My guest today is Amit Ahand, Co-Founder and CEO of Nailbiter. Founded in 2014, Nailbiter is a unique platform that offers CPG manufacturers an opportunity to see their consumers make purchase decisions at the shelf and at home. Prior to starting Nailbiter, Amit has been a key executive at IRI, Catalina and Affinnova.
Find Amit Online:
Find Us Online:
Social Media: @happymrxp
This Episode’s Sponsor:
Today’s podcast is sponsored by Schlesinger Quantitative, your trusted provider of global online surveys that drive the best decisions for success in the marketplace. Schlesinger Quantitative has built an entire division of experts with extensive online research experience and an unparalleled understanding of quality drivers across panel, sample, and data.
On Episode 217, I’m interviewing Amit Dhand, founder and EVP of Client Services at Nailbiter, but first a word from our sponsor.
Today’s podcast is sponsored by Schlesinger Quantitative, your trusted provider of global online surveys that drive the best decisions for success in the marketplace. Schlesinger Quantitative has built an entire division of experts with extensive online research experience and an unparalleled understanding of quality drivers across panel, sample, and data.
Hi, I’m Jamin Brazil. You’re listening to the Happy Market Research Podcast. My guest today is Amit Dhand, co-founder and CEO of Nailbiter. Founded in 2014, Nailbiter’s unique platform that offers CPG manufacturers an opportunity to see their consumers, make purchase decisions at the shelf and at home. Prior to starting Nailbiter, Amit has been a key executive at IRI, Catalina, and Affinnova. Amit, thanks very much for joining me the Happy Market Podcast today.
It’s my pleasure, Jamin, and I appreciate you doing this podcast. I think this is very overdue in the market research business. And I look forward to the conversation; I look forward to tracking your broadcast in the future.
Awesome, thanks very much. So, I’d like to start with a little bit of your background. Can you tell us where you grew up and a little bit about your parents and how that’s impacted where you are today?
That’s a great question because I ask that question in job interviews all the time. I grew up in India and did my undergraduate degree there. I grew up in a small- business family is the best way to describe it. My dad, many of my mother’s siblings, they were small business owners, traders. This was in India of a different era, which was much more socialistic, much more repressive, if you will, from both a society standpoint as well as business standpoint. So, I always saw my dad struggle, make ends meet, do well, and then get pleasure out of being an entrepreneur, I think, and also the trials and tribulations that go with it. But the one advice that he gave me consistently was to never be like him. Educate myself as much as I could and get a job in a nice, big company and be comfortable.
So that’s what I did, but I did pursue my passion, which was physics. I didn’t do the engineering track, which is common in India if you have grades that’s what you do or medicine. I was doing my masters in physics, and that’s when professor politely pulled me aside and said I didn’t have that much of a future in physics [He laughs.] because I didn’t have the temperament to a professor or a researcher. Strangely, now I’m a market researcher. So, that was my journey to looking for something new. And my sister was getting her masters in the U.S. at the time. So, I was looking for what’s next. For a lot of kids in India back then was the U.S. So I came to the U.S. for my MBA.
In what year was that?
That was in ’96.
Got it, got it.
A different millennium.
So, I just have to ask. I’ve been to India just a few times. Did you grow up near or around Mumbai?
I was in Mumbai, yes. I grew up in Mumbai.
Yes, that’s been my sole sort of anchor point to India. As you know, Neilsen is based out of that location. And then quite a few different support companies for Neilsen located there. Anyway, it’s a really interesting… Obviously, I don’t have the… more of a recent set of experiences. But, on the other side, I don’t have the historical point of view, but it is a very different culture. But I would say it does mirror a lot of what I have experienced in other parts of Asia.
Yeah, it’s an ancient culture. I think India strikes a really good balance between an ancient culture that is modernizing, I believe, the right way. A lot of people go to India and look at what doesn’t work, and a lot doesn’t work, and we’re used to complaining about that. But if you think about how many millions of people have been lifted out of poverty in the last 30 years, it was unimaginable, right? And with some degree of freedom or high degree of freedom and democracy while making that happen. So it hasn’t been a small feat. But next time you go to India, go attend a wedding. That’s a whole different experience.
So, that’s actually (funny you bring that up). That is on my bucket list of things to do is experience that. I have had quite a few… So, at Decipher we would sponsor H1B’s. I’ve had a lot of very good employees who I’m actually still friends with, who I was able to recruit from overseas, India, of course, being one of the main areas. Fantastic engineering talent as you already said. But, interestingly enough, the overshadowing characteristic of the talent that we were able to procure was customer service. There was one particular employee, Anthony, and he would get regular, unsolicited feedback from his customers directly to me, the CEO, saying, “I just love this guy. He’s so amazing.” Just picking on him, but there’s quite a few. There’s more than a handful who have followed suit. Anyway, I want to dig in a little bit with your father’s perspective. As an entrepreneur, you’ve probably heard the Elon Musk quote: “Being an entrepreneur is like chewing glass and staring in the abyss.” Sounds like that would have resonated with your father. Why did you decide to bunk the better life at the corporate level? I’ll call it the easy road even though we know it’s not as easy as all that and decide to branch out and start a company.
