2010 PopStats Research Conference Summary
Fifth Annual Event Meet or Exceeds 97% of Attendees' Expectations
Attendees of the Fifth Annual STI: PopStats Research Conference and User Forum came to Austin, Texas, March 24th to 26th to learn new developments underway at STI, how to better use STI's industry-leading data products, and to discuss shop with their peers in the market research industry. They did not go away disappointed. They rated this Conference a success - with over 97 percent reporting that the Conference either met or exceeded their expectations (almost 55 percent said it exceeded their expectations). Over 77 percent said they will attend this Conference again. In fact, referrals are the number one way that people hear about the PopStats Research Conference.
Nearly 83 percent of the attendees said they come to the event for the content. Adding that they primarily attend to hear STI staff members, retailers, and researchers speak about market research. Nearly 97 percent of the attendees said they will recommend this Conference to others.
This year's event included Robert discussing several topics including: new initiatives launched and underway at STI, the newest product called STI: Colossus, the upcoming 2010 Census data, the mathematical definition of true optimization, and the PopStats methodology. Researchers from CVS, Walgreens, Del Taco, and Kroger discussed their unique applications of PopStats data. And a wide range of speakers discussed how they use data to find and market to consumer niches.
As a follow up to the event, we've prepared a User Conference Brief with synopses of all the sessions. This is both a review of the highlights for those who attended and an overview for those who could not attend. This report begins with overall comments shared by the attendees about their experiences at the event.
TABLE OF CONTENTS
Wed. March 24, 2010
SESSION 1 - What's New and Major Initiatives Taking Place, Robert Welch, STI
Thr. March 25, 2010
SESSION 1 - True Optimization, What's It All About?, Robert Welch, STI
Fri. March 26, 2010
SESSION 1 - STI PopStats Methodology, Robert Welch
Wednesday, March 24, 2010
SESSION 1 - What's New and Major Initiatives Taking Place
Presenter - Robert Welch, Synergos Technologies
Robert led off the 2010 PopStats Research Conference with an overview of STI developments in the past year. Highlights of his presentation included the following:
SESSION 2 - Increasing Store Traffic Among the $4 Trillion Women's Market
Presenter - Miriam Muley, Author, "The 85% Niche"
The power of women in the marketplace is author Miriam Muley's favorite topic. She wrote all about it in "The 85% Niche - The Power of Women of All Colors." She said they are responsible for $4 trillion in sales, making them the third largest economy in the world. "This is not a niche audience to be marginalize." Miriam spoke to the misconceptions and opportunities in the women's marketplace. For example, all women over 50 are not poor, sad, and alienated. "They are actually successful, vibrant, and want a challenge." Miriam stated that "women of color are the crown jewel of purchasing. Twenty-five percent of black women spend $10 billion annually just to look good." She noted that there is an incredible benefit to culturally diverse markets: "Research shows that groups with greater diversity tend to perform better than homogenous residents." Miriam offered the Conference attendees four tips:
SESSION 3 - LGBT - Marketing to Lesbian, Gay, Bisexual, and Transgender Markets
Presenter - David Morse, Author, "Multicultural Intelligence"
Through a lecture that included video examples of LGBT marketing, author David presented the results of an online survey of 926 gay and lesbian consumers, conducted by New American Dimensions. Sixteen million adults self-identify as gay or lesbian. David reported that "this is a complex consumer segment." He advised attendees to avoid stereotyping them. The two most important facts to consider are that: These groups appreciate when companies take a sincere and respectful approach to marketing to them, and companies will attract the ire of watchdog groups if they don't follow that guideline. The online survey found that there are five primary segments within the gay and lesbian community:
SESSION 4 - Evolution through Revolution: An Enterprise-wide GIS Solution
Presenter - Jilliam Beydilli and Ben Farster, Walgreens
Walgreens' GIS division began in 2000 to find better locations. It was used only for retail site analysis until 2004. As the company grew to today's 7,000 stores, the company began expanding beyond this use, especially to help support new services, such as on-site medical clinics. Today all 25 divisions of the drug store chain use GIS tools, such as mapping and demographics, including operations and advertising. Walgreens has developed most of its own enterprise tools, including Walmaps, Mobile GIS, and a Competitive Location Database. GIS tools are used in multiple ways including:
"Good data is the key to the success of these enterprise tools," said Jillian. "If the underlying data is wrong, no one will have confidence in the tools. We learned that if we don't get it right, there will be slow adoption of the tools."
