In order for the Internal Assessment process to be relevant to a marketing executive and the marketing planning process, we view the assessment as taking place both at the macro-company level as well as at the marketing organization level (see previous blog post).

One key piece of the macro-company level assessment for a marketing executive has to do with understanding the company’s strategic planning (i.e. Mission, Vision, Values, Goals, etc.) so that the marketing organization’s own planning and strategy can naturally follow suit and stay in-line.

A not-so-obvious, yet critically important, piece of macro-company planning is its expressed Strategy related to achieving its company vision and goals.  We particularly like the article entitled, “Can You Say What Your Strategy Is?” by David J. Collis and Michael G. Rukstad in the April, 2008, Harvard Business Review.  In this article, the authors purport the value of a succinct statement to summarize company strategy.  They further espouse that an effective strategy statement will have three key components including:  Objective (or “Ends”); Scope (or “Domain”); and Advantage (or “Means”).  We believe that, while the company’s strategic objective and its unique sustainable advantage are certainly critical for a marketing executive in the Internal Situation Assessment, the scope provided in its strategy (statement) is also highly critical as a key component of understanding the External Situation.

The authors break down elements of scope along three dimensions:  customer or offering; geographic location; and vertical integration.  This has the effect of establishing important boundaries for internal decision making, but also for external markets to be explored and served.  These are the boundaries needed to further explore the Industry-Market level of the company’s External Situation.  It sounds simple, but merely reinforcing that our company is in the residential plumbing supply and distribution business for retail stores in the Northwest U.S. region goes a long way in showing us what not to focus on.

And for our Industry-Market analysis, this scope now allows us to not only define our market in more detail (market size, growth, etc.), but also to place more definition and understanding around three of our “5Cs”- Customers; Competitors; and Collaborators.  Data-driven insights from market research and other analytical techniques within these boundaries will shed light on these factors and how these play into overall market attractiveness.

One of the secondary data sources we use frequently here at Corona is data from the U.S. Census Bureau – more specifically, the American Community Survey (ACS). Where the Decennial Census only collects basic demographic information (age, gender, race, etc.) from all residents every 10 years, the ACS collects a much more in-depth set of data from a sample of residents on an annual basis. This data allows us to conduct very complex analyses on topics such as health insurance, education, disabilities, work status, and much, much more. For example, in the past few years, Corona has used ACS data to do things like:

• project housing demand for a local government in a rural Colorado county.
• characterize barriers of low-income populations to work, such as disability, single-parent situations, language, education, and other issues.
• develop a profile of children of migrant farm workers for the Colorado Dept. of Education to help assess their educational needs.
• develop profiles of college students to understand, among other things, the migration patterns of freshmen (big economic impacts there).

Unfortunately, the U.S. House of Representatives voted last week to eliminate the American Community Survey entirely. While the measure has yet to be debated in the Senate, the implications of eliminating the ACS are dire. Without the ACS, organizations of all shapes and sizes (government, nonprofit, and private alike) would be unable to make informed decisions nearly as quickly or cost-effectively as is possible with the ACS today. And it’s not just local governments and private/nonprofit organizations – the federal government itself uses ACS data to allocate more than $450 billion annually in program funds to state and local governments.

We encourage you to reach out to your Senators to voice your support for the American Community Survey. For those of you who are in Colorado, we have linked to the contact pages of their websites and provided their phone numbers below:

Senator Michael F. Bennet - 202-224-5852
Senator Mark Udall - 202-224-5941

Here’s our original Radiance Blog post from May 7, 2008:

“Welcome to Radiance, a blog brought to you by Corona Research [now Corona Insights]. This is a blog that speaks about more than just market research and strategy.  Within this corner of the blogosphere, innovations in research will be discussed, poor methods will be condemned, and – if nothing else – some great trivia conveyed. Radiance provides the crème de la crème of insight and a few useless (but still thought-provoking) facts about the world around you.  We hope you enjoy reading and don’t hesitate to offer up your comments – we’ll look forward to hearing from you.”

After revisiting our original vision, we like to think that it still holds true today.  We’ll keep doing what we’re doing but, in the meantime, is there anything our followers would like us to tackle in a future blog?

So, we know a data- and information-driven Internal and External Situation Assessment, as partially summarized in some of my previous posts, will provide two main bodies of information: 1) output related to internal business unit strategic strengths and competencies; and 2) a picture of the attractiveness of current (and possibly potential) markets.  This then empowers a marketing executive to conduct a portfolio analysis to decide the best market opportunities to pursue.

