Tag Archives: Surveys

Discovering Customer Needs through Research

INTRODUCTION:

Barclays is a global bank. It provides a range of financial services in 56 countries. Barclays provides retail banking services to customers, whether they are individuals or businesses. It offers a broad range of financial products and services including current accounts, savings accounts and general insurance.

Within the UK, Barclays communications are designed to help customers “Take One Small Step” to managing their money better every day. Different kinds of customers represent distinct markets for Barclays. The market for personal banking services is very competitive. Personal customers have a choice of banks on the high street or on the web to assist them in managing their finances. For example, they can have their salaries paid into accounts, pay bills through the bank or save money to gain interest on their savings. There is also a competitive market for business banking services. Businesses require different services such as credit management, payments for suppliers or loans and overdrafts to help them to survive and grow. For example, an expanding business may need a mortgage to buy a new building.

Market segments

Each market is capable of being further sub-divided into segments. A market segment is a part of a whole customer group that shares particular characteristics. These include such factors as age, life stages, geography or occupation. Within the market of personal banking, the segments could include categories such as students, graduates, “new to work”, mature, and families. By identifying different market segments, organisations can ensure they are providing products or services to meet the needs of these customers.

In addition to this, appropriate promotional techniques can be used to reach the people in the separate segments. Through segmentation, Barclays has been able to devise appropriate banking offers for customers in different segments. This approach is helping Barclays to improve its market share of the student accounts market.  Barclays believes students constitute a very important market segment for the business. Students may be choosing a bank for the first time and Barclays hopes to retain these customers. By focusing on the specific needs of this segment, Barclays hopes to attract more student customers and keep them in the long term. Using market research has enabled Barclays to identify the right product offer that will meet their needs.

The case study shows how market research enabled Barclays to improve its student account offer.

PURPOSE OF MARKET RESEARCH

The purpose of market research is to gather data on customers and potential customers. The collected data aids business decision making. This therefore reduces the risks involved in making these decisions. In order to create a product proposition that would attract new student accounts, Barclays needed to understand fully the needs of this target market. Before engaging on external market research, Barclays began by asking itself a series of key questions. It did this to ensure the business was fully aware of all the relevant issues and did not make incorrect assumptions.

In asking itself these key questions at the start and reviewing internal customer data, Barclays was able to clarify its rationale for acquiring students. Firstly, students provide an opportunity for developing a long-term relationship. As the student market segment increases each year in September/October as the university term starts, Barclays has an annual opportunity to target new student customers who need an account and who might not yet have chosen a bank.

Secondly, the use of this data highlighted that in the years after opening their accounts, Barclays was able to establish a valuable long term relationship with students. This meant that students could now be seen as an extremely important market segment, and attracting new student customers became a significant opportunity.

This internal understanding was vital. With this background, Barclays designed a programme of market research. The purpose of this was to establish what students really needed from a bank. In this way it could offer appropriate products and services which would add value to students.

TYPES OF MARKET RESEARCH

Barclays began a process that involved both primary and secondary research.

Primary research

Primary research involves finding out new information. It finds the answers to specific questions for a particular purpose. These enquiries may take the form of direct questioning. For example, it may include face-to-face surveys, postal or online questionnaires, telephone interviews or focus groups. This type of direct contact with people is valuable as it gives specific feedback to the questions asked. However, it is important that the questions are clear and that the researcher is trained. This will ensure that the results are not influenced. Although primary research can be expensive and time-consuming, the up-to-date and relevant data collected can give organisations a competitive advantage. This is because their rivals will not have had access to it.

Barclays” primary research process began internally with two key questions:

  • Who should our key customers be?
  • What are their needs?

The insights from these questions provided a factual basis to work from.

Qualitative and quantitative research

After this an external agency was employed to carry out an opinion panel. This took the form of an online questionnaire. The results of this delivered data about the market itself, as well as Barclays” market share among this target audience.

Quantitative research presents information in a numeric way, such as graphs, tables or charts that can be used to analyse the information.

For example, Barclays found from the questionnaire that 81% of students surveyed held a savings account and 32% an investment savings account (ISA).  The opinion panel also provided qualitative feedback on what was of interest to students and what they wanted from an account.

