Challenge
A prominent outdoor company currently distributes its packs and bags through various channels including its website, Amazon, REI, and specialty stores. However, an opportunity has arisen to partner with a major big-box retailer. With 850 stores attracting 17 million annual shoppers, the potential for increased sales is evident. Yet, the company is apprehensive about potentially alienating its niche target audience and risking harm to the brand's reputation.
Consequently, the outdoor company seeks comprehensive market research encompassing both quantitative and qualitative analyses to assess the advantages and disadvantages of this potential partnership.
Solution
- Quantitative: The initial phase of the study aimed to discern the distinctions between the primary consumer base of a prominent outdoor company and that of the retailer. A comprehensive survey was devised to investigate various aspects including purchasing behaviours, price preferences, product inclinations, shopping patterns, expectations, and outdoor activities engagement. Moreover, a gap analysis was conducted to delineate the disparities between these two demographics. Furthermore, in an endeavor to ascertain the ideal attributes for a backpack tailored to the new customer base, Cognitive Market Research undertook a conjoint analysis. This analytical tool aids in elucidating the most influential combination of attributes in consumer decision-making processes, such as price, size, color, material, and brand. This facilitates understanding consumer preferences and devising effective marketing strategies tailored to different audience segments (specifically, the niche audience compared to the larger retailer). The conjoint analysis can explore up to 100,000 combinations, assigning utility scores to each attribute to gauge relative interest. Additionally, a market simulator was developed based on the conjoint analysis findings to create an optimal knapsack. This tool enables the client to input various attribute combinations to forecast potential sales outcomes.
- Qualitative: The subsequent phase of the research involved qualitative exploration using online AI-powered methodologies. This segment delved deeply into purchasing behaviors, product preferences, shopping tendencies, expectations, and potential positioning strategies for knapsacks within the new retail environment. It also solicited insights into prospective marketing initiatives. Utilizing artificial intelligence for real-time analysis of verbatim responses, this qualitative approach offers a distinctive and potent methodology. The software's dashboard facilitates participant engagement by allowing voting on generated ideas during group sessions, lending a quantitative aspect to qualitative data. This methodology not only aids in understanding but also enables probing for underlying motivations and reactions. It transcends mere summarization by elucidating how various factors establish relevance, shape beliefs, and influence consumer consideration. Participants were presented with two knapsack options and four distinct in-store displays from other brands. Additionally, a visual depiction of the store's backpack section was shared to gather feedback.
Results
Research conducted by Cognitive Market Research indicated that it would be advantageous for the backpack company to pursue widespread distribution in a large-scale retailer. The findings, both qualitative and quantitative, shed light on the differences between the company's current clientele and the potential customer base of the retailer. Consequently, the company needed to strategize how to tailor its marketing approach for each demographic.
Utilizing a market simulator, the prominent outdoor company developed a new range of backpacks tailored to appeal to their expanded customer demographic.
The qualitative research provided nuanced insights into the preferences of the new customer base. This led to the creation of an ideal backpack design and an optimized display setup to enhance appeal. Additionally, it offered insights into the perception of the brand. The leading outdoor company also identified several marketing strategies to support the brand's launch.
