Research Lights

Dedicated research companies are defending their territory fiercely and in some cases expanding because of the increasing overlap between data gathering and interpretation.

The old put-down about clients using research as a drunk uses a lamppost – more for support than illumination – still exists.

But clients have countered with sobering demands for forward- rather than backward-looking intelligence, for less black magic and more transparency. Dedicated research companies are working harder to sell their services, underscoring the benefits of working with independent specialists and fending off the challenge from other areas of marketing and consultancy.

Some of the champions and denigrators of market research have moved on from the caricature of the drunk and the lamppost to the image of driving a car. The negative version, attributed to Anita Roddick, has research as nothing more than a glimpse in the car’s rear-view mirror, while the positive account sees it as turning on the headlights.

In fact, for many research companies, both mirrors and lamps serve a purpose: the specialists’ aim is to ensure they can provide more reliable versions of these components than anyone else. Clients will want to know that the 57.3 per cent figure for customer satisfaction represents the true picture; but they will clearly pay good money to fathom why the 42.7 per cent are not satisfied, and what can be done about it.

Research International (RI) chief executive Jon Wilkinson accepts that client demands on research companies are more exacting than ever. At the same time, he is heartened by the way in which research, of whatever degree of sophistication, has become an accepted part of our wider culture.

Wilkinson says many of the perception problems with market research stem from an over-emphasis on the more routine processes and on short time-lines. Meanwhile, the research tasks being set have become more complex. “Good researchers are like truffle hounds,” he says. “They love to hunt for solutions, but they need time and the freedom to explore. Both clients and suppliers have to accept that tough problems don’t have simple solutions.”

Wilkinson also takes issue with the idea that looking in the rear-view mirror is necessarily unhelpful. “Companies have a lot of existing knowledge, and the answer may already be out there,” he says. Of course, an ability to project into the future is equally important, he adds.

According to RI, the growth of customer databases and information from helplines, along with the use of the Internet as a source of data, may pose a threat to certain types of market research. But in the case of Net questionnaires, only the “far end of the food chain” is at risk, says Wilkinson. Most parts of the research industry will survive by adding value and insight to the basic data collection.

NOP Solutions managing director Mic Rogers agrees that, as a challenge to traditional market research, the burgeoning popularity of questionnaires on the Net is a threat that may be more imagined than real. “It’s difficult for the consumer to sit down and use the Net without being asked for an opinion about the experience,” he explains. “I expect that somewhere there’s a belief that market research can all be done on screen. One of the industry’s jobs is to continue conveying to end users the specific expertise and benefits that it brings to research.”

Sound interpretation

Recent attention has focused on the significance of sound interpretation in market research. But in the context of Net questionnaires, as in others, the British Market Research Association (BMRA) underlines the importance of input as well as output. Peter Jackling, deputy chairman of the BMRA and director of IDA, says an ability to plan a project successfully marks out the skilled and experienced specialist researcher just as much as an ability to interpret results.

It is true, says Bob Qureshi, managing director of TNS UK Custom Research, that the need to “add value” will increasingly be thrust on market research as growing Net use brings down the cost of data collection. Increased Net use will imply a greater consumer willingness to part with larger amounts of data – whatever the restrictions on depth. This will in turn mean that the value of the service provided must shift even further towards data interpretation, and translation into “actionable results”, he says.

Market research spans the entire spectrum, from the most basic data provision and fieldwork up to full-blown impact studies. At this upper end of the scale, where research companies see their greatest potential, there is already a point where the services provided by market researchers and by management consultants meet, says Qureshi. And in the next few years, as raw data itself becomes more of a commodity, this point of contact is likely to become a tangible overlap, he adds.

Qureshi’s division of TNS specialises in customised research solutions for some of the most dynamic sectors in the economy, including IT and telecommunications. Key areas for TNS Custom Research are the use of correlation for predictive modelling of return on client investment.

“One of the things we are doing is to align the skills of our researchers with the specialisations of our clients,” says Qureshi. “Gone are the days when you had a researcher who dabbled pretty much in any type of business.”

Jostling for position

The jostling for position between certain areas of research and some management consultancies has come about with the growth in importance of category management, explains AC Nielsen UK marketing director Richard Cook. Since it is an information-based discipline, category management is theoretically open to anyone with access to data – and that need not necessarily be the same company which collected the data.

Cook highlights the importance that market research companies are now placing on their own ability to translate information into practical recommendations. They bow only to the consultancies’ expertise in organisational change. Knowledge of consumer attitudes and skills in applying as well as collecting research data are fiercely defended as their own territory.

Two important areas where Nielsen has invested in research solutions are segmentation of the consumer base, with the aim of enabling retailers and manufacturers to target more effectively, and the testing of consumer response to advertising and other marketing stimuli.

Like other companies, NOP Solutions has a new media group to take up the research challenge from these technologies. NOP offers techniques designed to provide results in areas such as Net usage and online data collection. According to NOP, its solution for assessing website development and usability shows the benefits of employing a face-to-face approach that goes beyond simple number-crunching of online questionnaires.

NOP Solutions Rogers says: “By following the consumer through the website, rather than just looking at click-throughs, we are putting our results at the junction of qualitative and quantitative.” Samples are typically of between 50 and up to 100 analyses. In this project, NOP works with the Internet Exchange chain of cafés, and so is able to recruit respondents around the country with relative ease.

This fusing of quantitative and qualitative elements is also central to the Add+Impact advertising pre-test tool which NOP has been using under licence for the past year.

Early Learning

“When people are developing ad campaigns, they may organise the odd group discussion,” Rogers explains. “But quite often this is at a stage when it’s too late to change it in any radical way.”

The technique used by NOP is based on open questions, says Rogers; but while the output is qualitative, a sample size of up to 75 also gives it quantitative validity. This means that its value as a pre-test is boosted by an ability to make meaningful comparisons with results from other campaigns and treatments. If it is used early on, it can also allow the qualitative element to be fed back into the development process.

Even Rogers admits, though, that much of the innovation in research tools is rarely the result of pure strategic thinking. Rather, he confesses to a degree of opportunism, and a willingness – shared by NOP’s competitors, he says – to jump on whichever bandwagon is nearest and fastest-moving.

Some may balk at the idea that they are simply jumping on bandwagons. Certainly, despite the threat of business being poached by ad agencies or consultancies with newly-transplanted research arms, revenue for specialist companies has been growing steadily. The BMRA’s figures put year-on-year growth in the UK at about 11 per cent for the past six years. The association predicts that this year, the value of the industry will pass the &£1bn mark for the first time.

If so, one of the companies to celebrate will be RDSi, which claims to have been last year’s fastest growing research UK business. Offering a full service, but specialising in qualitative research to children and young adults, RDSi is among those companies which has found that specialisation is one of the most reliable routes to success.

RDSi stresses its ability to extrapolate future projections from group discussions. And director Geoff Bayley returns to the scene of the drunk leaning for reassurance against the lamppost of research.

He explains: “We always provide an arc of light to tempt the client to let go of the lamppost.” So the client may get home safely after all. Unless, of course, he staggers off the pavement and meets Anita Roddick barrelling down the road, lights off, not looking where she’s going.

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