Is Digital Age Changing Consumer Research Rules?

Be cautious about using traditional market research to guide a major consumer product change. That's the warning from the new book Absolute Value by Itamar Simonson and Emanuel Rosen. The authors take a Universal McCann study of consumer interest in the first iPhone as an object lesson in why research can miss the mark in predicting consumer behavior today: That study found that an iPhone-type product would be a hit in countries like India and Mexico but not in the United States, Germany and Japan. What went wrong? Why are consumers unreliable predictors of their own behavior? The problem, note the authors, is that traditional market research looks at prior preferences, beliefs and experiences, while future consumer buying decisions about a new product (one that involves more than tweaking an existing product) are affected by a mass of noisy, ever-changing inputs in today's digital age -- such as online user reviews, friend and expert opinions, price comparison tools, and emerging technologies or sources. If consumers are bad at predicting their own preferences, market "experts" are no better, the authors add, pointing out that many experts failed to predict the success of the telephone, television and Internet. Should marketers abandon market research? No, they should change focus, advise the authors. Instead of trying to predict long-term consumer preferences, researchers can go with the digital flow and track consumer trends and decisions on review sites, user forums and other social media -- so businesses can respond with better solutions. Simonson is a professor of marketing at Stanford Graduate School of Business, and Rosen is author of The Anatomy of Buzz. For more on their book Absolute Value, see the news release: http://www.gsb.stanford.edu/news/headlines/itamar-simonson-emanuel-rosen-how-digital-age-rewriting-rule-book-consumer-behavior