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Oct 26, 2000

Ernst & Young's Robert Duboff Talks About Competing in The Small Biz Marketplace

SUMMARY: No summary available.
Robert Duboff, partner and Director of National Marketing for Ernst & Young, is exceptionally knowledgeable about benefits and pitfalls of market research. Heís also a strong believer in segmenting markets. Duboff and Jim Spaeth, president of the Advertising Research Foundation, are authors of ďMarket Research Matters: Tools and Techniques for Aligning your Business,Ē published this year. He spoke with us about the challenges of the marketplace and how market research can help.

Q: A company like Bigstep is making the most of using market research to find out about the needs of small business. If a company doesnít do market research, is it losing out on an opportunity?

Duboff: Market research is even more important if you distinguish roughly that there are small businesses that will never grow and maybe have no aspiration to grow. Any business that doesnít have aspirations to grow is not a worthwhile target. If we take the small businesses that want to grow, that are growth companies, maybe some of them will make it and some of them wonít. The need for market research insight into them is far greater than the larger businesses. The reason for that is if you are a large business, your senior people are probably pretty similar to the big companies you deal with.

But itís a different animal from these start ups, particularly with the dot coms if you have younger management. They might have a different set of values and a different way of purchasing so if you donít do market research, how are you really going to meet their needs when you canít gut feel it the same way you can for a company more similar to your own? I would make the argument that itís far more important in that environment.

Q: Do you see a really big battle shaping up with the various portals for small business? Is anybody winning? How will it shake out?

Duboff: I think thereís always an issue with ďsmall businessĒ [with people thinking]that it isnít any different from big business. The approach that is going to be smarter is the one that Fast Company uses in the offline world. Look for a mindset of entrepreneurial people or people who are interested in change and doing things differently. Take that mindset and say it can apply to someone who is an entrepreneur, an intrapreneur, a small but growth oriented company or senior people in big companies. I think thatís whatís going to happen.

I think the same with portals. Youíll find that very few small businesses define themselves that way first [that is, as a small business]. Typically, in my experience, [people say] itís a family business or weíre entrepreneurs. Thereís not too many that say, ďIím a small business.Ē Or they affiliate with whatever industry is the substance of their business. So none of these people are going see a small business portal, any more than a small business magazine, being really for them.

Q: Do you think thatís why something like Inc. works pretty well because of the entrepreneurial factor?

Duboff: But even with that I think its day may be past. I think Fast Company may be more attuned to todayís society. But I think Inc. has done a good job. If you read it, you see that it has broadened beyond just gee, weíre a small business. So on the portals, I donít think any of them have distinguished them particularly where youíd say, ďYeah, this one is going to make it.Ē

Q: What about offline businesses trying to reach small businesses online? Whoís done a good job and who has blown the opportunity?

Duboff: Are there people who are trying things that arenít working very well? I donít have an answer to that. No, is my answer. I canít think of anybody I would single out for that honor.

Q: You mentioned Fast Company. Is there anyone else you think is doing a really good job?

Duboff: If you take a Business 2.0, itís doing very well. I think its readers include small business. Itís those [sites] that are taking that approach of speaking to the issues that matter are going to be the winners here.

Q: Are we going to get stuck in a marketing rut? Or is there enough creativity out there?

Duboff: Youíve got to segment things, as I say in the book. If you are looking for the entrepreneurial nature, I donít think thatís primarily a message or a targeting of small business. Or if youíre thinking of the family, and I think thereís an opportunity, family wealth and inheritance are the real issues there. There may be some, but I donít know of people who are really targeting family businesses.

The creativityís going to be getting your message across as a company and allying it. If Staples or are serving the small business market, they could become a channel for people who might want other things and who would be impressed or would find it convenient to have some [things] bundled while they are doing something about their office. I think thatís where there are opportunities.

Q: What about the upcoming trends in the next few months? What will the holiday season bring? Any fallout from last year?

Duboff: You never know what the story is going to be. This year is complicated just a tad by the election which will undoubtedly have a role in whatís going to happen. There will be changes in the messages because the media likes new stories. This may be the year when alliances start to happen. Iím a big believer in alliances. Thatís the wave of the future. That may be the road to success. Itís unclear at this point whether weíll have a good holiday or a bad one. Thatís going to be the first headline. That will either be a headache for the new president or kind of a blessing of how they start. Generally, those stories never include small business. They usually focus on retailers, and generally thatís the larger ones. You can imagine that smaller retailers in years when the big guys have trouble, maybe thatís good for the little guy. I donít know. Iíve never seen that story.

Q: What is occupying your mind at the moment in terms of market research and small businesses?

Duboff: I want to turn it for a second and look at small businesses as users of market research. I think thereís a big opportunity. Yes, small business is a growing target for companies, which means therefore undoubtedly that thereís more market research done of them. But by the same token, particularly a growth oriented small business, one would hope that they will come see the use of market research. Market research can be expensive for them. But if youíre a dot com, online research is very affordable and May have enough quality. If your entire target is an online target, then online research makes a lot of sense. It can be much cheaper. Small businesses have typically thought of market research as something that only the big folks use. Hopefully, reading the book will change some of their minds.

Q: Are people any less coveting of their email addresses? Is opt-in still something everyone needs to abide by?

Duboff: Not only me individually, but me as a market researcher and me as a member of Ernst & Young -- all of those are definitely in favor of the opt-in. Generally, itís self-defeating [not to use opt-in]. There are a couple of books out now Ė :Permission Marketing: Turning Strangers into Friends and Friends into CustomersĒ and ďUnleashing the IdeavirusĒ by Seth Godin Ė which suggest that if I havesomething good and I send it to you, youíll send it to your friends. I might encourage you to do that. Then youíre not ending unwanted material, youíre giving a reference that everybody wins. I think thatís really the model for how to do this. I think people feel as invaded by an unwanted email as they do by an unwanted phone call. So you only want to communicate with people that have indicated a willingness to communicate with you. Thatís a lot easier in our business-to-business world.

ďMarket Research Matters: Tools and Techniques for Aligning your BusinessĒ by Robert Duboff and Jim Spaeth (John Wiley & Sons, Inc., $34.95).
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