Research 2008: The Great Debate (Part 3 of 4)

Go to part 2 here

Part 3 contains (1) The Big Planning Debate: Is research failing in the boardroom and (2) Guaranteeing a return on investment

Day 2 Session 1: The Big Planning Debate. Is research failing in the boardroom?

And so onto Day 2. To open the session, Vanella Jackson of Hall & Partners introduced a video containing some very interesting quotes from business leaders. These included wanting intelligence and not insight, wanting a solution rather than the research, research is too often used as insurance rather than as a forensic analysis and that research is the only tool in the marketing mix that hasn’t substantially changed in the last 12 years. A call to arms then.

Rupert Howell of ITV gave a very entertaining keynote speech before the debate/Q&A began. He started by saying that his perspective on research is influenced by several experiences. Notably, he drew attention to the power of interpretation versus reportage and capturing what people mean and not what they say.

Rupert noted that he was booed at his previous appearance at the MRS Conference 15 years ago for saying that the industry has a criminal lack of accountability. It says a lot about the industry’s progress that this was still his main issue. He used the example of The Palace which tested strongly in research yet was hated among ITV’s core audience (but liked among young people). He didn’t specify what the research was but said that rather than run away, the research company should work with ITV to find out what happened and how it can be resolved in future.

He then questioned why researchers wanted to be in the boardroom. He divulged that plc boards aren’t very strategic as there is too much formal business and corporate governance. He gave six suggestions:

1. Unless you are a city specialist, aim for the operations board. Shareholder opinion is valuable in a plc board meeting but other data isn’t
2. Keep it short and pithy – management summary and conclusions only
3. Target strategy away days as a way to get your foot in the door
4. Boards want senior people presenting. Experience allows normative trends and CEOs are more interested in what someone says about the data than the data itself. Rupert gave the example of the McKinsey analysis of a CEO’s diary, which allowed CEO’s to see if they were doing too much or too little of a certain task
5. Use the marketing/communications director. He cited David Pemsel at ITV as being the key access point
6. Be accountable

The presentation was sharp and concise and brought some great points across. Throughout the debate, and for the only time of the event, the text messages sent in were broadcast on the screen for all to see. This was a great spur for the debate, while the feedback of Rupert’s speech was generally positive (a sharp contrast to 15 years previous). Joining Rupert and Vanella were Kirsty Fuller of Flamingo, Peter Dann of The Nursery, Malcom White of krow and Richard Huntingdon of Saatchi & Saatchi.

Each panel member was invited to respond to Rupert before the Q&A began. Peter opened by saying that marketing is failing research in the way that it is represented in the boardroom and by using the wrong metrics. Research should be an inspiration to succeed, not a vaccination against failure. Kirsty was concerned whether the learnings were influencing decision-makers. Richard extolled the virtues of simplicity – e.g. the Net Promoter Score is only one number. Malcom said he wanted to see the research presented differently. He wants to know less means and more ends, and if he doesn’t understand the numbers it is not his fault but the researchers.

The debate inevitably involved a question on procurement. Kirsty mentioned that clients get schizophrenic regarding procurement versus long-term strategic partners but Rupert argued that it is here to stay as part of corporate governance and so research should get used to it. Despite that, he would like better long-term relationships with a small number of agencies as clients have a plethora of information but not enough structure to ask the right questions. Long-term relationships allow a greater consumer focus that not all boards presently have.

Peter argued that clients get the research they deserve but that researchers should equally deliver what they promise. However, Rupert said that research isn’t precise and that mistakes are made. And when they are, client and agency should work together to learn from them.

Richard followed up by saying accountability comes from opinion – one doesn’t need to be senior to have an opinion and that isn’t the same thing as Rupert looking for seniority in meetings. He mentioned that the motto at HHCL, where he worked for Rupert, was “strong opinions lightly held”.

Richard also said that both research and advertising are too introspective and have a perennial death wish – we should stop the navel gazing, essentially. Researchers should be proud of their traditional and their work from a fundamental theoretical basis. Clients may think they can do research themselves, in the same way advertisers think they can write copy themselves, but it isn’t the same. Malcom concurred, saying that planning is currently obsessed with planners and not planning. Rupert said a similar thing, mentioning that he doesn’t want to watch research take place as he is not trained to make the inferences necessary.