Yeah, you know, I’ve asked myself that question many times; my dad’s asked me that question hundreds of times. He can’t believe that’s how I ended up. Let me complete the journey real quick and then this will make sense, right? I gave up physics, came here, got my MBA from Virginia Tech. And back then – this is pre-email and internet days – so you applied by mail. And I had a cousin, who went there for chemical engineering, and he introduced me to a professor. I got a scholarship to go study there, which is rare for an MBA coming directly from India. So I took it. It was an interesting exposure to the U.S. culture. And graduated MBA in marketing and got into market research. And we can talk separately about that. But, having spent some time in CPG market research more specifically, I had two sorts of burning questions. One was the field seemed extremely rigid and archaic, right? And we used to think physics was rigid and archaic. Nothing changes in physics until it changes and then it all changes in a week. But market research has been rigid and archaic ever since and has stayed that way. So I think part of me becoming an entrepreneur has been the motivation to bring change into the business because, as someone who has exposed to other ways of doing things, other disciplines in research as well as technology, I feel like there is so much marketers could be gaining from the data that they’re spending billions of dollars that they’re just wasting, right? So, that was one desire. The other desire was to be responsible for my own destiny.
So, I actually wasn’t an executive at IRI. I started as an analyst, moved my way up, and then I wanted to be a sales guy, which everyone found super strange. I was a statistician when I began there, but then I was dying to be in sales, and not just sales but commission-driven sales because I wanted this degree of destiny. If I do well, then I do really well; otherwise, you kind of go down in flames. And I liked that; I liked that challenge. I feel like entrepreneurs are self-motivated in sort of a negative way. What I have seen is that entrepreneurs work on great challenges, or they don’t work at all. And I’m guilt of the same: I get called out by people on my team that, if I’m working on a project that’s not strategic and not big and not interesting, then I miss all deadlines. But, if I’m working on solving a problem that’s pretty important to the company or to our client and it kind of seems very complex and difficult, then I’ll be at it for a week without food or sleep. That I can do. So I feel like a lot of entrepreneurs are very intrinsically driven.
I was intrinsically driven; I think my dad was because if you look at compensation, which a lot of people look at. When you’re successful, it’s very easy to see the house and the car and all those things and a lot of people look at that. But most entrepreneurs, myself included, these are by-products that we enjoy today that we didn’t seek, right? So the idea was to do something different, to be recognized for doing something different. So I would not think that entrepreneurs and Elon’s the biggest example of someone who’s not shy, who craves the recognition; so, I can’t say I don’t. But, fundamentally, drive change and not rest on your laurels; you’re always looking for the next problem to solve. So it is an interesting sort of mindset. What’s happened today is entrepreneurship has become easy. It is not my father’s world where… By the way, all his business was in cash because they had a 90% income tax rate, 90%. Imagine that.
….which meant you really couldn’t do official business. Everything was done in cash. And on payday, he used to go to the office with two huge suitcases of cash, and one time he got mugged. And he lost one suitcase; he had to go borrow another suitcase for the cash.
So it was an extremely difficult environment: you had to bribe your way through everything; he was in manufacturing; so, it was also a physically dirty environment to be in. None of that is true for the entrepreneurship that I practice. I think the one fundamental difference between him and me is that he never trusted anyone. He was quite successful; so, I’m not knocking anything he did. But his whole thing was trust no one and, you know, you’re an island as an entrepreneur. And I don’t buy that. Thankfully, I got some genes from my mother also, who trusts everyone, and I trust everyone. And my operating principle – and I think that’s easier to do in the U.S. than some other markets – is trust people ‘til they give a reason not to trust them and you surround yourself with people who generally are trustworthy, loyal, smart, intelligent, better than you in most things. And, surprisingly, you will do well.
I think this overriding principle of karma, if you want to call it that, is exactly right. Framed, as you’ve already said, in our modern society, which is (in North America anyway) certainly easier than it was 20, 30, 40, 50 years ago. We have the luxury of being able to trust or maybe we’re just more willing to take those risks because we have less… We’re not worried about food anymore, which is something that my father was worried about, growing up. And so, this freedom, if you want to call it that, that we have as entrepreneurs to be able to step out and solve the big problems, as you said, is exactly the point. It isn’t about the monetary outcome although clearly that’s great when it happens, but the motivator is 100% centric to working with people, solving this big problem, and then bringing about an effective change inside of an industry. And I want to just rewind just a little bit. Market research from your vantage point, using your words, rigid, archaic – why did you feel that was the fertile soil. How did you get introduced effectively into it as “This is where I’m going to make my bed”? for Nailbiter.
