The Death Of Market Research

Hopefully this title got your attention. Why, you may ask, am I writing about the death of the very industry that I’ve staked my profession (and my paycheck) on? Well, as the saying goes, with every door that closes, a new one opens, and there is a new door opening for market research.

I’m kicking off a new Forrester Big Idea report on the future of the MR function at client-side companies. As the name implies, this initial report will lay out Forrester’s overall thinking on where MR is headed, and it will serve as a basis for a new stream of research our team will be tackling over the next 12 to 24 months. The premise goes like this:

The market research role is changing rapidly. Not only are traditional, prevailing methodologies challenged by technological innovations and changing consumer behavior, but also the need for traditional market research data is decreasing. In fact, organizations are drowning in data. And all parts of the organization have their own sources of data, from what sales hears from the customer to what customer service fields in calls and email, and let’s not forget about the chatter on the Facebook fan page or other social outlets. Yet the best business decisions are made not through data but through insights: the context that comes from understanding what data means in the bigger picture of the business objectives and market trends.

So market researchers are struggling to reclaim their relevance in a time when data is a commodity, insights are power, and disparate sources of information are producing different versions of the truth. In fact, the role of the market researcher as we know it is going away for good.

This report, and the research that follows it, will take a good look at what the insights department of the future will look like. My hypothesis: This role will be responsible for collecting and analyzing both internal and external sources of data, analyzing it, and presenting a unified view of the truth on customer/consumer wants and needs, as well as the market conditions and health of the brand within that market. In order to do this, leaders of today’s market research departments will need to consider how they can organize their teams, scope their capabilities, and collaborate with internal teams (customer intelligence, anyone?) and external vendors in order to come to the table with relevant insights and recommendations — all based on business objectives.

 The market researcher must start seeing his or her work and setting priorities through the lens of a business strategist. 

Sounds like a big job, eh? Well, that’s why it’s a Big Idea. I’m excited to lead this piece of research and to start talking with those of you who have started taking your organizations down this path, have tools that you think can help enable this shift, or have suggestions on what other thinking I should throw into the mix.

Stay tuned for more over the coming months, and please drop me a line at tbarber at forrester dot com — or on the comments of course — if you’d like to be part of the conversations that shape this research.

Tamara

Comments

Well said. I think its safe

Well said. I think its safe to say that most of the 9,700+ market research professionals of NGMR group would agree with you

Many of the points Tamara

Many of the points Tamara makes are worth thinking about, some in great depth. Thought not explicityly stated, it appears to me that the topic of discussion is quantitative research. I do believe that the conclusions of the article are less applicable to qualitative research. The masses of information technology has provided offer lots of information relating mostly to what is happening. Qualitative research, as I have used anyway, seeks the why. This is something that technology has yet to offer.

Too much generalization

Len, I think you generalize too much with your statement that quantitative seeks the "what," while qualitative seeks the "why." Research in either stream (qual/quant) may serve either of the needs you mention, and neither has a lock on any genre of knowledge. If you're seeing quantitative research that answers only "what" questions and does not address higher-level information needs, it's because the research either was not designed to answer "why" questions or because it was executed poorly.

Qualitative vs. Quantitative

I still believe that quantitative research, no matter how much of it we have, cannot answer 'why' something is happening. Observation cannot do this. The most it can do is provide hypotheses for testing. I'm not sure what you mean by higher level information needs. But what I am referring to are 'deeper' information needs. Quantitative research cannot probe the individual, unless there are some new techniques I am unaware of. It can only observe. However, I'm sure the debate will continue for many years to come, just as Jungians, Freudians, behaviorists and constructivists argue the pros and cons of psychoanalytic approaches.

Now one area where I do agree that the web can change the way we conduct research is when we get into a truly interactive method of communication with our consumers. Social networks, online focus groups, blogs and other online communications offer us the ability to ask consumers why they behave the way they do. To your last point, during my twenty years in the business, I can assure you that the research studies I purchased for Gillette, Unilever, JWalter Thompson and McCann, to name a few, were designed properly and were well executed. All of these organizations were well aware that quantitative data could not probe the 'why' of behavior.

