Social Media Helps You Understand the Price-Quality Formula
Throughout
the troubled economy, I observed the impact of the recession in people’s
attitudes towards consumer packaged goods, technology, communication, travel
and other services. One of the most common themes in social media
discussion highlights the fascinating relationship between cost and quality of
goods and services. How much is one willing to forego in terms of benefits to
achieve savings is a key question. As I listen to these conversations, I
begin to glean distinct personas that appear to have a specific threshold when
negotiating between cost and quality.
Let
me give you an example comparing two personas.
First,
bargain hunters.We all know who they
are.They are easy to spot and
relatively simple enough to convert.Their propensity to buy is driven primarily by a low price point, and
this attitude is magnified by the lousy economy.They predictably go for the cheapest
available option, thanks to having the lowest expectations on quality and other
attributes.In social media, they
usually drive the positive favorability towards bargain brands.
A
slightly more complex group of consumers are those that appear to be willing to
pay more for better quality or better experience (as they have had the
opportunity to enjoy premium brands in the past), but are guilt-ridden with the idea of splurging due to the current state of
the economy.In conversations, they
oscillate between mid-tier and premium brands, weighing the cost-quality
benefits.Unlike bargain hunters, their
decision-making is more nuanced and less predictable, but discussion in social
media does glean an interesting finding about their propensity to buy.A premium brand becomes more attractive than
ever to this group when they feel that
they are getting the product or service at a lower-than-usual price point, even
if, technically, it is more expensive than anything else in the market. A
mid-tier brand, however, will not be quite as compelling to them even if the
price drop is more significant.
The
learning: amidst the recession, there is still opportunity to appeal to what
consumers want beyond what they simply need, and social media will tell you
how.
Marketers
know that the price-quality formula is more important than ever in these
economic times, and the resonance of this topic in social media substantiates
its influence in purchase decisions. The winning brands – those that
generate the strongest sentiment overall – appear to have found the sweet spot
in a price-quality structure that appeals to the market majority.
Many
reports claim that the economy is getting better. To a degree, social
media commentary will reflect this.I
look forward to witnessing how the trend in conversations and brand sentiment
shift as market conditions (continue to?) improve. This optimist can
hope.
I could probably talk for weeks at a time about printing, publishing, and enterprise content management (ECM) as a former technology research analyst. In fact, that was largely my job until 3 weeks ago, when I first joined the Cymfony Insights team. Researching content management, social media, analytics, and automation technologies; I focused on improving companies’ internal and external communication processes - from print to digital to social. Turning my attention to Cymfony, I intend to take advantage of this technology and research background to deliver unique insights about the social media channel, where it’s headed, and how to extract as much market information and leverage from it as possible.
While we are only on the cusp of the social revolution (no Marxist commentary intended), social media monitoring has already catalyzed a vast methodology shift in market research. No longer limited to standard measurement approaches such as surveys and focus groups, burgeoning online content – both social and traditional media – enables a new kind of monitoring. Focused on mashing disparate data sources, dynamically analyzing them, and responding in real-time, perhaps “listening” is a more appropriate term for this methodology.
As we get comfortable in the third millennium, it’s worth considering how far we’ve come from the first blog post and how much farther social media will take us. Penetrating every aspect of our culture, social media has the potential to re-define the way we work and the way we live. In the meantime, the Insights team (and this new member) is dedicated to providing visionary and credible studies of this exciting new world! (Twitter: @omriduek)
1) Over half of what Pew calls "e-patients" (those who rely on the internet for health information) are turning to social media in the course of their research.
2) While 66% of "e-patients" research specific diseases or medical conditions, 55% research specific medical treatments or procedures. The percentage of "e-patients" who research specific diseases has not increased significantly since 2002, however the percentage who research specific treatments has climbed from 47% in 2002 to 55% in 2008.
Marketing professionals in all areas of healthcare must understand the implications of these two facts. Let's begin with the first fact that over half of all "e-patients" are turning to social media. Whereas "non-user generated" healthcare content is generally based on academic knowledge, clinical results, and marketing spin, social media healthcare content is built on patient opinions and personal accounts. Therefore, over half of "e-patients" are making healthcare decisions based, at least in part, on information provided by other patients. This makes it imperative that the marketer is aware of these online opinions. Rather than speaking to patients and potential patients, healthcare marketers must listen first and then develop communications that not only speak to consumers but also respond to prevailing attitudes and concerns. In this sense, an understanding of social media is similar to the insights gleaned from traditional focus group and survey-based research, though social media provides a platform for unsolicited feedback. Two other advantages of social media are that conversations are peer-to-peer rather than "moderator-to-consumer", and patients are often afforded a greater level of anonymity in social media. The psychological differences between these two scenarios likely lead to the expression of more honest opinions.