So, market research is a space I learned really well from the inside out and, more specifically, CPG market research. And Affinnova was a company that had been in business for many years that then CEO was my mentor had pretty much taken over, acquired, invested in and decided to make it more of a data company than kind of a design optimization engine that it was. And he brought me on board in 2006 and together we made some strategic decisions. And one of them was to be in market research because it was an entirely new tool; it was evolutionary algorithms applied towards market research. And it flourished; it did really well. Now, it was extremely hard to convince big CPG clients to start using us. It took us many, many years (eight, nine years) eventually to make the company what it became. It was a top 20 MR firm when Neilsen purchased it in 2014. So, I was one of the handful of people who worked day and night to make it happen, to take it from a couple of million in revenue to 40+ million global operations. So I really saw what entrepreneurship means in this space from the inside out so that when the Neilsen acquisition went through, a few of us had a couple of bucks to spare. Now, the rational decision would be to invest your money and… It wasn’t enough money for us to retire, but it certainly was enough money that we could take it easy. But I decided to go for broke, and we invested (when I say “we,” it’s several of us, myself being the principal investor) in doing something new, and I wanted to stay in a space that I know well. So market research is data; data is the pursuit of something empirical, which I really like. I like that answers are finite; they’re definite. So, there’s a lot of aspects to this business I like. I’ve always enjoyed the people in market research. No matter where you go: you could be in China; you could be in India; you could be in France; you could be in Latam (Brazil, Argentina). I’ve been everywhere and always found like some degrees of uniformity: They’re slightly nerdy but more marketing-driven than maybe people who are in the pure sciences. A really nice combination of intelligent, intellectual people who are pursuing answers. Broadly, that’s the space I wanted to stay in. Another thing that I learned over the decades is that CPG is a recession-proof business; so, if you’re going to do something risky you might as well pick clients that are more stable although this is probably the least stable time to be in CPG. But I enjoyed that I had built a reputation along with my co-founder and some of the other people in CPG. So that is the place that we decided to pursue. And then we tried a lot of different things before we landed on video. So, I’ll pause there ‘cause I was going off on a tangent anyway.
That’s fine, perfect. So, CPG is recession-proof. I love that framing. I feel like the space has been proven to be ripe, right, for disruption when you think about the Amazon effect inside of CPG’s. I’ve talked about this on a few different podcasts and I’ll probably talk about it on a few more: and that is the impact of voice is going to make, is making rather, on the user purchase journey, especially in the CPG space. Purina’s stat something like in the next three years, they’re projecting 50% of their product will be purchased in a voice environment through Google Home, Alexa, etc. I personally and my wife are starting to acquire products through, you know household goods, through Alexa. And in that purchase journey, what’s really interesting is just going through the exercise, you wind up buying things differently. The only intercept is what Alexa decides to put in front of me. Are you seeing that as part of the instability in the CPG space or is it other factors that are driving it?
So, we come at it from two ways: One is the consumer dynamic that you referenced is very true. I do think that voice is a little bit more further away than a lot of people think. I think VR was considered something that’s around the corner five years ago. A lot of interesting companies in context; a few others sprout up but VR didn’t quite happen largely because of some hardware issues. I think similar problems are going to exist with voice, but eventually these technologies will take over. Now, what’s interesting with voice though and video and VR is they are perfectly placed and already available as great market research tools. So, they may not be good enough to conduct all sorts of marketing transactions or sales transactions on; they’re very, very robust for market research. And one of the things that we keep educating the industry, and I was just invited to speak at ESOMAR… We’re kind of begging the industry to take video quant, which we are doing. We do very little qual. Everything we do is very, very robust sample sizes. We’re not doing very ethnography. Our whole idea is capture a transaction; don’t worry so much about getting into the head of the consumer. Make an effort towards behavioral but let it be robust; let it be truly projectable; let it be something that CPG can make multi-billion-dollar decisions on. And that’s that data we are driving to create and are successfully creating all through voice and video. Five years from now, it could be that all your social interaction with friends and the internet at large is audio-video. And that happens to me: Our main office is in Virginia. I drive down for four hours once or twice a month, and the whole drive down there, I don’t have to touch my phone. Voice activation, even with my accent, works nearly perfectly. I can type emails; I can text; I can use all sorts of things in that type of interaction. Why would someone want to type? And, if they can’t type, how can they do online surveys? So, the survey companies, everybody has to make sort of these giant leaps forwards into an entirely new interaction with the consumer in the shop or… And that’s where I feel audio and voice and video and all of these will move faster than they will as sort of a broader e-commerce platform. The problem with voice is the margins: it’s very expensive and going to remain very expensive for that case of Diet Coke to be shipped to my house. So, it might work for some pet foods or the premium end but, if you think about 70% to 80% of pet food being more towards the middle or lower end, the price point of going to Walmart and picking up those 50-pound bags at a really good coupon, that value is not going to be beat for a very long time to come. So you will see the very high end and we’re seeing the top 1%, 2%, 3% people disproportionately move their dollars because convenience is more important to them but, for middle America, CPG’s sort of bread-and-butter, we think that these other systems are like about a decade away.
