Market research is becoming ever more complex for businesses because of the rapid growth of customer data and the emergence of technologies that offer new ways to gather insight.
Yet despite these challenges, a new study of 100 UK companies by Research Now, commissioned by ResearchExchange.com and seen exclusively by Marketing Week, suggests that many brands are continuing to stick with their tried and trusted research partners rather than look for new solutions from specialist suppliers.
Andrew Barling, head of international research at coupons brand Groupon, says: “Personally, I want an agency that isn’t afraid to challenge me and say ‘is that the right way to be doing this, or have you thought about this?’.” He adds that one of his biggest issues is finding research partners that are willing to innovate.
Barling commissions research projects on a regular basis covering a wide range of topics, such as customer service and email effectiveness, though Groupon also has continuous brand tracking measures in place.
He says: “Rather than the agency just saying ‘you asked for x, y and z and we delivered x, y and z’, I look for that value-added piece where they really understand [our] market and consumers.”
Indeed, 55% of research buyers want a supplier to have strong experience relevant to their research brief. Perhaps encouragingly for smaller, niche players, just one-fifth believe it is important for a new research partner to be ‘a large well-known agency’, however 21% prefer to have worked with an agency before, which could be limiting their opportunities.
Finding suitable partners
Dan McGuinness, chief operating officer and co-founder of ResearchExchange.com, which connects buyers of research with agency suppliers, argues that it is the “default setting” of many companies to opt for a well-known agency when choosing a research partner. There are benefits to this, he suggests, but brands also risk overlooking more suitable options.
“If [the supplier] has already worked in your sector, then you are buying a ready-made solution to an extent,” he says. “The natural inclination might be ‘we’ll go with the big name because they must have experience in lots of different sectors’.
“The other side of the argument is to say ‘instead of going for the big name, who is particularly good in this industry?’. That might not be the big name – it might be an unknown agency from [the buyer’s] point of view.”
The survey, which takes into account the views of both large corporations and small businesses, finds that only 17% of companies seek a quote from a new supplier when commissioning a market research project and about half (49%) only look for a quote for ‘unusual or very specific projects’, while 36% do so for ‘very large or important projects’.
Half of buyers (51%) say it is important that research agencies quote ‘very competitive prices’ during the tender process.
When finding the right partner, the survey suggests that half (49%) select research agencies on the basis of word of mouth, such as recommendations from friends, colleagues or peers within the industry.
In addition to relying on recommendations, 45% of brands find new agencies by searching online, while 39% meet new research partners at conferences and industry events and 12% use industry directories.
A quarter of companies (24%) say they commission new market research projects at least once a month, though these are likely to be the larger brands included in the survey. The biggest proportion (40%) commission new research only a couple of times a year, while 18% say they launch market research projects once every two to three months.
Groupon’s Barling manages the research needs for the company’s international markets except the US, covering 27 countries. This means the company also looks for research suppliers that adapt their methods to the requirements of different countries. According to the survey, 36% of UK companies commission research from overseas agencies.
“I need agencies that are capable of working across multiple regions and languages,” explains Barling. “There are some very subtle differences between the markets that need to be taken into account when we are building our questionnaires – and also some quite major ones in terms of things that you can and can’t ask.”
Barling says he is excited by the potential of new qualitative research techniques such as eye tracking and mobile video surveys. He believes smaller agencies are often able to apply these techniques at greater speed than larger suppliers.
“Some of the larger agencies aren’t able to move as quickly – they’ve got a lot invested in their existing techniques,” he adds. “It’s small, independent companies that are quicker and able to adapt.”
Importance of deadlines
Being able to meet deadlines has been an issue for nearly one-fifth (19%) of companies, which say they have worked with research agencies previously that were not able to complete a brief on time, while 28% state that the findings they received from a supplier have been of poor quality. Perhaps contributing to these issues, 27% have seen the agency team they were working with change mid-project, while 18% say the supplier did not have the expertise they thought they did when hiring them.
Stuart Byrne, consumer insight manager at drinks group Pernod Ricard, agrees that it is becoming increasingly important for agencies to achieve a quick turnaround on research projects. Part of his role involves working with social listening agency Sprinklr to test new marketing activations and creative work.
“We’re a global business that works quickly with our local markets,” he says. “That means [research] projects happen quickly because we need to react and make strategic decisions at speed.”
More than a quarter (28%) of research buyers believe that market research informs ‘most’ of their company’s business decisions, while 32% say it informs ‘many’ choices. To emphasise the value of market research, Pernod Ricard recently instigated a group-wide training programme to inform staff about new insight-gathering techniques.
“We meet together for what we call ‘digital acceleration training’, which includes understanding how we can use ‘big data’ and all the different digital tools that can help us turnaround digital insights quicker,” explains Byrne.
“Many of the top-performing companies worldwide deliver strategy through insight, where the insight function is the lead, rather than an additional nice-to-have. We’re a firm believer that you can’t do anything without the insight team being a critical part of it from start to finish.”
Given the ongoing advancements in areas such as data analytics and the behavioural sciences, McGuinness at ResearchExchange.com believes it is an exciting time for market research, but also argues that the industry needs to mature if brands and suppliers are to benefit.
“We’ve been very good at helping other industries, but we haven’t actually helped ourselves in a lot of cases,” he says.
“[The industry is] great at identifying opportunities for other businesses, enabling them to achieve their goals, but at the same time the research industry has hid its light under a bushel, rather than saying ‘here is how we want to present and market ourselves’.”
Q&A: Andrew Barling, Head of international research, Groupon
What are the main attributes you look for from a research supplier?
Beyond the obvious – professional, experienced, innovative – the trend is towards becoming more flexible. We want quicker turnarounds and more interesting, slightly different things in terms of when and how they do it, and how they send data back to us. A lot of the time we’re under huge pressure, so it’s important that agencies are able to turn things around quickly. Of course you want them to understand the market and your consumers, and to add value in that respect.
What types of research do you commission and use?
We have continuous trackers that are measuring our customers and the businesses. They are broad reaching across all the countries we work in. That means checking that we are addressing the needs of customers and merchants, but we will also drill down into specific areas depending on what’s happening at a regional or country level. So for example, we will look at customer service, the redemption process or specific studies looking at our emails and how well they are received.
Do you look for new suppliers for these projects?
Yes, we will review with our regular partners on an annual basis and talk to a few other people to check that what we are getting is value for money and so on, but we’ve got more scope with individual studies.
Sometimes it can be specific; if we’re changing the email templates and want to show them to people, there are new techniques such as eye-tracking we can use.
Q&A: Natalie Harb, Head of primary market research, Novartis PLS
What qualities do you look for from a market research supplier, and how do you decide which suppliers to work with?
Finding the right supplier can be a lengthy and sometimes difficult job. Finding a supplier with global reach is important. At Novartis PLS, we conduct studies across multiple continents and in different languages, so working with one supplier that can execute the entire project is a key advantage.
Also, a supplier with integrity that can deliver quality data is essential. Given the nature of our industry, having a partner that acts and behaves in an ethical way is critical. Lastly, considering the current economic climate, finding a supplier that can deliver within budget plays an important role in the selection process, however one that can deliver high-quality results will trump a cheaper supplier.
How are your market research needs changing and is the supplier market evolving fast enough to keep up?
The type of work that we do at Novartis PLS varies greatly by therapeutic areas, so it is important for us to be able to quickly, and cost-effectively, identify a pool of suppliers that can meet the needs of each brief. It is essential that research suppliers have a proven track record in the specific area we are interested in.