Why Research Matters

This is an excerpt from a podcast episode I hosted at my previous agency.

MICHAEL – Until recently, Annabel Venner was the Global Brand Director at the US insurance business Hiscox. And before that, she was at Coca-Cola. And I'm asking Annabel why research matters. So Annabel, welcome to Why It Matters. It's lovely to have you.

Where I want to start is your way into marketing and, in particular, having spent a lot of time at Coca-Cola, how did you end up with the insurer Hiscox?

ANNABEL – My background is a lot of it in the FMCG world. I'd spent nine years at Coca-Cola, which was a fantastic time there. And I got to work on many of their brands, not just Coke, but brands like Oasis and Powerade.

But after eight years, I started thinking about my growth, what I needed to learn, and the impact I could have on a business. Coke is a massive organisation, and growing brands are often complex, especially when working directly on Coke. So I found out about an opportunity at Hiscox. I must admit I'd never really heard of them. Also, I was slightly nervous about making that leap because it was an insurer. But once I'd been in and had the interviews, I was utterly won over by the people I met there. Two of them had a similar backgrounds. Hiscox was very customer-focused, valued doing the right thing, and had a strong reputation. The role I was offered would enable me to be a senior marketer in the UK business, selling directly to customers. So I could have that end-to-end customer journey management, which I couldn't have at Coca-Cola.

And there's a lot of history with Hiscox, as well. It’s been around for over 120 years. How sophisticated was their marketing at the point you joined? Were they pretty savvy? Or was there some educating to do?

So when it was first set up, it traded through Lloyds of London. Then it grew its retail business and started its direct-to-customer journey. I was lucky that a colleague who joined about four or five years before I had, from Diageo, had done a lot of the heavy lifting in educating the business about the impact that marketing can have on growth. So when I joined, I could pick up from him and then take many of my learnings from Coke and apply them to Hiscox. Sometimes people believe that marketing is different when you move from other industries. But it's not. The fundamentals of it stay the same. How you make a great ad is the same, the need to understand your customers is the same. And therefore, the need to research is the same. You need to apply it to a different sector.

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Sometimes people believe that marketing is different when you move from other industries. But it's not. The fundamentals of it stay the same. How you make a great ad is the same, the need to understand your customers is the same. And therefore, the need to research is the same.
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So to the heart of the episode, why does research matter?

It comes down to understanding your customers.  

And yes, you can use data you get, like web analytics or NPS scores. But there was nothing like going and talking to a group of business owners over breakfast one day to find out what's bugging them or what they think of your business. You need to use research to help understand the competitive landscape of what's happening. How is your advertising landing versus competitors? You can use research to develop new products and services. So for me, research has always been an invaluable tool.

During my nine years at Hiscox, we increased the value of the research we undertook because the business could then see the impact its marketing was having.

What led you to that conviction? What did you see in Coke when you concluded that research is integral to marketing?

So again, part of it is around understanding your customers. So, for instance, we would do a lot of work for our core groups of mums and teenagers – Mums were the ones that would do the grocery shopping, but teenagers were buying the product too. The research allowed us to see the different attitudes towards our brands. And the two groups were often very, very different. And then you could feed that into working out what your price promotion should be, your pack strategy should be and what your campaigns needed to say.

We took that and applied it to Hiscox. So we were selling to small businesses and people buying home insurance, and their attitudes towards the brand were very. And so, you often need to do early-stage research and feed that into a brief that you would give to an advertising agency.

So how sophisticated was Hiscox when you first got involved? Was research a new idea?

And no, it wasn't a new idea. We probably weren't doing the depth of research that Hiscox is now doing ten years on.

There was brand tracking that would go on. So when I joined, the only business where we were selling direct was the UK. We would undertake brand tracking once a year to develop the advertising. So they were already doing quantitative research.

But I broadened that out, so we ended up with more in-depth research with our customers. So we got a small group that we knew was happy to hear from us and happy to share their input. We did pop-up communities; we did many roundtables. We gathered some small business owners over breakfast and with brokers. We were selling through them so that they could reflect the clients' views. The research led us to innovate more about products and services.

