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Consumer
Understanding
Chapter Three Overview
Consumer
Understanding
The basic core of all marketing.
Finding consumer needs is our job.
Not wishes, not wants……needs.
Honor Thy Consumer
Many Ingenious Methods
for Consumer Learning
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Focus Groups
Surveys
Mall Intercepts
Test Markets
Sales Data
In-Home Testing
Phone surveys
Internet surveys
Purchase diaries
Most Research Is
Flawed
Methodology
Presupposing the answers.
 Poisoning the well.
 Asking the wrong questions.
 Timing.
 Market forces.
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Armour Hot Dogs
What do you as a consumer think about
Armour Hot Dogs?
What brands do you think are the
competition?
How do you think they fare?
Who’s the target audience?
Armour’s Reality
Target Audience is Mom’s with kids ages 12
and under. (60% of all volume).
Low involvement category for Mom – she just
buys what’s on sale. Doesn’t perceive much
difference between brands.
Key competition is Ballpark and Oscar Meyer.
Armour’s Research
Consumers say they want a good
tasting hot dog.
Product development team now working
on a flavor upgrade.
Will it work?
The New Rules of
Marketing
1st Law of Marketing Physics
OVERT BENEFIT – What’s in it for the
customer? Customers will maintain
established behaviors until they come in
contact with a benefit so overtly
appealing it compels them to action .
2nd Law of Marketing
Physics
REAL REASON TO BELIEVE – A new
idea will hit the market with a customer
appeal equal to the strength of its
benefit multiplied by its reason to
believe. Benefit and Reason to Believe
are of equal importance.
3rd Law of Marketing
Physics
DRAMATIC DIFFERENCE – The only
way to disrupt marketplace equilibrium
is to introduce a benefit-and-reason-tobelieve combination significantly
different from what already exists.
Armour Knowledge
Mining
Taste Perception is #1 (but all food products
fall into this trap – remember Citrus Hill).
Quality associated with brands
Ballpark
 Oscar Meyer
 Nathan’s
Everybody else is lumped together in the “generic”
brand category -- price is the only differentiator.

No magic bullet in this category like there was in OJ.
Armour is Cooked
• Don’t count on the product
improvement to generate
incremental sales and save the
brand.
• Need to offer Mom’s a reason to
pick Armour (other than low price.)
• What’s the benefit?
Creating Intellectual
Competitive Advantage
Use your brain and analyze everything.
Store shelves.
 Promotions by different brands.
 Cross-promotions.
 Advertising.
 Packaging copy.
 Ask around and look around.

Don’t Assume Anything
The old saying applies:

“When you assume, it just makes an ass
out of both u & me.”

Look, Listen, Learn.
The View From Your
Cubicle Sucks
Get out of the office and into stores!
This has to become an obsession
(you’ll be surprised how much you
actually learn!).
Case histories prove the value (Pooh).
Ringling Bros. & Barnum
and Bailey Circus
Attendance was in a ten-year steady
decline.
Lost most of the historical “stars”.
Obsessed with advertising “the hook”, a
single new act in the show.
Focus Groups
Mom’s felt that taking their kids to the
circus would be a good family activity
Virtually all had gone as a kid
themselves, but didn’t feel a sense of
urgency to go “this year”. They’ll get
around to it sometime.
New Positioning
“No childhood would be complete
without a ringside seat to the Greatest
Show on Earth.”
Almost doubled attendance with the
new campaign.
Tricks of the Trade
There are very few original marketing
ideas.
The best way to be brilliant is to steal
somebody else’s idea and twist it into
something new that works for your
brand.
Armour Needs
To Give Mom’s
A Reason To Buy
Can’t disrupt market equilibrium with
product improvement (Mom’s won’t
notice or care).
Need to appeal to them with a unique
benefit – in this case, a promotion that’s
different, better and special.
Armour Idea
Stolen from Disney’s “I’m Going to
Disneyland” sports campaign and “Willie
Wonka and the Chocolate Factory” Golden
Ticket.
Inside packages of Armour Hot Dogs look for
your Golden Ticket to win a family trip to
Disneyland to spend a day hosted by Roger
Clemens, Derek Jeter, Ken Griffey Jr., or
Sammy Sosa.
Appeals to Mom on Two
Levels
Disneyland / Disney World are the #1
vacation destinations for families with kids 12
and under. (70% plan to attend in the next 24
months).
Dad and older kids would dig meeting the AllStar baseball players (and Armour already
has them all under contract and is looking for
a way to use them effectively).
Straw Poll Research
at Brighter Child
60% of Mom’s (base of 125) said they’d
buy Armour Hot Dogs instead of their
regular brand if they saw that promotion
on the package or advertised.
For a brand with only 7% market share,
that’s a home run!