Qualitative research provides information on consumer perceptions, such as:

  • how they feel about products and services
  • what they like or do not like
  • what they would want from a new product.

The panel produced valuable insights which Barclays used to help re-evaluate its existing student account. It then used the information to develop new features and benefits to meet the established needs.

Testing

The enhanced student account proposition was then tested directly with 100 existing and new Barclays Student Additions account holders. This was carried out through bank branches and an online questionnaire. The sample group provided more qualitative feedback about what motivated students to choose a particular bank. Although small, the sample allowed Barclays to get a feeling for how students would respond to the proposition. For Barclays, it was important to know what motivated a student to choose a bank. Using existing students meant the bank was able to assess if the new offer would meet their needs. The expectation was that new and future students would also find it attractive.

Secondary research

Secondary research focuses on existing information. It uses published data that previous research has already discovered. This covers a wide range of materials, such as:

  • market research reports
  • sales figures
  • competitor marketing literature
  • government publications, e.g. national statistics.

Secondary research may be quicker to carry out but may give less specific outcomes for the topic in question. This part of Barclays research revealed that student accounts in 2009 amounted to 0.4 million out of a total market of 5.4 million new accounts.

RESEARCH FINDINGS

Numeric data gives a factual basis for planning – a snapshot of a situation. On the other hand, qualitative information can find out the things that really matter to consumers. For example, 80 out of 100 consumers questioned might say they preferred one brand of coffee over another. However, more valuable information comes from understanding what it is they prefer. Is it the smell, the taste, the packaging or the price?

To meet student needs for a valuable, helpful financial service, Barclays needed to understand what students really wanted.

By using student focus panels and staff working in branches with a high proportion of student customers, Barclays was able to discover students” concerns, priorities and strength of feeling.

Research outcomes

The outcomes of the opinion panel and the sample of student customers showed that:

  • students relied heavily on different forms of credit. These included an easily manageable bank overdraft to finance their time at university
  • students wanted and often needed to own high-tech gadgets and electrical goods, such as laptops
  • students wanted to have separate accounts to manage their student borrowing and spending
  • any incentives offered would not alone motivate students to choose that product. They were expected as part of any deal.

This insight was a real help to Barclays when considering the most attractive proposition for students. Its objectives were to attract new student accounts. It also wanted to retain students as customers for life in a profitable relationship that met their financial needs.

Barclays could now start to put together an offer that would embrace the main concerns of the target market. These concerns were financial security, credit availability, flexible banking and the right sort of incentives.

IMPLEMENTATION AND EVALUATION

In 2009, Barclays set up a working group to oversee the setting up of the new student proposition. It used the insight from the research to establish the key features and benefits of the student account. These features are valid for the life of students” studies:

  • no monthly fee to keep costs down for students
  • an interest-free overdraft facility of up to £2,000 from starting the account. Previously this started at £500 in the first year and increased through the years of study. This extension helps students manage their finances.
  • mobile banking and a network of local branches for ease of access to accounts.

Incentives

Of several incentives tested with students, Barclays found that an incentive based on a mobile or telecoms offer would have most appeal. This idea was tested further with students on university campus. The students expressed a clear preference for an incentive offering mobile broadband:

“The broadband offer looks good…I”d definitely go in to find out more.” “It”s good if the broadband offer is for the life of the account´you may be in halls for the first year but not after that.”

To establish this incentive, Barclays researched broadband providers. It then entered into partnership with Orange – the UK”s number 1 broadband provider.

Orange”s strengths were a good business fit for Barclays and ensured that the offer had credibility and perceived value. Students who signed up for a Barclays student account were able to obtain a 25% discount on the monthly cost of whichever Orange mobile broadband scheme they chose.

Communicating the proposition

Having developed a student banking proposition that Barclays felt confident would appeal, it began to communicate the message and promote the new student offer. An innovative marketing plan was launched which involved:

  • a word-of-mouth campaign through “100 voices” which encouraged students to share their experiences of managing money whilst at college or university
  • promotional literature available in branches nationwide. This proved useful information for Barclays colleagues as well as for students and their parents to take away
  • online advertising through barclays.co.uk
  • direct mail to prospective students through the summer before going to university.
CONCLUSION

The Barclays student account proposition shows how it is crucial for a business to listen to its market. To do this effectively means targeting specific market segments to discover their needs.

