Spare a thought for the market researcher. At a time when few are able to forecast where the nerve-jangling economic upheaval will take us next,the research industry continues to be saddled with the kind of client expectations that sound impossibly unrealistic. In the current environment,a profession that touts a sophisticated crystal ball as its raison d'etre could appear, to put it lightly, a little vulnerable.
At the same time, some uncomfortable questions are being asked about the researcher’s role in the recession. None more unnerving than the query from Toyota Motor Asia-Pacific VP of marketing Vince Socco, who believes that current events should lead every marketer to fundamentally reassess its market research requirements.
“We have had to reduce research spend, and the recent crisis gives us reason to pause and consider just how reliable and relevant quantifiable research is in this day and age,especially the conventional dipsticks or KPI's,” says Socco.
“After all, the current crisis was visited upon us notwithstanding what I can only imagine to be tons of sophisticated research conducted by companies and think-tanks and governments around the world. Are we really asking the right questions? Have numbers and quantitative information become so easy to manipulate?”
Quantifiable data, presumably, is not about to become obsolete. But, if the views of Unilever AAMET VP of consumer & market insight BV Pradeep are any guide, the research industry is going to have to endure sustained scrutiny if it hopes to persuade
clients that it can continue to provide value during the recession. “There is a close examination of our ‘real’ research requirements,” says Pradeep. “Research agencies need to do some soul searching,in terms of the real value they add to a given research project or partnership.”
Synovate CEO Adrian Chedore appears prepared for these kinds of demands, but believes that this is the direction that clients have been pushing the industry for many years.“One real impact of recession has been to emphasise the importance of delivering this,”he says.
While research budgets further West are being decimated, Chedore believes that Asia’s emerging markets will be less impacted. Regardless, it would be foolish to think that this region is somehow immune. The automotive and financial services are obvious examples of industries that are slashing spend, and the pressure is on for research agencies to demonstrate
that they can creatively deliver value in straitened times.
“There’s still a lot of opportunity for us to do better in terms of answering client needs and offering solutions that meet those needs,” agrees Nielsen Consumer Research Greater China MD Umang Pabaru. “Historically, the market research industry has
not always done this.”
What, then, are clients specifically looking for? Both Socco and Pradeep have fairly similar views, starting with a clear demarcation of ‘must-have’ and ‘nice-to-have’ research.
“For example, we are working doubly hard to prevent overlaps in our research projects,” explains Socco.“We are also considering how to remove ‘riders’ or ‘fluff’ from our research so we can drive costs down.”
For Pradeep, this means that spend will concentrate on those studies that are clearly geared towards supporting “important decision-making”. He uses Nielsen market share data as an example of information that is “urgently essential for our key markets, as it tells you where you are winning or losing.”The kind of ‘fluff’ that is being eliminated, says Pradeep, could be “a
general report of consumer trends that is more nebulous in terms of itsn usage.”
Socco, meanwhile, urges research agencies to dramatically modify their offerings into faster, more targeted studies that can help clients become more nimble.
“It is interesting how many ‘orphaned’ projects there are, whose relevance has been outlived or whose continued conduct is more from heritage than necessity,” he points out.“I would like to see more focused and modular research projects rather than
the extensive and gargantuan ones that sometimes dilute the purpose of the research,introduces so many variables and, of course, increase cost and time.”
Meeting these demands while grappling with smaller budgets does not sound like the easiest of feats. But Socco believes that agencies should explore the commonality that invariably exists among differing client research requirements.
“The cost of research has become prohibitive among auto companies,” he says. “We are probably asking fairly similar questions and researching similar markets. Syndication should be explored more aggressively to share baseline information more freely to enhance cost effectiveness. Consequently, the real value of research agencies will be in their ability to provide research that captures the customised needs of clients.”
To hear the research agencies tell it, they have already begun mobilising. Pabaru claims that Nielsen has accelerated
the integration of consumer research data with consumer panel information to provide a more cost-effective solution.
“We are bringing out certain fastturnaround products,”he notes,pointing to a new retail index that allows clients to immediately assess how their category is performing versus others.
Chedore meanwhile,says that Synovate is attempting to consolidate client needs across geographies or product lines by,for example, offering additional analysis of existing databases rather than commissioning new primary data collection.
“We’ve developed a suite of study designs which streamline and integrate several of our core solutions in brand and communications,customer experience and shopper research to provide even greater efficiency and value for money,”he adds.
In a similar vein, research agencies could do worse than identify the kinds of research that are likely to sell well in a recession.TNS, for example, is running a syndicated study that examines the impact of the recession on reputations in the financial services industry. Research agencies will face some significant challenges as they attempt to reinvent their offerings to keep pace with the sudden realignment of client priorities. Thankfully, perhaps, finding the right people may not be one of them — given the ceasefire that the recession has prompted in the war for talent.
“This should be more accessible as consolidation and downsizing frees up what has been up until now a very tight labour market but in many respects it can also have the opposite effect,” says Chedore.“Companies want to keep their high performers and also reduce costs associated with staff turnover.”
Unfortunately, the markets that remain in growth mode are also those where talent can be harder to come by — particularly when it comes to qualitative capabilities. “The quality is dependent a lot on the specfic researcher involved,as the skill level is not strong at an organisational level,” says Pradeep. “The exceptions are India, the Philippines, Singapore, Hong Kong and Australia.This calls for significant investment by agencies in training, coaching and retention of local talent.”
Competition from other players, furthermore, remains pressing. As Socco points out, research is increasingly being offered by a plethora of outfits — advertising agencies, HR firms, media shops — as part of their service model.
“Research is no longer the exclusive domain of the institutional research agencies and their advantages in terms of know-how, technology and resources is fast being diminished,”he says.
A more discernible focus on digital, it appears, would also help. “The one issue I have is at the analysis stage,”explains Sun Life Financial strategic marketing VP Rob Burr.“Speed from field work to report should be improved, and digital can help with this.I
believe using digital technology can help clients slice and dice data quicker and more cost effectively.”
“It is becoming more and more criticaln to pretty much every aspect of MR,”agrees Pabaru.“We are strongly encouraging our clients to transition. We are moving to applications which are more user-friendly and will get higher response-rates online compared to face-to-face.”
Ultimately,it is easy to overstate the impact the recession will have on the market research industry.After all, in relative terms,markets like China and India remain in rude health.
Yet it is hard to shake the feeling that the research industry could do much worse than re-examine its business model and client servicing approach if it is to emerge from the current environment in a strong shape.
“I believe the business model is shifting away from research per se and more into the effective use and analysis of the research information,”warns Socco.
“If there is one thing that the current crisis has taught us, it is that we should be more informed,more quickly.”
HOW TO BEAT THE DOWNTURN
1 Think qualitative Numbers are nice, but clients really want to know what they mean — and if you don't tell them, there are plenty of others that will.
2 Focus on speed With short-termism rampant, the need for clients for adjust decisions in real-time is critical.
3 Reduce, reuse, recycle Forget about that new multi-million dollar research study. Find out what data you already have, package it at a knockdown price and offer it to he clients who need it.
4 Get digital In terms of both designing and implementing research, and understanding what drives today's digital natives.
5 Invest Agencies that continue attracting the best people and spend money developing the right products will emerge from the recession in a better shape than when they entered it.
Researchers feel the heat of recession
Market research companies in the region are being put under increased scrutiny as key clients start to pull back spend and demand even greater value for money.
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