While there are many possible scenarios, let’s pick a particularly rosy one just for illustrative purposes.  Let’s say that our portfolio analysis tells us we’re currently in an attractive market, with internal business unit strengths that align and serve the market very well. Furthermore, prospects for growth appear to be good due to the market being in its growth phase of the lifecycle.  Rosy, indeed.

At this point in the marketing planning process, high-level marketing objectives (likely revenue- or profit-driven) are set, and then strategies to achieve these objectives must be considered.  And this is where use of the Ansoff Matrix (below) enters.

Given our rosy scenario presented above, it is logical that we’ll likely remain playing in the current market/current product box (i.e. Market Penetration) in order to achieve objectives.  This then begs the question as to how we will go about market penetration.  We have several strategic options to consider, including but not limited to:  sell more per transaction to existing customers, sell more frequently to existing customers, sell to customers currently purchasing from our competitors, etc.  But which option is best? Market research and data-driven insights will help us choose among these.

Let’s say we choose the latter (selling to prospects) as at least one primary strategy, given that we see an opportunity to increase market share.  Now we know that we need to seek those potential customers who currently purchase from competitors but may be “low hanging fruit.” So, market segmentation research and data analysis done with prospective customers may assist.  We might examine and identify key descriptors of such an audience that is found to be “likely to switch.”  Ultimately, we can proceed in our planning to further understand this consumer segment and most effectively target selected subpopulations or niches with communications, distribution, etc. in our marketing execution.

So, to answer the title question above, the Ansoff Matrix comes into play by providing a valuable link between strategic objectives and market segmentation or market studies that ultimately guide marketing execution.

One final question as food for thought:  Is your current market segmentation clearly linked to your overarching marketing objectives and product-market strategies?

*Market Growth Matrix adapted from Igor Ansoff, “Strategies for Diversification,” Harvard Business Review, Sept.-Oct. 1957, pg. 114

Marketing managers and executives: What would you do if you were asked to take several of the most common strategy tools and organize them to show how they interrelate for marketing planning and strategic decision making?  (No peeking below!)  The tools and frameworks to be considered, in no particular order, are:  PEST, SWOT, the “5 Cs” (Customer, Competitor, Company, Collaborators, and Context), Porter’s 5 Forces Industry Analysis, External Situation Analysis, and Internal Situation Analysis.

At this point, you may be saying, “Stop already, stop!  All of these strategy tools get thrown at us all of the time and it’s hard to know how they interrelate in the big picture! It’s difficult to understand how to make the resulting analysis actionable. What am I supposed to DO with it?”

We first propose the following table to make some sense and order out of these six frameworks or tools.  (All variables from frameworks above are in blue).  We start at the very top level by dividing out Internal and External Situation analyses.  Then, we do a little of our own categorization within each of these and break out “macro” and “micro” components.

Now, we can add in all of our variables from the strategic frameworks. For the 5 Cs, the “C” for “Company” becomes one in the same with Internal Situation Analysis.  The “C” for “Context” becomes one in the same with the Macro Environment section of the External Situation Analysis.   PEST is then listed as an environmental scanning tool within the Macro Environment/External Situation Analysis.  Our other three “Cs” all fall under the Industry/Market section of the External Situation Analysis.  Each of these is naturally dependent on at least some definition or parameters of the market you’re playing in.

Finally we’d be remiss if we didn’t address the SWOT variables.  First off, we recognize that SW and OT are sometimes described as being outputs of Internal and External Situation Analyses, respectively.  We choose to consider these as lying within these Analyses.  A comprehensive situation analysis will naturally uncover strengths and weaknesses on the Internal Situation (see our prior post on Marketing Audit for the Marketing Organization as one reason why) and an External Situation Analysis (through tools such as PEST, Porter’s 5 Forces, etc) will uncover threats.  And while opportunities will also certainly be uncovered, we like to think of opportunities separately as a big part of the next step in marketing planning and strategy.

This leads us to summarize with what to DO with the output from the analysis framework above.  We think a major output from holistic analyses will be Opportunities that are revealed.  Strategic variables, such as “business strength” (from internal) and “market attractiveness” (from external) allow for further analysis such as that through the GE-McKinsey framework (as discussed in my prior blog post) and other frameworks for strategic decision making that show the importance of the intersection of our now-defined and well-understood components of Company, Customer, and Competitors.  Clarity around these allows marketing goals to be logically established.

