What Matter Your Tracker?

Most companies track customer perceptions but few companies measure how those images change behaviours. We describe how to bridge this gap and how companies frequently track images that don’t matter.

Sylvester Stallone may have the acting skills of a satsuma, but if the Rocky and Rambo franchises have taught us anything, it’s that this is no impediment to selling cinema tickets.  Audiences may mock Stallone’s wooden acting and unintelligible grunts, but they flock to his movies.  Conversely, there are things that just shouldn’t affect how people behave and yet somehow they do.  Recent research from the University of Wisconsin (2013) shows how shares in companies that appoint attractive CEOs tend to outperform.  Ah, so that’s how Adam Crozier has been doing it.

So what is the relationship between people’s perceptions and their buying behaviour?  This is no idle question.  Every company has some form of tracker that periodically measures brand perceptions by asking people if they agree with about 10 to 20 statements, such as “they really care about their customers”.  But who decides which images to track and which of those to pursue as part of the brand strategy?  Despite the vast amount of money channelled through advertising, PR, and other initiatives to deliver this brand strategy, the answer to this question is virtually pulled out of thin air by a combination of qualitative research, management opinion and ad agency brainstorming.  Sure, these are all useful.  But are they really enough to accurately target an annual £10mm to £100mm investment?

Brand’s Impact on Media Switching

The graphic from the TV/Landline/Broadband sector illustrates an alternative approach.  By capturing people’s brand perceptions and then presenting them with a product purchasing task (or better still capturing their subsequent purchasing behaviour) it’s possible to infer the importance of different brand attributes. In other words, while critics may snigger at Stallone, a Hollywood mogul should invest in what actually makes audiences buy tickets.  In the end, all the test screenings in the world couldn’t save Disney from having to write off $160m from its recent turkey of an adventure movie, “John Carter”. Relying solely on qualitative research, focus groups and management instinct just isn’t enough.

As shown, this example of “triple-play” switching is, as you might expect, driven by how much money the customer can save.  But the decision is also driven by brand perceptions.  Being seen as good value for money is important above and beyond the actual pricing.  As, too, is the provision of “entertainment for all” (assuming that people still rate the England cricket team’s 5-0 Ashes series thrashing as value-for-money entertainment). Conversely, some customers are less likely to switch because they find a brand embarrassing.  Finally, only the four shown of 12 images being tracked by this company have any influence on this purchasing decision.   So let’s start with those.

Halford, J. T. & Hsu, S. H. C. (2013). Beauty is Wealth: CEO Appearance and Shareholder Value (Working Paper). Retrieved from SSRN.