So AR, VR, there’s obvious hardware issues. Nobody is going to walk around with those crazy headsets and whatnot. Even snap glasses are highly iffy according to my children. I personally like them, but they tell me, “They’re not cool, Dad.” The voice, though, as a platform… Consumer preference, as we both know, always wins. So then the question becomes, as you’ve already articulated, when. My theory, which is completely based on no data, is that it’s going to be half the time of e-commerce, right? So, when you think about like 1996, I love your framing of “We did mail back then.” I did mail back then. In fact, all my surveys were CATI and in-mall intercepts. That’s basically telephone interviews for those of you who don’t know. And so, then moving that online officially with Decipher in April 2000, that was a big transition. It’s taken a long time for commerce to move online, and still the majority of commerce isn’t there. So, still got a long tail associated with that transition. Obviously, it’s picking up steam with Walmart’s investment in home delivery, etc. Kind of the Uber of, just pick whatever category is taking over… I think you’re right from a practical perspective; this is not something that’s going to happen in a short period of time. So, if it was 20 years for the internet or 15 years for the internet, it seems to make sense to me. But, conversely, on the other side of it, when you think about with voice, you’ve got (what is it?) 40 million Alexa units in North America last year.
Yeah, it’s crazy the adoption that’s happened on that front. Now that we’ve got the, as they call it in the retail, the 13th month coming up this weekend (Black Friday and Cyber Monday) in a few days, we’ll see what those sales pop out at that point, but anyway. It’s going to be interesting to watch. So, I want to talk a little bit more, dig in a little bit more on your company Nailbiter. The first question I have (Man, I have done tons of market research; in fact, right now I’m doing market research for a couple different companies) but Nailbiter – that is every project it feels like, right? And I can’t believe I never made the connection to business. I’m a little bit jealous. How did you guys come up with the name Nailbiter?
So, I would love to take credit for it, but it actually came up in one of our early meetings. We sold one of our early projects to Ricola. We went in for the results meeting, and I think it was the General Manager or the senior person in the meeting that said, “Alright, let’s get going. I’ve been biting my nails to see what’s going on.” And they had a very specific Costco issue that they had tried a lot of different ways to do research and they couldn’t figure out because the issue was very subtle. I mean it was a big issue for them, but it was very subtle for the consumer, too subtle to survey anybody to ask them about it. It was about the size of the bag and the location and how things get dragged out and things like that. Up until then, we were called Motions Research, which was a typically boring market research name. So, coming out of that meeting, I was with my colleague; I said, “You know what? Nailbiter is a lot better than Motions Research.” And it stuck from day 1. And you’ve been in market research long enough to know that the people you have to be most memorable to are the ad men, right?
100%. That is exactly, exactly, exactly right. Insights Nation, this is the key point. This is going to be the title of this episode for sure.
And it stuck. Every meeting I used to go to, the ad men would say, “I’ve been waiting to meet you. I wanted to see who you are and what this is about.” And then they would remember me; they would remember us. We would call them the next time; it would make the whole process of getting in the door a lot easier.
Totally, man, totally. So, tell us who is the ideal customer for Nailbiter.
Heavily focused on consumer goods, consumer packaged goods, FMCG for the rest of the world for a couple of specific reasons. So, I’m not someone who is going to badmouth online surveys. Online surveys played a very important role. In fact, in 1998, when I was first starting in market research, I really liked the idea of online surveys. You guys came up in 2000; you were the pioneers then because a lot of people still didn’t believe that this thing would be a thing. But online surveys have become like a crutch for everything. You have a question: let’s go ask 1000 consumers ‘cause it’s so cheap. And we’ve noticed that more and more the industry has been doing that. The industry that suffers the most in using online surveys in these ways is CPG because CPG has some unique problems. One of them is recall. I don’t know what toothbrush I use and I’m in the business of toothbrushes, Colgate’s customer. And suddenly, I wouldn’t know what I paid for it even though I do most of the grocery shopping in my household. So, for me to do a 20-minute survey on toothbrushes when I don’t know so many things about my decision – no matter how good the model at the back end is that crunching the data – the inputs may not be as good. So, we felt that if we had a more behavioral way of capturing the actual transaction, let’s apply it to CPG and that thesis has really paid off. So ideal clients are any industry that wants to hear from the consumer, wants to see the consumer, wants more global quantitative behavioral information but is not being well served by surveys because while we are quant, no one can touch the scale of surveys today for the price that surveys are. So that’s where we feel we have the greatest bang for our buck and, indeed, we’re able to side by side show data that just coming out of our system is a lot more actionable because you don’t have to ask any questions. The system just records the transaction and then decodes it; so, it’s open-ended yet much more insightful, if you will.
