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MOSKOWITZ JACOBS INC.
Strategic Brand Developers: Research & Consulting
Accomplished Strategic Partners

  We work through all phases of the product/service
        innovation and development process

     New Product                     Re-Stage
       Development                    Efforts




A Research & Consulting Firm focused on accelerating
                the innovation process
                                                       2
Assisting Clients Access Every Region of the Globe
                                             3




                                                     3
MJI‟s Research Methods Are Based On a
   Simple Fact

“The Learning is in the Stimuli”
Customers don‟t know what they want in terms
of specific features, benefits, or ingredients
…until they see it, taste it or smell it
The most effective methods
    Test the broadest range of variables
    Reveal patterns in the data to identify
    drivers of consumer behavior
    Use systemized approaches for maximum
    discovery

                                                 4
Marketing Optimization Solutions
           MJI Suite of Business Marketing Tools
                                                       Optimize positioning for
                            Direction for agency       personal care product line
        IdeaMap®             creative                  Optimize health claims for
                             development                ice cream, snacks, and
                                                        beverages

                                                       Optimize loyalty program
                            Competitive
      ChoiceMap™             market simulation         Optimize on-package benefits
                                                        for OTC healthcare product

                                                       Clients have access to data
        Concept             User-Friendly             Clients revisit the optimizer
        Optimizer            Marketing Tool             for years after the research is
                                                        completed

                                                       Optimize logos
                            Graphic Design
       StyleMap™             optimization              Design packaging for infant
                                                        care product

                            Continuously              Create a real-time one-to-one
    Addressable Minds        integrate Voice of the     marketing optimization
                                                        platform (in development)
                             Customer
                            Drivers of Product        Category Assessments
     Product Engineer        Liking; Recipe
                                                       Ingredient Optimization
                             Optimization                                             5
IdeaMap® - The Industry Standard

                              When you want to…
 Web-based, self-directed     Have many options to measure
  or full service              Discover „drivers‟ of motivation
  quantitative survey          Understand the full competitive frame

 Uncovers the conceptual
  themes which drive
  interest

 Identifies the specific
  ideas that are most
  compelling

 Reveals attitudinal
  mindsets in your
  customer base

 Exposes potential niche
  markets

 Capture insights from
  hundreds of consumers
  fast and cost effectively

                                                                        6
IdeaMap Method to Identify…On A
          Conceptual Basis…What Consumers Want

» IdeaMap is rooted in conjoint (trade-off) analysis
     Recognizes that in reality, purchase decisions are made by evaluating bundles of
      attributes
     Consumers trade-off sets of bundled attributes against each other
     IdeaMap allows the identification of the contribution of each element in the bundle
      to the overall rating

» IdeaMap is based on a stimulus-response
     We know the response we want to elicit (e.g., interest) …the stimuli most effective
      at eliciting that response

» IdeaMap uses an experimental design – identifies causal relationships, not just
  correlations
ChoiceMap™ / ChoiceMap.Net

                         When you want to…
                          Identify the elements that will capture market share from competitors
 Web-based, self-
  directed or full
                          Measure how your customer respond to you and if you might
  service quantitative      inadvertently be pushing them to consider your competition!
  survey

 Built on the same
  principles as
  IdeaMap®

 Side-by-Side
  comparisons of
  your products vs
  competition




                                                                                                   8
Concept Optimizer™

                            Bringing Compiled Data to the Next Level
                                                                                For pre-defined customer segments
                                                                                   and
                                                                                   Attitudinal / behavioral segments which
                                                                                   emerge from the surveys
                                                                                                                                          For Illustrative Purposes Only


                                                                          Total Panel Segment

                                                               Winning Concept –
                                                                  Optimized                                                 Losing Proposition


                                                                 Total Score = 85                                              Total Score = 38




                                                           • Special blend of anti-irritants sooths                • De-puffs; minimizes appearance of dark circles
                                                               skin and minimizes puffiness
 Optimal Concepts are built from the                                • Alleviates dryness
                                                                                                                   • Ultra-hydrating eye cream that lifts, tones and
                                                                                                                               smoothes the eye area
   highest scoring elements in each                      • Lipids strengthen skin; optical diffusers                    • Anti-oxidants help fight free radicals
                                                             scatter light for a softened effect
   category
                                         Optimal Concepts are built from the highest scoring elements in each category. Scored by adding the sum of the
                                         utility scores to the constant


                                                                                                                                                                           9
StyleMap®

                                                           Web-based, self-directed or full service
                                                             quantitative survey

                                                           Built on the same principles as IdeaMap®




 Instead of elements, Advertising features are varied:
   Headlines
   Visuals
   Copy
   Positioning statements




                                                                                                       10
One Example of the Future Happening Now
        …Customer Typing Tool
   IdeaMap survey  Identify Segments, Create Typing Tool  Deliver the right message



#3 Deliver The Right                                                  #1 Use IdeaMap to
  Message To Specific                                                    segment customers
  Customer                                                               and optimize message

                                 Addressable Minds
                                      Message
                                  Optimization and
                                     Targeting

                                                          #2 Create Typing Tool And
                                                            Classify Prospects
What to say…
               And to whom

 IdeaMap.Net and Addressable Minds™
-Relevant Messaging to ReceptiveTargets-




                                           12
IdeaMap®

                                                           How It Works




    Defining the Scope:         Organizing Principle:             Experimental        Output & Analysis:              Addressable
     Input Elements                 Categories                       Design           Regression Modeling               Minds
 Promotes flexibility &        Categories                 Building the Concepts       Statistical modeling
  creativity                     Provide organization      Systematically             simulating the
 Collaborative effort; cross     of ideas                   combines elements          respondent‟s interest in
  functional                     e.g. Benefits, RTB‟s,      from different             learning more about the
                                                             categories                                               Enables one-to-
                                  Service, Offers,                                      product is built through
                                                                                                                       one targeted
                                  Experience, Brand        Consumer/Professional        regression modeling
Can be sourced from:                                                                                                   communication
                                  Selection, Delivery,       Response                   techniques
                                                                                                                       with the right
 Brainstorming                   Trust, Emotional                                     Utility scores assigned to     message, to the
                                                            Respondents are
 Focus Groups                  Messages                     exposed to these           each tested element            right person,
 Previous studies/internal                                  combinations or           Optimized product              at the right time.
                                 “Bite sized” ways of
  data                            describing a product,      concepts one at a time     concept and / or
                                  service or idea           They respond to the        messaging by segment
 Current messaging
                                                             whole entity, not its      identified
 Competitive advertising /      Can be either words or
                                  pictures                   individual parts
  packaging
                                                                                                                                      13
Expertise In Action …

                                                 RESEARCH METHOD

                            In our approach – IdeaMap.Net ®and Addressable Minds ™
                                  We have a true torture test of the ideas
                                  Every element appears against other elements in small, easy to
                                   read combinations
                                  Everyone sees different combinations

                            Test up to 36 elements, separated into 3 to 10 categories.
                                  A category is a collection of like-minded ideas.
                                  These categories with examples of elements are shown on the
   Research Methodology           next page.