The second fact, that 55% of "e-patients" research specific treatments and procedures, serves to emphasize the importance of the implications mentioned above. One of the first thoughts that should cross the marketer's mind when developing communication strategies should be, "the chances are very good that my target market will search the internet for specific information about my product." The natural follow-up question should be, "what will my target market discover about my product in online media?"
Pew's study shows that without a thorough understanding of the attitudes expressed in social media, a marketer can not develop optimal communication strategies.
Although I read blogs for a
living, the thought of consulting blogs and message boards to plan my wedding
was far from my mind.That is, until I
read a post that referenced a wedding blog in passing.Now my wedding includes lots of ideas I
picked up from other bridal survivors.One
example is table numbers.I never knew
how creative you could get with labeling the tables.Instead of large numbers or cardboard signs, we
will be displaying notebooks at all of the tables.Not only will the notebooks function as table
numbers, but they will also provide guests with a place to record notes to the
bride and groom (idea credited to oncewed.com).
This led me to contemplate where
else social media would be valuable, and why this would be true. I settled on: Any industry where a consumer
would become emotionally involved.At Cymfony, we have seen it time and time
again, when there is something on the line, whether it be money, a new car, or
the perfect tablescape, consumers turn to social media to give or get
advice.Additionally, as they become
more prolific, blogs and message boards are gaining a more authoritative
reputation.These aren’t unintelligible
rants, but thoughtful opinion.
What I get from bridal blogs
that I don’t get from wedding magazines or official websites is advice without
strings attached.I know that when I click
through to see how something is done I’m going to get a series of pictures taken
in someone’s living room, not an online marketplace.I have a trust in these women, I feel that
they are only there to help me and are looking for nothing in return.It’s almost like they are my cousin sharing a
wedding planning notebook from her wedding last year.
This
changes the media – marketer – consumer landscape.We are no longer a captive audience looking
to follow the methods and ways as spelled out by the publishing house.Just as banner ads have lost their efficacy
in online marketing, so too have magazines and company websites when dealing
with matters of emotional importance.
Notes from OMMA Social Panel: Authentic Conversations
I just finished a great discussion about how marketers can create authentic conversations in social media here at OMMA Social. Here are the highlights....
Even
in this economy, the cheaper option doesn’t always score high on preference
measures.
Hi,
I’m Cathy, an Analyst here at Cymfony. I take the lead on technology
clients, but with my marketing background in travel, I recently had the
opportunity to work on a study for a travel client and came across an
interesting angle on consumer sentiment towards price points.
Anyone
can tell you that consumers are becoming more price sensitive than ever in
these economic times. Across common goods and services, “budget” brands
and wholesalers are gaining traction; “premium” brands are struggling. In
social media, positive sentiment is stronger for budget brands. “Value” is the
most resonant discussion theme in message forums, indicating prioritization of
cost over inherent product attributes.
Does
this mean all companies should work towards significantly lowering price points
to compete in the marketplace? The answer seems to be, “Not
necessarily. In social media, “premium” brands equated with high quality
AND high price still trump “budget” brands when it comes to measures of
consumer preference. Looking closely at what people are saying, customers
still strongly prefer a better product or a higher quality experience in spite
of tough times compounding the price barrier. While discussion suggest
that the pragmatic mind gravitates to cost as a priority, many posts indicate
that raw emotions crave goods and services of the highest quality.
Clearly, there is opportunity to tap emotions that are not “selling out” to
cheaper alternatives.
Consumers
are price-watching across the board but have their eagle eyes on premium
brands. Furthermore, conversations indicate that they are more keen on opening
the wallet if they believe they are getting a sweet-ENED deal on a better
product. We see statements like “I’ve tried them. It was more
expensive but I had a good experience, so when there was a price drop, I
immediately took advantage” or “I heard good things about them, so I’m just
waiting for a discount.” An itty bitty savings can potentially multiply
desirability for a premium product (more so than a huge discount on a low end
product) and push the consumer over the edge to close the sale. Savvy marketers
believe this in their gut. Now social media analysis validates this belief in
the voice of the consumer.
Check out this hilarious video. Media and marketing industry veterans will especially appreciate this. (Warning: watch at home or close your office door: you'll be laughing so hard your co-workers will think you've gone over the edge!)