Excellent point

You've made an excellent point. While reading the article I had something on these lines going on in my mind although couldn't exactly get what I meant to say. I think qualitative research is slow but once acted upon its findings the difference it brings is much bigger than what quantitative research would.

Could be the death of researchers

That's what's going on but seems to me insight depts are still commissioning boundaried projects to cut through the mass of data and focus on their main issue. That could be a bridging strategy until we all migrate over to one where we pluck insights from a fast flowing river of data.

I work in partnership with a social media agency because businesses increasingly want to know what to do, not know what is going on. Researchers have rarely been good at that and not sure many will rise to the challenge now.

I agree with Tamara. I've

I agree with Tamara. I've been arguing for ages that market research is more than anything else a tool that helps companies make better business decisions. It's not a branch of academia - although of course academic rigour is important and relevant. Far too many practitioners, especially in the larger more established agencies are poorly trained in 'business', although they may be very well trained in 'research'. This needs to change - or the market research industry will contract.

It's not just Market Research

Great hypothesis. We are using a similar process with employee information and data to help HR better understand their workforce, and the relevant employment markets. Yes we are external but we see ourselves as a key partner, creating meaning from a mass of data they own and supplementing this with additional information that are gained from techniques recognizable to most market-researchers. Few HR departments have these skills in-house.

I'm not in full agreement with Len on this being exclusively for quantitative data. We use an approach similar to that proposed by DVL Smith / JH Fletcher in their 2004 book 'The art and science of interpreting research evidence'. Their Bayesian-inspired approach does enable integration of differing types of information. As Brian notes the aim is to solve a business problem in a pragmatic manner.

Qualitative Research

Hi Andrew,

Just before I explore this topic a bit further, I want to clarify that I said the article is more applicable to quantitative research, and less applicable to qualitative research, not exclusively for for quantitative data. Now, let me explain a bit further what I was getting at. The amount of information becoming available to us is unmanageable unless we use statistical methods to analyze the data. My comment really related to the method of collecting the data. For example, I don't think Tamara was including focus groups and one-on-one interviews in her hypothesis. There is of course a role for both in any strategic planning a company undertakes, especially when we are talking about the development of communications strategies which rely heavily on the determination of underlying motives that drive a consumers lifestyle, personality, beliefs and values.

In the focus groups I have recently been involved in, my objective has been to use the group to 'make meaning' and 'share meaning' about how the consumer field of experience, or semantic web, can resonate with the meaning of the brand to the consumer. At this point I don't feel that more information is a factor here. Deeper information from a smaller group of participants, in this case, seems more appropriate than more information from a much larger population.

Hi Len, I agree, though feel

Hi Len,

I agree, though feel that Tamara's hypothesis can include both types of information if brought together in the right way. Technology and statistics can help making sense of large volumes of data and my approach usually starts with exploratory data analysis. However I don't believe that transactional data provides a complete picture and it should be supplemented with qualitative information gathered in a variety of different methods from the focus groups you mention to techniques such as experience labs. You might have lots of information but it doesn't mean that you have the right information.

I feel the core theme is that there shouldn't be a divorce between the internal, transactional 'what is happening' data and the 'meaning' giving information that can be seen from other techniques. One complements the other I guess.

qual v quant: does it matter?

Very interesting points, and I appreciate the discussion. I have to say that, especially with the rising interest in tools like market research online communities and listening technologies, the qual/quant division has become less relevant. For example, is social media a scaled-up version of qualitative feedback? Or -- An online community is larger than a focus group, the feedback is clearly qualitative, yet some companies trust the validity of the feedback as much or more than they would trust a large quant study. More than methods, the discussion we’re having with our clients is starting to focus more on -- how do I actually integrate it all? I've got surveys, focus groups, transactional data, social media data, but what do I do with it all to make sense out of it? What kinds of processes should I have in place to cut through the noise and how I can actually start to get to the ‘why’ behind the ‘what’? Len, you’re right that technology isn’t the only answer. And there is absolutely a human element involved. But integrating it all will involve technology, new processes, and support from new org structures and objectives for the insights department. thoughts?

