The Situation
Businesses, public administrators, politicians, health organizations, and others all have one thing in common, they want their target audience to adopt and engage with whatever they are selling or offering. And, they want their users or customers to keep on using their products or services, or in the case of a politician, to vote for them again. They all want loyal customers, followers or advocates.
It boils down to three main goals: (1) create a strong brand: (2) build innovative and better products or services; and (3) cultivate a loyal group of customers.
Brand. Strong brands result from many factors that often include identifying the most appealing message(s) or image(s), using the most believable marketing claim, developing the most compelling positioning.
Product. Building more innovative and better products means figuring out which of the many product features under consideration are of most interest to potential users.
Loyalty. Companies and organizations can do many things to keep their customers. The trick is figuring out which of those things matters most to people.
An initiative to improve the brand, product or increase customer loyalty requires figuring out what really matters to customers! It's critical to prioritize your time, talent and treasure to focus on the tasks that are really going to drive adoption, engagement, and retention.
The Challenge
Asking people to indicate what's most important or appealing to them using traditional survey techniques like rating scales often doesn't work. Very often, people say everything is important. Or, if they can rate some items as slightly more important than others, it's still hard to know how much more preferred one item is over another. There's no way to know whether one item is, let's say four times as important as another item. And, it's very challenging to find sub-groups of users or customers who have different preferences.
The Solution
The solution is to use a relatively new Choice Analysis technique called Best-Worse Scaling (BWS - also known as "Max-Diff") in surveys. BWS is based on solid math and theory. And, it doesn't look like traditional surveys. Instead, respondents are asked to choose between items. People are excellent at making choices! Furthermore, Best-Worse Scaling removes scale bias and leads to greater differentiation, since respondents are not allowed to indicate that everything is important or desirable.
How does it work?
In a Best-Worse Choice exercise, respondents are typically shown 3-5 items at a time and are asked to choose which item is best and which is worse, or which is most and which is least important, from a subset of items. Respondents answer multiple screens of various combination of items. These combinations are organized via an experimental design that is frequency-balanced, positional-balanced, and orthogonal. Using Hierarchical Bayesian regression or HB, the resulting output provides what are called individual-level utility scores (i.e., "values") for each item.
How can you benefit from this technique?
Analysis of the utility scores provides three (3) key pieces of information:
A Ratio-Scaled Rank Ordered List of the items so that an item with a score of 10 is twice as preferred as an item with a score of 5. That's not possible with rating scales.
Simulations - the data can be turned into simulations to understand which group of items will reach the most people (TURF Analysis)
Segmentation - how the rankings list varies by sub-groups of people. (via Latent Class or Cluster Analysis)
Why use this Choice Analysis technique?
Do what's right for the customer
Build more suitable products, experiences and messages that drive consumer adoption, engagement and retention by directly responding to their "bests and worsts"
Determine how different populations value things differently
Improve your ROI by focusing time, talent and treasure on the right things
Barraza & Associates has over 20 years helping organizations create strong brands, build better products and cultivate loyal customers. Ask our past and current clients and brands at PayPal, Intuit, BigCommerce, Envestnet/Yodlee, Allstate, Travelers, and many others.
info@barraza.associates 650.539.9651 Silicon Valley, CA
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