2Psgtit

25,

Research method identifies

firms in
mature or deciining industries

New in Marketing
Narketing High Trdmcdogy
WiUttB L. ShaaMbi juid Jdui K. ffymt^ Jr.
Kfcnt State University
i ,
A pioneering book showing whaTconciepts, -~
techniques, and activities to use <or not useMn
successful high-technology tnarketing, Combiniitf
theory as well as practical material, the bode
discusses ail the activities in which high-tech
marketers need to engage: establishing market
priorities, researching and developing new product
ideas, and estimating market demand,
256 pp.
ISBN 0^69^06914-0 . $24.00
\

Personal V a l and Consumer

Robert E. Pitta, Jr,, Bureau f Business and
^
Economic Research, and Arch G. Woodside,
UniveT5ity of South Carolina
A number of leading authorities in the fiekl,discuss
the latest research on how people buy. The book
takes a ck)se look at how to research value
psychok)gy, and hrow it explains why specific products
:are selected over others,
KBN 0-669-O6937X June ca. $26.00

The Advances in Retailing Series, The Institute of Retail Managermnt, New York University
Penonti SeVUng Theory, Research ami Practice
Jacob Jacoby, Institute of Retail Management, and C. Samuel Craig, New York University, editors
-B*
psychological underpinnings of personal selling persuasion and discuss approaches to closing.
Additional topics are adaptation to situationai demands, negotiation,.and time allocation and
personal selling style, as well as a discussion of the life insurance industry.
\336pp.
ISBN 0-^9^7606-6
$32.00
.
.
.
,
The Service Eneoimter
/
^
Joha A. Cteplel New Yori( Universi^, Michael R
StdouHHi, Institute of Retail Management, Carol
Snrinreiiaiit, New York University, editors
Expbres the important service encounter as an ' .
opportunity for customer satisfaction or as-a problem
of quality maintenance. Prominent psychologists, ^
marketing and management scientists, and executives
discuss the latest ideas and research findings on the
various approaches used to attract and serve the
customer,
ISBN 0-669m273-2
September ca. $30.00

Consumer Perceptkm of Merchandise and .

Store Quality
Jacob J a c ^ , In^itute of Retail Management and
Jeny C. (Msoa, PennsyWania State University, ~
editors
An examination of how the perception of quality
determines a consumer's patronage, product, and
.
branch choices. Addressed are such issues as: What
informat3!0.do consumers use to make quality
judgments about merchandise, stores, and services?
How does perceived quality affect purchases and
patronage? Wh4t are the Federal IVade Commission's
concerns and policies?
^

ISBN 0-669-08272-4 August ca. $30.00

LwingtonBookt, D.C Heath and Company

125 Spring Street, Lexington, MA 02173
(617) 862-6650
(212) 924-6460
HEATH Call our ioll-(rM numbMS, (600) 428-8071 or (800) 33HEATH

price paid, etc. Pre-identified respondent demographics make for

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,
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Current industries covered include:
'
.

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_

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Identify purchases of maie leans and
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HOME FURlNISHINGS: q u a r t e r ^
screening to identify purchasers,
y{ with follow-up for details.

