In May, I had the honor of speaking to the San Francisco CORE (Chief Officers Reaching Excellence) group about how to improve new product success. CORE groups, sponsored by the International Housewares Association, are groups of senior level housewares executives who meet quarterly to network, learn, and help each other with professional challenges.
The speech reflected my beliefs about the importance of data-driven decision-making. I believe that you should never base new product decisions solely on gut feel, intuition, and management experience. Certainly, intuition grounded by years of in-market experience should always be listened to carefully, but it pays to augment even the best intuition with data.
When I asked how often they base product decisions on gut feel and intuition, most of the people in this group of entrepreneurs and small business owners answered “often”. I assumed that they didn’t think they needed to do consumer market research at all. I figured that they fancied themselves as the Steve Jobs of housewares; eschewing market research and relying on their intuition, believing that, as Jobs put it, “It isn’t the consumers’ job to know what they want.”
My assumption was so wrong. I found out that most of these entrepreneurs are making decisions based mostly on gut feel and intuition not because they don’t value consumer feedback or think they know better than the consumer. They are making decisions based mostly on gut feel and intuition because they don’t think they have the time or money to do market research.
Out of necessity, these entrepreneurs are figuring out creative ways to get consumer feedback without breaking the bank or blowing the schedule. Case in point, Scott, one of the entrepreneurs I met at the CORE meeting, didn’t do any formal product concept testing, did not test the product with a nationally representative sample, didn’t spend a dime on formal market research. Yet, almost every major product and marketing decision he made during the product development process was based on the consumer insight he gained by doing consumer research with local wine enthusiasts.
I applaud entrepreneurs like Scott who recognize the value of consumer feedback and I am very impressed with the quality of Scott’s research. I understand that entrepreneurs and start-ups often have to do the research themselves because they can’t afford to hire someone to do the research for them.
But the use of do-it-yourself research raises a concern. Earlier I said that it pays to augment even the best intuition with data. But that data needs to be objective, valid, and reliable.
Anyone can create and field a survey using low-cost survey software platforms such as Survey Monkey and Google Consumer Surveys. But it is dangerous to undertake a do-it-yourself research study if you don’t have some level of proficiency in methodology, questionnaire development, sample selection, and data collection and analysis. A research study performed poorly will not yield relevant results. You wouldn’t dream of tackling a D-I-Y home improvement project if you didn’t know what you were doing. The same should be true of research projects.
If you have someone in your organization who has research experience and expertise, then by all means, do the research in-house. But if you don’t have research expertise in-house, you should hire a market research professional to do the research for you or collaborate with you on questionnaire development, sample selection, data collection, and data analysis.