The Scottish Referendum - Let's deal with that PEST......

Well, today’s the day that everyone is talking about – the Referendum on whether Scotland remains in the UK or goes independent ending a union that is the United Kingdom. 

Everyone is talking about it and, before the ink is dry on the ballot papers, the press is rife with dramatic headlines about what will happen when we all get up tomorrow morning.  If it’s “aye” then we’re all facing change – north and south of the border.  Things we’ve had as part of our lives for generations may change or even be consigned to history.  What will happen to the NHS? Will the Queen still be head of state?  What would happen to the BBC?  What about the Armed Forces?  Would there even be a new border control?

Factors in the external Macro environment, that form the acronym PEST or PESTEL, are usually theoretically explained to marketing students as almost remote to an organisation but they could now be very important particularly if your business involves customer segments and markets in Scotland.  Whilst on this day, the Scottish people have control in their hands with their individual vote, once the deed is done then these factors are uncontrollable but perhaps not as remote to your business as you would like.

Let’s just review some of these in the context of a “yes” vote:

Political / Legal – clearly the most prominent factor here in terms of headlines.  The Scot’s as part of an independent nation would have total control (that’s the point after all) but what about the English parliament?  Lots of implications regarding the Conservatives and the PM himself and even if it’s “nay” then there’s political strife ahead as more powers will be devolved anyway.  Will Scottish MPs have to leave parliament and what affect would that have?

Economic – Would Scotland’s economy fare better inside or outside the UK?  The “yes” camp say it will.  How would the economic turmoil we’ve seen the past few years affect a smaller independent country?   However, doubters question the possible loss from not having direct access to the rest of the UK for its goods.  Some multinationals have said they’ll relocate their headquarters from Scotland to England.  There would be big changes ahead with a new currency and the amount of debt that parliament have said will transfer to Scotland’s hands.  All this change could affect jobs, taxes, disposable income and pensions.  

When a business markets internationally exchange rates are of course important and Scotland as a republic will be errr international as far as a marketer is concerned.

Inevitably, all this uncertainty will have a dampening effect on consumer sentiment, business confidence and investment intentions which could be as gloomy for us all as a wet weekend in the Outer Hebrides.

Sociological – our culture and heritage is what makes us British.  We’re famed for it and a little teased by it at times, let’s face it.  There will be a need for new Union Jack, perhaps new National Anthem (and the Scot’s would have to agree on what theirs would be) and what about the Queen?  The latter question may not have a direct effect on marketing per-se, unless you make mugs and tea-towels with Royal Family branding, but a lot of companies market “Britishness” and an erosion to that, however slight, could cause us to choke on our Earl Grey tea.

Environmental – As I am contemplating whether there are any issues here that we could discuss, my eye glances at a snippet in the Daily Mail about Shetland, that oil-rich island very very far north.  There was some discussion in the media about Scotland being able to capitalise on being oil rich as an independent nation but, before we start contemplating a Scottish Dallas, the Shetland Islanders, in the event of a “yes” vote, may make the decision to break away from Scotland and remain as part of the UK. 

The Scottish government says Scottish renewable energy is the most cost-effective source of low-carbon electricity, and enables the rest of the UK to meet its climate change targets.  In return, financial support for renewable energy schemes and the transmission network would be met by consumers across Britain.

The UK government says any decision to import energy from an independent Scotland would be taken on a "commercial basis" i.e. if the numbers don't stack up it won't happen.  That could leave consumers in Scotland to foot the bill for renewable energy schemes and investment in the transmission network.

Technological – no discussion on external environmental factors would be complete without switching to technology.  Nothing particularly springs up here (and analysis sometimes results in “analysis paralysis” after all, so my students tell me) but if we have border controls resulting in passport checks, it reminds me of the chaos that engulfed the UK passport agency this summer.  Could the Scot’s have a better techy process for issuing their passports in a timely fashion?  Aye, it’s possible and if they do, can they sell it to the English please?

This referendum is unchartered territory and we’ll have to wait and see tomorrow what the future of the UK will be.  One thing’s for certain, marketers everywhere will be affected and will need to adapt and change, just as they should.

Scottish Referendum Opinion Polls - who is really going to win?

Everyone likes a good statistic and an opinion poll can make a fantastic headline, however, there is more to interpreting the results than many journalists care to mention. 

