The Center for Strategy Research, Inc. Vol 2 Issue 3   March 2006



Welcome!

These days, focus groups are the market research choice of many companies.

In our experience, however, in-depth, one-on-one interviews provide better information at less cost. Read on, and we’ll explain why.

As always, your thoughts and comments are appreciated.


Julie Brown
President

Mark Palmerino
Executive Vice President



Is Your Research Out of Focus?

You don’t need to be a market research professional to know that focus groups are as popular as ever these days with business decision makers. My Google search this morning on the term turned up 19,000,000 entries, and even a search of Google News just now revealed nearly 50 stories referencing “focus groups” in just the last 24 hours!

From a liquor store in New Brunswick, Canada that wants to reach out to a different group of customers, to a soft drink company in Hackensack, NJ testing out its new caffeine-laced gum (yuck), it seems everybody’s employing this popular approach to conducting qualitative research.

Before you jump in with the crowd however, take heed. In our experience, there is a much better approach available — one which provides better information for less money, and without many of the limitations imposed by focus groups. It’s called in-depth, one-on-one interviewing.

Focus group research has many benefits, there’s no doubt about it. For example, it’s a terrific way for small groups to brainstorm new ideas or solutions.

That said, there are a number of significant drawbacks with this approach, including unrepresentative samples, geographic constraints, high per-unit costs, and the ever present “negative effect of group dynamics,” in which a few vocal individuals sway the entire group.

The fact is, in-depth, one-on-one interviews have many advantages over their more popular, but less effective, qualitative cousins:

  1. Less Bias. In a typical focus group, a few of the respondents do most of the talking. That’s just human nature. And while an adept moderator can help smooth out the imbalance and involve the less talkative participants, it’s almost impossible to prevent group-think bias. One-on-one interviews on the other hand, uncover the best thinking of each respondent, allowing your research to tap into the wisdom of all participants, rather than just the loudest few.
  2. More Quality. Unlike focus groups, in-depth interviewing is designed to elicit the “whys” behind respondents’ reactions. At CSR for example, interviewers are trained to probe into people’s thought processes, to obtain a clearer understanding of exactly what respondents mean by their answers, and without leading them to a particular conclusion. This kind of probing is difficult to accomplish systematically for each participant of a focus group.
  3. More Quantity. Researchers typically obtain twice the amount of information per respondent in an in-depth 20-minute interview (where each interviewee speaks at least 80% of the time), than in a typical eight-member, 90- minute focus group, in which all respondents plus the moderator must take turns sharing the floor. Looked at on a “cost per respondent minute” basis (see “Mixology” below for more on this concept), in-depth interviews provide much greater value.
  4. Less Cost. From an efficiency standpoint, the problem with bringing together a group of people to a specific location at a specific time is that it requires bringing together a group of people to a specific location at a specific time. Physical presence is inherently inconvenient, and as a result, participants must be incented with money, food and (my favorite) peanut M&Ms, to show up.

    Interestingly, those same people are happy to engage in a targeted, 15 to 45 minute conversation over the phone, often with no incentive whatsoever. As a result, more of your research budget goes towards eliciting respondent information, and less towards hosting a party.

As you can see, the value received from in-depth one-on-one interviews when compared to focus groups is significantly greater. You’ll get better information for less cost, and with no need to hop on a plane, thus saving yourself several trips waiting at the airport security queue (where’s that caffeine-laced gum when you need it?).

— Julie

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Mixology (Putting research into practice)

Cost Per Respondent Minute

When it comes to evaluating various approaches to research, most companies focus on just two factors:

  1. How many people will we speak with?
  2. What’s our total cost?

In our experience however, this starting point misses a critical differentiator: “How much time will each respondent be speaking?” In other words, if the purpose of fielding a research study — of any type — is to learn what a given population thinks about a given topic, doesn’t it make sense to maximize the amount of time each participant spends talking?

Which is why we pay close attention to a simple, but telling metric called, “Cost per respondent minute” (CPRM). Here’s how the math works…


Focus Group

In a standard, eight-person, 90-minute focus group, there are nine people (eight participants plus moderator) sharing the floor. On average, therefore, each respondent is allotted 10 minutes of talk time across those 90 minutes (90 minutes divided by nine people).

The cost of a focus group of this type is about $6,000. That number includes everything: recruiter, moderator, participant stipend, food, facility, report write-up and the cost of getting you, the client, to the event. Divide 80 minutes of participant talk time (the moderator doesn’t count) into the $6,000 expense, and your CPRM in this case is $75 ($6000/80). See the chart below for more.


Closed Ended Interview

Closed Ended Interviews are known for being “fast and cheap,” and at first glance, that appears to be true. Dig deeper however, and you’ll see that it isn’t.

A 30 minute session costs about $80. When you consider however, that the respondent will speak for less than 5 of those 30 minutes (the interviewer in this case, does the vast majority of the talking), your CPRM is now $17 per minute ($80/4.7).


In-Depth Interviews

CSR’s typical in-depth interview runs 30 minutes and costs about $325, an expense figure that includes recruiting, interviewing, participant stipend and reporting.

The big difference here however, is in the amount of time the respondent spends talking; typically, about 25 of those 30 minutes. Dividing those 25 minutes into the $325 per session cost, and the CPRM for an in-depth interview is just $13.

The key concept to keep in mind when comparing research approaches is this: Given that the purpose of an interview is to interview someone whose opinion is important to you, it’s not the amount of time spent sitting with each respondent that matters. It’s a question of how much time the respondent actually spends responding, and the costs associated with those precious minutes.

Cost of Research
 

Is Your Research Out of Focus?

Mixology (Putting research into practice)

Twist and Shout

About Us


In last month’s issue, we mentioned that Julie Brown, President of CSR, would be speaking at the Second Annual Managing Retirement Income conference in Cambridge, Massachusetts.

The presentation received such positive feedback from conference attendees, that we wanted to offer it to you as well. For a copy of the presentation, please send an e-mail to
e-newsletter@csr-bos.com with your request.



“Few things are harder to put up with than the annoyance of a good example.”

— Mark Twain



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