Regardless of theories the

Regardless of theories the real world (brand MR dept's) are moving fast in the technology direction and there are various drivers for this.

1) There's a buzz about social media, MROCs and mobile, ppl want in, both brand MR staff and the brand mgrs who have budget
2) Perception that technology will bring faster results, mostly true
3) Perception that technology is more cost effective, probably true but when you add in ALL costs it's not as wide a gap
4) MR dept's are under extreme pressure for faster and cheaper results at same quality levels.

Add all these together and you get the kind of change Tamara is talking about.

I was at a Top 3 Global CPG internal conference last week, 130 internal MR staff from across the company. Every staff member has a personal cost savings goal for the year and for the most part they intend to achieve their cost savings goals via adopting new technology at the expense of the old. Savings sited where plane fares, facilities rental, recruiting, follow up qual, report writing time. No one questioned the quality of the results they were getting from the new methodologies, eg. MROCs, SM and Mobile.

I look forward to more discussion!

Jim Schwab
OnePoint Surveys

It's a combination of new and old

Hi Tamara,

After seeing some of the results coming out of the work Synthesio (international web monitoring and research) is carrying out with some of our clients, the insights businesses can get nowadays from online conversations looks as though it is going to rival traditional market research. However, for the moment I'd say more businesses are looking at using the 2 sources of information as complementary. There are quite a few that have come to us to find out how they can integrate the data from the 2 into one platform that they can use to cross-analyze the findings.
If you'd like, I can send you a case study we're working on with the Accor hotel chain that has been comparing online hotel reputations for over 4,000 hotels across guest feedback sites and comparing it with internal data like surveys and questionnaires.They've had some interesting discoveries that can even go beyond market research.

Best,
Michelle @Synthesio

Hi Michelle, Thanks for this.

Hi Michelle,
Thanks for this. Yes, I'd be interested to learn more about this case. This integration piece is one of the big questions that market reserachers have when it comes to using insights from social media. I totally agree that right now these are complementary; and actually making the linkage between the two is the tough part. Talk to you via email?
Tamara

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The future of MR...

Tamara, we agree. We believe in getting facts to help support decisions...research must drive actions to be effective. When it comes to 'rear view mirror' research, we believe in building a holistic scorecard before the marketing initiative even starts. One that looks at all aspects of the business....consumer, financial, customer (retail), operations etc.. This is one way we've found helpful for the Insights team to rise beyond the MR function to truly aid the business. Thanks for your pov's. They are always interesting.
Jennifer Smith @sklarwilton

Hi Jennifer, I'm curious,

Hi Jennifer,
I'm curious, have you found that your work in the long run actually helps elevate the position of your client's MR departments? And are you engaging directly with MR or with other functions that MR would support (marketing, sales, etc)?
Tamara

Response to Tamara

Hi Tamara,
Yes. We have definitely elevated the consumer insight function by fusing it with strategic consulting and facilitation to help our clients define and get the facts for their business decisions. It's working :)
Jennifer

To your last point Tamara, we

To your last point Tamara, we recently carried out some work for the ISBA (the UK advertiser trade body) in which we interviewed senior client procurement offices, client-side market researchers and research agency CEO's on the relationship between agency and advertiser. Amongst many other findings, we found a lack of trust between certain elements within the business; and a changing set of priorities at client companies. This work has led to a Guide being produced, aimed at helping non-specialist client-side managers in their commissioning of market research. The UK Market Research Socity has come on board to back this Guide, which I am writing and which will be unveiled in Q1 2011.

very interesting. would love

very interesting. would love to get a sense of the findings if you are open to sharing.

Probably better we discuss on

Probably better we discuss on email as opposed to on a blog. I guess it depends what you want to do with them - but to date ISBA has been fairly open to any suggestions we've made re sharing findings.

of course. would you like to

of course. would you like to drop me a line at tbarber@forrester.com?