To learn more about how Corona Insights’ can assist you with your strategic marketing visit our Insights for Strategic Marketing page or contact us.

Simple enough to interpret.  A combined high market attractiveness and high business unit strength is a place a company wants to be, and even more so if the market size is relatively large and its market share is high.  Ultimately, where a business unit stands on this matrix influences an “invest” or “divest”-type decision in the larger context of a company’s business portfolio management.  This is a tough decision, with significant implications.  So you want to be right.

The questions that naturally arise have to do with how to rate the attractiveness of a market or the strength of a business unit in this context.  It is up to a company’s discretion as to what factors are used and the weighting they are given based on relative importance level.  Regardless, some typical factors that go into “market attractiveness” might include market size, market growth rate, competitive intensity, entry barriers, etc.  Note that these and others typically used are all factors that are naturally uncovered by a proper External Situation Assessment.  On the other hand, common factors that go into determining “business unit strength” many times include brand strength, management strength, market share, market share growth, product quality, marketing capability, etc.  Note that these and other similar factors are most effectively and definitively determined through an Internal Situation Assessment.

Granted, not all companies are conglomerates with different business lines like GE.  However, it is safe to say that all companies have finite resources and many possible uses of these resources.  Even if a company only has one business line, decisions about pursuing potential new markets or offering new products or services must still be informed by an analysis of its current market attractiveness and business unit strengths.  In either case, a big investment (or divestment) decision requires doing some homework and due diligence to make sure you get it right.

Stay tuned for a future white paper from Corona’s Insights for Strategic Marketing on data- and information-driven Internal and External Situation analysis and how marketing goals and strategy are ultimately dependent on this type of analysis.

To learn more about how Corona Insights’ can assist you with your strategic marketing visit our Insights for Strategic Marketing page or contact us.

Computer people might be better suited for online research methods because when they're in public, humans are constantly trying to use them to check their email.

Have we really reached a point in which our technology deserves more attention than living, breathing humans? Microsoft’s “Really?” commercials for the Windows Phone back in 2010 suggests that we may have – and heck, that was nearly 2 years ago. While this is hardly the time or the blog to have a deep discussion about civilization and its relationship with technology, I’m sure this point is somehow related to what I’m trying to say here: there is great value and authenticity in interacting with customers and constituents face to face.

That said, I’ll also point out that this MythTrouncers episode is not intended to undermine online research methods, either. I sincerely believe that both online and in-person research methods have their uses, and there are cases in which one is better – or perhaps more user friendly to participants and clients – than the other.

I’m not the only one who feels that while online research has its uses, it isn’t always the best choice. There are researchers who actually specialize in using particular online methods who are still careful to make certain that their clients are getting what they need.

It comes down to a few key questions:

1. What are the questions that you need answered? Can these be answered with existing data? Do you need to collect new information? Does this involve the need for quantifiable data? Do you need more in-depth information from a conversation? Do you need to watch how someone uses a product in a particular environment? And if you do need to reach out to collect data:
2. Who do you need to reach? Where are they located? Are they in the same area, or spread across the country? How much time will they have to participate in the research? Does it make sense to segment them into different audiences? Are they a high-touch audience?
3. Are the people you’re trying to reach actively online? Do you need to the research to be representative of the larger population? Will the people you can reach online actually be representative of said larger population? (One of the biggest drawbacks to online research is that online sampling isn’t robust enough to do general public survey research as the results generally can’t be projected to a larger audience due to the nonrandom nature of the sample.)

These are some of the initial questions and issues we’d discuss with our clients in deciding an approach to methodology. The point is that there are a lot of factors involved in deciding the best approach to answering your questions, and the best approach won’t necessarily involve an online component.

I’m declaring this myth TROUNCED! Online options have expanded our toolbox in research. Many research professionals can vouch for the importance of flexibility in methodologies, based on the types of questions their clients would like to have answered.

Holly Russo celebrated her 5-year anniversary on April 1^st (no fooling).  With that accomplishment we’re proud to say that seven of our total 11 staff have been with Corona for five years or longer.  We’re proud of that track record and even prouder of our Team Corona.  Congrats Holly!  You join Beth, Matt, Dave, Leo, Kevin and I in this merry band.

