I am the founder and CEO of Argus Insights, a leader in Experience Analytics. Argus was started in stealth mode in 2008 to answer the question, "How can Market Research be improved and help drive innovation instead of validation?"I was the Executive Director of the ME310 Global Design Innovation Course at Stanford University. The course has a forty year history of developing tomorrow’s innovation leaders.Formerly I was the Chief Technologist for SK Telecom America’s R&D Group. In this role I was responsible for understanding how the rapidly changing technology landscape would enable SK Telecom to craft new business opportunities in the Americas. My areas of responsibility ranged from NGN wireless technologies (LTE vs WiMaxx, etc), handheld experiences & the interface technologies that enable them (multitouch touchscreens, haptic feedback, smartphone operating systems), as well as evolving influences on the telecommunications market (cloud computing, femtocells, CDN’s, LBS, SNS, etc.) I also supported SKTA’s internal Business Development & Corporate Venture Capital organizations.Prior to my role at SKTA, I led Synaptics efforts for developing next generation capabilities for handheld devices from within the marketing organization. I was responsible for developing a comprehensive competitive landscape for the various handheld markets, with specific focus on the mobile ecosystem, driving the product & technology strategy, in partnership with the engineering organization, to architect & execute our roadmap of future capabilities.I was also the architect of the Onyx Concept Phone, the world’s first multitouch mobile experience. I worked with the top handset manufacturers on the creation of tomorrow’s handsets, ensuring the right marriage of technology & user experience takes place as we see an industry transformation take place around multitouch technologies.
Argus Insights CEO recently had a conversation with RCR Wireless’s Martha DeGrasse around the key findings in the latest weekly Smartphone Demand report. Top of mind was the comeback of the Galaxy S IV thanks to Verizon and the surprise that the Blackberry Z10 continues to demand attention. The report will be released later this week. Sign up for a subscription here.
I recently attended a fantastic CMO conference in San Francisco where I was able to observe the mostly graceful dance between vendors and the CMO’s themselves as the group wove together conversations of the emerging needs and solutions with Marketing today. In the midst of the continuous banter of “the CMO is the new CIO” and the fact that “your Facebook fan page is not an owned asset” was the constant presence of Net Promoter Score (NPS). Many CMO’s in the room were stalwart fans, others just starting, but a vocal minority advised caution, citing dark tales of where NPS let them astray.
Focusing just on Net Promoter can lead your company astray.
Recently Bruce Temkin released analysis of actual NPS respondents across multiple sectors and found that the rigid categories of promoter, detractor, and passively satisfied while generally were interesting, in many aspects that matter did not accurately represent consumer behavior. For example, in their broad industry NPS survey, his team found, on a scale from 0 to 10, actual humans tended to clump their responses in three choices, 0, 5 and 10. Under the NPS guidelines, that would put the bulk of the population in two buckets, detractors and promotors, with a bias towards detractors. Knowing this about human behavior writ large kind of messes with the math of Net Promoter, which in turn, mucks up the metrics many companies are driving their business with.
Don’t get me wrong, I love the notion of the Ultimate Question and the insights that can be pulled from it. I just take issue with the over-simplified math of NPS BECAUSE of how people answer the question. Our own research at Argus Insights, where we pay attention to both the numbers and the stories provided by consumers, provides a few startling insights. While we use multiple sources for our analysis, consumer reviews are particularly interesting because it allows us to see how consumers respond to other multiple products/services. Does a particular consumer love everything or hate everything, such as if they hate the Samsung Galaxy SIV do they also hate Zumba DVD? By understanding the patterns of consumer behavior coupled with an analysis of their own unsolicited opinions, we found that the NPS methods focus companies on the wrong consumers. By dictating that the Passively Satisfied data be thrown own and that firms could be laser focused on turning Detractors to Promoters, companies are leaving opportunities for Innovation on the table. Based on our research, we divided the rating scale into four categories, each with a different impact on the strategic moves the company can take to improve their relationship consumers.
Four categories of consumer insights, each with salient lessons for companies.
What NPS would call Promoters we call the “Emphatic Yes”. These people love your product and will crow about it the the whole world, NPS is right, they are promoters. They are also the source of what position points should be used in messaging because we know, at least for these delighted consumers, what they are happy with and it may be different than what you thought.
