Opinion Dynamics Corporation

Winter 2004

Message from the President

In an interesting twist, the do-not-call lists and the hot button "spam" issue have breathed renewed life into an older research technology--mail. Once relegated almost entirely to membership and readership surveys, the number of clients who are weighing the pros and cons and deciding on mail has increased in the last couple of years.

Obviously, mail is not suitable for broad based public opinion surveys. Poor response rates and self-selection bias make mail surveys unreliable for predicting elections or market share.

However, for certain kinds of customer research such as customer satisfaction, they work fine. I know that I am continually bothered by my very nice, very attentive auto dealership that always calls me--even after an oil change--to ask if I'm "satisfied". I got my car back in one piece--I'm not going to take the oil to a lab to find out if they really changed it.

The call is an annoyance.

Now, Opinion Dynamics conducts those kinds of surveys for a number of clients, and increasingly we're getting the "I'm on the do-not-call list" response. The interviewer explains such calls are permitted and the respondent becomes angry--not so much at us as at our client.

When we report to clients, they are more and more frequently opting to do mail surveys instead. This permits them to get feedback from the very happy and the very unhappy, because self-selection bias actually works in favor of getting those responses. The vast middle-ground simply discard their surveys.

On another front, response rates to web-based surveys have dropped like a stone. Because Internet surveys are inexpensive to conduct, it has encouraged too many of them to be done. E-mail invitations to do web surveys are increasingly being blocked by better spam blockers.

However, we have found that mailed invitations to do web-based surveys elicit a higher response rate. The letter provides a substantial invitation, often gets read, and does not get lost in the in box.

All in all, this is an interesting case of technology and social change resuscitating an older, "dead" methodology.
-John Gorman

Measuring a Revolution:
Understanding the Impact of Low-Carbohydrate Diets

Over the last couple of years, there has been a revolution in the food industry. As has been widely reported, people are increasingly turning to low-carbohydrate diets in an attempt to lose weight. In recent focus groups conducted by ODC, food industry executives mentioned low-carbohydrate diets among the most important issues facing the industry. When discussing what steps should be taken, one respondent said it depended on the numbers: "If we are talking about only 2 percent of the population, then it's not really urgent. If it's 10 percent, we need to do something now."

Based on the results of two separate surveys, conducted in December 2003 and January 2004, we found approximately 11% of the public is currently on a diet that restricts carbohydrates such as the Atkins or South Beach diet.

Twenty percent of the public has tried such a diet in the past two years, and approximately 19% of those who are not currently on a low-carb diet may try one in the next two years. These figures are substantially higher than other studies have found in the past year.

ODC also investigated the impact low-carb diets are having on a specific product - orange juice. The orange juice industry has reported a 5% decrease in sales over the past two years. We found that among people who have tried a low-carbohydrate diet, 39% say they have decreased or eliminated orange juice consumption, while only 12% have increased consumption. Based on this information alone, it appears the decrease in orange juice consumption can be entirely attributed to low-carbohydrate diets.

Not everyone on a low-carb diet has cut out carbohydrates entirely. We found that people are more likely to follow the diet more strictly at home than when eating in restaurants. While over three-quarters (79%) of respondents who are on a low-carb diet follow it all or most of the time when eating at home, only 59% of respondents do so when eating at restaurants.

In addition to following the diet more closely when eating at home, people also rely more on low-carb labels and advertising when making choices at the grocery store than when choosing a restaurant. Almost two-thirds (66%) of people on low-carb diets say it is very or somewhat important to them that a food has a specific low-carb brand label on the packaging when making a purchase. However, only 38% of low-carb consumers say it is very or somewhat important that a restaurant advertise low-carb offerings before choosing that restaurant. This provides further evidence that people often follow low-carb diets selectively, and they are more likely to do so at home than when eating at restaurants.

There is much more that we need to learn about this issue. The variety of low-carbohydrate diets, and the personal preferences of consumers on those diets, may mean that each food is affected differently - 10% of the population may decrease or eliminate the consumption of one food, while the same may be true of only 3 to 5% regarding another food.

Furthermore, even within a particular food group, there may be different effects depending on the brand. For example, the Florida Department of Citrus reported that private label sales of orange juice have experienced a much greater drop in consumption than brand name juices.

Finally, the crucial question of what can be done regarding this issue will vary depending on the unique circumstances of each organization in the food industry. What is clear, however, is that this is becoming a revolution in an industry - one that cannot be ignored by those on the inside.

For more information on this topic, contact Lawrence Shiman at 800-966-1254 or via e-mail at lshiman@opiniondynamics.com.

Gauging Reputation

Research has shown that organizations with strong, positive reputations enjoy more success. Companies with stronger reputations are viewed as having winning sales initiatives and more consistent financial performance, greater trust with investors and partners, and stronger customer satisfaction and loyalty than companies with poor or no widespread repute. An organization that maintains an assured and affirmative reputation entices higher quality employees, receives better publicity and instills a public trust that enables deeper community relations. Organizations with well-defined reputations are better positioned to communicate with any audience, from regulators to shareholders, in good times and during a crisis.

