80/20 Market Research

Many years ago in graduate school, I took a seminar in advertising. The professor was a distinguished British gentleman who was a veteran of many years at the highest levels of the industry. This professor made it a point from the first day of class on to impress upon the students that advertising was a “weak force” that couldn’t do much more than nudge somebody to buy something they were already inclined to buy in the first place. Furthermore, he told us the people most likely to pay attention to a brand’s advertising were those who were already users of that brand.

Those sorts of proclamations from the professor took a little bit of the air out of my tires. As a child of ’70s and ’80s television, I had grown up believing that advertising was a powerful force that changed people’s minds on a dime and could persuade people to switch brands with just a little clever wordplay or a well-executed design. That was the whole reason I was in grad school studying it! I didn’t want to believe my professor’s arguments about advertising’s limitations. But ultimately, he convinced me by virtue of the fact that, like most Americans, I automatically accept any information delivered to me in a British accent as being authoritative.

Since then, I have seen for myself over the course of my career that the professor’s assertions were true, both about advertising and marketing as a whole. It is profoundly difficult to change people’s minds or behavior, even if your message can fight its way through all of the clutter of competing marketing that the target audience is doing its best to ignore. Word-of-mouth is much more likely to influence a consumer than anything the marketer can do or say.

I bring all this up because it provides some context for my appreciation for a piece by Ray Poynter that was recently featured on the GreenBook Blog. Poynter argues that, in most cases, a marketer should focus 80% of its market research on its customers. This is in contrast to the way much research was done in the past, which tended to focus on the whole market. A major underlying assumption of the whole market approach is that it’s important to understand a lot about non-users of a brand in order to figure out ways to convert them. In other words, it assumes that marketing is a powerful force, fairly capable of overcoming the consumer’s skepticism, previous habits or apathy.

Focusing a large majority of the research on existing customers is more of a nod to the factors that my grad school professor was talking about – essentially that marketing works best when it is applied to consumers already positively inclined toward the brand. Or, as Poynter says in the piece, “In many cases, perhaps most cases, the best way to grow a brand is to increase the number of customers who ‘love’ it, because these people will recommend it, use it ostentatiously, and offer it in group settings. In most cases, a new line, a new campaign, a new service will only succeed if existing customers respond positively to it.”

It’s a very sensible approach, yet I suspect that a lot of marketers who should be following this 80/20 recommendation are devoting less than 80% of their research efforts on existing customers. It can be hard sometimes for even experienced marketing veterans to admit how much more powerful the consumer’s own inclinations and social peers are than our best-laid marketing plans. And if you don’t have an advertising professor with a persuasive British accent on hand, reading Mr. Poynter’s article in its entirety is the next best thing to remind you otherwise.