Alright, so then, describe to us what the actual product is from Nailbiter. Let’s pick on Purina. I’m an executive of Purina. What is the delivery?
Sure. So, actually, Purina has been a client, but everything I’m about to say is not from any of their projects, but think that you are launching a new product. And you have invested millions of dollars in concept testing, developing it, R&D. You really believe in the concept. You’ve spent a lot money optimizing the packaging, and then you have 20, 30 million dollars invested in TV after the product hits the shelves. So, this major, major investment is about to hit the market and, by the way, at a smaller level, you’re doing this every month. At a big level, you’re doing it a few times a year. So, CPG company’s job is to innovate and stay ahead of competition and private label; so, they constantly have to come up with things that are new: new marketing, new products. Now, that product goes on shelf; a lot of in-store marketing is happening. What you’re getting in the early days is some distribution data; you are getting sales data. None of that data has any insight. So the insight has to wait til maybe the Catalina or Neilsen, IRI tracking systems that are more household level take off. Or you could do some mystery shopping and shop-alongs and things like that. In our system, because again we are watching people make shopping decisions, we can see what percentage of stores are carrying the product; we can see what percentage of shoppers have seen the product, have touched the product, have picked it up, have carted, or put it back. And then, people also speak sometimes; sometimes they don’t, but if they say something like, “Well, I don’t get it” or “That’s too expensive.” Whatever it is, their few words per shopper, across 500 shoppers, you can come back to that executive (and we’ve done this at most of our clients in days and weeks) and say, “Your product is having a real challenge because the packaging is black; the pack on the left of it is black; the pack on the right of it is black. So, when we did our pack testing online, it popped because everything was white, but the shelf has changed or the retailer has planogrammed it differently from what they promised you. No one is even seeing it. Or they’re seeing it but they don’t get it that this is a premium, organic product because you have the simple packaging and all the claims are on the back. And a 20-pound bag of dog food is not something that one lifts to see the back or maybe they do. So, all of that gets captured; it gets turned into very tangible data and measures that they can make effective decisions on very, very quickly. So that’s sort of the power of bringing something new to the table but then having it be actionable so that output of it is not just, “Hey, that’s cool insight. So let’s do another project with this video company next year” versus like this is an always-on-system that you’re making decision on every week.
Are you leveraging AI or some other math to do the insights at scale or is it just human beings just crunching?
So, it goes in three levels: The first is automation. There is a small degree of AI in the way the video is processed, but I don’t want to overplay the AI piece either.
You’re the only one, by the way. Everybody else overplays the hell out of AI. I’m sorry. It’s just a max-diff. Anyway, go ahead.
Correct. Hey, I’m drowning in AI, VR and all the acronyms, but our original thesis was that 100% of the video could be processed programmatically. And it was true when the video quality was very pure. So, we had also thought that we would create some sort of Google Glass kind of a panel: high-res images coming and high-res video coming in, but none of that could scale. Thankfully, Google Glass we didn’t use because they stopped making it. But we wanted scale, and scale comes through people’s mobile phones, and that’s what we use. So, we have two technology platforms: One can recruit people just-in-time and convince them to make a quick video of their transaction for a little bit of a reward. (Don’t want to give too much reward to change behavior either.) The second and more important can take video in any format and process it three ways: The first way is automatic, programmatic AI, if you will. There we can slice up the video into images, enhance the images, look for brands, and make correlations through that. That gets us to about 30% or 40% in English. If you’re talking about Chinese, that gets you to 10%. Then the second layer is a crowd. So, we need to process extremely high quantity of videos. And we need to know what’s inside this video. So once the machine has done its job, we have our platform – just like it can recruit real shoppers – it can recruit in the same market people who will see the short video or even like a five-second snippet of the video and say, “In this video, is this brand, this brand, this brand and this is the price. They can decode the video very, very quickly on a crowd platform. And then finally, once the data is 70%, 80% baked, then our people take over. So, we do have analysts who watch videos. There’s no way to get around it. I watch videos from time to time. What they’re looking for is to see what degree of accuracy we’re getting in that platform. Whatever manual stuff needs to be done, they do it. My joke is that HI is still a tenth of the cost of AI. Human Intelligence, you can have people…
100%, by the way. This is such a great point that you’re making.