Ben noted that there is more innovation to come, including enhancements and upgrades, tablet PCs for mobile users, location database enhancements, and qualitative databases.
SESSION 5 - Take "Juan" and Call me in the Morning: Hispanics as an Antidote to the Recession
Presenter - Manuel Delgado, CEO, Agua Marketing
"Hispanics are an antidote to the recession," explained Manuel during his talk about the myths, realities, and opportunities among the U.S.'s growing Hispanic population. This consumer group offers an estimated $951 billion purchasing power, which is equivalent to the GDP of Canada. He provided a wide variety of interesting anecdotal marketing examples and statistics on Hispanic growth. For example, for every non-white person over 65 there are seven white people in the same age group; but for every non-white child 10 and under there are .66 white children in the same age group.
To approach this market, companies must avoid stereotypes, advised Manual. "If you're not an expert of Hispanic culture, distrust the things you think you know." He described areas important for companies to be aware of when marketing to Hispanics:
SESSION 6 - The Tale of Three Trade Areas: Asian, Hispanic, and Foodie
Presenter - Don Scott, Retail Research Group
Don demonstrated the combining of "non-traditional" PopStats demographics, including language spoken, mortgage risk, and families with one worker to find specific consumer groups for his wide range of grocery store clients. "We like to think beyond the standard data and use many of PopStats myriad other data to slice and dice up geographies." He overviewed how his company researched three areas for three clients by strategically applying various PopStats variables.
Thursday, March 25, 2010
SESSION 1 - True Optimization, What's It All About?
Presenter - Robert Welch, STI
Robert stated that "optimization" is a word bantered around by many companies today. However, he noted, "optimization is a math term and true optimization can only be determined through mathematics." It means "finding the very best answer to a problem."
He said that linear programming or planning (LP), a term that goes back to the 1600s, is the process for finding an optimized answer. "It is best suited when you have to make a choice between several options, yet each option is restricted by constraints," explained Robert. For example, if a retailer has a 15 potential store sites, but can only place stores in three of them, LP can find the three sites that offer the best opportunities. Robert detailed an example of the research method for the Conference attendees.
Robert noted that LP can be used to solve four basic types of research problems:
SESSION 2 - Defining Store Trade Areas Using Loyalty Cards, MS Bing, and SQL Server 2008
Presenter - Harwell Hooper, CVS
Hartwell explained that CVS has access to a rich set of geographic data from both the front of the store and the pharmacy. He overviewed how the research department has leveraged the Microsoft Bing tiling system, because "it provides a new approach for managing and visualizing geographic data via grids." He noted that "the latest version of SQL Server offers a rich set of GIS tools for analysis and data manipulation and for storing the grids." By combining these three things - store data, MS Bing, and the SQL Server - CVS has developed an automated approach for defining store trade areas.
Hartwell said that the CVS research group was attracted to this approach, because "block groups are too large in many areas and so don't capture growth well. With Bing's variable grid size options we were able to create spatial patterns in population density that is helping us better establish market share and allocate consumer supply and demand."
He added that the SQL Server Platform "does all the heavy lifting" for the company's Real Estate Research Data Warehouse, which includes corporate data, vendor data, field data, and applications.
SESSION 3 - Drilling for Dollars: The Neighborhood Market DrillDown
Presenter - Carolina Valencia, Social Compact
Carolina presented an overview of Social Compact's original Neighborhood Market DrillDown methodology developed to analyze inner-city, minority, and low-income markets. "The Census tends to undercount these populations. Undercounting leads to undervaluing. It's our goal to determine accurate demographics for these markets to help attract private sector investments."
She explained the methodology, which includes drawing from real-time, transactional local market sources and a cash-based economic model. Four key areas of research include: households and populations, income and expenditures, businesses and leakage, and crime. Data sources include: tax assessment records, building permit records, utility hook ups and usage, credit bureau records, and home sales data.
Carolina also explained how the company executes its research, including determining a neighborhood's size (population count), strength (income and buying power), stability (homeownership and residential investment), and investment opportunity (businesses of all types). "Often what we find is different from the standard data."
SESSION 4 - A Tale of Two Neighborhoods: Assessing Cultural Assimilation in Ethnic Communities
Presenter - Andy Verostek, Sarittarius Restaurants, LLC
Andy began his discussion on cultural assimilation by posing the question: Was I the only native English speaker who received a call from Hillary Clinton in Spanish? He then cautioned, "As researchers, we must be cognizant of our personal assumptions and let the data speak for itself."