Barclays” new student account proposition was an “insight-led” approach.

Using carefully constructed and phased market research, the bank was able to gain an overall insight into the thinking of students. In the early stages of the research, it was discovered that the student segment provided an opportunity to develop a long-term relationship. It was found that students were not necessarily “here today, gone tomorrow”. If the bank made a valuable and relevant offer, students were likely to remain lifelong customers.

Barclays” initial target was to increase the overall number of student accounts by 25%. This target was exceeded with an increase of 34%. As a result, Barclays increased its market share of the student market, moving from third to second among the top four market leaders.

The process of meeting customer needs is an ongoing one. Barclays has a continuing plan for re-evaluating its student proposition to ensure it remains relevant to the target audience.

Source: thetimes100.co.uk

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How to Define your Target Market

To build a solid foundation for your business, you must first identify your typical customer and tailor your marketing pitch accordingly.

With the current state of the economy, having a well-defined target market is more important than ever. No one can afford to target everyone. Small businesses can effectively compete with large companies by targeting a niche market.

Many businesses say they target “anyone interested in my services.” Some may say they target small business owners, homeowners, or stay-at-home moms. All of these targets are too general.

Targeting a specific market does not mean that you have to exclude people that do not fit your criteria from buying from you. Rather, target marketing allows you to focus your marketing dollars and brand message on a specific market that is more likely to buy from you than other markets. This is a much more affordable, efficient, and effective way to reach potential clients and generate business.

For example, an interior design company could choose to market to homeowners between the ages of 35-65 with incomes of $150,000+ in the Baton RougeLouisiana, market. To define the market even further, the company could choose to target only those interested in kitchen and bath remodeling and traditional styles. This market could be broken down into two niches: parents on the go and retiring baby boomers.

With a clearly defined target audience, it is much easier to determine where and how to market your company. Here are some tips to help you define your target market.

How to Define Your Target Market: Look at Your Current Customer Base

Who are your current customers, and why do they buy from you? Look for common characteristics and interests. Which ones bring in the most business? It is very likely that other people like them could also benefit from your product/service.

Dig Deeper: Upselling: Dig Deeper Into Your Customer Base

How to Define Your Target Market: Check Out Your Competition

Who are your competitors targeting? Who are their current customers? Don’t go after the same market. You may find a niche market that they are overlooking.

Dig Deeper: In Praise of Niche Marketing

How to Define Your Target Market: Analyze Your Product/Service

Write out a list of each feature of your product or service. Next to each feature, list the benefits they provide (and the benefits of those benefits). For example, a graphic designer offers high quality design services. The resulting benefit is a professional company image. A professional image will attract more customers because they see the company as professional and trustworthy. So ultimately, the benefit of high quality design is to gain more customers and make more money.

Once you have your benefits listed, make a list of people who have a need that your benefit fulfills. For example, a graphic designer could choose to target businesses interested in increasing their client base. While this is still too general, you now have a base to start from.

Dig Deeper: How to Conduct Market Research

How to Define Your Target Market: Choose Specific Demographics to Target

Figure out not only who has a need for your product or service, but also who is most likely to buy it. Think about the following factors:

    • Age
    • Location
    • Gender
    • Income level
    • Education level
    • Marital or family status
    • Occupation
    • Ethnic background

Dig Deeper: Why Demographics Are Crucial to Your Business

How to Define Your Target Market: Consider the Psychographics of Your Target

Psychographics are more personal characteristics of a person, including:

    • Personality
    • Attitudes
    • Values
    • Interests/hobbies
    • Lifestyles
    • Behavior

Determine how your product or service will fit into your target’s lifestyle. How and when will they use the product? What features are most appealing to them? What media do they turn to for information? Do they read the newspaper, search online, or attend particular events?

Dig Deeper: Understanding How Your Customers Think

How to Define You Target Market: Evaluate Your Decision

Once you’ve decided on a target market, be sure to consider these questions:

    • Are there enough people that fit my criteria?
    • Will my target really benefit from my product/service? Will they see a need for it?
    • Do I understand what drives my target to make decisions?
    • Can they afford my product/service?
    • Can I reach them with my message? Are they easily accessible?