Yeah, and they don’t need a lot of training because CPG market research, above everything else, is about common sense. If you’re someone smart and educated, I can give you a little bit of training. And, again, remember that we’re not processing these videos ethnographically. We’re looking for specific markers. And then audio is a lot easier to do, to transcribe and use programmatically. So that’s kind of the platform we’ve had to build because AI is just not that good. And if you talking about native video, AI is not going to get good. Where you can actually use technology is if you can use crowds to capture. It’s a very interesting thing. I had a lot of companies (I think Google tried it) when you translate capture from visual to text, enough people do the same thing. They know that this is real text. They can translate a book. And that’s very interesting. We use something very, very similar to translate, transcribe these videos. And we really think that the gig economy offers market research companies this tremendous benefit of becoming tech-enabled but not through AI but through HI. It’s just that you don’t have to hire hundreds of employees. You have this just-in-time workforce that you can leverage.
Yeah, just from a community component, I really like the idea of the power of HI. When you’re talking about the gig economy, just being able to have more of a distributed wealth because you have an open work opportunity. It has a tremendous amount of community value or human value, I should say, assuming it’s the right shoe for the right foot, right? To your earlier point, there are obviously clear applications and winning applications of AI over HI. I want to circle back for just a moment about this point that you made early on, which is on surveys. And I think this is a really important point for the other executives. Do you see surveys as the budget that you’re competing for?
That’s an interesting question because most of the business we win, we never find out what they cut because it’s very rare that we even do business in an RFP setting. In fact, most of the RFP’S that we get inbound, right? We know we’re not going to win; we often don’t even bid, the reason being it’s a mind shift. And if they think of it purely as a replacement for something that they would do in a survey form, then they’re going to be disappointed because in surveys, one of the big benefits, it’s closed-ended again for a very small amount of money, relatively speaking. You get a lot of quantity of answers, right? And what we are saying is that the game is about the quality of the data and the actionability of the data; so, we don’t get put up against surveys. But in a different context, we think of ourselves as a video survey. So, better educate the marketplaces. We’re not a tech company. We wanted to be a market research and data company. We had to build a lot of technology to facilitate the type of data we wanted to extract. Now we have built that extraction engine based on video. We’re very open, and we’re talking to a lot of other market research companies outside CPG to license it. In a way, we think of it as a platform, and you can think of it as a video-survey platform. So, we actually don’t think of our technology as being different from online surveys. We think that this is a big part of the future of online surveys, right, the audio-visual component because we also have a survey engine. So, if I want to know if you’re male or female, what’s your age, income (all of these standard questions), I don’t need to make a video out of that and increase all my costs to get that information. You can give me that information very clearly. So I want to use video truly for observational, if you will. So, that’s how a kind of see the evolution and that’s where I think most of the platforms today that are online survey platforms, I think will be adding audio-video to their platform within the next few years. So I just see that, all of that kind of just coming together. I don’t think that for the next decade, we’re moving away from online surveys, but I do think CPG tends to be leader in market research. So I think it will lead the way in video and audio. I don’t know if that answers your question.
Yeah, I mean it’s really interesting point for me. As an entrepreneur, I always think about what is the… Actually, the person that this idea came from is a man named Doug Gallypso. I have a tremendous amount of respect for him; he’s on my previous board of FocusVision. Anyway, he actually asked me a question one time: “Jamin, are you competing for an existing dollar or a new dollar”? And it was this Ah-ha moment for me. And it’s one of the reasons like, if you think about like Uber, Uber was so successful because it wasn’t trying to create new budget, right? I was already going to pay for a taxi ride; it’s just a better taxi. You know what I mean? And so, like there was no argument in my mind of, “Oh, I’m going to pay for an auxiliary service that’s going to create a better experience.” One of the things that I’ve seen and actually been part of in entrepreneurship is I’ll come up with new thing (We’ll call it an online survey, which sounds ridiculous right now, but it wasn’t in 1996) and say, “OK, now, I’ve got this new mechanism by which I’m able to gather consumer insights, and, Oh, by the way, it’s great.” So, the corporations in those days, they really struggled with it, but it did have parity with a budget line item. In other words, it’s still a survey, right? It’s just a third category or whatever number categories there are. That’s where I’m seeing what technology has brought forth in the last, I’ll call it, three years, like a plethora of video, audio, and text-based hybrid qual/quant tools that’s basically qualitative at scale. And everything is pointing (and I’m also done with my rant) everything is pointing to one thing, which is a better conversation with the consumer. When you think about what surveys did a hundred years ago the way it started when this whole industry started, it was I needed to have a conversation at scale with my constituents. In order to facilitate that, I needed to be able to do a standardized set of questions across people. And so, then those have to get analyzed, obviously. And the way that was done was data tables, and then from that we now know that there are 2.3 children in every household. But the reality is nobody has 2.3 kids or whatever the average is. And so, what these qualitative at scale products are bringing to market is actually, to your point, a different… So it’s not the same thing; you can’t compare them. It’s not a survey, and it’s not a focus group. It’s something that’s like right in between those two things. But where I’m seeing corporate budgets having a hard time tracking is how do I pay for it. In other words, “Am I not going to do the survey?” “Well, no, maybe I still need to do that.” “Or am I not going to… Well, no, I still want to see the face or whatever it is. I want that human interaction piece.”