Skipping to what NPS call Detractors we found two styles of behavior. First, the most negative consumers tended to be negative across reviews. Simply put, they are “Curmudgeons”. It would be a waste of resources to try to make these consumers happy, yet NPS says companies should focus their energy on turning them into Promoters. Where the real opportunity lies is within the “No And” group, short for “NO, I don’t like this experience AND these things are not bad.” This is the population companies have the best shot at turning into promoters. By understanding what drives the NO and doing more of the AND, firms can harvest low lying fruit to improve satisfaction.
Where the crimes of NPS passion are most egregious are in the Passively Satisfied. Ignored and shunned by NPS practitioners, Argus Insights finds these consumers to be the rich veins of gold to be mined from your research. These “Yes, But” consumers are your lead users as defined by MIT Professor Eric Von Hippel (you can actually download all his books for free), consumers that like what you have to offer but see some opportunities for improvement. Our research showed that these consumers are living life a bit in the future of the rest of the market so not only do they continue to support your product/services but are providing free insights as to what would delight them more in the next release. NPS demands you leave these opportunities for innovation on the cutting room floor when you discard the Passively Satisfied, which means you are unlikely to uncover the innovations that could lead you from the dark tunnel.
If you would like to learn more about the insights we are able to extract from the less than Passively behaving not quite Satisfied consumers, check out our Social Intelligence Platform.
While the Q10 is finally coming to America, it is unlikely to do as well as the Z10 has in the battle for hearts and minds. We’ve been tracking the Q10 in Canada and the UK since it was released weeks ago. The initial response has been poor, both in terms of buzz and delight, especially when compared to the triumphant release of the Z10.
Notice that the Z10 is slowing but still perceived by consumers as a better experience than even the iPhone 5. We’ll see if Monday’s Apple event shifts that perception. The Q10 is barely demanding commentary from the early markets, signally a slow start as it comes to the United States this week. Maybe the days of physical keyboards on phones have finally passed us by? We will have a surprise on Monday for Apple’s event so stay tuned!
When the iPad Mini was launched in late 2012 it was into an already confused consumer market of the Apple faithful. The iPhone 5 had been launched weeks earlier to a largely yawn response from the market (though it’s improving now). The iPad 4 launched with the Mini, and out of the normal cycle consumers had come to expect from Apple, largely delivered what consumers expected from the iPad 3 in March of 2012. Along with the release of the iPhone, Apple released new iPod Touch, known commonly the gateway drug to full iPhone ownership, but at a reasonably high price point. This put Apple in a pricing squeeze play for the Mini, pricing it twice as much as it’s comparable competitors. As a result we saw slow adoption for the iPad Mini and even the iPad 4 around the holiday season.
Cut to today and we see demand spiking in a way we have not seen for an Apple product since the iPhone became available on Verizon. In wallowing through the social media analysis, we found the culprit. Apple allowed retailers to drop the price by a significant percentage in April, ahead of Mother’s Day and after probably having a disappointing Valentine’s Day. This is typically unheard of for Apple to allow a price drop before launching another product. The punchline? Apple is losing its ability to demand a premium from the market. A smaller iPad is cool but not enough to compete against the much cheaper but almost equivalent experience of the Kindle Fire. Apple will have to pull more than one rabbit from their hat at the event on 10 June. Argus Insights is preparing a special surprise to assess the market impact of Apple’s announcements. More soon!
Contrary to popular belief, the iPhone’s aren’t the highest rated devices on the market. While the competitors have broad product portfolios that a mix of hit and miss, this allows them to tailor a handset to the diversity of consumers while the first thing iPhone customers do is buy a case to personalize it. I agree their focus on profitability is keeping the market share limited. The fact that Verizon sold as many iPhone 4S as iPhone 5 demonstrates that for iPhone fans, the only thing better than the iPhone 5 is a cheaper iPhone 4S. They have also been losing the experience innovation battle, focusing their launches on cool technical features such as camera components or silicon rather than moving the user experience forward. Even Henry Ford’s vaulted, “any color you want as long as it’s black” strategy had to give way to diverse offerings. You can see the narrowly defined handsets are delighting consumers more, in large part due to the strong point of view they take on the mobile experience.
As the Smartphone market matures, user expectations are starting to fragment. Handsets that cater to these evolving niches are beating the iPhone.
Time and time again, as markets mature, the dominate experiences have to fragment to address the refined niche needs of the market. Galaxy Note does that very well while the Facebook phone didn’t. The Note phones added capabilities that integrated into the mobile experience. The Facebook phone took over the mobile experience, forcing consumers into an even more constrained experience. It’s time for Apple to find ways to fragment their walled garden or else iPhone users will continue to dig their way out.