    Stimuli Tested          Whatever comes up to the top must be strong…otherwise it would
                             fade against the onslaught of the other elements
    Results
                            IdeaMap.Net used for 20+ years to understand consumer minds
    Optimal Concept               For product design & marketing
                                  For the law (jury selection and communication…where it
    Sensitivity Analysis           creates very large jury awards)
                                  Communication (identifies what to say to prospective
                                   customers)

                                                                                               14
A Recent Success Story
                                                                                                       1
                                                                                                       5


Recent Press Release …
     High profile lawyer, Rex Parris, uses MJI’s Addressable Minds, powered by
       IdeaMap.Net to optimize trial arguments in historic $370 million award

» White Plains NY and Los Angeles CA – July 28, 2009 Moskowitz Jacobs Inc. (MJI), a global leader
  in Messaging Optimization Solutions, today announced that R. Rex Parris, the lead attorney for the
  employees in a defamation law suit, was instrumental in having $370 million awarded to his
  clients after utilizing IdeaMap.Net‟s Addressable Minds solution to optimize his arguments.

» IdeaMap.Net‟s Addressable Minds solution quickly identifies the most compelling combination of
  arguments in their case to maximize the likelihood of achieving the desired verdict. IdeaMap.Net‟s
  Addressable Minds assesses and optimizes relevant content including framing statements, evidence,
  collateral factors, and even the nature/tonality of the witness.
»
          “This quantitative technique really helped me frame my courtroom
          arguments…The net result…The jury returned one of the biggest verdicts in
          the history of Los Angeles County for a defamation case”, said R. Rex Parris,
          the lead attorney. “The tested messages were dead-on. I knew exactly what to
          say and what not to say.”
Case History.. From the Food Industry

» The client manufactures healthful snacks…now using probiotics to increase product
  healthfulness

» Probiotics are the healthful bacteria in yogurt, which can now be added to baked goods
  with the same customer benefit

» Where is the opportunity…and what specifically to say and to whom

» This test used a combination client‟s own marketing material and new messages




                                                                   16
Flexibility to Test Broad Range of Elements
        - Showing 8 Out of 24 Test Messages -
                                                      General Benefit
                                          Get the most out of your breakfast

                                                    Minimize Calories
                                   Each portion is worth its weight in health – 100
                                   calories per 2 oz. serving…no need to settle for
                                                   smaller portions

                                                    Taste Promise
                                      Comes in deliciously rich flavors to hit your
    Research Methodology                              sweet spot


   Stimuli Tested                        Specific Ingredient / Health Benefit

    Results                                     Helps reduce cholesterol

    Optimal Concept                                      Probiotic
                                 Contains probiotic bacteria, treats gastrointestinal ills
    Sensitivity Analysis

                                                      Closing Benefit
                                Get the energy you need while keeping it gentile on your
                                                       stomach                           17
The Complete List…Six Silos, Four Phrases Each




                                    18
In the Study..We Begin by Orienting Participants




                                   19
A Concept




            20
Expertise In Action


                                                     RESULTS
                            A statistical model simulating the respondent‟s interest in buying
                             an 8 pack of muffins is built through regression modeling
                             techniques.

                           Input 1                           Input 2
                           Combinations of ideas             Respondent’s Answers
                           (Experimental design)
    Research Methodology
                                                  Regression
    Stimuli Tested
                                                   Analysis
   Results
                           Output: Additive Model simulating respondent‟s behavior
    Optimal Concept
                           The additive model shows the impact, or value, of each
                           individual idea (element) to the respondent‟s behavior.
    Sensitivity Analysis
                                    Drive behavior to learn more (drivers)
                                    Prevent from learning more (inhibitors)
                                    Have no impact (neutrals)
                                                                                              21
Understanding the Additive Model

Each concept element is assigned an impact score that represents the importance
 contribution of that element.


 Positive values indicate     Scores that are near zero         Negative values
   that the respective         indicate respondents are         indicate that the
   element enhances         indifferent to inclusion of that   respective element
   customer reaction.                  element.                detracts consumer
                                                                    reaction.

In addition to the individual element impact scores, the regression analysis yields
 a “Constant”.
Think of the constant score as a “baseline” level of motivation to start from when
 building a concept.


                      Constant (C)             Individual          Total
                                              Elements (I)       Impact (T)
                                                                                    22
What we discovered

 What the data show us from the evaluation by 172 respondents of
               different combinations of messaging




                                                         23
How to Read the Results

» Let‟s look at interest
      % rating 7-9 „I would buy the product‟ (like the top 2 box)


» Begin with the constant
      % saying I accept, with no elements
      Baseline…estimated from the ratings by regression (also called the additive constant)
      It is 28 here..28% of the people would say „I‟m interested‟..even without any elements


» Look at the contribution of each element beyond the constant
      E1: Contains probiotic bacteria, which treat gastrointestinal ills (+7)
      An additional 7% of the respondent would change from “base line”to interest (from 28 to 35)


» Build a new selling message by combining (at most) one element from each of four silos
      Additive constant + impact values (utilities) tell you how many people interested




                                                                                      24
Relate Presence/Absence of 24 Elements to Interest




                                      25
Today‟s Advertising Practice
            Messages…not-targeted, not-relevant


» Retailers / Manufacturers ->

» ...Traditional advertising messaging targeted
  to large audiences …based on simple
  classification descriptors and what they
  purchase …it‟s how media is bought

                                                  Demographics, Behavior

» Your Customers….Advertising strategy
  assumes/hopes for group homogeneity…Men
  want “Y”, Women want “X”



» Result…Lots of messages without regard to
  „true/effective‟ messages & motivators „that
  really work‟ for each customer

                                                                       26
Mindsets Create Business Opportunities

» People differ from each other
     Conventional methods divide them by easy-to-buy information (geo-demos)
     Other methods divide them by high-level psychographics (general world views)
     Still others divide people by what they buy, etc.


» We are going to segment the 172 respondents based on how they react to these new ideas
    This is called mind-set segmentation
    It is granular, specific to the particular product and opportunity
    And it is up-to-date


» We uncovered two different mind-sets, based on the patterns of reactions to the elements




                                                                         27
The Addressable Mind™ Solution
           Targeted by Mind-Set, Very Relevant Messaging


» Retailers / Manufacturers ->

» IdeaMap.Net Foundation Database / test for
  each retailer / manufacturer                              IdeaMap.net


» Discover Segments, Create Typing Tool,
  Identify Message Drivers



» Classify new population into  Discover Mind Segments:     Identify Mechanism        Identify Importance
                                       - Green Conscious                              Of Each Message by
  segments…THEY LOOK THE SAME BUT      - Only The Best
                                                            For Segmentation
                                                                                      Total, Segments etc.
  THEIR MINDS ARE DIFFERENT

» Now, Target best messages to each segment
  and do it by each manufacturer and retailer
                                            GREEN BEST GREEN BESTGREEN BEST             GREEN         BEST


                                                                                 28
Mindset 1 – It‟s About Calories
Mindset 2 – It‟s About Health




                                30
Opportunity Analysis of the Segments

» It will be all about building interest in the brand and selling to more people
      We learn that from the high interest scores
      For this product

» Let‟s look at Segment 2 – your prospects for the product benefits
     They are more than half the sample (97 out of 172 respondents)
     They have a modest interest in the product (constant of 29)

» But you can add another 16% (i.e. go from 29 to 45)
     How..by putting in ONE of the top two scoring elements
          E.g., Contains probiotic bacteria, which treat gastrointestinal ills
     And then build on that by adding another hot button for segment 2
          All natural with no artificial additives or preservatives (adds another 5)


» NOTE ON IMPACT OR UTILITY VALUES
    5-10 are very good, keep
    10-15 are breakthrough
    > 15 are blockbuster for the group
                                                                   31
Expertise In Action

