ED On Business: De-Bunking Marketing Myths

I suppose that one of the reasons we did the study was to find out the truth of how customers evaluate, specify, and buy products in the entertainment industry.

In the process, we also discovered that some of the truths we held to be not only self-evident, but near to Gospel, were simply not so. In fact, one of the possible titles for the study might have been “Everything You Used To Believe About Marketing Products Probably Ain't True Anymore.”

Let me back up. A little over a year ago, a proposal was made to the Board of Directors at ESTA, the Entertainment Services and Technology Association. (ESTA is the industry's trade association of manufacturers, dealers, and affiliates.) The proposal was that ESTA conduct some original research to discover facts about how most customers buy equipment and expendables. Are they buying it largely from Internet vendors? Is there a seasonality to the process? What sources do customers use for product information? Is service as important to the customers as, say, price, when evaluating vendors or products? How many dealers does the typical customer shop at when buying expendables?

There were plenty of anecdotal answers to the questions. In fact, if you consulted the sales and marketing people at theatrical supply dealerships and at manufacturing companies, everyone had an opinion …but no one had any facts to support or deny their views.

The ESTA Board allocated sufficient funds to conduct the research and appointed a committee to supervise the work. I had the privilege of working on that committee, so I can tell you that it represented all segments of the industry and virtually all its members were veteran marketing people. The committee engaged a well-known marketing research firm to help formulate the questionnaires, ensure the accuracy of the sampling, and handle the technical aspects of the project. The survey questionnaires were distributed, the responses came back and were tabulated, and the results along with an “executive summary” were published.

Then all hell broke loose.

What we didn't realize, in either our innocence or stupidity, is that the survey thoroughly demolished some very popular myths and most people don't like having their marketing myths destroyed. Let me give you just one example from the 75 pages that comprise the results of this mammoth research study.

We actually conducted two studies: one analyzed buying patterns for expendable products, such as gels, lamps, tape, and gobos and the other analyzed patterns for such equipment/systems products as spotlights, control boards, rotators, and projectors. Both studies went across the board in venues, covering statistically accurate samples of theatres and performing arts centers, colleges and universities, K — 12 schools, corporate and industrial venues, houses of worship, hotels and convention centers, theme parks, and many more — basically wherever products for entertainment are bought and used.

We asked respondents to tell us what drives their purchases of products, i.e., to rate a list of 12 criteria when considering the purchase of expendables. Among these criteria was price, which should be, at least for the purchase of expendables, the most important, right?

Wrong. Or at least that's what the research shows. What the customers told us was that three other criteria are more important to them than price. These are first, product performance or quality; second, product durability or reliability; and third, product features.

Nobody wants to believe this, because every dealer and vendor on the planet remembers the sales he lost because his or her price was a trifle too high. But there are hundreds of sales made every day where price is not an issue. What this data says is that it's all about the product — its quality, durability and reliability — and not so much about its price.

I also like what we learned about how customers currently get their product information and how they would prefer to get this information. Let's take the equipment/systems study for this example. We asked: “When you're in the early stages of deciding what equipment or systems to buy, what are your product information sources?” We asked respondents to select the top three sources they use currently and the top three they would prefer to use. The list in the questionnaire had 19 possible sources, ranging from “peer recommendations” to “conferences/trade shows” and everything else you can imagine in between. You'll have to buy and read the study to get the details of the answer to this provocative question. I want to address here only the variance between what sources customers use now and the sources they prefer to use.

The largest variance was in “hands-on evaluations.” Only 19% currently get a chance to use that method to get equipment product information. But 37% would prefer to use that method. The second largest variance was “in person visits to supplier/ dealer showroom,” where 20% use that method currently, but 36% would prefer to gather information that way.

If I were a dealer, I'd read those two bits of information as a command to get equipment in front of my customers' faces. I'd mandate that my sales people carry with them portable equipment and accessories, like gobo rotators or scrollers and show the customers how to use them. If that's not possible, I'd put a raft of them in my showroom and make a real effort to get customers to come in and see them and make their own evaluations.

I write this knowing that many effective sales people make outside calls rarely, except when there is a bid in the offing or it's a visit to a job site. Most of their days are spent profitably on the phone or in front of a computer screen. So this idea of putting some in your car and going out to see a customer in person, is more than a casual suggestion; it may well be a radical change in the working culture!

Nevertheless, I think it's worth it, and I get this notion, again, from the ESTA study. The research asked customers: “in general, from how many different suppliers do you buy equipment and systems?” About half (51%) said they “shop the same two or three suppliers regularly.” The other half (48%) said they “shop across a broad cross section of suppliers.” (Only 1% said they purchase exclusively from one supplier).

Here's my interpretation of that response: Half of the customers are shopping every time they come into the market for new equipment. My own personal solution would be to make sure that all my customers discovered the need for new equipment from me and not from other sources or suppliers.

So the radical change in the working culture — putting some gear in your car and “cold calling” customers so you can demonstrate the equipment in their facilities — may well turn out to be the best thing you can do to protect your customers. Its also, based on the ESTA survey, good customer service.

Stan Schwartz is the executive vice president of Rosco Laboratories, Inc.