Sense

If you are a marketer with a big budget, there is a very good chance that market research is part of your plan...whether its part of concept testing, copy testing, surveys or focus groups. Yet, in spite of all this research, one still comes across marketing disasters that leave you questioning the role of research.

One such marketing disaster was the launch of the New Coke in 1985. Why did the New Coke fail even after extensive product testing, focus groups and a test market program in Kansas? And more importantly, what does it tell us about blindly following research?

This is where some common sense may save the day. Don’t just follow data... Question it. Ask why or why not. Don’t go so deep into the data that your intuition goes into sleep mode.

Incase of the New Coke, the company did not ask why. They seemed to have downplayed insight that had emerged from focus group that indicated the possible public impact. In his book "For God, Country and Coca-Cola: The Definitive History of the Great American Soft Drink and the Company that Makes It”, Mark Prendergast talks about how a small minority, of about 10-12%, felt angry and alienated at the very thought, saying that they might stop drinking Coke altogether. Their presence in focus groups tended to skew results in a more negative direction as they exerted indirect peer pressure on other participants. Instead of tapping into this insight, and asking “why”, Coke chose to give more significance to surveys that were less negative. And the rest as they say is history.