Shoot the focus group

Advertizers are inventing new ways to connect with consumers. My research department doesn't know it, but I'm killing all our focus groups." So spoke Cammie Dunaway, chief marketing officer at Yahoo! Inc. , at a Silicon Valley conference in September. Dunaway doesn't plan to harm the groups of innocents that marketers have long assembled in beige conference rooms to observe behind two-way mirrors, like zoo animals, as they hold forth about coffee and shampoo preferences. But she does want to put the two-way-mirror manufacturers out of business. Yahoo has been getting little useful information from such groups, says Dunaway. She prefers "immersion groups" -- four or five people with whom Yahoo's product developers talk informally, without a professional moderator typical of focus groups. That leads to work sessions in which a few select consumers work together with Yahoo staffers to actually design a new product. "The outcome is richer if they feel included in our process, not just observed," says Dunaway. One recent result: Yahoo is testing a new online community for car buffs who want more member-to-member opportunities to chat.

Exasperation with focus groups, while not universal, is growing as companies look for better ways to get inside consumers' heads, often assisted by new technology and the Internet. The dissatisfaction and the proliferation of new research approaches has been escalating so rapidly that the ad industry's main trade group has been spurred to conduct the first widespread study of testing methods since the 1950s.

Perhaps the most common complaint about focus groups is that consumers are not honest in front of other people. America Online Inc. in 2003 saw a disconnect between what men revealed in groups and the complaints about spam it received by e-mail. It turned out that men, in a room with strangers, were not keen to admit they didn't have full command of their laptops. But in e-mails, they conceded that they were tortured by underperforming spam blockers.

Observing and interviewing men at their keyboards led to a revamp of the AOL blocker and an ad campaign publicizing the change. "There's peer pressure in focus groups that gets in the way of finding the truth about real behavior and intentions," says John B. Osborne, chief executive officer of BBDO, New York, AOL's ad agency. Author Malcolm Gladwell bashes focus groups of all kinds in his latest book, Blink: The Power of Thinking Without Thinking. "Asking someone to explain [their behavior and intent] is not only a psychological impossibility...but it biases them in favor of the conservative, in favor of the known over the unknown," said Gladwell in a speech to the ad industry last August.

Despite the common assumption that you don't know if an online chatter is a teenager or a cocker spaniel, going online to get at true consumer behavior is drawing increasing interest from marketers. Consider the conversion of PepsiCo Inc. a to the new thinking: Pepsi launched a new cola in 2004, Pepsi Edge, which tasted similar to original Pepsi, but with half the calories. Edge was greenlighted in large part after focus groups endorsed the concept. But it was a classic case of a focus-group false-positive. The idea made sense to people who switch between zero-calorie Diet Pepsi and the original, but the murky positioning of being neither diet nor the original stirred little interest at the retail level.

Looking for better methods of predicting consumer acceptance, Pepsi recently turned to Wellesley (Mass.)-based Invoke Solutions, which conducted several instant-message-style online panels of 80 to 100 people collected by its affiliated online survey firm, Greenfield Online. Pepsi delved into attitudes among Gen Xers toward drinking mineral water. In just a few hours, the beverage marketer was able to gather and process detailed feedback from hundreds of consumers. Getting a comparable result from focus groups would have taken several weeks.

Invoke is one of many firms popping up whose outreach to consumers is based on connecting via the Web. Reaching out online, through surveys or IM, shields people from the influence of a group and better enables different departments to eliminate blind alleys. At first, Pepsi marketers were jazzed that the group liked the idea of high levels of mineral content in water. But the beverage scientists on the scene squelched higher mineral levels; that would require adding sugar, which consumers didn't want, to make the taste acceptable. "Conclusions that could take three to four months to sort out through focus groups... get settled in a few hours," says Invoke Chief Operating Officer David Rubinstein.

Speed is just one of the appeals for political strategists shifting from traditional focus groups to online research. Mark Mellman, president of Washington's Mellman Group Inc., recently used Invoke on behalf of Planned Parenthood. A series of online panels totaling hundreds of people shared attitudes about U.S. Supreme Court Justice John G. Roberts Jr. and abortion rights, and inspired the messaging for ads. Mellman figures he'll use the method for candidates as well. The savings and speed, he says, lets him reach more diverse voters than focus groups allow -- beyond those "who simply have a few hours on their hands and want the $50 fee."

Some of the new solutions displacing focus groups don't rely on consumers to sort through their feelings at all. Instead, companies get more useful feedback just from watching daily life. In spring 2003, paper products company Kimberly-Clark Corp. (KMB ) saw sales of Huggies baby wipes slip just as the company was preparing to launch a line of Huggies baby lotions and bath products. Focus groups weren't yielding any compelling insights. Then a K-C senior packaging designer came up with a new approach: a camera mounted on a pair of glasses to be worn by consumers at home, so researchers could see through their eyes. "Letting us see what they see, rather than pointing the camera at them, proved more comfortable for them and useful to us," says Becky Walter, innovation and design chief.

It didn't take long to spot the opportunities. While women in groups talked about changing babies at a diaper table, the truth was they changed them on beds, floors, and on top of washing machines in awkward positions. The researchers could see they were struggling with wipe containers and lotions requiring two hands. The company redesigned the wipe package with a push-button one-handed dispenser and designed lotion and shampoo bottles that can be grabbed and dispensed easily with one hand.

The old-fashioned focus group still has its believers even with fiascoes like Pepsi Edge and a decades-long new-product failure rate of about 90%. Bonnie Goebert, author of Beyond Listening: Learning the Secret Language of Focus Groups, says, "Consumers aren't dishonest, it's that most people don't listen the right way." On the other hand, maybe consumers can be heard more clearly when nobody is watching.

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