This week, we’re trying something different. David Kippen, the genius behind Evviva Brands is going to take us on a tour of Market Research. David is a powerful advocate for the idea that you have to learn about the markets you serve. So, one step at a time, we’ll go through the basics of doing your own work to get a ‘dirt under the fingernails’ look at the market. – John Sumser
Dr. Kippen is CEO and Chief Strategist of Evviva Brands. With a background spanning advertising and communications and a client base spanning the globe, Dr. Kippen is recognized as among the top thought leaders in brand strategy. David has held leadership roles in several top associations that support the HR and communications professions. He is currently a member of SHRM’s Performance Management Task Force and an active member of the Council of Communication Management. Full Bio »
DIY Market Research 3/5 Individual Expenditure
by David Kippen
This is often the easiest to assess.
I look to see how people spend their discretionary income, in three variable areas. Climbing the development ladder these are: shoe stock, owned transportation, and women’s accessories.
Shoes are durable, almost universal, and range from extremely cheap to very expensive. Because of the price range and their durability, looking at wear and tear tells you a lot about the wearer’s underlying economics. Alan Greenspan famously watched a “men’s underwear index” because in lean times men replaced their underwear less frequently than during flush times. That sort of data is not possible to get everywhere, so I look carefully at the average quality of shoe stock and how new the average shoes are. This is not about assessing whether people are wearing cheap or expensive shoes—it’s about whether they’re wearing newer, rather than older, and higher quality, rather than lower quality, shoes.
Owned transportation can vary from bicycle to scooter, tractor, boat, livestock or luxury car, and from very new to very old. Like shoes, it tells you fairly obvious things about the economy. In Vietnam, moving from bicycle to scooter represents a huge improvement in average daily wage. In Beijing moving from scooters to luxury cars is an even bigger shift. Transportation can also tell you a great deal about how far people are able to travel to find work. You’re obviously not going nearly so far on bicycle, an ox, or a tractor as on a scooter or car. Second to housing (which you probably can’t observe without knowing more about your talent’s migration patterns than you’ll have access to), transportation is the largest area of individual investment you’ll see. The more cars there are, the newer they are, the higher the wages in the area are and the wider the talent pool is.
Women’s accessories are often the trickiest to assess.It’s not really worth it in most markets unless there is also evidence of robust owned transportation. (If everyone’s on bicycles, the inventory of women’s accessories isn’t very useful.) But if the transportation stock is fairly good, women in many developing markets wear significant family wealth in their accessories and jewelry. So this is an important marker of a variety of things ranging from safety and social order (higher if there’s significant jewelry present) to trust in the formal economy (lower if families believe they must keep significant wealth in gold in case of economic instability). So part of what I look at is the quality of the jewelry (is it fake or real gold?) and the youngest ages at which I see jewelry commonly being worn.