TIVO in 2002………..

Key learning points

- Understanding the viewpoint of consumers is a journey

that requires leadership and Imagination, and a dynamic
combination of various approaches.

- The choice and implementation of research projects, and

the interpretation of results, are subject to (often
misleading) contextual influences including wishful thinking,
relationships with suppliers, investors and current
customers, espoused strategic marketing paradigm (e.g.,
viral marketing vs. mass marketing).
 Study Questions

According to Keast, “there is a mystery in the sharp

contrast between the inertia of prospects and the
evangelical zeal of TiVo users As an emerging expert in
consumer behavior how would you tackle that mystery

 What do you think could be going on? Beyond your pet

hypothesis, try to be creative and list a large number Of
conflicting hypotheses by taking multiple points of view.
What might “evangelists” mention as a cause of their
failure to sell TiVo to their friends? What might a “couch
potato” say about his reluctance to buy TiVo? What
would you expect a top executive at NBC to say about
the situation? What explanation would the founder of
TiVo love to hear? Hate to hear?
 2.Now look at the data in the case exhibits. What hypotheses get
supported, what hypotheses get discounted? .What other insight(s)
do you directly derive from the data summarized in the text and
presented in the exhibits that might help to guide the growth of
TiVo?

 3. TiVo is a new technological company and the management s

approach to research and insight has gradually evolved over time
What have been the different stages in their exploratory journey?
What conclusion is this journey converging to? If you could time-
travel to the early hours ÔL the company, what would your advice
to Keast be in terms of the research they should be conducting (the
type of insight they should be looking for) at the outset for a more
effective launch?
 Analysis

 Initial Stage: Starting in April 1999 (right at the time of

the mass market launch), TiVo has been conducting
consumer surveys to “monitor product satisfaction and
to come up with guidelines for improvements” (see case
Exhibit 4). This initial approach reflects great confidence
in the value proposition and a focus on product quality.

 The March 2001 Survey- Exhibit 3 What do we learn

from Exhibit 3?
 What research would be needed in support
of a word-of- mouth campaign assuming we
decide to take that route?

 Users are excited to describe their own experience.

 Users don’t speak as much about product features, they primarily focus on
control benefits (watching what you want when you want).

 Nonusers do not seem open to being convinced.

 User excitement is off-putting (disconfirming) for nonusers who are quick to

deny that TV might be that important in their life.

 Users then attempt to justify their own investments in sophisticated TV

viewing by emphasizing unique interests or constraints that they might have,
and that the nonuser does not encounter.
 Different types of responses
(No convergence of users and non
users)

 The product needs to be personally experienced in the

context of one’s own life.
 There are small segments of consumers who need TiVo
and (vast) segments that need it less.
 People start from vastly different interpretations of what
TiVo actually is (e.g., a substitute VCR or a tool to
enhance live TV watching).
 People don’t want to look like TV matters in their life;
while conversations about TV shows might be frequent,
few people want to brag about their TV technology
investments.
 Exhibits 5 & 6

 Researching current users to a fuller extent

 Predicting the next wave of users
 Researching nonusers (not included)
 The Attitude Survey (Case Exhibit 7)

A relatively conservative account of the data might go as follows:

 TV with TiVo: TiVo seems to enhance the experience of watching TV,

primarily by allowing the viewer not to miss parts of the program.

 Life with TiVo: users agree that TiVo has made their life better, primarily
by increasing planning flexibility.

 TiVo and spouses/significant others: watching TV together is easier

with TiVo (primarily thanks to pause and rewind functions).

 Kids and TiVo: even though agreement with statements in this area is
scattered at best, it seems that the added flexibility given by time shifting
makes coordination of family activities smoother.
 Validity of the data in Exhibit 7

 Low scores are difficult to interpret:

 The data is tainted with self-
justification,
 Open-ended “deep” interview
 Exhibit 8

What is tivo???.
Creative Insights into TiVo’s Adoption
Problem

 What hypotheses they generated that could not

be tested based on case data.

Examples are as follows:

 TiVo doesn’t sell because people have lost

awareness of the huge importance TV plays in
their life due to habit formation.
Creative Insights into TiVo’s Adoption Problem
Some Hypotheses not tested

 TiVo doesn’t sell because people have a love-hate

relationship with their TV TiVo might enhance the love-
part of the equation, but it is not clear what it does on
the hate side. People are afraid that TV might become
more addictive or more important in their life.

How can you test these hypotheses from existing data????

How firms learn about their customers

 Little effort is placed initially on grasping the viewpoint

of customers (e.g., their motives and thoughts) in their
own terms.
 There is a bias towards researching current users
(strategy or laziness?).
 The more that is known about consumer behavior, the
less reasonable it appears that products could boil down
to a list of features and functions.
 Productive research needs to give reality a substantial
chance to disconfirm your strongly held hypotheses.
 Learning
 What should be the hypothesis that are
consistent with business strategy (of selling
TIVO bundled with satellite services) would be
necessarily privileged.
 Consumer Research in practice is not a scientific
exercise, but rather a journey where a realistic
understanding of the consumer competes
against cost and strategic constraints.
Management Decision Problem:
What should the management do to
strengthen the consumer’s awareness and
understanding of TiVo, increase sales, and
reach a broader range of customers?
Marketing Research Problem??