maritz research, april 2010 synching brand and customer experience research proprietary and...
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Maritz Research, April 2010
Synching Brand and Customer Experience Research
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Keith Chrzan, VP, Marketing Science, Maritz Research
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
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PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
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PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Maritz Research, April 2010
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Synching Brand and Customer Experience Research
Keith Chrzan, VP, Marketing Science, Maritz Research
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 20105
Brand and Experience Research are not in Synch
• Companies invest in marketing programs, at least partly to shape potential customers’ beliefs about their brands
• They also invest in operations, to fulfill the promises they make with their marketing efforts
• But they often silo the research on these two expenditures– Often two views emerge,
only partly aligned
– As a result, a holistic picture never emerges
• Resource allocations are less evidence-based than they could be
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Advantages of Synching
• Once we know the contribution of each kind of experience in brand choice we can see how important they are relative to one another, informing resource allocation decisions
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Three Ways to Make Them Synch
• Statistical model for customer experience as one of many ways of knowing about brands
• Direct questions about the relative contribution of customer experience and brand building efforts
• Integrating customer experience into a choice model of brand selection
7
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 20108
Three Case Studies
• 4,371 mobile phone users in North America and Europe
• 1,858 U.S. buyers of automobile insurance
• 1,202 buyers of delivery pizza
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Three Ways to Make Them Synch
• Statistical model for customer experience as one of many ways of knowing about brands
• Direct questions about the relative contribution of customer experience and brand building efforts
• Integrating customer experience into a choice model of brand selection
9
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201010
Ways Customers Know Brands
• Different kinds of experiences affect people’s knowledge of, evaluations of, and choices among, brands
First-hand experienceAdvertising
Public RelationsWord-of-mouthWord-of-mouse
WebsiteEtc.
First-hand experienceAdvertising
Public RelationsWord-of-mouthWord-of-mouse
WebsiteEtc.
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201011
ModelingMetricized Categorical Regression
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201012
Questionnaire
Ask only for brands respondent has heard about via Word-of-Mouth
We ask similar questions for each brand they’ve experienced first hand, each they’ve seen advertised, etc.
10. Based on what your friends, relatives, or colleagues said, how do you feel about each of the following automobile insurance companies?
Extremely positive
Somewhat positive
NeutralSomewhat negative
Extremely negative
a. State Farm 5 4 3 2 1
b. Allstate 5 4 3 2 1
c. Progressive 5 4 3 2 1
d. GEICO 5 4 3 2 1
e. Nationwide 5 4 3 2 1
Etc.
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201013
MCR Model
• Use respondents’ evaluations of experience, advertising, PR and WOM to predict brand preference/choice
• MCR quantifies separate effects of different sources of information (and of missing information)
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201014
Relative Importance – Auto Insurance
• Personal experience is consistently most important, but …– the website plays a significant role for several brands– word-of-mouth matters
Source of Information
All Brands
Experience 75% 80% 73% 65% 57% 74% 76% 74% 71%
Advertising 2 1 4 9 4 6 1 6 4
Word of Mouth 10 10 8 9 9 11 10 11 11
Website 11 11 13 14 26 7 8 7 11
PR/Word of Mouse 2 2 2 2 4 2 3 2 2
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Relative Importance of Information Sources By Brand For All Customers (Percentage)
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201015
Relative Importance – Auto Insurance
• Personal experience trumps all for loyal customers• Among switchers, advertising and word-of-mouth
count for more than personal experience
Source of Information
All Customers(%)
Loyal Customers (%)
(81% of All)
Switchers (%)(19% of All)
Experience 75 77 13
Advertising 2 2 39
Word of Mouth 10 9 34
Website 11 11 7
PR/Word of Mouse 2 2 7
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2009
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201016
Relative Importance - Mobile Phones
• Same relationships hold for Mobile Phone market
Source of Information
Loyal Customers (%)
Switchers (%)
Experience 58 31
Advertising 18 30
Word of Mouth 14 28
Website 9 9
Word of Mouse 1 1
PR 1 1
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MCR Special Effects
• Intrinsic to the MCR modeling is the notion that effects of experience, advertising, etc. on brand preference/choice may not be linear
• MCR automatically quantifies the effect of “non-experience”
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2009
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201018
Response Function for Experience - Pizza
Very negative
Somewhat negative
Neutral Somewhatpositive
Verypositive
1.2
1.0
0.8
0.6
0.4
0.2
0.0
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201019
Response Function for Advertising - Pizza
Very negative
Somewhat negative
Neutral Somewhatpositive
Verypositive
1.0
0.8
0.6
0.4
0.2
0.0
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Three Ways to Make Them Synch
• Statistical model for customer experience as one of many ways of knowing about brands
• Direct questions about the relative contribution of customer experience and brand building efforts
• Integrating customer experience into a choice model of brand selection
20
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
A Second Approach to Determine Source of Preference
• A stated importance approach combines answers from two direct questions:
21
FOR EACH FACTOR CHOSEN: What made you believe that (BRAND PREFERRED) is better on (FACTOR)? Multiple responses allowed.