Interestingly, there was a poll midway through the session on who was failing who – the research or the boardroom. The answer came back as both. Overall, it was more of a Q&A than a debate, but there were many high-quality questions and answers, and ample food for thought. This was a certainly a highlight of the conference.

Day 2 Session 2: Guaranteeing return on investment

Andrew Sharp of PwC opened this session. As his keynote contained elements of a Thinkbox study that I have already seen, I confess that my concentration wasn’t as great for this section. His main point was that we need to capture brand value. Intangibles have now risen to 80% of corporate value but too much (around 3/4) is going on goodwill and not enough on brand value.

However, brand investments are risky. In an analysis over 1991-2006, 49% of brands were created post 1991 yet ceased to exist by 2006. Their average life-span was 4.1 years. Only 11% of brands existed throughout.

He also pointed out that the cumulative effect of action is roughly flat. For instance, a short-term sales gain (e.g. through price promotion) will be counter-balanced by brought-forward sales and competitor reaction. This was followed by an econometrics model that went totally over my head but which I think was saying that advertising affects base sales both directly and indirectly.

Andrew finished by saying that research has a vested interest in supporting the intangible wealth creators, that willingness to pay is a useful metric, that we should look at prices and volumes but discriminate between long-term and short-term, and that risk (i.e. statistical variance) should always be quantified. Finance officers will be used to derivatives et al, so it is important to establish norms and variances.

The next paper was by Mark Kingsbury from Bootstrap who put forth some blue sky thinking on measuring the return on investment of insight.

He suggested that insight is split into consumer information – of which we identified 184 types – and marketing action – which has 86 types. Fortunately, he filtered these down to six knowledge areas – brand perceptions, category needs, brand usage, brand disposition, context and people – and four marketing modes – rework/improve, innovate, lift spend per customer and get new customers. The connections between these two areas are used to build the central idea of a ROI model.

However, at this stage it is only a hypothesis and there are no case studies or counterfactuals to prove or disprove the model. Mark mentioned that this is the first stage of a debate that he was looking to begin. However, as one member of the audience pointed out, hypothesising this research up-front is one thing but it leaves itself open to changes in the marketing mix – shelf space, competitive action etc – that will affect the model before a product is even sold.

After an econometrics paper and a theoretical paper, we moved onto a case study that I found fascinating. Fiona Blades of MESH planning and Ana Medeiros of Unilever presented the research they conduced for the Lynx boom-chicka-wah-wah campaign.

The research is split into three stages but it is the middle that is the most interesting. Respondents are asked to text in whenever they see one of 4 brands (Lynx and 3 others to keep the client secret) advertised. They are asked to say which brand they saw, where they saw it, and how it made them feel on a scale of 1 to 5. This is combined with a pre-wave questionnaire containing standard metrics, and a post-wave on their experiences. Respondents can also access a website where all their texts are uploaded to, and are invited to add photos or comments in order to add colour to the data.

The Lynx research had two main strands – the catchphrase and the coolness of the brand. Not only could Lynx be directly compared to other brands and catchphrases, but the diary meant that they could track changes to the responses over time. Were feelings becoming more or less positive over time? Were changes driven by a particular medium? Was one medium too saturated? Were others under-exposed? As well as having the emotional measures, they could also work out touchpoint share, frequency, reach and even cost per touchpoint. They found that Lynx had fewer digital touchpoints than the other brands, and that this was something to work on. In another study for 3, they found that conversation was driving the high-scoring touchpoints.

Of course, one could argue that respondents are pre-disposed to looking out for mentions of the brands they are following. But then don’t know which specific brands or media the client is interested in, and there is the pre-wave data to fall back on. I found this to be a very interesting methodology and one I could see working for a variety of brands.

Overall, this session was quite disjointed. There were three very different papers converged around a central theme. I confess that the econometrics and the theory went over my head a bit – they seem the sorts of paper that are best read rather than watched. However, I found the case study very compelling and would be interested to participate in a similar study myself when the opportunity arises.

Go to part 4 here

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