                                                OPTIMAL CONCEPT
                                             & SENSITIVITY ANALYSIS

                             These concepts for each subgroup are the result of a computer
                              program generated selection routine that focuses on the highest-
                              scoring elements across the categories.
                                   It is an example of how the optimization process works.
                                   The Optimal Concepts are examples of high-impact bundles
                                    of elements.
                                   Other combinations can also be built from this research.
                                   These scores are calculated by adding the sum of the utility
                                    scores to the constant
     Research Methodology
                             The Optimal Sensitivity Chart on the following page (read across)
                              identifies on the diagonal the predicted sum of the Optimal
     Stimuli Tested           Concept for each sample group as calculated by a combination of
                              the constant + the additive values of the elements in the optimized
     Results                  concept:

    Optimal Concept

    Sensitivity Analysis




                                                                                               32
Sample Data
         Optimal Concept Example                                                     Do Not Quote
         - Total Sample -

 Optimal Concept

                                                                            Total Seg 1 of 2 Seg 2 of 2
                                                                Base Size: (172)        (75)       (97)
                                                                  Baseline:   28          27         29
E1   Contains probiotic bacteria which treats gastrintestinal ills             7          -5         16
     Maximize satisfaction with minimum calories…low fat and high
B2   in fiber and nutrients                                                    7          11          3
F2   Our mission is simple: to make healthy and delicious baked goods… 6                   6          6
D1   Contains less sugar and more vitamins and minerals than an apple          5           6          5
                                                             Total Impact     53          45         59
 Sensitivity Analysis

          Optimized for:                   Total Sample Seg 1 of 2 Seg 2 of 2
          Total Sample                              53         45         59
          Seg 1 of 2                                48         60         41
          Seg 2 of 2                                45         22         60

                                                                                                          33
Addressable Minds Scratch Testing



Turn your website visitors into
Addressable Minds™

Improve your website… mind-type
visitors and direct them to the proper
pages based on their mind-set



                                         34
The Scratch Test


With a segmented world..and enormous
segment responsiveness….you have to find
your segment 2 people to whom you can really
sell…

We use a 45 second scratch test.. With five
questions and a scoring key

Put this on your website, let your prospects
score themselves, and give them the „right
message‟
                                        35
Finding, directing, messaging your target with
a 5-question scratch test




   Segment 1                         Not in a
                                       36
                                     segment
   Segment 2
Change the Data-Mining Game…Designed for the
  Data-Miner Trying to Increase Lift



Data Mine Using Customer Minds At the
Granular Level of Today‟s Messaging




                                                 37
When You Can‟t Mind-type Individual People
            In Your Database…What to do?

»   All you know are today‟s current messages
»   You know who responds by sub-groups and segments
»   You know the strength of each message
»   That‟s already demonstrably more than any of your competitors know
»   Given the above…who in your database is likely to respond to your client‟s offer
»   Maximize your client‟s lift rapidly
Simulate 10,000 Alternative 4-Element Messages

» Look at how each key subgroup responds to each of the 10,000 test combinations

» If you don‟t profoundly understand your messaging or your database customers…then
  who should you message to

» What elements in your current messaging are really working for and among whom




                                                                      39
Using the results to assess strategy ..
          Who do you mail to (mining your database)
» Don‟t want to use probiotics this year in selling message
     We looked at 20 of the 24 messages (no probiotics messages)
     All of these are current messages
     Now what do we do?..to whom do we mail?


» We don‟t know who will buy the „new product‟..but we do know from our audit how
  prospective customers respond to current messaging
     Instead of guessing, we simulated different messages, and „ran them by our data set‟
     So ..we‟re replacing previous behavior (which we may/may not have) with attitudes
      to the precise current messaging the client will use
     We created 10,000 random „4 element mini ads‟ representing what could be sent
     Now let‟s see what consumer groups will be turned on


» Now we can estimate distribution of interest for our new strategy
     Which of our groups is most likely to respond to an offer
     These are our likely responders
                                                                        40
     And…we easily simulated and scored the current strategy!!!!
Groups Highlighted in Green are the Target for a
             Strategy (No Probiotics)…Good Idea or Not?


                                                                           Q2_65
Without Probiotic        Total                  Q2_30- Q2_39- Q2_45- Q2_53- and Segment 1   Segment
Messaging              Sample Q1_Male Q1_Female    38     44     52     64 above     of 2      2 of 2
Base Size                172       43        129    21    20     42    68    17       75         97
Constant                  28       37         25    25    30     30    23    42       27         29
Mean                      44       39         46    45    33     58    40    42       50         40
Median                    44       38         46    46    33     58    40    42       50         39
St.Dev.                   2.5      4.9        2.7   7.0   6.4    4.6   3.1   7.1      4.6        3.6

% greater than 25       100%     100%       100% 100%     90%   100% 100%    98%    100%       100%
% greater than 30       100%      98%       100% 98%      70%   100% 100%    94%    100%       100%
% greater than 35       100%      78%       100% 93%      40%   100% 94%     84%    100%        91%
% greater than 40        95%      34%        99% 78%      16%   100% 52%     62%     97%        45%
% greater than 45        36%      14%        65% 51%       3%   100%   8%    34%     86%         8%
% greater than 50         0%       1%         7% 26%       0%    94%   0%    12%     52%         0%
% greater than 55         0%       0%         0%   9%      0%    73%   0%     2%     13%         0%
% greater than 60         0%       0%         0%   2%      0%    33%   0%     0%      0%         0%
% greater than 65         0%       0%         0%   0%      0%     5%   0%     0%      0%         0%
% greater than 70         0%       0%         0%   0%      0%     0%   0%     0%      0%         0%


                                                                             41
Using the Results to Assess Updated Strategy ..
          Who do You Mail to (Mining Your Database)

» We looked at all 24 of the 24 messages
    All of these are current messages
    Revised strategy.. pursue probiotics this year
    Now what do we do?..to whom do we mail?


» Then we created „4 element messages‟
     10,000 new messages .. With the probiotic messages ..to reflect the new strategy
     One or no element from each silo
     And estimated level of interest


» Now we can estimate distribution of interest for our new strategy
     Which of our groups is most likely to respond to an offer
     These are our likely responders
     Simulated and scored the new strategy allowing in probiotics !!!!

                                                                          42
Groups Highlighted in Green Are the Target
                    for a Strategy (Use Probiotics)
                                                                                                 Q2_65
Marketing Message: With       Total                                                Q2_53-          and Segment 1 Segment 2
Probiotics                  Sample    Q1_Male Q1_Female Q2_30-38 Q2_39-44 Q2_45-52     64        above      of 2      of 2
Base Size                      172        43        129      21       20       42          68      17        75        97
Constant                        28        37         25      25       30       30          23      42        27        29
Mean                            45        37         47      45       31       57          43      44        42        47
Median                          45        37         47      45       31       57          43      44        42        48
St.Dev.                         2.8       4.7        3.3     7.7      6.3      4.5         4.4     7.1       7.2       6.5

% greater than 25            100%       100%       100%     100%     84%     100%         100%    99%      100%      100%
% greater than 30            100%        96%       100%      97%     56%     100%         100%    96%       97%      100%
% greater than 35            100%        69%       100%      89%     27%     100%          97%    89%       84%       97%
% greater than 40             96%        25%        99%      72%      8%     100%          73%    71%       58%       83%
% greater than 45             48%         9%        76%      49%      1%     100%          32%    45%       32%       65%
% greater than 50              3%         0%        22%      25%      0%      93%           6%    18%       18%       39%
% greater than 55              0%         0%         0%       9%      0%      68%           0%     5%        4%       10%
% greater than 60              0%         0%         0%       2%      0%      26%           0%     1%        0%        0%
% greater than 65              0%         0%         0%       0%      0%       3%           0%     0%        0%        0%
% greater than 70              0%         0%         0%       0%      0%       0%           0%     0%        0%        0%
% greater than 75              0%         0%         0%       0%      0%       0%           0%     0%        0%        0%




