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Market Research, Freakonomics and the Butterfly Effect

Posted by Mike Damphousse

Do you trust the statistics you use when you are making marketing decisions? Yahoo recently published a research study claiming that "77% of consumers identify themselves as green."  They go on to state that "23% claim to be deeply committed to environmental issues," and that "71% have an interest in purchasing an environmentally sound car." And, that "72 percent saying they get (green) information in traditional media and 68 percent citing online," and tout portals as still being strong sources of information (of course).

Then there is one very important piece of data buried at the bottom, "respondents were recruited ONLINE." Could this possibly be tainted NOT to represent consumers as a whole? I think so. Online respondents could possibly be on the upper end of the economic scale, education, and already interested in green if they decided to respond to a green survey.

As a marketer, I dig through numbers all the time. Analyst reports, claims on blog articles, even conversational stats. Having taken a handful of probability and statistics courses, some market research courses, and having wanted to make a point or two with numbers myself in the past, I always look for the source. Knowing the source is like knowing the butterfly in the butterfly effect.

Stephen Dubner, one of the Freakonomics co-authors, stated in Global PR Week Blog, that, "The three things marketers can mainly learn from our book include

- realizing conventional wisdom is often wrong;
- dramatic effects often have distant, even subtle, causes; and,
- knowing what to measure and how to measure it makes a complicated world much less so.

But, keep in mind our methods in “Freakonomics” actually counter intuitive marketing thinking."

My message to marketers and analysts (especially the analysts since they publish most of the data), is when you're trying to make educated decisions and conclusions based upon numbers that figures don't lie, but liars can figure. Check your sources, and if you don't like the source, simply explain why and let others make their own conclusions.