Will Google Wave be the Fifth Wave of the Internet?
The Internet has evolved through four waves since it entered everyday usage: communication, content, commerce and community (aka social media). Will Google Wave usher in a fifth wave: Collaboration?
Social media tracking is no
longer just for damage control and seeing what the consumers have digested, it
is about looking toward the future and discovering what the consumer wants and
how they make their decisions.
Recently
the Cymfony CPG team has been working on bringing more of our Clients away from
the purely tactical uses of social media and into looking at it as a strategic
tool.Currently I am working with a
Client who has been with us for years.They originally came to us to use our tools to track a negative PR
episode and never adjusted the scope of work after things had died down.For the last three years we were able to give
them metrics that allowed them to keep a handle on damage control, but last
week they came to us and asked, ‘how are some of your other Clients using the
data you give?’
As social media evolves, it is
becoming a more strategic tool for businesses and brand managers. We have
been hearing feedback from Clients in various verticals about using our data
and insights to make changes in their customer service relations, or as fuel
for long-term campaigns.
So for this Client, instead of reviewing the data on a monthly basis, we
looked at the first quarter of 2009. Rather than looking at the same data
that we reported on, we looked at everything that was brought into our systems.
And finally, instead of looking at our narrow scope, we did a blanket
search for "unbranded" key terms in all social media that is
available to us at this time. By doing that, I was able to describe consumer
motivations in the category and identify alternative services outside of the Client’s
definition of ‘direct competitors.’This
gave them data that validated a direction they were considering and helped them
move forward to execute it.
There's still time to learn how to Put the Social Web to Work
We've had a great response to our webinar this Wednesday 2/25 at 12 noon eastern time, "Putting the Social Web to Work". But there is still time to sign up -- click here.
Author Dave Evans will take attendees through a straightforward and practical evolutionary process for how to incorporate the Social Web into your marketing plans. He'll begin with listening, then talk about developing a sensible response, and ultimately influencing the markets that are critical to success.
Did Facebook just set the stage for sharing revenue with consumers?
In case there was any doubt before, the backlash against Facebook's change in policy to take more control of consumer-created data and content shows that consumers will militantly protect what they create. Will users next demand a cut of any revenue that Facebook derives from their work?
February 25 Webinar: Putting the Social Web to Work
I'm really excited to host a webinar next week with my friend and someone I consider a guru of all things digital: Dave Evans. Read on to learn more or click here to register -- and you may win a free copy of Dave's new book!
Hi – My name is Jessica and I’ve worked at TNSCymfony for about a year and half. In that time I’ve had the opportunity to work in a variety of different industries, finally settling in to the insurance industry over the past year. Oh yes, I’m talking about property/casualty, auto, life and homeowners insurance. If you’re thinking this doesn’t apply to you, take a moment to think about how much money you spend on insurance in a month, a year. Or better yet, think about the last time you had to file a claim with your insurance company… So, yes, it’s that important.
Ok, let’s start off with the obvious stuff – Advertising.
Advertising in the insurance industry is all about brand promise. I’m sure you can think of a few tag lines off the top of your head (or maybe I just read too many insurance blogs):
Geico - “Save you 15 % or more on car insurance”
State Farm -“Like a good neighbor, State Farm is there”
Do these phrases resonate with you? Do they make you want to seek out their insurance? If not, maybe their funny, bizarre, perhaps more serious commercials catch your eye... no? If you’re like many other people out there, you’d say you’re just looking for the best rate and that’s it. Well, I’ve got news for you – it’s not all about the rate.
After over a year of reading about the ongoing quests for the “best” care/home/life insurance, I’ve come to the conclusion that it’s not just about price. Many people post on message boards and blogs about their rates and their experience with specific insurance companies. For the most part, these people have exposure to at least two or three different companies, switching primarily because of poor customer service, or negative experiences when having to file a claim.
Initially, yes, people want the best deal in town (often asking complete strangers possibly on the other side of the country about what they should be paying for car insurance), but then comes the life change (the accident, the baby, the flood, etc.) and all of a sudden these people are wishing they had better customer service or an agent that was more explicit about their coverage and rates go right out the window. I’ve read too many instances of people not getting enough money for the house/car because they didn’t know the fine print of their insurance policy.
Insurance companies are only as good as what they can do for you when things go wrong. It’s a tough business but there’s a unique opportunity here – to listen and respond to the specific needs of their customers.