Don’t break your target down too far! Remember, you can have more than one niche market. Consider if your marketing message should be different for each niche market. If you can reach both niches effectively with the same message, then maybe you have broken down your market too far. Also, if you find that there are only 50 people that fit all of your criteria, maybe you should reevaluate your target. The trick is to find that perfect balance.

You may be asking, “How do I find all this information?” Try searching online for research others have done on your target. Search for magazine articles and blogs that talk about your target market or that talk to your target market. Search for blogs and forums where people in your target market communicate their opinions. Look for survey results, or consider conducting a survey of your own. Ask your current customers for feedback.

Defining your target market is the hard part. Once you know who you are targeting, it is much easier to figure out which media you can use to reach them and what marketing messages will resonate with them. Instead of sending direct mail to everyone in your zipcode, you can send only to those who fit your criteria. Save money and get a better return on investment by defining your target audience.

Dig Deeper: How to Find New Customers and Increase Sales

Source: Inc.com By Mandy Porta

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How to Conduct Market Research

A guide to using market research to understand who your customers are and what they want.

If you don’t know your customer, then you don’t know your business. You won’t know how to respond if you see changes in your sales patterns. And because it’s so hard to hang on to customers you don’t know intimately, you will forever be chasing new ones.

Unfortunately, though most business owners like to think they know their customers, many are really only guessing. And when it comes to forecasting sales — in fact, when it comes to virtually every aspect of business planning — an empirical understanding beats gut instinct almost every time. Now is the time to get the facts.

Professional market researchers generally divide their work into qualitative studies (interviews and focus groups, with free-flowing and open-ended discussions) and quantitative studies (usually surveys). In a perfect world, you would probably do both, using qualitative research to create a survey, the results of which might in turn be interpreted using another focus group. Given limited resources, though, it generally makes sense to go quantitative. After all, says Steve Sprague, a marketing consultant in MarionIowa, “some data — any data — is better than none.”

Building a better Survey

1. Define Your Survey Target

First, identify the customers to survey. In general, it makes sense to focus on your best customers. “You want to look at the upper 60 percent of your customers by sales,” according to Sprague. Naturally, this is easiest for companies that track purchases and customers individually: Rank your customers by sales and lop off the bottom 40 percent. Alternatively, your sales or accounts receivable staff ought to know who your most reliable buyers are.

Retail shops and other establishments in which purchases are small and buyers tend to remain anonymous may have to settle for a smaller sample from a broader range of customers. But even these businesses can identify their best customers by encouraging customers to fill out a postage-paid postcard with very basic information or by asking them at the register for a Zip code, which can then be used to create a demographic profile. (See “Decoding Demographics.”) You might also institute a frequent-customer program, in which you offer a discount or other incentive in exchange for a small amount of personal information and an opportunity to contact the customer later. Newsletters and e-mail updates are also an opportunity to identify whom to contact later; ditto the prize drawing that requires a business card to enter.

Sometimes you will want to study specific customers. If, say, sales are flagging, you might study lapsed customers. “Identifying characteristics of your attrition market may help you develop new customers and clients,” notes Nancy Ulrich, a marketing research consultant in suburban JacksonvilleFlorida.

2. Decide on a Format
There are basically three ways to administer a survey: by mail, by phone, or online. A highly personalized letter is best when the survey population is hard to reach (physicians, say, or senior executives). A phone interview serves well for complex and probing questions that demand interaction between interviewer and subject, but it normally requires professional assistance. Most businesses, though, will do very well with an online survey. Many survey companies (Zoomerang.com, for one) offer inexpensive tools and complex branched questions, in which a specific response to one query generates a specific follow-up. And they are fast — you can see results in real time.

Experts say that a written survey should take from five to 15 minutes to complete. Divide your questions between customer satisfaction and customer demographics, weighted toward the former. And keep it short, says Sprague, who includes fewer than 10 questions when he writes surveys for his clients. “By limiting the number of questions, you improve the response rate,” he says. “And it forces you to think about what’s important.”

Be personal, and begin by praising your customer and highlighting the importance of the survey. At the end of the survey, you should offer some sort of reward or incentive — the longer the survey, the more generous the reward.

3. Probe Customer Satisfaction
When writing survey questions, take care to avoid introducing a bias that telegraphs the answers you hope to receive. Avoid trade jargon or abbreviations, or at least make sure they are well defined.

