From The Urbach Letter –
(What Do You Want to Know Today?)
Information is Power! Do you believe that? Yes? Really? Uhh, sorry, I don't believe you. If you truly thought it was all that important, you'd be doing a lot more information gathering… and a lot less guessing and assuming. But don't worry. We can fix that.
Welcome to the "new and improved" Urbach Letter. I know what you're looking for: more creative business-building ideas, more cutting-edge marketing concepts, and more ways to leverage the power of the Internet to gain competitive advantage or advance your professional career.
How do I know what you want? Because I asked. 128 Urbach Letter subscribers accepted my invitation to participate in a reader survey. Their responses confirmed a few things I believed to be true, but much more importantly, provided new insight I might not have gained any other way. I hope you agree with something I wrote in the March issueGetting What You Want: if you sincerely want to get ahead in business and life, becoming a great question-asker is perhaps *the* most important skill you can develop. That article focused on one-to-one communications, but now we're going to take it forward a giant step and obtain meaningful answers and suggestions from a much larger group of people via a computerized survey.
I'm going to take you by the hand and show you how to design, distribute, and interpret your own customized survey. But first, a reality/motivation check. Why, exactly, would *you* want to do a survey in the first place? What's the point? Well you just may learn something that'll positively *transform* your business or profession. You may just find that what *you* think your customers (or clients or patients or donors or employees) want, is, in reality, way off the mark. Dead wrong! You may get early warning of customer service problems -- or uncover a new competitive threat -- before they do serious damage to your business. You will definitely learn how to best allocate your limited resources (time, energy, and money – these are *always* limited) to activities that'll provide the greatest return on investment. Perhaps you've been thinking about launching a new product or adding a new service, or even starting up an entirely new business venture. Before you invest your hard-earned money and precious time, do some "guerilla" market research first. There are dozens of good reasons for conducting a survey -- and now, very few excuses for *not* doing one. Computer technology has taken all the drudgery out, and made the whole process easy, engaging, and almost fun.
But you're a busy person. You don't have time to read thick books or long academic articles about market research or conducting surveys. That's why I've created a video tutorial for you. Even if you haven't tuned into the Urbach Letter Video Magazine in the past, I highly recommend investing the next 18 minutes in this fast-moving, *interactive* tutorial.
Hey! Hold on!
If you've completed the tutorial, you *could* stop reading this article at this point and immediately start working on your own survey. Indeed, if you're the kind of person who enjoys figuring things out by yourself, go for it. However, if you'd rather gain from my pain (i.e. learn from the many, many mistakes I've already made), and want to maximize your return on investment for this project, please read on.
Market Research 101
(1) Market Analysis. Translation: understanding the characteristics of the people who "buy" from you now, or might do so in the future. [Important Note: my articles are written for a general audience. I therefore use the terms "buy" or "sell" in the broadest possible sense. You may not "sell" anything per se, but you undoubtedly influence the thoughts and actions of other people in some way. That's selling. And gaining a deep understanding of who those people are (demographics), and what makes them tick (psychographics) is a fundamental success factor.]
(2) Product/Service Potential. Translation: projecting what product or service (and how much of it), people might want to buy from you. This also involves understanding *why* people might or might not buy from you (i.e. the marketplace's buying criteria).
(3) Advertising and Marketing Effectiveness. Translation: are you getting your money's worth? If you do the kind of direct marketing I advocate, your marketing research is built-in. That is, you'll be able to immediately measure the cost-effectiveness of every marketing initiative. However, if you insist on spending your money on brand/image advertising (like 98% of the business population), you'll have no direct correlation between ad expense and customer/prospect behavior. In that case, you'd be smart to measure ad recall, brand preference, and other metrics via interviews, focus groups, and surveys.
(4) Strategic Business and Marketing Planning. Translation: getting smart about what you're going to do next. It means gaining a high-level view of your business, setting goals, and developing an integrated strategy to reach those goals. "Strategic Planning" might sound like something you'd hire a high priced consultant to do, but if you ask the right questions, you can turn your survey respondents into unpaid strategic advisors.
