The Strategic Question Approach to Market Research

Strategic_Questions.jpgA Director of Marketing at a major consumer-goods company calls a research supplier and explains that she needs to do a project on potential customers. She wants to conduct several focus groups with people within a specific age range who spend a certain dollar amount on competitor’s products. She says she wants these groups done in three major cities in the U.S., and, after asking if the research supplier has any questions, ends the call. The supplier hangs up the phone and starts to get together costs for the study. The research that is then conducted conforms exactly to these specifications, and the final report is delivered on time. Nice story, right?

We have all been on one side of this phone call, an uncomplicated request with clear exchange of information, verified by both sides, that then leads down what seems like a straight and narrow road. So how is it that, further on down the road, the research that gets conducted is deemed “not actionable” and the Director of Marketing who commissioned it declares it “a major waste of money?” 

The reason is simple: it wasn’t clear what the fundamental question was that the client wanted to answer, nor was there an indication of how the research could move the client’s business forward. Although the focus groups that were conducted provided good general information about competitor customers, the Director of Marketing never felt she really understood how to help her company. Within all the generalities, she never got insights that would help her win over some of these potential customers to use her products. Stories like these, which are sadly all too common, have lead us to develop the distinctively pragmatic approach to helping our clients that we use: we call it the Strategic Question Approach because it helps us do research that makes a difference.

What Is the Strategic Question Approach?

Our approach assumes that underlying every piece of good research is a business issue and a particular business objective. So, the first thing that we try to understand is the reason for the research. Is revenue down? Has there been a decrease in customer satisfaction? Are current customers not being retained? Once we know the business issue, we can identify the strategic objective for the company. And once we understand what’s driving the need to do the research, we can hone in on the major strategic question — which sounds deceptively easy, but which is not. 

Many market researchers will describe the strategic objective of the research in very general terms such as “to understand our customers better” or “to see how our product compares to competitors,” which are not useful or clear strategic questions. Just try to imagine, for example, what would one would do with reports that have such general scopes: If we understand our customers better, do we: 1.) Cut back on what’s not important to them? 2.) Get them to increase their spending on us? 3.) Provide social media links that make them more loyal? As laudable as any of these actions may be, no one of them is clearly specified as a likely course of action. In fact, we find that the more specific the question, the better the research. And further, it’s those studies that try to answer every question that end up answering none.  

Once the strategic question is clearly identified, it’s easy to begin designing the study and to then conduct research that will answer that question. See Table 1 for examples of good and poor strategic questions. 

 Poor Strategic Question

 Good Strategic Question

 What do customers think about our new product?

 How likely would customers be to purchase this  particular product with these specific features at  this price point?

 What is important to customers when they buy this  product/service?

 What are the key criteria customers use to  evaluate and select this product/service and which  2-3 criteria are most important?

When we have identified the major business issue, the business objective and the strategic question, we determine the specific sub-questions for the research. We then challenge ourselves (and our clients) to determine what actions would be taken once we answer those questions. Notice what’s happening in this approach: rather than foregrounding the techniques of research, the content of the research, or the executor of the research (all three of which are the province of the typical market research supplier), this approach makes action the focus of the research. For example, Table 2 gives an overview of this approach as applied to a car-rental service.

 Business Issue

 Current customers are not highly satisfied and are  using competitors after using our company

 Strategic Objective

 To retain more current customers

 Major Strategic Question

 What are the major reasons current customers are  not being retained after they use our service?

 Specific Sub-Questions That Will Answer the  Strategic Question

 How do customers experience our rental car  service?

 What do they like/dislike about the experience?

 What are the major reasons they are selecting  competitors?

 How does our experience compare to the  competitors?

 Are they loyal to any provider?

 What aspects of the experience might lead to  greater loyalty?

 Would a loyalty program increase customer  retention?

 Potential Actions

 Changes to the customer experience and/or a  new loyalty program

At the point where we have a good overview of the business issue, strategic objective and major strategic question and sub-questions that need to be answered, we know exactly what we want to ask if we’re designing a qualitative or quantitative study. We also know the types of people we want to recruit for our research. And when we have an eye toward the potential actions the client can make, we can make strategic recommendations for them once we have conducted the study. The research is designed to trigger action. 

Hypotheses Help to Frame Research

The other part of our Strategic Question Approach is that we generate hypotheses about the answers to the major questions. Although it seems dogmatic to use a “scientific method” approach like hypothesis-generation, we do so because it’s an effective way to kick the tires on the research design: are the right questions being focused on, is the right target being recruited, etc.? Moreover, we find that organizations and people who have expertise about an area that we’re researching often have thoughts about why the business is having a particular issue or ideas about what might be effective. It’s useful to test these ideas because they’re often not explicitly stated. Just knowing the current thinking within an organization can be a great input into the research so that one can confirm or refute hypotheses and help the organization move beyond ideas and make concrete changes. 

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About the Author

Anne BAnne_Beall.jpgeall is CEO of Beall Research, Inc. She specializes in strategic market research and previously was Director of Market Research for The Boston Consulting Group (BCG). She conducts both qualitative and quantitative market research and specializes in conducting large-scale, complex studies for Fortune 500 companies across many industries. She has published the following books: Strategic Market Research: A Guide to Conducting Research That Drives Businesses (Second Edition) and Reading the Hidden Communications Around You: A Guide To Reading Body Language in the Workplace. Anne received her M.S, M.Phil. and Ph.D. degrees in Social Psychology from Yale University. If you want to learn more about the Strategic Question Approach, you can read about it in her book Strategic Market Research.

Topics: Market Research Strategy