                                                                                     43
ChoiceMap
     Market Simulation
     Think of Vectors Influencing Each
     Other (Psychological Cross-
     Elasticities)




                                         44
ChoiceMap Concept Screen


                                     SAMPLE SCREEN




    Research Methodology

   Stimuli Tested

    Results

    Optimal Concept

    Sensitivity Analysis




                                                     45
ChoiceMap Example of Deliverables


                                                                                   RESULTS




                                                                                                                   Base 3+ Purchases          Loyal Competitor
                                                                                                                 Sample     per Month Shoppers          Shoppers
                                                                                                 Base Size       (1502)            (603)      (511)         (452)
                                                                                              CONSTANT               12                5         12             5
                           Feature 5: Special quarterly discounts for members available through local gyms, rec centers, spas, online shopping partners and
                           other outside health partners:
                           OPTION C:           Discounts of 30% to 50%                                                  9            9           9            11
    Research Methodology   OPTION B:           Discounts of 15% to 30%                                                  6            5           5             9
                           OPTION A:           Discounts of 10% to 15%                                                  4            4           4             9

    Stimuli Tested
                           Feature 2: Panel of experts available for members to consult with via telephone or online 24 hr/day

   Results                OPTION C:
                           OPTION B:
                                                Available Both online and via phone
                                                Available by phone only
                                                                                                                        7
                                                                                                                        4
                                                                                                                                     9
                                                                                                                                     7
                                                                                                                                                10
                                                                                                                                                 7
                                                                                                                                                               6
                                                                                                                                                               3
                           OPTION A:            Available online only                                                   4            5           7             2
    Optimal Concept

    Sensitivity Analysis




                                                                                                                                                              46
StyleMap Design Optimization
- Same Principles As IdeaMap But Graphically
Based-




                                               47
Shampoo Bottle Case…Six Silos and 4 Graphical
Options Each




                                    48
Product Development
    - Category Assessment
    - Drivers of Liking
    - Recipe Optimization




                            49
MJI‟s Product Evaluation Competencies


                                                  Today’s Focus

                          Category Appraisal
Product Screening                                             Product Optimization
                          Competitive analysis
                                                              Optimal ingredient
Winners/Losers            Sensory drivers of liking
                                                              formulation
Benchmarking              New product
                                                              Optimal formulation given
performance against       opportunities
                                                              cost/ manufacturing
in-market products                                            constraints
                          Sensory segmentation
Direction for product                                         Ingredient drivers of liking
                          Reverse Engineering
improvement
                          Brand equity                        Sensitivity analysis
Product acceptance by
                          measurement
subgroups                                                     Optimizer Software
Product line
extension/ constriction
Product Hierarchy Based on Overall Liking
                        - Partial List of Products



                                     Toilet Tissue Products: Overall Liking
                        100


                         80
                               72
                                              66
       Overall liking




                                                                 58
                         60
                                                                                       50

                         40


                         20


                          0
                              #304           #309               #290               #601


A difference of +/-10 points is significantly different at the 90% confidence level.
Sensory Profiles for Each Product Tested
    -Partial List of Products and Attributes

                      #304   #309   #290   #601 Signifcant
Overall Liking         72     60     58     48     [+/-10]

Like Overall Appearance
                      65     40     65     55      [+/-10]
Visual Thickness      63     45     59     80      [+/-10]

Like Overall Aroma    65     40     65     55      [+/-10]
Strength of Aroma     63     35     55     75      [+/-10]

Like Touch On Skin    68     57     49     44       [+/-8]
Thickness             65     59     45     85       [+/-8]
Softness              66     85     49     44       [+/-8]

Is A Premium          70     85     51     44       [+/-8]
Toilet Tissue
Technical Measure 1   3.9    3.85   4.2    3.95
Technical Measure 2   402    385    425    299
Category Appraisal

» Drivers of Liking Analysis
     Create sensory response curves
     Graphically shows the relationship of overall liking versus:
          Sensory perception
          Objective measures
          Instrumental measures
Sensory Drivers of Liking and Sensory Targets



                 100

                 90
                                                   #304
                 80                    #290
                                                                    #309
Overall Liking




                 70                   #601
                 60

                 50

                 40

                 30                           Products in this area
                 20                           represent sensory
                                              targets to aid in
                 10                           product improvement

                       10   20   30     40    50   60     70   80     90   100
                                              Softness Against Skin
Category Appraisal


» Sensory Segmentation (requires larger base sizes)
     Identify whether liking is homogeneous or whether different preference segments
      exist
          Based on stimulus response patterns
          Was the basis for the segmentation approach used for IdeaMap
Consumer Segments With Opposing Sensory Needs



                 100

                 90            Weaker Fragrance
                                                              Stronger Fragrance
                                  Segment
                 80                                                Segment
Overall Liking




                 70

                 60

                 50

                 40

                 30

                 20
                       SEGMENT1: sq. mult. R= .81
                 10    SEGMENT2: sq. mult. R= .93

                          10    20    30   40       50   60   70   80   90   100
                                                     Tissue Fragrance Intensity
Category Appraisal


» Sensory optimization
     An optimal sensory profile which maximizes overall liking can be identified.


            Compare against tested products to identify which of the tested products have
             the most desired characteristics …REVERSE ENGINEERING

            Use this to adjust existing products or create new ones
Reverse Engineering – How To Use It



                                         Optimal
                Product Description-->   Product
                     Product Code-->                           304              309                290    601
 Overall Liking                               72                 69               63                 57     54
 Like Fragrance                               55                 64               62                 51     48
 Like Fragrance Intensity                     50                 46               49                 43     49
 Strength of Fragrance                        55                 53               53                 48     55
 Easy to Tear                                 58                 66               62                 53     44
 Large Sheet                                  43                 45               46                 80     22
 Soft vs. Firm Texture                        62                 65               62                 56     51
 Is a premium product                         52                 60               57                 52     49
 Expert 1                                     61                 68               64                 68     52
 Expert 2                                     59                 58               59                 54     49
 Expert 3                                     44                 48               44                 54     37
 Objective Measure 1                        0.25               0.20             0.08               0.55   0.51
 Objective Measure 2                        1251              1235             1300                 900    800
 Objective Measure 3                         750                 62               68                 75     53




Boxed number indicates the product is off by +/-3 points from the optimal product score for that
attribute.
Product Optimization

» Why use this approach
    Most direct approach to identify formulations that optimize consumer behavior
    Optimal formulations are reported in terms of R&D ingredient levels


» Experimental research design helps estimate the link between ingredients and
  consumers‟ perceptions and liking.
     Enables R&D to systematically manipulate the ingredients and/or manufacturing
      processes of a product

     Reveals ingredient drivers of liking and perception within the ingredient set tested


     Provides R&D with a recipe for formulation guidance
            What is the best combination of ingredients on an absolute basis?
            What is the best combination of ingredients at specific cost constraints?
Overall Liking of the Products
        - 4 Continuous Variables; 3 Levels Each,

Individual recipes that consumers want:
» By systematically varying ingredients and processes, the following prototypes
  beating the current product on an unbranded basis were produced.