As the Scottish Referendum looms on the 18th September 2014, the result is so close, many commentators and researchers feel it is impossible to know which way the referendum will go: the UK is literally on a knife edge.

From a research perspective, the headline percentages are not the only thing you should be aware of. These don't tell us the true story. We have to consider how close to the true result the survey actually is... there's no point releasing the results of a survey saying 80% will say Yes, if the final result  is 40%. 

So the first thing we have to do is to get a statistical level of confidence in our findings - the normal accepted rate is to be 95% confident in our results. This level helps us to make some calculations on the necessary sample size needed. Most polls take a figure of 1,000 people from the population. 

We then have to consider the margin of error. If we asked everyone eligible to vote in Scotland (approx 4m), rather than 1,000 people, what would the true result be? Our margin of error tells us how many percent either way of our survey percentage that true result could be - and for 1,000 people it is going to be +/- 3%.  

If we take Panelbase's opinion poll from 12th September 2014 that published a vote of 46% for Yes, this went to 1,000 people with a margin of error of 3%, so you can be 95% confident that the true result in the referendum would be between 43% and 49%. Now just to confuse matters, they published 3 statistics: Yes 46%, No 47% and 7% Don't Know, so some journalists may recalculate the results based on those who have decided, and we cannot equate for the number of people who may not vote at all on the day. Previous election turnouts may give you an indication but this is a once in a lifetime referendum so those statistics may not be reliable.

So if we consider the results of a poll by Panelbase published in the Daily Mail on the 15th September 2014, this excluded undecided voters and said No was ahead with 50.6% and Yes was on 49.4%. We can be 95% confident therefore that the true value is No: 47.6% to 53.6% and Yes: 46.4% to 52.4%. We can see from this that it is impossible to call: the published statistic of No: 50.6% could equally be achieved by the Yes campaign. Results in opinion polls that are close to 50% are the hardest to call because if the result was for example 60% Yes - even with a margin of error of 3%, it would make no difference to the final result!

Whatever your view on the future of the UK, it is important to know how to look at the statistics for a full picture. The results in the next few days will be revealing but at the moment, we cannot statistically make a call. If you'd like to follow the results from the various polling companies with a good explanation of their sampling methodologies, please see the BBC's excellent reporting tracker.

When we discovered that Hello Kitty is not a kitty...

My children discovered the joys of dressing cute pliant kittens in dresses during our summer holiday so it was with horror that I returned to discover the shocking news that Hello Kitty, that ubiquitous over-branded merchandising phenomenon that they adore, is not in fact a kitty at all, but a young British girl who lives outside London! It was the biggest branding story of the year! We recently lost the hamster so I was well-prepared for the big talk ahead of me. I sat my daughters down (5 and 7 - old enough to understand but not to reason why) and broke the news to them. "Don't be so silly Mummy, she has whiskers," they both told me. This was taking me towards a discussion that bordered on bodily changes and sex education which I am trying to avoid like the plague so I accepted their proclamation and eye-rolling and made a hasty retreat. Hello Kitty may be a little girl in the eyes of her creators, but it don't mean a thing in our household.

But in fact, there is a good reason for the humanisation of this popular character, I am reliably informed by BBC Newsbeat that Hello Kitty was designed to appeal to Japanese women in the 1970s who were obsessed with Britain and their image of the typical British childhood. The storytelling behind the character enabled the manufacturers to create a strong brand and heritage that appealed to its initial target market and to new markets as they continued with the process of internationalisation, presumably through extensive licensing opportunities. Global markets may be confused about Kitty's biology but her styling is in line with Japanese approaches to art, animation and cartoons.

Giving a back story to a brand by giving it human or animal characteristics can be a successful strategy. The long-running Jack Daniels outdoor ads, often seen on tube platforms, create emotional resonance as you read about his traditional approach to distilling and creating the unique taste of the drink. I have no idea if he was real or not... I don't want to Google it because it would spoil my enjoyment of the ads.

Finding out what animal or human characteristics customers would apply to your brand can also be a revealing approach. In a market research study, we asked customers to think of an animal that would best describe our client... animals like sloth, cheetah or lion quickly tell you all you need to know.

Whether you are personifying or 'animalifying' your brand, fleshing out its bones leads to a better understanding of how to promote it to customers, how to direct sell it to clients or distributors, how to place your advertising, and how to build a strong, sustainable global heritage. Whether your customers accept your version is another story!