March 08, 2010
Sterling Lanier ('02) Brings a Strategic Perspective to Market Research
Created firm that provides a deep understanding of consumers by going where they live
As a senior at Duke University in the 1990's, California native Sterling Lanier ('02) felt that Durham, NC needed and deserved a Mexican restaurant. Sensing an opportunity, he and a friend opened a student-friendly watering hole called the Cosmic Cantina. The venue was a hit and remains one of the most popular bars in the Durham area.
"That's how I got my first taste of entrepreneurship," Lanier recalled recently. Although he sold his interest in the chain after a couple of years, he knew he wanted to continue as an entrepreneur. "That put me on the road to entrepreneurship and ultimately led me to Anderson," he said.
Moving to the Bay Area, Lanier joined a brand strategy firm called Tattoo and later moved to a firm called Prophet where he worked closely with author and consultant David Aaker. "He is kind of the brand guru and Prophet is now arguably the world's largest brand strategy firm," said Lanier. "That's where I cut my teeth."
"In order to create a brand strategy," he continued, "you need to conduct consumer research to understand the emotional levers you need to pull to create a compelling brand. At Prophet, I was disappointed with some of the vendors who did research for us, so one day I jumped in and moderated a focus group. From that time on, I did all my own consumer research, even though we weren't necessarily in that business."
Because of this experience, Lanier soon realized there was an opportunity to start a market research firm with a strategic point of view - but his first step was to earn an MBA from UCLA Anderson. "I went to Anderson because of the entrepreneurship focus," he recalled. "I took the courses offered by the Price Center and attended all of the lunch meetings where they brought in guest speakers. Listening to successful entrepreneurs had an enormous impact on me. It was just so helpful to see how what you learn in the classroom translates into the real world. It gives you confidence. These were humble guys who would say, ‘Hey, I'm no smarter than you. You can do it, too.'"
So when Lanier graduated from UCLA Anderson in 2002, he stayed in Los Angeles and laid the groundwork for a new firm that he eventually named Chatter. "Some former clients from my consulting days called and wanted me to do some market research," he said. One of the first clients was a relatively-unknown videogame firm called Activision. Today, the firm is an industry leader.
Lanier explained that his clients often want to know how customers think a product or service can be improved. "Clients like Activision will ask us to help map out the future of their largest franchises, like Call of Duty or Guitar Hero," said Lanier. "So we'll go out and do a big round of qualitative research and a big round of quantitative research."
"What we do is try to get inside the minds of consumers," he continued. "On the qualitative side, we do a lot of traditional focus groups - but I'd say about 50 percent of the qualitative research we do is ethnographic in nature. We meet with customers in their native habitats to get a deeper and richer idea of the brand and environment. We call our approach ‘consumer expeditions.'"
One of Chatter's techniques is called, "Table for Six." "If someone wants to know the state of their brand and where they should go next," said Lanier, "we'll throw dinner parties across the country and invite the firm's customers. We'll have the parties catered with good food and drink - and discuss how these people really feel about the brand. Or with categories like videogames, we might invite teenagers to a pizza party."
Lanier disagrees with those who say that customer research should be performed with groups of strangers. "That might be true with certain applications," he said, "but when you're dealing with products or services where word of mouth is a strong purchase influencer, it doesn't make sense to talk with people in isolation. Choices are often influenced by those around us - so why not take a holistic view of what drives motivations?"
"A good example is MTV," Lanier said. "We did a very big project about how teen influence works. How do teens influence each other - and what can MTV do to leverage that knowledge? So, we held pizza parties around the country and, before the meetings, we had each person make a collage. We use collages a lot. In this case, each person had to make a collage depicting their social network and the people they communicate with on a daily basis. They all made spider web-looking collages that were very insightful representations describing their communication, how they influence each other and who influences them. That provides a great launching point for discussion."
One of the things Chatter does for its clients is to bring customer input to life by presenting collages and video clips of customer discussions. "Our clients might walk into a final presentation with 40 collages hanging on the walls and video highlights showing people talking," said Lanier. "The client gets a deeper, richer understanding of the research that occurred."
"I think our moderating skills are better than other firms," said Lanier. "We're listening for 'windows of insight' that we can continue to probe. And we're listening for what customers are really trying to communicate about a brand - rather than just taking what they say at face value."
"We also try to apply the same creativity to our quantitative work," he said. "Most research firms employ quant wonks that pump out data without customizing it to the client's learning objectives or understanding how the findings will be used internally. Instead, we create novel quantitative solutions that glean meaningful insights that often can't be found with the smaller sample sizes of qualitative methods. It also makes for a great sledgehammer when socializing the findings within the client's organization."
Chatter is also unique among its competitors in that it takes a business point of view toward market research. "We try to help our clients connect the dots so they can understand how to implement our findings," he said. "We infuse market research with a strategic perspective. Our goal is to deliver meaningful business goals. That's our core differentiator. We don't just hand them PowerPoint slides and say, ‘Good luck.' My training at UCLA Anderson was a big reason that this has become such a key strength of ours. There aren't a lot of MBAs in market research, so we use this as a competitive advantage."
Chatter has employed these techniques with nearly every major publisher in the videogame industry. Also, in addition to MTV, Chatter has many clients in television including ABC, Discovery Channel, TLC, the Travel Channel, the Military Channel, Animal Planet, the Science Channel, Warner Brothers, and NBC. They also serve many clients in the financial services industry, and won the prestigious 2007 Grand Ogilvy Award for the research behind Charles Schwab's current Talk to Chuck campaign. Chatter also has many clients in new media and healthcare, such as Yahoo!, AOL, Johnson & Johnson, GlaxoSmithKline and Schering Plough.
"We've been fortunate to work with many of the most recognizable brands over the years. But one of the things that a lot of aspiring entrepreneurs don't realize is sales is hard to do!" said Lanier. "You can't just hang a shingle out and expect people to start calling you. Entrepreneurship is really about 90 percent sales and 10 percent execution. Selling is involved in everything you do, from selling projects to clients to selling prospective employees on why they should work at your firm."
In 2007, Lanier opened a Chatter office in San Francisco and a New York office followed in 2008. The managing partner in New York, Lee Lodes, is also an Anderson grad, as is a senior consultant in the Los Angeles office. And Lanier's wife, Jessica Clark, completed her MBA at UCLA Anderson the year after her husband. She now serves as Chatter's CFO. "We pretty much hold an Anderson reunion every day we go to work," Lanier said.
Chatter's distinctive position in the market research field is evoked by the firm's name. "I was walking down the street with my wife," he recalled. "I think we were talking about some celebrity gossip and I said, ‘Yeah, what's all that chatter about?' And I immediately thought we should call the firm Chatter. What we do is try to make sense of all the chatter surrounding a brand. The word chatter really implies our strategic point of view around research. And that's what gives us our edge."Contact Information
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