That’s why I think today is a very good time for us. There are two reasons for it: One is marketing requires data to make decisions. No marketer today is going to do the 1950s, “Well, I’m smart; so, I can just guess it.” Every decision they make requires data. And our pitch to these big companies today is very frontal where we say, “Look, you’ve been buying billions of dollars of data, yet you keep losing market share. And e-commerce, your market share is down ten points over your traditional commerce. Why? Because you’re playing with yesterday’s tools. So, if the data you’re buying today is so perfect, then why are almost every big manufacturer, especially the food manufacturers, in trouble?” So, clearly, there’s a need for better data; there is a need for better decision making. Not every meeting goes that way, but some meetings you can have that discussion, and you can kind of do that broaden-the-horizon thing. But the second piece quickly has to be actionability. So, I gave you the example of new products. Same thing applies for marketing. We can literally tell our clients that their new product is going to succeed or fail in two weeks. Before the product reaches 20% distribution, we’ll make a prediction. And in the right situation, if it doesn’t sound too sale-sy, I’ll tell the client, “I’ll give you double your money back for whatever you pay for my data, if my prediction is wrong.” But, more importantly, if my prediction is right and 80% of new products fails, I’m not going to come back and say, “Oh, look, your product failed, and I predicted it, and screw you.” “But I’m going to come back and give you three ways that you can fix the problem before the retailer even realizes it. Get your product out of this part of the shelf, put in that part of the shelf. That is also your shelf; so, that it’s an easier transition. Get the price down by 30 cents. Put a coupon on it. I will give you very, very actionable answers that will change the metrics and will change the future of the product.” So, that type of conversation – again it has to be much more subtle than the way I’m presenting it to you – that works. And the last thing I’ll say about this is that market research has to… We, as researchers, open our minds grudgingly, if you will, when we are pushed by people like you to think about online. It took us a long time, but then everyone loves online today. But we’re going through the same problem again with the internet of things, VR. All of these other communication tools, and experience tools (voice, Alexa, right?) are going, scaling up, but we’re ignoring it where we have our head in the sand, going, “Well, online survey is the way to go because I can get a sample of 1000.” So it is our job, I think. to expand our clients’ minds, but we have to do the R & D at our cost so that the information that we bring to them is actionable. And that’s been a big problem with neuro and behavioral and those techniques where you go and say, “Look, I hooked up 100 people to an ECG and look what I found.” “OK, how do I sell more Coca-Cola based on this data?” “Well, you can’t.” So that’s where the disconnect is, I think, and I think it’s going to change.
I mean there’s a couple things there. Rogier Verhulst from LinkedIn had this great quote that I keep coming back to: “Every research project needs to have the ‘now what’ and ‘so what’,” as the follow point. Sexy technology is just not the answer. It’s the better insights, to your point. And in the second part, Kristi Zuhlke from KnowledgeHound had this framework of what’s the ROI on each project. And it’s incumbent on the research company, the provider, as well as the internal research to make damn sure that they know what the financial outcome is of that research. It isn’t just, “Oh, well, now we know there’s 2.3 kids.” There needs to be a “Why,” that “Now, OK, oh so that means I can sell more stuff to this particular demographic” or whatever it is. That’s the other piece. And I think as long as market research can cement those anchor points in their deliverables, then it makes it a lot easier for the brands, the CPG companies, to know ‘cause it’s a zero sum game for them, “OK, I’ve got $50,000, whatever it is, to do my research. So, what’s the optimal allocation of those dollars across my suppliers or knowledge partner or whatever in order to answer those questions so that the executive is able to make a decision with confidence?” And that’s kind of the broad point that you’re making and I just couldn’t be more excited about is that us, as an industry, for us to continue to grow and really I think assume our position of dominance inside of the corporate org chart, we’ve – like you said – we’ve got to bear the burden and then not be afraid to talk about this shift in consumer insights. Four years into your startup, you’ve probably seen a wide variety of people enter your work force some successfully, others not. What do you see as characteristics of an All-Star Employee in context of a startup?