Only four reasons to do market research… and they all overlap to some extent. But if there's a unifying element among them, one factor that's crucial across the board, it's asking the right questions. That's where I can help you the most. But before we get to question-asking, I should mention something important. There's more to market research than surveys. Much of the "research" in "market research" is just what it sounds like: researching the demographics and psychographics of your market/customer base, reviewing industry-wide surveys, studying other people's "generic" research, etc.
Pro market researchers divide all information into primary data and secondary data. Primary data is what we're concentrating on now: the data you can generate for your own business. It comes from one-on-one conversations with customers, suppliers, and employees, from a directed group discussion (focus group session), or from your own survey results. Obtaining primary data will always cost you time and/or money. Secondary data, on the other hand, is often free for the taking. Secondary data is information collected by others. Some examples are: industry surveys conducted by a trade association, census data, government statistics, or commercially available databases.
Time to Call in a Pro?
Even if you intend to turn this work over to someone else, I highly recommend doing at least one survey on your own. There is simply no substitute for personal experience. Having some will mean you'll be in a much better position to guide the study and interpret/implement its results. Beyond that, I believe it's a big mistake to delegate strategic planning. If you're running your own business, managing a department or a professional practice, or have significant responsibility in any organization, you should be asking these questions on a regular basis:
If there's one universal truth in marketing, it is this: it's much easier and more profitable to keep an existing customer than to find a new one. That's why the most valuable use of a survey is to gauge the level of your customers' satisfaction. Another good use is to assist with price-setting. Although it's often best to let people "vote with their dollars," you can't always vary your pricing enough to evaluate if what you charge is the right amount. This topic requires a lengthy article all by itself, but for our present discussion, please know that you can get very valuable feedback on your pricing structure from a simple survey. Your "pricing reality check" can be a real eye-opener. For example, many professional service providers vastly undercharge for their services. Others haven't built enough value to be asking their current fees, and wonder why they're always scrounging for their next client…
One more thing, I'm emphasizing the collection of information to enhance an existing business rather than for a new venture or startup. That's because most of my readers are more interested in expanding their current operation than in starting a new one. However, market research is vitally important when you're blazing a new trail. The best entrepreneurs aren't wild-eyed speculators; they're cautious risk-avoiders. They use market research to model their prospective venture "on paper" before investing.
The Electronic Advantage
While I highly recommend doing your survey online, there could be a major stumbling block. Who are you going to invite to take your survey? You're going to need their email addresses first. That could limit your universe considerably. But now I must digress for a moment. Do you have all your customers' email addresses? If not, why not? You should keep in (relatively) frequent contact with your customers, and one of the easiest, most appropriate ways to do that is via email. You should actively solicit email addresses and develop value-enhancing messages to send. Of course, don't restrict yourself to just building a list of people who've bought from you. You need multiple lists (prospects, suppliers, networking contacts, etc.), and tailor your communications to each. However, if you haven't already cultivated an email list, and now want to do an electronic survey, that's an issue. But not an insurmountable one. While you can rent a list to email, please be very careful. Many supposed "opt-in" lists are anything but, and the new anti-s_p_a_m laws can bite you. Another reason for not sending a survey invitation to a rented list is that you have no relationship with those people. That means they'll have little intrinsic motivation to fill it out.
And that's a good lead-in to the next topic: motivating people to complete your survey. More often than not, it's going to require a bribe of some sort. People are busy and will not invest the time to complete your survey unless there's something in it for them. But the bribe doesn't have to be monetary. My "ethical bribe" to Urbach Letter subscribers last month was this upcoming article, and the promise that you would get much more out of it if you completed my survey as part of a mini case study. A second part of the bribe was the promise to share the results of my survey with you. This can be a particularly powerful motivator in some instances. If you're collecting information that's of general interest to an industry or community, the promise to share results may be sufficient motivation. However, if your results are for internal use only, then you'll need to come up with a bribe. I've had good results from the offer of a random drawing for a PDA or iPod. Another good vertical industry bribe is the offer of an information product (white paper PDF or CD-ROM document) to everyone who completes the survey. The best items to use as motivators have high perceived value but low actual cost. Info products (special reports, e-books, audio tapes or CD's, etc.), fit this criteria extremely well. Once created, their duplication cost is minimal. Even better, if you make the content available for download, you can have zero duplication/distribution cost.
