In this issue...

Trends in the CE Marketplace

Consumer Electronics Buyers May Realize Too Late that Less is More

On the Verge of 3G: Cell Phone Users Low on Facts but High on Interest in 3G Technology

Research to the Rescue

How Good is Your Website? Let Your Visitors Judge!

Events

Don't Miss Our Free Webcast!

Welcome to the latest edition of eBrain Solutions. In this issue, we are delighted to offer you insights from leading experts, national consumer research, and from our own wealth of experience in the market research industry. The articles below explore the issues of feature fatigue, consumers' knowledge of and interest in 3G technology, and how research can help you get the most out of your company's online presence.

Best Regards,
Gina Woodall
Vice President
eBrain Market Research

Consumer Electronics Buyers May Realize Too Late that Less is More
By Tracey Holupka

Consumer electronics (CE) manufacturers continually wow consumers as they pack more bells and whistles into each new product. CE buyers seem to feel the more features available, the better. However, once they try to use their new devices, consumers’ opinions can change dramatically. What does this mean for the future of the consumer electronics industry? eBrain recently spoke with Roland T. Rust, one of the authors of the Harvard Business Journal article, “Defeating Feature Fatigue.” Mr. Rust and his co-authors conducted research into how purchasing a product with too many features can lead to “feature fatigue” and ultimately to a sense of dissatisfaction. Three key findings emerged:.

• Consumers know that products with more features are harder to use, but before they purchase a product they value its capability more than its usability.
• Even when consumers are allowed to customize a product, they load on the features, worrying little about the learning curve they are setting for themselves.
• Once consumers have used a product, their preferences change, and then usability matters very much.

eBrain: What events led to your decision to do the research regarding feature fatigue?

RTR: The article and the research came from our perceptions of people’s frustrations with trying to deal with devices, especially devices that have a lot of information technology in them, devices that have a lot of computerization and microprocessors. We were noticing that many devices were harder and harder to use and packed more and more features, so we wanted to get a better understanding as to how people make these types of decisions to choose these kinds of things and how the process works.

eBrain: During the research effort you utilized three research approaches to round out the learning. Can you describe how this structured approach came about?

RTR: It was a matter of systematically going through and figuring out how people dealt with features. We needed to know how people chose features before they had any opportunity to use the features, then tried to figure out whether people in fact understood that there was a tradeoff between the number of features and usability and then what happens after they actually use it. Do they at that point change their point of view?

eBrain: In your opinion, as products become more all encompassing, will a potential increase in buyer’s remorse due to feature-overload lead to the return of a simplicity model or do you think it is more likely, at least in the short term, that consumers will try to educate themselves (or make do)?

RTR: It’s probably a combination of those things. Certainly consumers are going to have some problems with overly complicated devices, and when they do they’ll have a worse opinion of the company, and they may not come back. Companies are going to eventually realize that, and they are going to say, “why are we losing our customers?” I think there is some hope that companies will realize this ahead of time and will actually change what they are doing before the disaster hits.

eBrain: Many of us have purchased a feature-rich product (for example, a high tech cell phone) only to get home and say, “what was I thinking?” It’s possible that one of the reasons we went for the upgrade in the first place was a friend or colleague who asked (or dare I say mocked us) as to why we haven’t upgraded our phone in the past 2 years. Word of mouth is a powerful marketing tool when it comes to technology. How much does technology “peer pressure” lend itself to us being in these overload situations?

RTR: I think peer pressure is one thing and word of mouth is another thing. Certainly there can be an image aspect of wanting to be seen as a high-tech, with-it sort of person. Word of mouth on the other hand tends to work against feature fatigue products. For example if you consider the BMW models that have the iDrive system, the word of mouth around that is tremendously bad and definitely hurting BMW sales.

eBrain: In your research were there any key differences to the depth of feature fatigue across segments, perhaps by age or gender?

RTR: We didn’t really have a broad enough sample to be able to tell that; we were dealing with students primarily. We did find though that people who were experts also suffered from feature fatigue. So you might think, “hey I really know how to use cell phones,” but even the people who thought that were equally victims of feature fatigue.

eBrain: Do you have a sense when this era of feature fatigue came about?

RTR: I think feature fatigue has accelerated since microprocessors became easy to employ, meaning since the 1980’s. Basically it’s gotten worse and worse and the reason for that is that micro-processing has become very inexpensive. As a result, many information products can have many, many, many, many features with very little trouble and very little additional cost. That’s why features have proliferated. Engineers tend to think, "if I can put it in there then I will, because who knows, maybe someone will like it.” Even a lot of traditional market research techniques like conjoint analysis have made the assumption on the front end that more features actually will be better because they contribute some utility, assuming that the feature has positive utility itself. There hasn’t been much of a voice saying, "hey don’t do that, there is a downside to this."

eBrain: Finally, can you give us a brief overview of the Center for Excellence in Service and tell us about any upcoming events?

RTR: The center has been in operation here for six years, and we've investigated a lot of different topics related to service. Many of the topics that we have investigated have involved the internet and e-applications. One of the things we are involved with is the National Technology Readiness Survey, which we do with Rockbridge Associates. Our big event that is upcoming is the 'Frontiers in Service Conference' (co-sponsored the American Marketing Association), and it’s been in operation since 1992. This is the 15th consecutive year. It will be held in Brisbane, Australia the end of June, first part of July.

"Defeating Feature Fatigue" was published in the February 2006 issue of the Harvard Business Journal. Professor Rust is the David Bruce Smith Chair in Marketing, Executive Director of the Center for Excellence in Service1, and Chair of the Department of Marketing at the Robert H. Smith School of Business at the University of Maryland. Mr. Rust co-authored the article with Debora Viana Thompson, a Smith School PhD candidate, and Rebecca W. Hamilton, an assistant professor at the Smith school.