    Prototype       Ing.A      Ing.B       Ing.C       Ing.D     Overall Liking
          1          Low        Low          Low         Low            74
          2          Low        Low         High        Med             71
          3          Med        High         Low        High            69
          4          Low        High        High         Low            69
          5         High        Low          Low        High            67


     18 - Current                                                       57
Do Consumers Track Formulation Changes?
“As R&D created a thicker sheet consumers recognized the change”



                            100                                            R2 = .948


                             80
      Perceived Thickmess




                             60


                             40


                             20


                              0
                                  0%         50%                    100%


                                       Sheet Thickness – R&D Controlled
Ingredient Drivers of Liking
                     - Sheet Thickness vs. Overall Liking -

                            SIMILAR CHARTS ARE CREATED FOR EACH INGREDIENT



         80



         70
                                                                             R² = 0.75
         60
Overall Liking




         50



         40



         30



         20



         10



             0       0%                         50%                                100%
                 4          8           12              16              20                24

                                             Thickness of Sheet - R&D Controlled
Product Modeling Approach
     -No constraints and with 2 cost constraints

                                  Optimal
Constraints               None        Cost 1 (-5% ) Cost 2 (-20% )

Ing. A                    65%            55%            50%
Ing. B                    22%            25%            18%
Ing. C                    13%            15%             8%
Ing. D                     0%             5%            24%
Cost per unit             $6.50          $6.18          $5.20

Overall Liking             79              74             63

Strength of Fragrance      65              62             56
Softness                   60              65             75
Easy to Tear               65              58             50
A Premium Toilet Tissue    75              70             59
MJI - For more information…

We offer solutions with actionable results - each engagement
       delivers a unique set of solutions and benefits.




           Bert Krieger                                    Howard R. Moskowitz, Ph.D.
    Executive Vice President                                       President
          914-421-7456                                       Moskowitz Jacobs Inc.
   bkrieger@mji-designlab.com                               Phone: +1-914-421-7408
                                                           Email: mjihrm@sprynet.net

                                                           www.mji-designlab.com
                                                              www.ideamap.net
                                                         www.SellingBlueElephants.com


            Moskowitz Jacobs Inc. - 1025 Westchester Avenue, 4th Fl. - White Plains, New York 10604 -
                                       (914) 421-7456 - www.mji-designlab.com
                                                                                                        64

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Mji.Capabilities.Aug.2009.Pdf