You know this is something that I think about a lot because all startups live and die by getting a good team of people together, but market research and data-driven startups even more. Because we’re really not pitching an algorithm or a technology, there needs to be these human translators that can take the data and talk to customers about it but really from a perspective of both empathy and consultation. So, a quick sidebar is that we have a very strong principle and we’re extremely technology-driven as a company but we don’t give any of the technology to the client because our clients pay top dollar for the data (we’re very premium priced) and, in return, they want to talk to a human being. Why? Because they work on 50 projects at a time these days. They just want to be sure that that person at the other end is not going to leave them hanging with a dashboard, which a lot of companies do. So that’s built into our pricing and our business model. So, when we look to bring people on board, anyone who’s going to touch a client must know market research and must know market research really well and pretty much all aspects of market research that the client deals with because we don’t live in a vacuum and our data doesn’t sit in a vacuum. You have to have context. So that’s like a given. Of course, the people who work on the product and technology have technology background, but today I would say a lot of them have become market researchers. So that’s very, very important. But beyond that, it’s really people who are smart. That you can literally look at the high school or college GPA and tell if someone’s smart. Not all smart people have high GPA’s, and I’m proof of that, I think so. But anyone who got a good GPA early on in their career probably is smart. It’s not easy to get good GPA’s. So, if you have those two things, then the third thing is motivation. That’s it. If the person sitting across from me is motivated to work in a startup, to be a part of something new, different, growing rapid pace… First of all, it’s infectious, you can tell. You can see it in their face. You can see it in the way they speak. You can see it in the interest in the product and how much research they’ve come before coming here. You can see it in the follow-up that they do. And certainly, you can see it perhaps in their resume as well.
Then you have another type of person who is kind of becoming insecure about their job at a big research company and starting to look around. And that person is going to fail in a startup environment. Another type of person that I look for which is a little rarer is all the stuff I described before with enthusiasm, etc., but more goal-oriented. One of the hottest new hires we’ve made, Graham (I’ll call him out). He said in the interview that he wants to be doing his own startup in five years or be CEO of startup in five years. He’s a young kid. And I like that because if you have a goal, and I can help you in your journey towards your goal, then you are much more likely to do what it takes to be successful at Nailbiter. And your success will be the company’s success. When I joined Affinnova, I was very young, probably naïve and stupid. Those characteristics also help a little bit, but I was extremely determined for Affinnova to succeed not because I liked the CEO and he was a mentor and all this stuff and the company was great but I wanted to succeed. And I felt like here’s a vehicle that’ll help me get around the trap of manager, VP, SVP at Neilsen, that traditional path. I’ll make money; I’ll be independent; I’ll travel, which I love to do; I’ll travel the world. And I made the job what I wanted to be. And that’s what people do when they join a startup and become successful; they start kind of asking for things: “Can I do this?” “Can I do that?” And, within reason, you have to let them because then they will do things they’re good at because they want to succeed. And again, if it’s aligned with company’s goals, the company will do well. So, these things sound difficult; they’re actually not. But the flip side is “Don’t pretend to be a startup.” And I’ve seen that a lot at bigger companies: “We’re a startup within a startup.” “No, you’re not.” A lot of CPG companies are doing that these days: they’ll create like a startup room in the basement, and this is a startup within a startup, but at 5:30 everyone is gone. And rightly so, because if that startup within a startup becomes a billion-dollar enterprise, those people who worked on it, they get nothing. They get a decent bonus check. But, if you really did a startup and you worked 24/7 to make it successful, you’d be a billionaire, probably the wrong word to use in market research. I tell everyone a billion dollars doesn’t exist.
Unless you’re Ryan Smith. I think he did OK on the Qualtrics exit.
That’s true, that’s true.
Congratulations to them, by the way.
They are exceptions. That’s my answer to people. And even the market research piece at Affinnova I would teach because we had more resources. Here we do hire people who have the experience but that experience and skill set is very secondary to intelligence and motivation, I think. Those are things, you can’t learn them; you can’t just put them on.
So, we’ve talked a lot about Nailbiter today. Do you have any parting words or ways that people can get in contact with you if they’re interested in finding out more?
Yeah, contact me on LinkedIn. I love talking. You are very easy to talk to. I hope to continue the dialogue with you. I’m not very good at communicating through email and other things, but I actually have someone who checks LinkedIn and a lot of interesting people I find reach out through LinkedIn. And I enjoy having conversations. Anyone who’s listening to this who has no interest in buying data from us but wants an education, I’ll be happy to teach, especially people who want to copy what we’re doing and steal from us. We love that too. We’d rather have 50% market share of a big pie than 100% market share of a small pie.
So we are going to be reaching out a lot more through conferences and through forums to educate the marketplace because I think we’ve hit upon something, but we’ll find out.
My guest today has been Amit Dhand, co-founder and CEO of Nailbiter. Thank you very much, Amit, for joining me today on Happy Market Research.
My pleasure, Jamin. Thanks for inviting me and thank you for this podcast that you’re doing. I hope that more and more people will listen. And I think you’re somebody with interesting ways of interviewing people. So I wish you continued success.
Well, thank you very much for that. And thank you, everyone, for your time and attention today. I hope you have a wonderful day. As always, please, please provide us reviews whether it’s on Apple iTunes or GooglePlay. Your reviews are how other people like you are able to find our podcast and it is our oxygen. Have a wonderful rest of your day.
Schlesinger Quantitative is proud to have sponsored of this podcast. Schlesinger delivers comprehensive online survey solutions, including survey programming, world class project management, intelligent recruitment, survey hosting, and data delivery services. An uncompromising commitment to your success sets them apart.