In an effort to rely on data to more accurately determine the cultural assimilation of neighborhoods and better understand the populations surrounding Del Tacos and Captain D's restaurants, Andy created a methodology for giving trade areas an assimilation score. For the analysis, he applied specific sets of data from PopStats, including Language Spoken in the Home, Ancestry, and age-related Ethnicity.
"I've been doing a lot of work on trying to determine how ethnic communities may positively or negatively impact our businesses," notes Andy. "In order to determine how assimilated ethnic populations are in our trade areas, I am using a combination of PopStats and LandScape data to construct the assimilation profile." Andy provided interesting photographic on-the-ground proof of his methodology's results in a variety of Los Angeles neighborhoods. In the end, Andy did decided that Hillary was correct in calling him with a Spanish message, based on the cultural assimilation score of his own neighborhood.
SESSION 5 - But is it Relevant?: Understanding Trade Areas
Presenter - Erica Jones, Dunnhumby USA
Erica discussed Dunnhumby's relationship with Kroger, and described how the two companies have collaborated to apply demographic data to GIS to precisely define retail trade areas - and tap into untapped potential in current markets. She showed how the research project is helping to answer questions regarding connection, potential, and relevance. Dunnhumby is an international marketing consultancy and services company.
"Our goals are to make loyal and semi-loyal customers more loyal, and to become more attractive to non-customers," said Erica. "Building loyal shoppers is very important and a great opportunity, because we know we are not getting 100 percent of their dollars. Through the research, were have been able to identify opportunities to achieve these goals that we didn't know we could or should do at both the enterprise, regional, and local levels."
Working together the companies created a research methodology designed to highlight unique opportunities in specific trade areas. Kroger's consumers were already grouped by categories using LandScape segmentation. The additional research further identifies consumers and creates a road map to best capture their grocery-store needs. The research also prioritizes tasks according to stores, departments, and initiatives. Data used in the analysis included behavioral (loyalty cards), demographics and attitudes (PopStats), the rest-of-the-market movement (Market Basket), and customer in-store research.
SESSION 6 - Leveraging Trade Area Information: The Step to Marketing
Presenter - Cindy Reid, Mapping Analytics
Cindy discussed the importance of profiling customers to better understand who they are demographically, geographically, and attitudinally. She described how the LandScape segmentation product, in particular, can help bring define consumers, so that companies can make better decisions in a multitude of areas, including product selection, site selection, and marketing.
She outlined the three levels of segmentation within LandScape, including the unique lifestyle indicators:
"Combining customer knowledge with trade area knowledge can be uniquely powerful," said Cindy. It can help to answer questions such as: who lives in the trade area?, what are they purchasing today?, and how can a company speak to them most effectively.
SESSION 7 - Census Data Update and Request for Enhancements
Presenter - Robert Welch, STI
Robert discussed the 2010 Census, its release schedule beginning in March 2011, and PopStats implementation of the new data. He also overviewed the government's changes to the Census, including replacing the long-form with the American Community Survey (ACS). He noted that the ACS has to be congressionally approved every year, and that many of the numbers provided will amount to five-year averages versus direct counts at the block group level.
Robert then opened up the discussion for requests for enhancements to STI products, including specific data clients would like to add to STI products. "Our approach to product development is to add variables our clients actually need," he noted. "Our philosophy is to add new content to our existing products, not just add more new products to our suite." Allowing customer input that guides product development also "allows us to extend our products in new directions that we would not have otherwise thought of."
Friday, March 26, 2010
SESSIONS 1 & 2 - STI: PopStats Methodology
Presenter - Robert Welch, STI
Robert rounded about the two-and-a-half day Conference with explanations of the PopStats' methodology, the five-year forecasts, the 10-year projections, and PopStats Expected Value Index. Regarding the methodology, Robert said that the PopStats estimates are calculated on multiple computers working together in a pseudo-parallel processing manner. "We have created a self-correcting artificial intelligence modeling system that learns from itself." Here is a brief description of the methodology. Four models comprise the PopStats' model:
The PopStats methodology includes automated processes for overcoming any and all anomalies present in the data, including ZIP+4 inaccuracies, data smoothing issues, conversions (lofts), and overrides. If a client has a question about PopStats' estimates, Robert will research the issue. The client should first gather as much detail as possible, include any third-party evidence that supports his or her position, and be patient during the evaluation process. Robert will verify the issue, check the underlying data, check soft sources, and report back to the client in a timely manner.
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