Recruiting Survey Participants
Art and Science
The Unasked Question
Open versus Closed Format Questions
Guidelines for Framing Questions
1. Ask for only one piece of information per question.
2. Avoid negatives.
3. Keep your questions short and simple.
4. Ask precise questions.
5. Provide context.
Socially Acceptable Answers (versus what they really think)
5 AM 6 AM 7 AM 8 AM 9 AM
the answers you get will be biased. Because people don't want to be regarded as indolent, and because early risers are considered more productive, disciplined, and successful, many people will *say* they get up earlier than they really do. The context in which you're asking a specific question can also bias response. In the previous example, if the earlier questions in the survey were concerned with time management, work ethics, and income goals, that'll bias toward even earlier rising hours. If prior questions had to do with quality of life issues, peak productivity hours, sleep deprivation, fatigue, mistakes/accidents, etc., it becomes more socially acceptable to admit rising at a later hour. The problem of bias is exacerbated in one-on-one interviews and focus groups. That's an important advantage of online surveys, particularly if you assure respondents of anonymity.
How long should your questionnaire be?
Ordering and structuring your survey
Finally, if you gather demographics (age, ethnicity, sex, income, etc.) or ask personal questions (regarding health issues for example), put them at the end. After people have invested time in the survey, they feel more involved in it, and will be more likely to comply.
You've undoubtedly seen political polls reported like this: "21% Californians believe George Bush secretly chews tobacco. 34% believe he likes cats. This survey had a margin of error of plus or minus 3%." I guess we can live with a three percent error on that. But how much error on *your* survey can you live with? Fortunately, you can often dial-in the accuracy you're willing to accept (i.e. pay for). For example, if your universe is large, the chance of your survey yielding erroneous results is a direct function of your survey size. To get more accurate results, survey more people. How many? This chart will tell you:
Stated another way, if your universe of interest is large (e.g. homeowners, republicans, dentists), and you choose 100 people at random to interview, you can be 95% confident that the answers you collect will represent the entire "population," although those answers could vary up to ten percent from the "real" values. For example, if your survey reports that 63% prefer your gizmo in purple instead of yellow, in actuality, between 53% and 73% of the entire population prefers purple. Maybe that 20 point range is too broad for you to base production quotas upon. The simple solution is to interview more people. If you survey 1,000, and get the same 63% preference response, you can project between 60% and 66% of the entire population will prefer purple.
What to Look For in Your Results
On the other hand, if your responses are favorably level over a wide range of demographic groups, you may uncover an aspect of your product or service with universal appeal, and can now apply a niched marketing strategy to a much broader audience.
You might see a puzzling contradiction in your survey results. Perhaps 93% of your participants favor your new forest green model, but the other 7% absolutely hate it. That's strange. Color preference isn't this bipolar; responses normally fall along a gradual spectrum. Looking further, you see that 99% of the female respondents favor the green gizmo, while only 89% of males do. Before chalking this up to plain gender preference (which would be obvious if the color was something like puce, rather than forest green), you might suspect color blindness as a factor. Between 8 and 12 percent of males of European origin have some degree red/green colorblindness. But less than half of one percent of females are color blind.
Finally, take the time to read as many of the fill-in responses as you can. I guarantee you'll discover some things that'll absolutely shock you.
Congrats. You've reached the end of this article. You now have all the tools and information you need to put together a meaningful survey. Now what are you going to do? Sadly, the majority of the people reading this will take the "do nothing option," and continue to waste money in areas of little interest to their customers or stakeholders. I don't concern myself with those folks. I write these articles for you, the top five percenter, a person who is intensely interested in gaining the crucial information you need to build your business, advance your career, and dramatically increase your income.