During the summer of 2003, Opinion Dynamics conducted a survey for Morrissey & Company to measure the reputations of Massachusetts-based institutions. The Massachusetts Corporate Reputation Survey is the first-ever attempt to rate public perceptions of the select private and public organizations that drive the state's economy. Boston-area business leaders were asked to rate 144 Massachusetts businesses, universities and hospitals on a variety of criteria. Ratings were gathered from 201 top-level executives at companies with more than 150 employees. Over half of those interviewed were executives at companies with more than 250 employees.

The survey found that non-profit institutions enjoy the best reputations in the eyes of business executives. Universities are viewed as having the best reputations, followed by hospitals. Of all institutions tested, Harvard University tops the list, followed by Boston College. The Massachusetts Institute of Technology, Northeastern University, Boston University, University of Massachusetts-Amherst and Tufts University are all in the top twelve. Massachusetts General Hospital is the fifth highest rated institution overall; Children's Hospital and Tufts/New England Medical Center rate in the top twenty.

Among for-profit institutions, Fidelity Investments is viewed as having the best reputation. Other financial sector businesses such as John Hancock, Fleet, and State Street Bank received good ratings, but lag significantly behind Fidelity.

As a sector, HMOs have the best reputations among not-for-profits with Tufts Health Plan and Blue Cross Blue Shield of Massachusetts in the top ten. Several of Massachusetts� largest businesses also scored well; Reebok, Staples, Gillette, and BJ's Wholesale all rated in the top twenty.

Virtually no business in the technology, biotech, telecommunications or manufacturing sectors have established notable reputations for themselves. This result is more a function of lack of recognition than of negative perception. However, "no perception" can hinder business success as much as "problem perception."

For more information on this topic, contact Chris Anderson at 800-966-1254, or via e-mail at canderson@opiniondynamics.com.

FOX News/Opinion Dynamics Poll

As the 2004 presidential election approaches, it's interesting to scan the political landscape for trends that might indicate where the electorate is heading. One way to do this is to identify the overarching themes. These themes can define fundamental differences between candidates, clarifying possible political outcomes.

For example, in 2000, a range of measures indicated that the contest for the White House would be extremely close - with the public essentially divided 50/50 on questions that laid out differing political "world views". As we saw, the final results of that election mirrored the almost perfect split the public displayed in answering the political worldview questions.

In 2004, one of the key themes could be the classic issue of whether the public prefers higher taxes for bigger government and more services; or lower taxes, smaller government and fewer services. Since 1997, our FOX News/Opinion Dynamics Poll has tracked public sentiment on this question. As the table below indicates, the "Democratic" worldview (higher taxes, bigger government, more services) has steadily gained ground on the "Republican" worldview (lower taxes, smaller government, fewer services). Indeed, the activist-style government model is now a scant 7 points behind the more laissez-faire model. In comparison, in 1997 the activist-style government model lagged 27 points behind the laissez-faire model.

Could this mean that President Bush is in for another close battle with the Democratic nominee? Other findings show that the supposed sea change in American political sensibilities post-9/11 may not have been as permanent as once believed. Despite the president's enhanced favorability since the 9/11 tragedy, our research shows that the electorate did not fundamentally shift in their voting priorities from the November 2000 configuration. Rather the electorate has maintained a narrow but persistent divide that goes beyond national security concerns, and might again result in a very long night on November 2nd.

The following table, which shows a major shift in the security/economy dichotomy from our findings less than 2 years ago, illustrates this theme.

Another issue that has long defined the political worldviews of both Democrats and Republicans is taxes. This is a theme in which, historically, public opinion has sided with the "fiscally-responsible" Republican party. As with the other issues, the field of opinion regarding taxes has leveled between the two parties. Surprisingly, as the following chart shows, after trailing by double-digit margins in the near past, Democrats are now as likely as Republicans to be seen as capable of doing a good job on tax-related issues.

Clinton strategist Jim Carville brought sharp focus to the 1992 campaign by declaring the defining theme of that race, "It's the economy, stupid". If that theme still holds true in 2004, it's another red flag for President Bush. The combined "fair" and "poor" ratings of the economy now stand at 71%. By contrast, one month before the 2000 presidential election the combined negative ratings were 26% - 45 points lower than the current findings - and the incumbent Democratic Party lost.

All in all, it's much too early to forecast how the 2004 election will turn out, but the trends suggest that Americans have not moved beyond the deep-seated divisions that characterized the race for the presidency four years ago.

For more information on this topic contact Ernie Paicopolos at 800-966-1254 or via e-mail at epaicopolos@opiniondynamics.com.

ODC in Brief

ODC�s president, John Gorman was part of the FOX News Decision Team for the recent Democratic presidential primaries.

ODC welcomes Janice Greenwald as project analyst.

ODC�s recent white paper, "Measuring the Low-Carb Revolution" by senior. account executive, Lawrence Shiman, was covered in various media outlets including the Wall Street Journal. Mr. Shiman will speak on the low-carb revolution at the Low-Carb Manufacturer's Alliance Marketing Conference on April 15th, the Southwest Food Expo on June 27th, and Low-Carb 2004 on June 28th.