The Brand: Your Ultimate Competitive Advantage

Les Stern

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Current Customers

The key to having an effective MCIF is not the software it runs in, but the data in it. For some industries, such as banking or catalogs, household-level information may be enough. For other industries, such as health care providers or airlines, information at the individual level as well as the household level is important. Customer information that should be in the MCIF includes:

• Basic information, such as name and address. Business to business marketers will also want contact title information.
• Purchase information, such as type of purchase, date of purchase, amount of purchase, place of purchase, costs associated with the purchase, source of purchase (direct mail, Internet, current customer referral, direct sale, etc.), and any demographic information available from the data source. Descriptive information is also important. For example, long distance carriers will want to know specific markets customers call; airlines will want to know travel destinations. Interestingly, many nonprofits do an outstanding job of this by capturing this type of information for donations.
• Contact information, usually from a telemarketing center or Website. This includes date of contact, reason for contact, source of contact, and all demographic information associated with the contact.
• Survey information, especially factors that predict loyalty, such as likelihood to defect, and likelihood to recommend products or services. Also critical for former customers are reasons they defected, and what it would take to get them back.
• Demographic information, such as age, household income, etc. Company demographic information might include SIC code and number of employees.
• Psychographic information, such as importance of quality, price, etc.
• Lifestyle information, such as computer ownership, hobbies, etc.
• Geodemographic segment (PRIZM, MicroVision, or other industry-specific systems)

Prospects

While your MCIF will analyze customers, this data needs to be augmented with market information. Market information includes:

• General market information, such as census-based demographics, which can be used to calculate market share.
• Industry-specific information. For example:
  • In health care, number of procedures
  • In financial services, ownership of mutual funds
  • In consumer products, how much households typically spend on a product type

   

Analyzing the Data

There are numerous ways to analyze the data. Perhaps the most critical is to determine market share, market size and profitability by market segment. This enables an organization to prioritize appropriate market segments for retention, upsell and cross-sell, and acquisition.

Another type of analysis will identify purchase and revenue patterns by customer segment, geographic market, product line and distribution channel to assess utilization and customer value and begin to understand which consumers are most attractive to you.

Finally, other modeling techniques will allow an organization to predict the next purchase of a customer, given past purchases.

Phase II - Understand the Perceptions of Current Customers, Prospects and Stakeholders and Establish Benchmarks

Phase I is designed to understand behavior. Phase II is designed to understand perceptions of customers, prospects and stakeholders.

Customers and Prospects

The way to understand the perceptions of customers and prospects, and to create a baseline of their awareness and perception of the organization, is by conducting solid, quantitative primary research, and then analyzing that research.

Designing this type of research requires a high level of expertise. For example, close-ended questions should be used exclusively. Therefore, it is very important that the survey is developed and the research conducted and analyzed by market research professionals.

This will also take several months, but can be done concurrently with Phase I.

To be successful, those surveyed must include a representative sample of the population. Additionally, a great deal of thought will be needed upfront to determine the market segments to be analyzed. For example, an investment firm might want to do a market survey, but might be specifically interested in people who own mutual funds. Therefore, the survey design must ensure that enough people who own mutual funds are contacted to create statistically significant results.

The type of information that must be captured to make a survey effective includes:

• Demographic information such as age, income, marital status, etc.
• Psychographic information such as cost consciousness, quality consciousness, willingness to experiment, etc.
• Purchase behavior such as recency, frequency, type and monetary value of purchases
• Purchase criteria, such as importance of price, quality, service, convenience, etc. (essential for positioning)
• Satisfaction with current brand on the attributes mentioned above, as well as likelihood to switch and recommend.
• Mass and direct media viewing and response habits, including the Internet (essential in creating the media plan)
• Other miscellaneous behavior, such as events, activities, retail outlets used, etc. (essential for developing partnerships and sponsorships)
• Aided and unaided awareness of the sponsor brand and competitor brands
• Perception of the sponsor brand and competitor brands

Once this information is gathered, one can then analyze what is important to these respondents and segments. Results can be analyzed by market segment (i.e., for a healthcare provider, for respondents in a particular payer class). One can also profile people by how they responded. For example, if a software company believes it can differentiate itself on its product's speed, one can analyze customers and prospects for whom speed is important.

Finally this research will enable the organization to establish awareness and perception benchmarks. Research to be done after execution of the branding strategy will measure changes in awareness and perception.

n addition to these benchmarks, the organization should also create a baseline for indirect measures such as current telemarketing center volume, Website hits, and current market share. Changes in these measures can also be used to quantify the impact of the branding program.

Stakeholders

While the most critical input is from customers and prospects, the opinions of internal and external stakeholders cannot be ignored. The mere act of obtaining this feedback will help ensure buy-in. And the opinions obtained will discern whether these stakeholders' perceptions are aligned with those of customers and prospects, or whether there is a disconnect.

Stakeholder interviews should be obtained through one on one interviews. Also, it is important that somebody not employed by the organization conduct these interviews. That will ensure objectivity, and will also make the interviewees more comfortable to speak freely.

Both internal and external stakeholders should be interviewed. Internal stakeholders should include all executives and all department heads. External stakeholders should include community and civic leaders, senior managers and primary contacts at key customers, key suppliers, and the ad agency.

These stakeholders should be asked their perception on the organization's mission, strengths and weaknesses, and opportunities to improve. Where possible, the same close-ended questions used in the customer/prospect research should be used here. Upon completion of these interviews, the stakeholder responses can be compared to those of customers and prospects.

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