EVALUATING MARKETS |
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The challenge with trying to assess the potential of a market is the need to see what is missing rather than what is already there.
Current behaviour in similar markets can help, but the evidence from behavioural science shows that any differences in the context have to be taken into account as these can fundamentally affect behaviour. Insight & research can be used to understand the needs, motivations and constraints of potential customers, though equally crucial is understanding how these vary between different groups: segmentation is therefore a vital tool for use in evaluating markets. |
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CASE STUDY: CYCLE HIRE
Project description
The aim at the time was to estimate the potential demand for a new cycle hire scheme in London, along the lines of the Velib scheme in Paris. This was an entirely new concept then, though now the scheme is part of the furniture of London. A variety of quantitative and qualitative research methods were used and then combined with data on travel in London to identify the number of trips being made which would be suitable for a cycle hire bike, and the share of these trips which a cycle hire scheme might capture.
Project Outputs
Accurate estimates of the demand potential, including information concerning the nature of the trips was vital part of the successful launch of what was then commonly referred to as the 'Boris Bike' scheme. Since then further studies have been undertaken in London to examine extensions to the scheme, while various studies have been undertaken in locations outside of London.
Added value
This project required a unique set of skills in terms of research techniques, knowledge of travel patterns in London, and an understanding of the attractions and barriers associated with a novel cycle hire scheme. Expertise in geodemographic segmentation was also key for assessing both the scale and nature of demand. For subsequent studies it has been important to understand the impact of differing contexts, given the particular nature of the environment and people in central London.
Behavioural science concepts
Power of context - the success of a cycle hire scheme is highly dependent on the context within which it operates, key considerations are the types (and lengths) of trips being made, the type of people travelling and the availability of suitable routes.
Relativity - potential users would see the hire bike in relative terms, and they would compare it to different things, such as using their own bike, using the bus, walking, driving or using a taxi.
Status Quo bias - for considering a completely new form of transport it was important to understand all the points at which people may be unwilling to try something new such as planning their journey, joining the scheme, paying for the hire bike, releasing the bike from the docking station, and then riding the unfamiliar looking bike itself.
Project description
The aim at the time was to estimate the potential demand for a new cycle hire scheme in London, along the lines of the Velib scheme in Paris. This was an entirely new concept then, though now the scheme is part of the furniture of London. A variety of quantitative and qualitative research methods were used and then combined with data on travel in London to identify the number of trips being made which would be suitable for a cycle hire bike, and the share of these trips which a cycle hire scheme might capture.
Project Outputs
Accurate estimates of the demand potential, including information concerning the nature of the trips was vital part of the successful launch of what was then commonly referred to as the 'Boris Bike' scheme. Since then further studies have been undertaken in London to examine extensions to the scheme, while various studies have been undertaken in locations outside of London.
Added value
This project required a unique set of skills in terms of research techniques, knowledge of travel patterns in London, and an understanding of the attractions and barriers associated with a novel cycle hire scheme. Expertise in geodemographic segmentation was also key for assessing both the scale and nature of demand. For subsequent studies it has been important to understand the impact of differing contexts, given the particular nature of the environment and people in central London.
Behavioural science concepts
Power of context - the success of a cycle hire scheme is highly dependent on the context within which it operates, key considerations are the types (and lengths) of trips being made, the type of people travelling and the availability of suitable routes.
Relativity - potential users would see the hire bike in relative terms, and they would compare it to different things, such as using their own bike, using the bus, walking, driving or using a taxi.
Status Quo bias - for considering a completely new form of transport it was important to understand all the points at which people may be unwilling to try something new such as planning their journey, joining the scheme, paying for the hire bike, releasing the bike from the docking station, and then riding the unfamiliar looking bike itself.
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Tony Duckenfield is a Certified Member of the Market Research Society and ensures all Beyond Logic's research is undertaken to their demanding standards 
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