What about the first-mover disadvantage?

Posted by Ray Poynter, 28 June 2014 This week’s Economist has an interesting article about the founders of Napster (Shawn Fanning and Sean Parker) and the difficulty they have had in coming up with a successful second presence in the market. Towards the end of the article the Economist refers to one of my favourite terms in the area of new business, “First-mover disadvantage”. First-mover advantage? Whenever I meet start-ups, or people back from the latest hi-tech innovation fest, the talk is often about first-mover advantage. The idea is that a company gets in first and secures a long-term advantage. However, although there are examples of first-mover advantage (e.g. when a first mover can tie-up the market for scarce materials), it is much more common to see first-mover disadvantages. First-mover disadvantage Examples of first-mover disadvantage go back at least as far as the printing press, noting that in the 16 Century Gutenberg died bankrupt). The economist article quotes Motorola and the mobile phone along with Netscape and the browser. To this list we could add: Alta Vista had first mover status in search engines, but was overtaken by Yahoo! and then Google. When personal computers first appeared the early advantage […]

In defence of business jargon

Ray Poynter discusses the merits of business jargon.

The McGurk effect and why it matters to market researchers

We like to think of ourselves as rational creatures and we like to think we can trust our ears. However, watch the video below and be ready to change your mind. The Mckurk effect , the understanding of which dates back to 1976, shows how hearing and vision interact with each other. One of the interesting things about this effect is that even once you are aware of it you still experience it. From a marketing and market research point of view key messages are: Changing the sound can change the perception, which means that the real sound should be tested as part of the research. More generally, the behavioural sciences, such as behavioural economics and neuromarketing are changing the our understanding of how marketing works and how it should be evaluated. Perception is not reality, which in terms of persuasion means that reality is not always relevant. People exposed to this sort of effect may be tricked, but if they are they are likely to be angry once they are aware – so include checking to post purchase remorse as part of the research. Can you suggest other similar effects that help remind marketers and market researchers that they […]

Asking the wrong questions gives you the wrong answers!

A very large part of market research is based on asking people questions, for example in surveys, focus groups, depth interviews, and online discussions. In general, people are very willing to answer our questions, but the problem is that they will do it even when they can’t give us the right answer. At IIeX last week Jan Hofmeyr shared the results of some research where respondents had been asked about which brand they buy most often and he compared it to their last 3 and last 6 purchases from audit data. He found that in the last 3 purchases 68% of people had not bought the product they claimed to buy ‘most often’, and in the last 6 purchases 58% of people had not bought their ‘most often’ brand. The video below is designed for entertainment, but it illustrates the bogus answer problem really well: There are two key reasons why asking questions can produce bogus answers: Social desirability bias. People are inclined to try to show themselves in the best possible light. Ask them how often they clean their teeth and they are going to want to give an answer that makes them look good, or at least does […]

When and why does the wrong sample give you the right answer?

Most samples used by market research are in some sense the ‘wrong’ sample. They are the wrong sample because of one or more of the following: They miss people who don’t have access to the internet. They miss people who don’t have a smartphone. Not representing the 80%, 90%, or 99% who decline to take part. They miss busy people. Samples that suffer these problems include: Central location miss the people who don’t come into central locations. Face-to-face, door-to-door struggles with people who tend not to be home or who do not open the door to unknown visitors. RDD/telephone misses people who decline to be involved. Online access panels miss the 95%+ who are not members of panels. RIWI and Google Consumer Surveys – misses the people who decline to be involved, and under-represents people who use the internet less. Mobile research – typically misses people who do not have a modern phone and who do not have a reliable internet package/connection. But, it usually works! If we look at what AAPOR call non-probability samples with an academic eye we might expect the research to usually be ‘wrong’. In this case ‘wrong’ means gives misleading or harmful advice. Similarly, ‘right’ […]

University of Winchester offers a Masters in Insight Management

On July 16 Steve Wills will be giving a NewMR lecture on Insight Management and various initiatives to make it a recognised professions – click here to access the slides and recording. One of those initiatives is the creation of a MSc Insight Management degree by the University of Winchester, in the UK (to the South-West of London). Below you can read more about the course. MSc Insight Management The University of Winchester’s MSc Insight Management is designed for working managers, delivered on a part-time weekend basis. It will appeal to managers from diverse business support organisations such as market research, data analytics and competitor and market intelligence. The degree will give students an understanding of the Insight Management function and equips them with key skills in insight generation and delivery for business decision-making. The degree develops students’ ability to critically evaluate the information needs of an organisation and the potential value it can generate. It explores ways in which organisations make sense of the information they generate, examining consumer decision and business decision processes. It examines the barriers to getting that information used when decision makers are swamped in diverse and often conflicting data and reviews approaches to generating […]

Dialling in to the MRIA Conference – the shape of things to come?

Today I had the pleasure of taking part in a panel discussion with Lenny Murphy and Simon Chadwick, ably chaired by P&G’s Greg Rogers, as part of the Canadian MRIA’s annual Conference in Saskatoon. Only one of us, Greg, was actually in the room, or indeed in the country. Simon, Lenny and I all joined via webcams (Simon and Lenny from the USA, and me from the UK). I look forward to hearing from the audience what they thought, but I really enjoyed it (find out more about the Conference via Annie Pettit’s blog). Virtual events are not unusual, indeed NewMR was perhaps the first to pioneer them in the market research space. And, I have dialled into events in the past, typically when something has gone wrong with the plans (for example clouds of ash grounding planes). But this was the first time where I joined a panel where all the guests joined by webcam, intentionally. I hope that face-to-face conferences will remain a core part of how the MR industry goes about its sharing, learning, and networking – but I think remote speakers and panels could be a growing part of the picture, especially as the technology gets […]