WlbiMt*,JN,

ALWAYS TAKE A HOLD of

nurse, for fe^r of finding something
worse," English nannies tell their
little chaises while playing in the
park. The same advice applies to
companies in mature or declining
industries:
Their best strategy is to stick with
the familiar. The challenge is to find
a new strategic angle. The probleni
is that traditional research approaches aren't up to the task,
critical strategic quandaries today are in mature or dying
industries,' In many, defeatism
reigns. They desperately lurch
toward escape routes in glamourous, high-growth, high-tech areas.
In most instances, this is a terrible
mistake.
Numerousr'studies underline the
folly of forsaking the mature industry and embarking on diversification
programs in growth industries. Such
programs cause mature firms to be^
"eeme^glued and unfocused, Companiesihat remain focused on related lines of business are invari^ly
healthier financially, .
Conversely, the widely diversified company does not use its capital as efficiently, and generally fails
to increase its profitability. Companies that branch out into growth
industries, and away from their root
lines of business, generally have
lower returns on investment. No
doubt they also have less-happy
shareholders,
Mattel Inc, s erstwhile diversification program left it with a negative
net worth. In February, Mattel's
board of directors decided to retrench, and ordered its entertainment and electronics businesses divested, Mattel is returning to its
roots (toys) and. one hopes, to
profitability,
THE MATURE I N D U S T R V is a
secret gold mine. The women s
hosiery market was "mature"" until
panty hose came along. Designer
jeans put some life back into the
stagnant sportwear industry,
"Gourmet"" TV dinners have
thawed out the frozen-foods^ category. The gym-shoe industry could
have died when the baby-boom generation matured. Jogging shoes
brought it back to life.
Dying, industries can be rebom,
but the surface has only been
scratched. Most mature industries
are unexplored territcnies when it
comes to new product concepts, repositionings, exciting packaging
ideas, new uses, new markets, new
channels of distribution.
We can"t all move to Silicon Valley and manufacture computer
chips, and few areas in the
"foundry"" states are going to attract
high-tech companies. But many socalled "sunset"' industries offer bigger opportunities than "sunrise"' industries because (1) there are more
of them, (2) they are a lot bigger, and
(3) their participants are sound
asleep (usually theyre just "harvesting"') and thus less competitive, ,
If you buy this notion and the
business-strategy literature has
been preaching it with some frequency lately you may be
strongly tempted to do something
about it. The question is: "How can
I pull it off with a minimum of risk,
and with the greatest chance of
making a high return?"
The "how" is by deploying the
correct strategy. The way you identify the correct strategy is to use a
"hew type of marketing research, one
that has been designed to deal with
strategic issues.
UNLIKE MOST marketingresearch methods, this one will
work just as well for industrialgoods companies as consumergoods firms. In fact, the latter occasionally present more difficulties
because they have so many bad
habits and entrenched procedures
that must be unlearned. They're
hopelessly tactical.
This new research iiiethod is

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to react effectively.
Quarterly and annual syndicated
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range of marketers keep an eye on
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DIVI6I0N OF NFO RESEARCH, INC

P.O. M X 311 TOUOO, ON49SM

irtterview (SFGI), It's a qualitative

form of research, at a fairly high intellectual level, that goes beyond the

traditional, plain-vanilla forms of

qualitative stucUes,
Most standard research concentrates on tactics: the SFGI explores
strategic issues, tliis means it can.
produce a selection of high-powered
strategic scenarios that offer the
promise of discovering a gold mine
within the mature industry.
Moreover, by extracting the right
information from consumers or end
users, the SFGI is capable of zeroing in on the optimum strategy that
fits corporate needs^ This will
be the strategy that maximizes ROI.
Unlike regular qualitative research, the SFGI wastes no tinie
flogging the same old tactical and
product-attribute topics known to
everyone in the marketing department. (Questions ofa tactical nature
always can be added to the end ofa
SFGI session or incorporated into a
later, separate study:)
THE BASIS OF THE SFGI technique is that strategy has many
components that can be measured ^
and evaluated by consumers.
Strategy specialists know these
components: product quality,
criteria used to judge quality,
brand differentiation^,-0mpetittve==
strengths and weaknesses, consumer "need gaps" in the market, '
product and company image, attitude shifts, etc.
The SFGI allows you to avoid
strategic gambits, select a strategy
that offers the best chance of winning, and discover the consumer or
end-user values inherent in the
strategy. With this knowledge, you
then can formulate the strategy and
prepare a marketing plan to implement it.
Most companies in mature o^ declining industries allocate the lion's
share of their research budgets to
searches for tactical solutions. This
usually leads to failure.
New-product ventures may have
a success likelihood of 2%. according to some studies. Even when they
succeed in generating big sales voluine, they still may not yield high
ROIs. Only the right strategies can
deliver satisfactory results. Accordingly, the need for sound ,'
strategic research is clear,
,
THE OTHER TYPE OF strategic
dilemma faced by a mature firm is
how it should confront Wall Street.
The SFGI can be used here, too. It
can be conducted with security
analysts and fund managers, using
slightly different subject matter but
roughly the same format. The SFGI
can explore, in an organized and
potent manner, strategic issues Wall
Street should know about when
assessing your company.
Many times analysts completely
change their view of a company
while it is being discussed in the
SFGI. The goal of such sessions is to
come up with financial-relations
strategies that will improve the corporate im^e among members of the
investment community.
The SFGI should be a part of the
research repertoire of every mature
firm that seeks either a higher ROI
from its opeiittion or a higher price
on the stock market.
' ,
For niore information on,SFGIs
and strategic issues, consult the

books Danger: Marketing Researcher At Work (Greenwood

Business Strategists (PrenticeHa.,
.