Ask open-ended questions. These let respondents ruminate about what they like about your company and what might improve the relationship. Be sure, says Ulrich, that the text boxes allow space for lengthy responses. Follow these with a multipart rating question and a corresponding multipoint scale to review your business’s specific processes. Ulrich believes that respondents more easily understand descriptive words (excellent, fair, poor, etc.) than a numbered scale.

Calculate your net promoter score. Ask respondents how likely, on a scale from 0 to 10, they are to recommend your company, product, or service to others. The net promoter score is derived by subtracting the percentage of “detractors” (customers who rate the business from 0 to 6) from the percentage of “promoters” (who rate the company 9 or 10). The greater the difference, the more likely that your company can convert the enthusiasm of current customers into new customers. Sites like Net Promoter (netpromoter.com) offer more information about these scores and comparisons with leading companies. Or simply view your score as a useful general indicator of your customers’ feelings about your product or service.

Ask for suggestions. Sprague likes to conclude the customer satisfaction portion of a survey with a query like: “What could we do to make your next experience with us extraordinary?” “It stretches their mind and your mind,” he says. “It’s going to help you think of things you haven’t thought of before.”

4. Dig for Demographics
The demographic information you seek will depend on which attributes drive your business — these may include age, gender, marital status, educational attainment, household income, and leisure pursuits. Some of these are sensitive topics, and you don’t always need to broach them. For instance, if you know a customer’s Zip code, you can get a rough idea about income and education. If you know the address, you can refine that further by sorting customers into what are called census block groups, says Jeffrey DeBellis, director of marketing and research services at the University of North Carolina‘s Small Business and Technology Development Center. (See “Decoding Demographics.”)

When your customers are businesses, you want information about their size by number of employees and revenue. (If your customers are reluctant to share that information, formulate the responses as a series of ranges.) Also, try to get the NAICS (or North American Industry Classification System) or SIC (or Standard Industry Classification, which has been replaced by the NAICS) code. This can help you identify similar companies in the area.

5. Test the Survey First
Before you make the survey available to your customers, ask family members and friends to test it for time and clarity, and whether the questions mean what you intend them to mean and are free of bias and the like.

Using the Data

Once you tabulate the results (which happens almost immediately with e-survey programs), patterns should emerge. “If you have 20 answers, and you don’t see definite trends, then you probably don’t have enough data,” says Sprague. You could try to resurvey, using the existing results to write more probing and targeted questions, or you could convene a focus group. Focus groups are also useful for interpreting the results.

Focus, focus, focus. For focus-group testing, it is smart to engage experienced marketing consultants, who will be adept at moderating the conversation. For one thing, your subjects will probably be more reticent if you or your top sales executive is conducting the session. “With a trained focus-group facilitator, you’re going to have someone who will generally script the experience up front,” says Ulrich. Moreover, “experienced facilitators develop a certain amount of intuition when something’s up,” sensing when the dynamic has changed and able to steer the conversation in a new direction if necessary.

The “aha” moment. Ulrich recommends that once you have collected all the data, “find one or two ‘aha’ ideas and implement them immediately. Make sure they’re visible and that they impact the greatest number of people in a positive way.” This will show, she says, that you have been listening to the needs and concerns of your customers — which, any great salesperson will tell you, is half the job.

Decoding Demographics

The Web offers databases and automated services that can help make sense of the survey data you collect. Some are free, but the most useful involve fees or subscriptions. Check with your public library and local “economic gardening” organizations — such as Small Business Development Centers, chambers of commerce, and economic development groups — to see if they offer free or discounted access.

To check the demographics behind your customers’ Zip codes, go toesri.com/data/esri_data/index.html, a site operated by the software developer ESRI. Also visit mybestsegments.com, a site operated by the demographic profiler Claritas. Both services are free teasers; more detailed information will cost you.

Census block group data are available from ESRI (esri.com/industries) and Pitney Bowes Business Insight (pbinsight.com).

Rutgers University Libraries offers an extensive list of online market research resources at www.libraries.rutgers.edu/rul/rr_gateway/research_guides/
busi/markres.shtml
.

 

Source: Inc.com By Robb Mandelbaum

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