  • 1. MOSKOWITZ JACOBS INC. Strategic Brand Developers: Research & Consulting
  • 2. Accomplished Strategic Partners We work through all phases of the product/service innovation and development process New Product Re-Stage Development Efforts A Research & Consulting Firm focused on accelerating the innovation process 2
  • 3. Assisting Clients Access Every Region of the Globe 3 3
  • 4. MJI‟s Research Methods Are Based On a Simple Fact “The Learning is in the Stimuli” Customers don‟t know what they want in terms of specific features, benefits, or ingredients …until they see it, taste it or smell it The most effective methods Test the broadest range of variables Reveal patterns in the data to identify drivers of consumer behavior Use systemized approaches for maximum discovery 4
  • 5. Marketing Optimization Solutions MJI Suite of Business Marketing Tools  Optimize positioning for  Direction for agency personal care product line IdeaMap® creative  Optimize health claims for development ice cream, snacks, and beverages  Optimize loyalty program  Competitive ChoiceMap™ market simulation  Optimize on-package benefits for OTC healthcare product  Clients have access to data Concept  User-Friendly  Clients revisit the optimizer Optimizer Marketing Tool for years after the research is completed  Optimize logos  Graphic Design StyleMap™ optimization  Design packaging for infant care product  Continuously  Create a real-time one-to-one Addressable Minds integrate Voice of the marketing optimization platform (in development) Customer  Drivers of Product  Category Assessments Product Engineer Liking; Recipe  Ingredient Optimization Optimization 5
  • 6. IdeaMap® - The Industry Standard When you want to…  Web-based, self-directed  Have many options to measure or full service  Discover „drivers‟ of motivation quantitative survey  Understand the full competitive frame  Uncovers the conceptual themes which drive interest  Identifies the specific ideas that are most compelling  Reveals attitudinal mindsets in your customer base  Exposes potential niche markets  Capture insights from hundreds of consumers fast and cost effectively 6
  • 7. IdeaMap Method to Identify…On A Conceptual Basis…What Consumers Want » IdeaMap is rooted in conjoint (trade-off) analysis  Recognizes that in reality, purchase decisions are made by evaluating bundles of attributes  Consumers trade-off sets of bundled attributes against each other  IdeaMap allows the identification of the contribution of each element in the bundle to the overall rating » IdeaMap is based on a stimulus-response  We know the response we want to elicit (e.g., interest) …the stimuli most effective at eliciting that response » IdeaMap uses an experimental design – identifies causal relationships, not just correlations
  • 8. ChoiceMap™ / ChoiceMap.Net When you want to…  Identify the elements that will capture market share from competitors  Web-based, self- directed or full  Measure how your customer respond to you and if you might service quantitative inadvertently be pushing them to consider your competition! survey  Built on the same principles as IdeaMap®  Side-by-Side comparisons of your products vs competition 8
  • 9. Concept Optimizer™ Bringing Compiled Data to the Next Level For pre-defined customer segments and Attitudinal / behavioral segments which emerge from the surveys For Illustrative Purposes Only Total Panel Segment Winning Concept – Optimized Losing Proposition Total Score = 85 Total Score = 38 • Special blend of anti-irritants sooths • De-puffs; minimizes appearance of dark circles skin and minimizes puffiness  Optimal Concepts are built from the • Alleviates dryness • Ultra-hydrating eye cream that lifts, tones and smoothes the eye area highest scoring elements in each • Lipids strengthen skin; optical diffusers • Anti-oxidants help fight free radicals scatter light for a softened effect category Optimal Concepts are built from the highest scoring elements in each category. Scored by adding the sum of the utility scores to the constant 9
  • 10. StyleMap®  Web-based, self-directed or full service quantitative survey  Built on the same principles as IdeaMap®  Instead of elements, Advertising features are varied:  Headlines  Visuals  Copy  Positioning statements 10
  • 11. One Example of the Future Happening Now …Customer Typing Tool IdeaMap survey  Identify Segments, Create Typing Tool  Deliver the right message #3 Deliver The Right #1 Use IdeaMap to Message To Specific segment customers Customer and optimize message Addressable Minds Message Optimization and Targeting #2 Create Typing Tool And Classify Prospects
  • 12. What to say… And to whom IdeaMap.Net and Addressable Minds™ -Relevant Messaging to ReceptiveTargets- 12
  • 13. IdeaMap® How It Works Defining the Scope: Organizing Principle: Experimental Output & Analysis: Addressable Input Elements Categories Design Regression Modeling Minds  Promotes flexibility & Categories Building the Concepts  Statistical modeling creativity  Provide organization  Systematically simulating the  Collaborative effort; cross of ideas combines elements respondent‟s interest in functional  e.g. Benefits, RTB‟s, from different learning more about the categories  Enables one-to- Service, Offers, product is built through one targeted Experience, Brand Consumer/Professional regression modeling Can be sourced from: communication Selection, Delivery, Response techniques with the right  Brainstorming Trust, Emotional  Utility scores assigned to message, to the  Respondents are  Focus Groups Messages exposed to these each tested element right person,  Previous studies/internal combinations or  Optimized product at the right time.  “Bite sized” ways of data describing a product, concepts one at a time concept and / or service or idea  They respond to the messaging by segment  Current messaging whole entity, not its identified  Competitive advertising /  Can be either words or pictures individual parts packaging 13
  • 14. Expertise In Action … RESEARCH METHOD  In our approach – IdeaMap.Net ®and Addressable Minds ™  We have a true torture test of the ideas  Every element appears against other elements in small, easy to read combinations  Everyone sees different combinations  Test up to 36 elements, separated into 3 to 10 categories.  A category is a collection of like-minded ideas.  These categories with examples of elements are shown on the  Research Methodology next page. Stimuli Tested  Whatever comes up to the top must be strong…otherwise it would fade against the onslaught of the other elements Results  IdeaMap.Net used for 20+ years to understand consumer minds Optimal Concept  For product design & marketing  For the law (jury selection and communication…where it Sensitivity Analysis creates very large jury awards)  Communication (identifies what to say to prospective customers) 14
  • 15. A Recent Success Story 1 5 Recent Press Release … High profile lawyer, Rex Parris, uses MJI’s Addressable Minds, powered by IdeaMap.Net to optimize trial arguments in historic $370 million award » White Plains NY and Los Angeles CA – July 28, 2009 Moskowitz Jacobs Inc. (MJI), a global leader in Messaging Optimization Solutions, today announced that R. Rex Parris, the lead attorney for the employees in a defamation law suit, was instrumental in having $370 million awarded to his clients after utilizing IdeaMap.Net‟s Addressable Minds solution to optimize his arguments. » IdeaMap.Net‟s Addressable Minds solution quickly identifies the most compelling combination of arguments in their case to maximize the likelihood of achieving the desired verdict. IdeaMap.Net‟s Addressable Minds assesses and optimizes relevant content including framing statements, evidence, collateral factors, and even the nature/tonality of the witness. » “This quantitative technique really helped me frame my courtroom arguments…The net result…The jury returned one of the biggest verdicts in the history of Los Angeles County for a defamation case”, said R. Rex Parris, the lead attorney. “The tested messages were dead-on. I knew exactly what to say and what not to say.”
  • 16. Case History.. From the Food Industry » The client manufactures healthful snacks…now using probiotics to increase product healthfulness » Probiotics are the healthful bacteria in yogurt, which can now be added to baked goods with the same customer benefit » Where is the opportunity…and what specifically to say and to whom » This test used a combination client‟s own marketing material and new messages 16
  • 17. Flexibility to Test Broad Range of Elements - Showing 8 Out of 24 Test Messages - General Benefit Get the most out of your breakfast Minimize Calories Each portion is worth its weight in health – 100 calories per 2 oz. serving…no need to settle for smaller portions Taste Promise Comes in deliciously rich flavors to hit your Research Methodology sweet spot  Stimuli Tested Specific Ingredient / Health Benefit Results Helps reduce cholesterol Optimal Concept Probiotic Contains probiotic bacteria, treats gastrointestinal ills Sensitivity Analysis Closing Benefit Get the energy you need while keeping it gentile on your stomach 17
  • 18. The Complete List…Six Silos, Four Phrases Each 18
  • 19. In the Study..We Begin by Orienting Participants 19
  • 20. A Concept 20