Method
a. Advertising ( )
b. Website ( )
c. Personal experience ( )
d. Things I heard from relatives/friends/coworkers ( )
e. Things I read in magazines, newspapers, blogs ( )
f. Other…please specify ( )
Which one thing below made you choose (BRAND PREFERRED)? What other things led you to select (BRAND PREFERRED)?
Most Others
a. Offers the phones that you are interested in ( ) ( )
b. A good selection of wireless phones in their stores ( ) ( )
c. Reliable wireless coverage ( ) ( )
d. Economical, predictable pricing ( ) ( )
e. Texting and data plans that fit your needs ( ) ( )
f. Etc. ( ) ( )
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201022
For Loyal Customers, Personal Experience Most Influences Choice
Choice Influencers (Cross-Brand)
Among Loyal Customers
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201023
Among Likely Switchers, Advertising and WOM More Important
Choice Influencers (Cross-Brand)
Among Switchers
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Similar Findings about Drivers of Brand Preference
• Experience is clearly the most important driver of brand preference
• Word of mouth and advertising flip-flop in importance between the two measurement approaches
24
MCR (Derived) vs. Stated Influence for:
* Re-based to add to 100%.
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Three Ways to Make Them Synch
• Statistical model for customer experience as one of many ways of knowing about brands
• Direct questions about the relative contribution of customer experience and brand building efforts
• Integrating customer experience into a choice model of brand selection
25
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
A Customer Satisfaction Model
26
Satisfaction
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
• Experience attributes predict overall satisfaction on a five point scale
.82
.79
.76
.63
.85
.71
.84
.76
.81
.14
.05
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Satisfaction Model Integrated into Choice Model
27
Brand C
Brand B
Brand E
Brand A
Brand D
Brand G
Brand F
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
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PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
What’s Different?
28
Brand C
Brand B
Brand E
Brand A
Brand D
Brand G
Brand F
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
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PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Attribute Importances Tell a Different Story
29
Brand C
Brand B
Brand E
Brand A
Brand D
Brand G
Brand F
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
i
A
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eAP )(
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Multiple Brands Reflect Competitive Environment
30
Brand C
Brand B
Brand E
Brand A
Brand D
Brand G
Brand F
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
i
A
U
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eAP )(
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Fancy Math Connects Satisfaction to Choice Outcome
31
Brand C
Brand B
Brand E
Brand A
Brand D
Brand G
Brand F
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
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PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Outcome is a Brand Choice (Translatable into $)
32
Brand C
Brand B
Brand E
Brand A
Brand D
Brand G
Brand F
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
Product
Price
Service
Speed
Size
Function
Color
Sales
Support
Price
Deal
4.21
.96
1.06
.82
.79
.76
.85
.71
.84
.76
.63
i
A
U
U
e
eAP )(
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Simpler if You Want to Hold Competition Constant
33
Brand Share
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
• Attributes predict brand choice instead of satisfaction
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
And Better Still if Competition is Irrelevant
34
Retention
Product
Price
Service
Speed
SizeFunction
Color
Sales
Support
Price
Deal
• Attributes predict retention/defection (called survival analysis)
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 201035
Summary
• Through careful questionnaire construction and modeling we can synch brand and customer satisfaction research studies
• We’ve shown three different methods– Linkage via MCR model (powerful model, so-so results)
– Linkage via direct questions (better, but still a “nice to have” in a “need to have” world)
– Linkage via integrating customer experience into a choice model (seems like the way to go)
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
Questions?
PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010
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PROPRIETARY AND CONFIDENTIAL, MARITZ COPYRIGHT 2010