Companies do not want to compete on rates alone in the market. Progressive and GEICO have pretty explicitly carved out that portion of the space, so move on.
Social Media gives insurance companies the opportunity to respond to the needs of their customers, far beyond straight rate comparisons.
With so many people asking complete strangers for insurance recommendations, a company could establish itself as a trustworthy knowledge base for people to research their overall coverage needs, breaking free of rate only competition.
A recent Cone LLC study confirmed that not only are people looking for company involvement in social media, but 85% of social media users believe a company should be present AND interact with consumers via social media. It’ll be those companies who listen to their customers and evolve to meet their particular needs that end up truly delivering on their brand promise in the end.
The Big Super Bowl Ad Winners: Not Pepsi, Coke or Bud
This Ad Age article cites our respected competitor, Collective Intellect, saying that Pepsico dominated the social media discussion of the Super Bowl ads. Not so fast. Movies outstripped Pepsico's performance, and Transformers beat brand Pepsi in the immediate post-game discussion.
Hello, my name is Kate and I
have been working at Cymfony for just over a year.In that time you could say that I have become
the go-to person for all of our food clients.It started with a simple project looking at peanuts and now has exploded
to bars, crackers, and most recently cereal.Throughout this time spent knee deep in food discussion, Jim Nail has
been consistently asking me to blog about some of my findings.Not wanting to bore you with talk about inulin
(a particular form of fiber) and high fructose corn syrup, I have been hesitant
to put my thoughts on the subject out here until one very dominant trend
emerged.
The topic of today’s reading
will be on what I call ‘the weight watchers.’These individuals are not necessarily in the Weight Watchers program,
but they are consumers who regularly and learnedly discuss weight management on
the web.In every food study that I
have worked on, whether it is about the intersection of food, health and
wellness, or an investigation on why one cereal brand has been the most popular
brand in the last twelve years, the weight watchers emerge as the dominant
voice.
This group is made up of two
large sub-groups: weight conscious women* and the body-building men.Both of these groups are very conscious of
what foods and which ingredients they put into their bodies.Additionally, both groups keep avid food
diaries, and in many cases, these are online journals.The weight watchers have all been through
tough times and have struggled to get to where they are.They are an online community that is simply
there for support and encouragement of the new members.
Discussions on food are quite
different than discussions of other products that we analyze. Social media
tonality for most of our clients is usually neutral**, but with all of our food
clients to date, the tonality breakdown has been 80-90 percent positive.The biggest reason for this is that weight watchers
go online to offer advice and to educate, not to complain or ‘bash’ a brand or
product.Additionally, most of the
discussion drivers*** for our food clients have also been positive.This shows that the weight watchers are
online advocating products.This is the
group’s most defining characteristic, with all of the things to complain about –
high price, high calorie count, etc. weight watchers only comment on what they
deem helpful to another blogger.When
comparing two similar products, a post will typically only explain why one
product is preferred over the other, and not call attention to the lesser
product’s flaws.
We also see that discussions about
food take place on a variety of sites, including general discussion sites and
general health sites such as ivillage.com
and answers.yahoo.com, as well as
specialty weight loss sites you might expect like calorie-count.com.This
shows that food conversations online are diverse in topic and location.
Next
time I’ll talk about where health management fits into all of this and what
those trends look like!
* With social media it is very difficult to discern age,
gender and life stage.
** Meaning that a majority of the documents collected
speak neither positively or negatively about a brand being tracked.
***Discussion drivers are the topics with the highest
volume.We look at a wide range of
discussion drivers, including taste, recommend, price, health, etc.
In November, TNS Cymfony received top honors from the Association for the Measurement and Evaluation of Communications.
Now we have received top ranking from a certain analyst firm that modesty (and their citation policy) prevent me from telling you about. But you can read about it at Ad Age
The end of Pownce -- or the beginning of microblogging?
Blog service SixApart has bought Pownce -- and will shut it down. Twitter came this close to being swallowed by Facebook. So why do I think this is the beginning of microblogging?
In a recent post, speculated that President-elect Obama will not abandon the social network he built during the campaign but use it to mobilize supporters to push the change he envisions. Here's an article with the full scoop....
Transforming Research, Step 3: Storytelling -- or tailoring?
At the October 29 ARF Transforming Research conference, there was a strong theme that market researchers should weave interesting stories about how consumers interact with brands rather than present reams of data to induce a Powerpoint coma. But storytelling risks creating a fiction that loses touch with the carefully gathered facts in our research. Perhaps the better way to think about it is tailoring...