  • 21. Expertise In Action RESULTS  A statistical model simulating the respondent‟s interest in buying an 8 pack of muffins is built through regression modeling techniques. Input 1 Input 2 Combinations of ideas Respondent’s Answers (Experimental design) Research Methodology Regression Stimuli Tested Analysis  Results Output: Additive Model simulating respondent‟s behavior Optimal Concept The additive model shows the impact, or value, of each individual idea (element) to the respondent‟s behavior. Sensitivity Analysis  Drive behavior to learn more (drivers)  Prevent from learning more (inhibitors)  Have no impact (neutrals) 21
  • 22. Understanding the Additive Model Each concept element is assigned an impact score that represents the importance contribution of that element. Positive values indicate Scores that are near zero Negative values that the respective indicate respondents are indicate that the element enhances indifferent to inclusion of that respective element customer reaction. element. detracts consumer reaction. In addition to the individual element impact scores, the regression analysis yields a “Constant”. Think of the constant score as a “baseline” level of motivation to start from when building a concept. Constant (C) Individual Total Elements (I) Impact (T) 22
  • 23. What we discovered What the data show us from the evaluation by 172 respondents of different combinations of messaging 23
  • 24. How to Read the Results » Let‟s look at interest  % rating 7-9 „I would buy the product‟ (like the top 2 box) » Begin with the constant  % saying I accept, with no elements  Baseline…estimated from the ratings by regression (also called the additive constant)  It is 28 here..28% of the people would say „I‟m interested‟..even without any elements » Look at the contribution of each element beyond the constant  E1: Contains probiotic bacteria, which treat gastrointestinal ills (+7)  An additional 7% of the respondent would change from “base line”to interest (from 28 to 35) » Build a new selling message by combining (at most) one element from each of four silos  Additive constant + impact values (utilities) tell you how many people interested 24
  • 25. Relate Presence/Absence of 24 Elements to Interest 25
  • 26. Today‟s Advertising Practice Messages…not-targeted, not-relevant » Retailers / Manufacturers -> » ...Traditional advertising messaging targeted to large audiences …based on simple classification descriptors and what they purchase …it‟s how media is bought Demographics, Behavior » Your Customers….Advertising strategy assumes/hopes for group homogeneity…Men want “Y”, Women want “X” » Result…Lots of messages without regard to „true/effective‟ messages & motivators „that really work‟ for each customer 26
  • 27. Mindsets Create Business Opportunities » People differ from each other  Conventional methods divide them by easy-to-buy information (geo-demos)  Other methods divide them by high-level psychographics (general world views)  Still others divide people by what they buy, etc. » We are going to segment the 172 respondents based on how they react to these new ideas  This is called mind-set segmentation  It is granular, specific to the particular product and opportunity  And it is up-to-date » We uncovered two different mind-sets, based on the patterns of reactions to the elements 27
  • 28. The Addressable Mind™ Solution Targeted by Mind-Set, Very Relevant Messaging » Retailers / Manufacturers -> » IdeaMap.Net Foundation Database / test for each retailer / manufacturer IdeaMap.net » Discover Segments, Create Typing Tool, Identify Message Drivers » Classify new population into Discover Mind Segments: Identify Mechanism Identify Importance - Green Conscious Of Each Message by segments…THEY LOOK THE SAME BUT - Only The Best For Segmentation Total, Segments etc. THEIR MINDS ARE DIFFERENT » Now, Target best messages to each segment and do it by each manufacturer and retailer GREEN BEST GREEN BESTGREEN BEST GREEN BEST 28
  • 29. Mindset 1 – It‟s About Calories
  • 30. Mindset 2 – It‟s About Health 30
  • 31. Opportunity Analysis of the Segments » It will be all about building interest in the brand and selling to more people  We learn that from the high interest scores  For this product » Let‟s look at Segment 2 – your prospects for the product benefits  They are more than half the sample (97 out of 172 respondents)  They have a modest interest in the product (constant of 29) » But you can add another 16% (i.e. go from 29 to 45)  How..by putting in ONE of the top two scoring elements  E.g., Contains probiotic bacteria, which treat gastrointestinal ills  And then build on that by adding another hot button for segment 2  All natural with no artificial additives or preservatives (adds another 5) » NOTE ON IMPACT OR UTILITY VALUES  5-10 are very good, keep  10-15 are breakthrough  > 15 are blockbuster for the group 31
  • 32. Expertise In Action OPTIMAL CONCEPT & SENSITIVITY ANALYSIS  These concepts for each subgroup are the result of a computer program generated selection routine that focuses on the highest- scoring elements across the categories.  It is an example of how the optimization process works.  The Optimal Concepts are examples of high-impact bundles of elements.  Other combinations can also be built from this research.  These scores are calculated by adding the sum of the utility scores to the constant Research Methodology  The Optimal Sensitivity Chart on the following page (read across) identifies on the diagonal the predicted sum of the Optimal Stimuli Tested Concept for each sample group as calculated by a combination of the constant + the additive values of the elements in the optimized Results concept:  Optimal Concept  Sensitivity Analysis 32
  • 33. Sample Data Optimal Concept Example Do Not Quote - Total Sample -  Optimal Concept Total Seg 1 of 2 Seg 2 of 2 Base Size: (172) (75) (97) Baseline: 28 27 29 E1 Contains probiotic bacteria which treats gastrintestinal ills 7 -5 16 Maximize satisfaction with minimum calories…low fat and high B2 in fiber and nutrients 7 11 3 F2 Our mission is simple: to make healthy and delicious baked goods… 6 6 6 D1 Contains less sugar and more vitamins and minerals than an apple 5 6 5 Total Impact 53 45 59  Sensitivity Analysis Optimized for: Total Sample Seg 1 of 2 Seg 2 of 2 Total Sample 53 45 59 Seg 1 of 2 48 60 41 Seg 2 of 2 45 22 60 33
  • 34. Addressable Minds Scratch Testing Turn your website visitors into Addressable Minds™ Improve your website… mind-type visitors and direct them to the proper pages based on their mind-set 34
  • 35. The Scratch Test With a segmented world..and enormous segment responsiveness….you have to find your segment 2 people to whom you can really sell… We use a 45 second scratch test.. With five questions and a scoring key Put this on your website, let your prospects score themselves, and give them the „right message‟ 35
  • 36. Finding, directing, messaging your target with a 5-question scratch test Segment 1 Not in a 36 segment Segment 2
  • 37. Change the Data-Mining Game…Designed for the Data-Miner Trying to Increase Lift Data Mine Using Customer Minds At the Granular Level of Today‟s Messaging 37
  • 38. When You Can‟t Mind-type Individual People In Your Database…What to do? » All you know are today‟s current messages » You know who responds by sub-groups and segments » You know the strength of each message » That‟s already demonstrably more than any of your competitors know » Given the above…who in your database is likely to respond to your client‟s offer » Maximize your client‟s lift rapidly
  • 39. Simulate 10,000 Alternative 4-Element Messages » Look at how each key subgroup responds to each of the 10,000 test combinations » If you don‟t profoundly understand your messaging or your database customers…then who should you message to » What elements in your current messaging are really working for and among whom 39
  • 40. Using the results to assess strategy .. Who do you mail to (mining your database) » Don‟t want to use probiotics this year in selling message  We looked at 20 of the 24 messages (no probiotics messages)  All of these are current messages  Now what do we do?..to whom do we mail? » We don‟t know who will buy the „new product‟..but we do know from our audit how prospective customers respond to current messaging  Instead of guessing, we simulated different messages, and „ran them by our data set‟  So ..we‟re replacing previous behavior (which we may/may not have) with attitudes to the precise current messaging the client will use  We created 10,000 random „4 element mini ads‟ representing what could be sent  Now let‟s see what consumer groups will be turned on » Now we can estimate distribution of interest for our new strategy  Which of our groups is most likely to respond to an offer  These are our likely responders 40  And…we easily simulated and scored the current strategy!!!!
  • 41. Groups Highlighted in Green are the Target for a Strategy (No Probiotics)…Good Idea or Not? Q2_65 Without Probiotic Total Q2_30- Q2_39- Q2_45- Q2_53- and Segment 1 Segment Messaging Sample Q1_Male Q1_Female 38 44 52 64 above of 2 2 of 2 Base Size 172 43 129 21 20 42 68 17 75 97 Constant 28 37 25 25 30 30 23 42 27 29 Mean 44 39 46 45 33 58 40 42 50 40 Median 44 38 46 46 33 58 40 42 50 39 St.Dev. 2.5 4.9 2.7 7.0 6.4 4.6 3.1 7.1 4.6 3.6 % greater than 25 100% 100% 100% 100% 90% 100% 100% 98% 100% 100% % greater than 30 100% 98% 100% 98% 70% 100% 100% 94% 100% 100% % greater than 35 100% 78% 100% 93% 40% 100% 94% 84% 100% 91% % greater than 40 95% 34% 99% 78% 16% 100% 52% 62% 97% 45% % greater than 45 36% 14% 65% 51% 3% 100% 8% 34% 86% 8% % greater than 50 0% 1% 7% 26% 0% 94% 0% 12% 52% 0% % greater than 55 0% 0% 0% 9% 0% 73% 0% 2% 13% 0% % greater than 60 0% 0% 0% 2% 0% 33% 0% 0% 0% 0% % greater than 65 0% 0% 0% 0% 0% 5% 0% 0% 0% 0% % greater than 70 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 41
