BEHIND MARKETING’S WOES:
Marketing is ripe for a revolution because its failures are so apparent. “Everybody–stockholders, directors, CEOs, customers, the government–is angry because marketing, which should be driving business, doesn’t work” write marketing executives Kevin Clancy and Robert Shulman. One of the most important reasons for this breakdown is that research is not working because of flaws in its basic premises.
Even academics, the primary source of research theory, see major flaws in mainstream research methods. Multivariate statistics that describe personality traits can account for no more than 7 percent of purchasing behavior, according to a paper published by William Massy, Ronald Frank, and Thomas Lodahl of Stanford, the University of Pennsylvania, and Cornell, respectively.Consumer research’s problems originate in psychology, a field that has long struggled to define human behavior with the same precision physicists use to describe the movement of bodies from atoms to stars. But human behavior is too unpredictable to describe with such precision, because it depends on an almost infinite number of relationships. An increasingly desperate search for cause-and-effect explanations leads many psychologists to “retreat to abstract ideas that ignore contexts completely,” writes Harvard psychologist Jerome Kagan. Consumer research reflects similar tendencies.
Kagan is bothered by psychology’s excessive dependence on behavioral models that conform better to statistical theory than to behavioral realities. Models of consumer behavior tend to extract their subjects from the complex, often unpredictable, but completely natural contexts in which people live and make purchasing decisions. The result is often an interesting manipulation of a hypothetical situation that leads to a marketing failure.
One of the most famous marketing busts was the reformulation of Coca-Cola. Extensive consumer research predicted success for “New Coke” because people said it tasted better. But the research failed to disclose that people also saw “Old Coke” as an important cultural icon, that would lose value by changing the original recipe. This subtle value proved to be far more influential than taste in determining consumer response.
Kodak’s “Advanta” camera was an even costlier bust. Its research failed to warn executives of Advanta’s biggest challenge: persuading a marketplace dominated by middle-aged baby boomers to buy what was proudly touted as a high-tech product. In mid-life, the bells and whistles of new technology generally begin to lose their appeal. Simplicity begins to edge out complexity in consumers’ preferences.