Truth, lies and data – How market research can mislead – Comment

It’s tempting to think you need as much research as possible before you can make the right business decisions. That you must push the boundaries of consumer understanding at the coalface of in-depth knowledge.

But if you’re the kind of drinks industry executive who thinks they can never have enough research, then think again. Too much research really can be counterproductive. And, if you let it drive all your thinking about the consumer, there’s a risk you’ll end up blind to what’s really going on.

Take the latest results from Bevtrac, IWSR’s longitudinal consumer sentiment tracker covering 15 of the world’s leading markets, which shows that younger LDA consumers are re-engaging with alcohol.

Recalled alcohol consumption among LDA Gen Z consumers has risen to “similar levels of participation seen in the population as a whole in most markets”, the findings show. Indeed, Gen Z’s alcohol consumption has increased in the last two years, with the proportion of those drinking rising from 66% to 73% in the top 15 markets.

The trend is especially strong in the US, where participation rates among Gen Z consumers rose from 46% to 70%. There has also been robust growth in the UK (up from 66% to 76%), India (60% to 70%) and Australia (61% to 83%).

Further research published by Rabobank in April supports this notion, with data showing that Gen Z’s drinking is actually on par with previous generations when you look at the share of disposable income spent on alcohol.

For years, we’ve been told that Gen Z has been abandoning alcohol, with the cohort renamed ‘Gen Sensible’, ‘Gen Moderation’, ‘Gen Sober Curious’ and so on. This received wisdom was built on two things: countless studies showing younger age groups drinking less alcohol over the past five to ten years, and a rapid rise in sales of no- & low-alcohol drinks over the same period.

But, it seems that correlation does not equal causation. Turns out that Gen Zers were just broke.

There are many examples of drinks brands that by over-focusing on the data and under-focusing on context – the circumstance driving consumers to do what they do – ending up allowing themselves to be misled.

Take The Coca-Cola Co’s decision to reformulate its namesake CSD in the mid-1980s. In blind taste tests, ‘New Coke’ performed well. Once in the market, however, it flopped – in part due to the emotional connection drinkers had with the old recipe, in part because when drinkers consumed more than the 2.5cl micro-serving used in tests, the new taste started to pall.

In contrast, Red Bull taste-tested poorly pre-launch and consumers expressed scepticism about claims about its energy-giving benefits. Rather than go with the data and give up, however, taste concerns were overcome by a carefully cultivated anti-corporate positioning.

Likewise, Monster overcame research indicating consumer concerns at launch that its positioning was overly edgy, aggressive and even confusing by building a solid following among subcultures. Today, Monster rivals Red Bull globally.

My point is that while valuable, research considered in isolation can mislead. Instead, you must get to grips with the context. To do that, you must work hard to understand the ‘why’ of consumer behaviour.

‘Hurts Real Good’, a new global positioning campaign by Coca-Cola for its Sprite brand that launched in early July, is a timely case in point. The immersive initiative integrates global brand partnerships, talent collaborations and festival experiences to showcase how Sprite’s lemon-lime fizz is the perfect partner for the bold, spicy food that today’s Gen Zers are passionate about.

Research told the brand owner that spicy food over-indexes with this group. In fact, 50% of this group actively seek it out.

But Coca-Cola didn’t stop there. Instead, they thought beyond the data to the context behind it, building an entire campaign platform about what that signifies socially and culturally: a passion and demand for thrilling sensations.

Marketing research has always provided invaluable insights into consumer needs, preferences and behaviours, as well as market trends and the competitive landscape. And it always will.

The key to brand success, however, lies not in the raw data, but in the insights extracted from them that guide strategic decisions and actions, and power the most effective marketing strategies and campaigns.