Findings of marketing audits commonly show that organizations typically lack a truly strategic approach in their marketing.  The 1989 reprint and review of the original article (The Marketing Audit Comes of Age, Philip Kotler, William T. Gregor, and William H. Rodgers III) shows the top 10 findings of marketing audits, but below are a selected few, backing up the commonly known hunch that we tend to fall back to natural tendencies of jumping to tactics without having the foundation of a real compass.  While the world has changed drastically since this article, it’s amazing how these findings still ring true, even today.  Just a few include:

• Lack of a marketing planning process
• Failing to invest in the future, particularly in human resources
• An organizational structure that is incompatible with the marketing strategy
• Tendency to view marketing as only advertising or sales
• Narrow, short-term view of advertising and promotion

While the word “audit” may have some negative connotations thanks to the IRS, don’t be afraid. In this case, the goals are to step back, look at your marketing organization as a whole, and make better decisions thanks to the process.

So where do you begin?

An internal assessment is one of the very first high-level steps in the marketing planning process, a step that shouldn’t be taken for granted and should be periodically readdressed given the underlying assumption that organizations constantly change just as markets do.

For a marketing executive, an audit of the macro-organization (e.g. financial status, strategic plan, key initiatives, other functional department goals, etc.) as it affects the internal marketing organization’s planning and decision making is certainly an important part of the assessment.

But what do we do with the marketing organization itself as part of our internal assessment?

Why not perform a marketing organization audit – a relatively little-known, little-espoused tool?  This is a tool for conducting a broad evaluation that helps understand not only performance, but also yields key insights for future planning.  Of course, resulting insights are information- and data-driven, and it is largely a qualitative assessment.  Particular areas of interest examined include:  marketing objectives and strategy; marketing organization (structure and people); marketing systems (processes, procedures, etc.); and marketing performance … Doesn’t this sound at least a little like the classic management functions of planning, organizing and controlling?  In addition, individual marketing mix functions are examined to ensure objectives are aligned with both internal strategy and external market needs, and that all variables work effectively, interrelated to each other.

 ~

So, let’s begin to think strategically and consider a marketing organization audit – one of the first steps to actually being strategic.  Some literature shows there are some types of organizations that are especially in need of such an audit.  Is yours one?

Well…I’d love to raise my nose in the air and snootily say, “That is ridiculous. That sort of thing does not happen!” But I’m pretty sure many of us have witnessed times in which it indeed has been the case. It’s interesting really, because the fact is that nobody wants it to end up that way. Not the people who paid for it, not the people who conducted it…and you know, even participants like to feel that they’ve made a valuable contribution via their role.

This man has made a living by riding his bike around and dusting unused research reports.

If that’s the case, then why does this happen? I suggest several scenarios:

1. The information isn’t all that great. This could be because the firm doing the research didn’t do a good job conducting it, or maybe they stopped too soon – that is, maybe they did do good work conducting it, but didn’t take it to the next level – they didn’t look for insights and actions tucked away in all of that data and conversation.
2. The organization isn’t prepared to use it. Sometimes this can be fed by the fact that the research firm they’re working with didn’t take it to the next level, which makes it less actionable, I’ll admit. But other times, the organization paying for it wasn’t quite ready to listen or make changes in the first place…so it just sits there on a shelf. And let’s face it, even the best data typically has an expiration date on its usefulness.
3. The organization doesn’t like what they hear, so they disregard it. We’ve seen it happen. It can be very hard to hear negative things about your organization, so there’s a tendency to want to defend current products or processes if you’re receiving information that isn’t entirely complimentary.

I’m sure there are other reasons, and if you’d like to add to the list, feel free.

Much of this list seems to suggest that lazy, shelf-occupying research is the fault of the organization buying it, and not the firm conducting it. But that isn’t really the takeaway, here. What I want to emphasize most is that research isn’t meant to sit on a shelf collecting dust, and an engaged and insightful firm will help you make sure that it doesn’t. They’ll have a more intimate understanding of your organization and the landscape in which you function. This is the kind of research – and relationship – that helps you effectively use that research to your advantage.

I’m calling this one PLAUSIBLE, realizing that the fate of any research, no matter how good it is, still depends on the ability of the firm doing the research to provide actionable insights, and the willingness of the organization to heed what the research is telling them.

Has your research fallen victim to a weekly visit with a feather duster, or did you find ways to fold what you learned from it into your organization?