Rochester, NY (PRWEB) May 5, 2006
One of the most common objectives of market research is to find the customers wants and wishes, or their hot buttons. But what if traditional market research identifies the wrong hot buttons? What if conventional market research singles out hot buttons that will freeze your finger? What if standard market research uses a malfunctioning thermometer? A recent study by Professors Dan Horsky, Paul Nelson, and Steven S. Posavac published in the Journal of Consumer Psychology examined this possibility.
The study (Horsky D., Nelson P., Posavac SS. Stating Preference for the Ethereal but Choosing the Concrete: How the Tangibility of Attributes Affects Attribute Weighting in Value Elicitation and Choice. Journal of Consumer Psychology, 2004, Vol. 14, No. 1&2, Pages 132-140) compared the attractiveness of five sporty car attributes calculated using answers provided in a market research study (what people say), and the attractiveness of the same five attributes derived from the actual buying behavior of the car buyers (what people do). The five attributes were Performance, Dependability, Comfort, Prestige, and Exterior Styling.
The relative attractiveness of the performance, dependability, comfort, prestige, and exterior styling attributes, calculated using the answers in the market research study, were 0.13, 0.22, 0.13, 0.16, and 0.20. The relative attractiveness of the same five attributes, calculated using the real behavior in the marketplace, were 0.24, 0.21, 0.13, 0.00, and 0.19 (note the change in values of the first and forth numbers).
According to the authors: “a rather dramatic change in the ordering of the average weights occurs ... Specifically, the tangible attribute Performance, previously one of the least important attributes on average, is now the most important to sporty sedan buyers. … In contrast, the weight of Prestige, an intangible attribute, falls dramatically and becomes the least important attribute. The remaining attributes change little.”
This “dramatic change” has dramatic implications. “The implication of our findings is that stated preferences may not be highly predictive of actual consumer decisions because the relative importance of attributes differs in value elicitation and choice. This finding is troubling because of the reliance of marketing practitioners on research data pertaining to attitudes, purchase intentions, and attribute importance rankings. If predictions based on stated preferences are markedly different from reality, marketers’ decisions (e.g., product positioning, advertising emphasis) made based on the stated preference data may be suboptimal.” In other words, “forecasts of choice based on stated attribute importances would have been erroneous.”
So, can you believe what people say about their wants and wishes? Yes, if you have the formula that converts what people say into what people do. If, you don’t; if you rely on non-converted customers’ suggestions, be prepared to face some unpleasant surprises.
But don’t the traditional market research tools use a conversion formula? No they don’t. They believe what the customer says, whole heartedly. The observations above show that they shouldn’t believe, but they do. In light of this gullibility, can you trust these tools?
Mike T. Davis, Ph.D., SCI, Rochester NY
We are the inventors of Computer Intuition™, a psycholinguistics based program that analyzes the language that people use to describe themselves and their environment, and “converts what people say into what people do”™. When clients hire our services, they send us their qualitative data. We input the data to the computer, which calculates the psychological intensity, or psytensity, of every idea found in the text. We then isolate the ideas with the highest psytensities, and document them in a report that also includes our "Do this, do that"™ recommendations. Our clients include many Fortune 500 companies, such as Apple Computer, Sears, Allergan Pharmaceuticals, Chrysler, Citibank, IBM, Motorola, Eastman Kodak, Hewlett-Packard, Anheuser-Busch, Gannett Newspapers, Cincinnati Gas & Electric, Xerox, and Frontier Communications. We also serve many smaller companies and individuals.
In the Science on Decision Making series we analyze papers from scientific journals that include interesting findings on the relationship between decision making and analysis of qualitative data. More reports are available at http://www.computerintuition.com/Reports.htm