  • 42. Using the Results to Assess Updated Strategy .. Who do You Mail to (Mining Your Database) » We looked at all 24 of the 24 messages  All of these are current messages  Revised strategy.. pursue probiotics this year  Now what do we do?..to whom do we mail? » Then we created „4 element messages‟  10,000 new messages .. With the probiotic messages ..to reflect the new strategy  One or no element from each silo  And estimated level of interest » Now we can estimate distribution of interest for our new strategy  Which of our groups is most likely to respond to an offer  These are our likely responders  Simulated and scored the new strategy allowing in probiotics !!!! 42
  • 43. Groups Highlighted in Green Are the Target for a Strategy (Use Probiotics) Q2_65 Marketing Message: With Total Q2_53- and Segment 1 Segment 2 Probiotics Sample Q1_Male Q1_Female Q2_30-38 Q2_39-44 Q2_45-52 64 above of 2 of 2 Base Size 172 43 129 21 20 42 68 17 75 97 Constant 28 37 25 25 30 30 23 42 27 29 Mean 45 37 47 45 31 57 43 44 42 47 Median 45 37 47 45 31 57 43 44 42 48 St.Dev. 2.8 4.7 3.3 7.7 6.3 4.5 4.4 7.1 7.2 6.5 % greater than 25 100% 100% 100% 100% 84% 100% 100% 99% 100% 100% % greater than 30 100% 96% 100% 97% 56% 100% 100% 96% 97% 100% % greater than 35 100% 69% 100% 89% 27% 100% 97% 89% 84% 97% % greater than 40 96% 25% 99% 72% 8% 100% 73% 71% 58% 83% % greater than 45 48% 9% 76% 49% 1% 100% 32% 45% 32% 65% % greater than 50 3% 0% 22% 25% 0% 93% 6% 18% 18% 39% % greater than 55 0% 0% 0% 9% 0% 68% 0% 5% 4% 10% % greater than 60 0% 0% 0% 2% 0% 26% 0% 1% 0% 0% % greater than 65 0% 0% 0% 0% 0% 3% 0% 0% 0% 0% % greater than 70 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% % greater than 75 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 43
  • 44. ChoiceMap Market Simulation Think of Vectors Influencing Each Other (Psychological Cross- Elasticities) 44
  • 45. ChoiceMap Concept Screen SAMPLE SCREEN Research Methodology  Stimuli Tested Results Optimal Concept Sensitivity Analysis 45
  • 46. ChoiceMap Example of Deliverables RESULTS Base 3+ Purchases Loyal Competitor Sample per Month Shoppers Shoppers Base Size (1502) (603) (511) (452) CONSTANT 12 5 12 5 Feature 5: Special quarterly discounts for members available through local gyms, rec centers, spas, online shopping partners and other outside health partners: OPTION C: Discounts of 30% to 50% 9 9 9 11 Research Methodology OPTION B: Discounts of 15% to 30% 6 5 5 9 OPTION A: Discounts of 10% to 15% 4 4 4 9 Stimuli Tested Feature 2: Panel of experts available for members to consult with via telephone or online 24 hr/day  Results OPTION C: OPTION B: Available Both online and via phone Available by phone only 7 4 9 7 10 7 6 3 OPTION A: Available online only 4 5 7 2 Optimal Concept Sensitivity Analysis 46
  • 47. StyleMap Design Optimization - Same Principles As IdeaMap But Graphically Based- 47
  • 48. Shampoo Bottle Case…Six Silos and 4 Graphical Options Each 48
  • 49. Product Development - Category Assessment - Drivers of Liking - Recipe Optimization 49
  • 50. MJI‟s Product Evaluation Competencies Today’s Focus Category Appraisal Product Screening Product Optimization Competitive analysis Optimal ingredient Winners/Losers Sensory drivers of liking formulation Benchmarking New product Optimal formulation given performance against opportunities cost/ manufacturing in-market products constraints Sensory segmentation Direction for product Ingredient drivers of liking Reverse Engineering improvement Brand equity Sensitivity analysis Product acceptance by measurement subgroups Optimizer Software Product line extension/ constriction
  • 51. Product Hierarchy Based on Overall Liking - Partial List of Products Toilet Tissue Products: Overall Liking 100 80 72 66 Overall liking 58 60 50 40 20 0 #304 #309 #290 #601 A difference of +/-10 points is significantly different at the 90% confidence level.
  • 52. Sensory Profiles for Each Product Tested -Partial List of Products and Attributes #304 #309 #290 #601 Signifcant Overall Liking 72 60 58 48 [+/-10] Like Overall Appearance 65 40 65 55 [+/-10] Visual Thickness 63 45 59 80 [+/-10] Like Overall Aroma 65 40 65 55 [+/-10] Strength of Aroma 63 35 55 75 [+/-10] Like Touch On Skin 68 57 49 44 [+/-8] Thickness 65 59 45 85 [+/-8] Softness 66 85 49 44 [+/-8] Is A Premium 70 85 51 44 [+/-8] Toilet Tissue Technical Measure 1 3.9 3.85 4.2 3.95 Technical Measure 2 402 385 425 299
  • 53. Category Appraisal » Drivers of Liking Analysis  Create sensory response curves  Graphically shows the relationship of overall liking versus:  Sensory perception  Objective measures  Instrumental measures
  • 54. Sensory Drivers of Liking and Sensory Targets 100 90 #304 80 #290 #309 Overall Liking 70 #601 60 50 40 30 Products in this area 20 represent sensory targets to aid in 10 product improvement 10 20 30 40 50 60 70 80 90 100 Softness Against Skin
  • 55. Category Appraisal » Sensory Segmentation (requires larger base sizes)  Identify whether liking is homogeneous or whether different preference segments exist  Based on stimulus response patterns  Was the basis for the segmentation approach used for IdeaMap
  • 56. Consumer Segments With Opposing Sensory Needs 100 90 Weaker Fragrance Stronger Fragrance Segment 80 Segment Overall Liking 70 60 50 40 30 20 SEGMENT1: sq. mult. R= .81 10 SEGMENT2: sq. mult. R= .93 10 20 30 40 50 60 70 80 90 100 Tissue Fragrance Intensity
  • 57. Category Appraisal » Sensory optimization  An optimal sensory profile which maximizes overall liking can be identified.  Compare against tested products to identify which of the tested products have the most desired characteristics …REVERSE ENGINEERING  Use this to adjust existing products or create new ones
  • 58. Reverse Engineering – How To Use It Optimal Product Description--> Product Product Code--> 304 309 290 601 Overall Liking 72 69 63 57 54 Like Fragrance 55 64 62 51 48 Like Fragrance Intensity 50 46 49 43 49 Strength of Fragrance 55 53 53 48 55 Easy to Tear 58 66 62 53 44 Large Sheet 43 45 46 80 22 Soft vs. Firm Texture 62 65 62 56 51 Is a premium product 52 60 57 52 49 Expert 1 61 68 64 68 52 Expert 2 59 58 59 54 49 Expert 3 44 48 44 54 37 Objective Measure 1 0.25 0.20 0.08 0.55 0.51 Objective Measure 2 1251 1235 1300 900 800 Objective Measure 3 750 62 68 75 53 Boxed number indicates the product is off by +/-3 points from the optimal product score for that attribute.
  • 59. Product Optimization » Why use this approach  Most direct approach to identify formulations that optimize consumer behavior  Optimal formulations are reported in terms of R&D ingredient levels » Experimental research design helps estimate the link between ingredients and consumers‟ perceptions and liking.  Enables R&D to systematically manipulate the ingredients and/or manufacturing processes of a product  Reveals ingredient drivers of liking and perception within the ingredient set tested  Provides R&D with a recipe for formulation guidance  What is the best combination of ingredients on an absolute basis?  What is the best combination of ingredients at specific cost constraints?
  • 60. Overall Liking of the Products - 4 Continuous Variables; 3 Levels Each, Individual recipes that consumers want: » By systematically varying ingredients and processes, the following prototypes beating the current product on an unbranded basis were produced. Prototype Ing.A Ing.B Ing.C Ing.D Overall Liking 1 Low Low Low Low 74 2 Low Low High Med 71 3 Med High Low High 69 4 Low High High Low 69 5 High Low Low High 67 18 - Current 57
  • 61. Do Consumers Track Formulation Changes? “As R&D created a thicker sheet consumers recognized the change” 100 R2 = .948 80 Perceived Thickmess 60 40 20 0 0% 50% 100% Sheet Thickness – R&D Controlled
  • 62. Ingredient Drivers of Liking - Sheet Thickness vs. Overall Liking - SIMILAR CHARTS ARE CREATED FOR EACH INGREDIENT 80 70 R² = 0.75 60 Overall Liking 50 40 30 20 10 0 0% 50% 100% 4 8 12 16 20 24 Thickness of Sheet - R&D Controlled
  • 63. Product Modeling Approach -No constraints and with 2 cost constraints Optimal Constraints None Cost 1 (-5% ) Cost 2 (-20% ) Ing. A 65% 55% 50% Ing. B 22% 25% 18% Ing. C 13% 15% 8% Ing. D 0% 5% 24% Cost per unit $6.50 $6.18 $5.20 Overall Liking 79 74 63 Strength of Fragrance 65 62 56 Softness 60 65 75 Easy to Tear 65 58 50 A Premium Toilet Tissue 75 70 59
  • 64. MJI - For more information… We offer solutions with actionable results - each engagement delivers a unique set of solutions and benefits. Bert Krieger Howard R. Moskowitz, Ph.D. Executive Vice President President 914-421-7456 Moskowitz Jacobs Inc. bkrieger@mji-designlab.com  Phone: +1-914-421-7408 Email: mjihrm@sprynet.net www.mji-designlab.com www.ideamap.net www.SellingBlueElephants.com Moskowitz Jacobs Inc. - 1025 Westchester Avenue, 4th Fl. - White Plains, New York 10604 - (914) 421-7456 - www.mji-designlab.com 64