1 The Center for Excellence in Service (CES) is a nonprofit organization dedicated to service strategy and research, focused on technology. It was founded by Rust, now the Executive Director, in 2000, and is currently directed by Professor P.K. Kannan. http://www.rhsmith.umd.edu/ces/index.html

---

On the Verge of 3G: Cell Phone Users Low on Facts but High on Interest in 3G Technology
By Melissa Paluch

Do you know what “3G” technology is? If so, count yourself among the technologically-savvy. If not, don’t worry; you’re not alone. According to the 2005/2006 National Technology Readiness Survey (NTRS) sponsored by eBrain Market Research, Inc., about four out of five cell phone users either know very little about 3G or have never even heard of it. This general lack of knowledge among consumers about 3G is likely to change as infrastructure for the technology is enhanced, presenting an excellent opportunity for marketers to capitalize on this burgeoning technology through educating consumers now about 3G.

What is 3G technology? For the uninitiated, 3G or “third-generation” technology allows greater and faster transmission of data over a wireless network. This enables users to send both audio and video messages, participate in live video conferences, download music and videos, use GPS devices, and much more. At the present time, the U.S. has limited telecommunication networks required for 3G technology, but the nation’s capabilities are poised to grow in the near future.

Are consumers interested in 3G? Nearly one-third of cell phone users say that they are likely to purchase a 3G device in the next five years. Purchases of 3G technology will likely increase as consumers learn more about 3G and its benefits. However, at present, text messaging is the most widely used advanced cell phone feature in the U.S., with more than a fifth of cell phone owners utilizing this feature. As 3G networks become more prevalent and awareness increases, global positioning may surpass text messaging to become the number one feature for cell phones in terms of interest. In addition to GPS, other 3G features that cell phone users are interested in include: bluetooth technology, e-mail, Broadband Internet access, and the ability to play MP3 or other music files uploaded from their computers or other devices they own. The benefits of 3G technology that most appeal to consumers are:

• Being safer Offering a more secure way of transmitting information, especially in this age of identity theft
• Communicating more effectively Enabling communications to be exchanged more rapidly than currently available technology and via a wide array of portals
• Saving time Helping consumers communicate and receive information even faster than they can now

What approaches will be most effective for marketing 3G technology to consumers? Cell phone users know very little about 3G technology, thus it is imperative for marketers of this technology to educate cell phone consumers about 3G and its benefits. GPS is the 3G feature of primary interest to cell phone users and according to the NTRS study the best channel for marketers of GPS to advertise their services to potential consumers is via the Internet. Advertising messages for 3G technology in general must emphasize what consumers report drives their interest in 3G technology the most: safety, effective communications and saving them time.

While most Americans can’t tell you what 3G means, the NTRS indicates that there is a market for the new features it provides. By knowing consumers’ attitudes and interests, marketers and manufacturers can develop more appealing products and services utilizing 3G technology and can more effectively market 3G to consumers.

How Good is Your Website? Let Your Visitors Judge!
By Marcia Harrington

A great website can play a vital role in enhancing the image, sales, and communications of your organization. But how great is your company’s site? The most direct and reliable way to find out is to survey website visitors themselves.

• Who, What, When, Where, How, and Why? An online survey can help you get the full story about your organization’s website. With a well-designed survey, you’ll be able to get answers about why visitors come to your site, the frequency and duration of the visits, how they heard about your website, their relationship to your organization (e.g., member, customer, outside visitor), and the web pages they visited.
• How satisfied are your web visitors? Your company’s site might get plenty of traffic, but that doesn’t always mean visitors are enjoying the experience or telling their friends and co-workers to check it out. Online surveys allow you to ask such questions directly, as well as to evaluate attributes that we have found to be important to all successful websites. For example, any site ought to perform well on these factors:
  • Appearance or "look and feel"
  • Organization and ease of navigation
  • Useful and up-to-date information
  • Search capabilities
  
  In addition, your particular website may also call for evaluation of additional attributes:
  • User log-in
  • Shopping cart
  • Online learning
  • Membership/subscription renewal information
  • Notification of meetings, conferences, seminars, or other events
  • Job search capability
  • Credentialing/certification information
  
  Not only can we help you see how well your site is doing in each of these areas, but eBrain can also tell you which areas will have the biggest impact on your visitors’ satisfaction.
• How can you turn yours into a great website? Ideas for improvement can be solicited through a series of close-ended questions or via text boxes in the survey that encourage open-ended feedback. The latter can be coded to identify underlying trends and patterns.

How an online survey can provide valuable insight

Not long ago, we were approached by a large association of nationwide professionals that wished to evaluate its recently-redesigned website. Using a pop-up link and offering an incentive, we administered an online survey that collected responses from association members as well as non-members.

• The findings of the study showed that the new website performed favorably in areas of content, timeliness of information and appearance, but had lingering issues related to searching and navigational ease.
• The study also identified the elements driving overall satisfaction and identified some stretch-goals for the association.
• Finally, the study gathered information from members about additional features desired and from non-members about the kinds of things that would motivate them to join the association.

For this organization and others with whom eBrain has worked, an online survey of website visitors has given them the feedback they need to make their website the most effective organizational tool possible.

To find out how we can do the same for you, contact us.

Don't Miss Our Free Webcast! CEA and eBrain are pleased to present a Webcast on How to Build a Strong Consumer Electronics Brand - and Measure its Effectiveness. This 1-hour session will demonstrate how to measure the strength of your brand and outline ways to increase your brand's equity - and increase your sales. For details, please visit http://www.ebrain.com/invitation.aspx.

---

Don't miss our next issue! Click here to be added to our newsletter e-mailing list.