Many people think that their country is very different. But what we quickly learned was that the needs of a small business owner can be very similar, whether you're in the US, France, Germany or the UK. So we developed a centre of excellence for research and insight to share all the learnings.

And having done the research and got the feedback, what were the key things you were learning that were helping you rethink the Hiscox brand and the route to market and the marketing?

So if I go back, probably six years, we developed a successful campaign for small business customers. The tagline was “the small and the brave”. And all the marketing tapped into the emotion of running a small business. And before the campaign, we spent a lot of time researching small businesses, their hopes and dreams, why they were set up, the negatives, and how they wanted to be talked to. And what we learned was they want advertising that wasn’t just functional, not about a price message, or this policy enables you to do this. They want people to talk to them to demonstrate they get them and understand their business challenges. All our research fed into the creative brief given to our advertising agency. And they developed this campaign that probably ran for four or five years. It enabled us to have powerful advertising that connected very emotionally with these people, which was very different from what our competitors did.

And we often think at this point, certainly in an advertising context, that this is about the P&L and growing revenue. But this is more than that, isn’t it? It is also about brand building. You're trying to shape perceptions about Hiscox as much as creating revenue.

But they are linked. So if you think about it, especially if you're selling direct to customers ­– companies spend a lot of money on Google Adwords. And what we wanted people to do is to put the brand name Hiscox into Google rather than put business insurance because of the cost per click. Bringing somebody to your website who's typed in Hiscox might be a tenth of the cost of bidding on a general term like business insurance.  

A strong brand also does much more than make it cheaper to acquire new customers. They’re more likely to talk about you and recommend you. They're more likely to stay loyal to you; they're more likely to buy more than one product. So it has a massive benefit. And part of my role was constantly educating the business that you need to have the right mix of brand spend and acquisition been spent. And when you get that right, that drives the best long-term marketing effectiveness. And again, we would use research to prove it.

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A strong brand also does much more than make it cheaper to acquire new customers. They’re more likely to talk about you and recommend you. They're more likely to stay loyal to you; they're more likely to buy more than one product. So it has a massive benefit.
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Does research ever have limitations? Are there things that it can't do? In the context of someone like Wally Olins, who is a sort of grandfather of branding. He famously said that market research is very good at telling you problems but will never give you solutions; it can't go to market and tell me what to do. So have you ever seen research misapplied or limited in its function?

You still have to use your gut feeling a little bit. You read stories of great ad campaigns formed in research, but the Marketing Director or CMO believed differently and took something else to market. Especially if you're doing something very different and groundbreaking, you must go with your gut unless the idea stinks in research. And the idea didn't research very well. But if you evolve it a little bit or tweak it, you could develop a fantastic idea.

So there's still a sense of intuition. So there's a role to play.

Otherwise, you know, otherwise, what's your role as a marketing leader? You need to make decisions based on the number of years of experience that you've got. Otherwise, you risk letting your customers make all the decisions; sometimes, they can’t figure out what they want.

And for organisations that perhaps need to start doing this research on a similar scale to someone like Hiscox, what's the best way to position the research value to the leadership team?

There are lots of external studies out there that you can use. Many awards focus on the effectiveness of marketing. The IPA's marketing side publishes many papers on the effectiveness of marketing. And a lot of those are free to access. Many studies show that when you get the right balance of brand and acquisition, spend what it can do.

Plus, go out there and make a start yourself. Feel free to use an iPad and ask some customers for their views. I did that at Hiscox, and we had good marketing budgets. You can do a lot of research for free. Talk to your customers. They love being asked for their point of view. Lots of these things can be done with little money.

And that's undoubtedly true. Indeed, with the sort of rebranding projects I've been involved in, go out and ask the existing client base, “What do you value about the organisation? What's working? What's not working?”. You always get loads of nuance that the leadership team has never considered or taken for granted. And actually, the customers or clients have said something that helps the leadership see something of value they’re not talking about.

And also, it might not necessarily be around having to change. Often what you hear doesn't mean you need to spend much money on changing your product or redesigning its attributes. Often it can be about communicating in a slightly different way. And then, you can do effective emotional marketing that will connect and make you different in the market.

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Listen to the full podcast interview here.