OPINION21 February 2018

The disruptor brand and market research

Finance Opinion UK

Disruptor brands aren't just for millennials; there’s far more nuance in their appeal. But market research agencies can also learn from this insight says Network Research’s Virginia Monk.

As the research and tech space overlap more, technological innovation in market research is becoming a core aspiration for many an agency or supplier to the industry. With research platforms now consistently on the hunt for sector disruption, the concept of a disruptor has become a core element in industry conversations, particularly for those looking to sell their company or secure investment.

Of course, the rise in the disruptor phenomenon is not limited to our industry. From travel, to healthcare, to finance – disruptor brands are shaking up the market by changing business models, to provide their customers with new offerings and improved customer experience.

I was interested in finding out whether the rise of the disruptor was explicitly linked to a younger more technologically savvy generation. If so, then as more millennials become decision makers in the boardroom and in the home, what does this means for brands and business?

With this in mind, we carried out a study of 1500 people in the UK to understand which sectors are most ripe for disruption, who does and doesn’t gravitate to disruptor brands, and why. 

The study gave us two clear findings – the first is that no sector is safe. The second, which I’m focusing on here, is that consumer use and consideration of disruptor brands isn’t only defined by demographics. So (refreshingly, and perhaps unexpectedly), it’s not all about millennials or other broad-brush age bands. 

While overall disruptor use declines with age and increases with income, our study revealed that this isn’t the full story. Disruptor brands appeal across all demographics, and it is a combination of demographics and attitudes that prove powerful in identifying those consumers most open (or closed) to disruption. 

With that in mind, we created an attitudinal segmentation, splitting consumers into five groups, linking attitudes to propensity to use disruptor brands.

Three of the segments were very open to using disruptors, and, relative to the population, were heavy users of these brands, but their motivations to use by segment were different.  These groups total about 40% of the UK population:

 

  • Too cool for school. This bunch are image conscious, trend watchers and are most concerned about other people’s opinions of them, and want to use brands that say something ‘good’ about them. They are also concerned  about technology, community and the environment. A fifth of this group are aged 55+
  • Go Getters. This second heaviest disruptor user group are also interested in trends and fashion, but they are the more out-going, least cautious and generally least happy with the quiet life. Think of this group as people who are keen to give something new ago.  Again, a fifth are over 55. 
  • Nonchalants. The third group is a little trickier to pin down. They enjoy investing in brands that really fit into their lifestyles, instead of using disruptors for trend or ‘newness’s sake.  And guess what? A fifth are over 55.   

Our final two groups were much less likely to use disruptor brands:

  • Mainstreamers.  As their name implies, cluster around the averages for many factors. That said, they are considerably less likely to say they try new things before others. They are community and environmentally conscious, and both value and convenience are important to them. A quarter of these are millennials.
  • Tried and Testeds. This group are most likely to be cautious and settled, and the least likely to try new things. They are also the group most driven by value, and the most likely to worry about data security. This group were the least likely by far to have used any disruptor brands on our list of 20 brands. This was the group with the oldest average age – 55, but around 14% were millennials.

 Among other insights, the study provides direction for consumer targeting strategies.  For example, when looking at the profile of Barclays, by attitudinal segment, we see that over half of current customers are either ‘Tried and Testeds’ or ‘Mainstreamers’. This compares with just 15% of Monzo customers, a successful disruptor brand. This is what we’d expect.

However, a third of Barclays’s customers fall within the top two segments most open to disruptors – so potentially susceptible to Monzo’s charms. Yet with this insight Barclays can determine how to hold onto those vulnerable customers and fend off Monzo’s advances.

Closer to home, it throws up some similar analogies for the research industry. Certainly, many investors in the industry will sit in those prime disruptor segments; they will be trend followers, looking to stay one step ahead of the game, looking for the next ‘thing’.

However, when it comes to research buyers, I feel many often fit into those final two groups; the Mainstreamers and Tried and Testeds. And, if so, then industry players will need to consider this when it comes to positioning their company; playing heavily on the disruptor angle may make you desirable for investors (and those innovative research buyers), but is it resonating with your core audience?

Virginia Monk is managing director at Network Research

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