It seems to me that there's

It seems to me that there's always been a disconnect between researchers and insight. The best researchers to me it seems are the ones who are intent on solving the problem in addition to doing the research. Insight is imperative. Research is useless without it. Grant McCracken has a new book called "Chief Culture Officer" and I think he's trying to get at that disconnect. It seems more often then not, that businesses consistently make business decisions absent of cultural awareness. Data for sure is there to help but it seems decisions are made in a vacuum and people don't talk to one another. It would be a miracle to me if true knowledge sharing could happen. That is where I think research companies could really stand out. For a research company to tell me that we researched this and heard this but a social media analysis revealed this, and another study revealed this, which caused us to go back and ask this and now we think we actually have some insights. I think the real question is can you actually pull it off.

That's my concern as well

That's my concern as well Mark. Talk of the death of MR, our increasing marginalisation and commoditisation isn't new. Apart from a handful of bright (and vocal) individuals, the research industry as a whole has failed to reverse that and I don't see a great deal of evidence that many of us will be able to pull it off.

Well here's an interesting

Well here's an interesting question then, assuming that you're also taking about client-side researchers: if market research doesn't 'reverse' it's course, what other functions will step in to fill this gap that clearly exists between data and decision-making? Or is it a lost cause (i hope not!).

On the agency front, it seems that once could envision an actual contraction in the MR supplier-side business, whereby only the most innovative companies who can enable the path from data, to insight, to action will survive.

Agree that talk of the death of MR isn't new. However, I'd argue that we're at a time where technology is rapidly evolving the ways in which companies do business, not in the least of which is how they engage with customers. And when you have this confluence of both consumer-to-consumer interaction changing, along with business-to-customer interaction, the rules/structure of the industry (which ostensibly link knowledge of the customer to the business) must change as well.

I would say that this does

I would say that this does include client-side researchers a dearth of whom I've worked with who always seem to struggle with asking the right questions. And all too often I see client-side researchers who are seeking safe answers. I can recall a time when we presented data to a client that their top-two box satisfaction numbers had a $87M positive impact on revenue however their bottom-two box satisfaction numbers was costing them roughly $850M a year in lost revenue. Not a thing was done about it.

I think you would find Grant McCracken's book very insightful. It's when we can look at data in relation to culture it all really starts to make sense. It's when data is revealed that 98% of women don't find themselves attractive that campaigns like Dove's "Real Beauty" are allowed to flourish. It's not just understanding the raw data, it's understanding why the data told us what it did.

Maybe it's research companies who need a Chief Culture Officer.

Grant McCrackan's blog is http://cultureby.com

I reference him fairly often in my blog as well... http://seldomtypql.com

Organizational Intelligence

A good example of how a basic business capability such as market research can be transformed into something else by introducing new forms of organizational intelligence.

http://rvsoapbox.blogspot.com/2010/12/embedding-intelligence-into-busine...

A few thoughts about your research

Dear Tamara,

This new Big Idea report will be of particular interest as many MR professionals are really questioning themselves about the future. Here in France, MR market faced a 10% downturn in 2009 and 2010 doesn't look brighter.

3 movements are coinciding: a declining market, further integration of MR companies within Communication groups and mergers, ability for traditional fieldwork providers to be more present within clients due to lower costs (field and tabs, no consultancy) and, we must admit, improved quality.

Is the market cursed to become a no value commodity however ? I don't think so, and my guess is that smaller and smarter mid size companies focusing on growing issues (digital marketing is one) with ad hoc but benchmarked approaches and deeper knowledge of clients business (let's call them consultancy MR vs. fieldwork/data MR) can succeed by offering accurate data that fuels business decisions: ROI, target insights, etc. In order to do so they have to face 3 different challenges:

- The Value challenge : Provide value PERMANENTLY (vs. punctual missions) with benchmarked results (building patterns so that clients can have comparison factors in an ocean of data is becoming crucial) and skilled people (researchers that actually understand business needs of their clients to propose insightful vertical approaches).

- The Innovation challenge : Set up useful methodologies (no more nice to have "consumer blogs" for instance but methods that offer real improvment vs. standard results)

- The Sharing challenge: Bring EXPERTISE to the market (which French MR professionals are really shy at doing traditionally vs. other MarCom people), create stronger BOUNDS with the clients by sharing information with them all year long (clients’ blog, dedicated Twitter accounts, etc.) with LOYAL people (the less turnover you have within your team, the more likely you can create proximity with clients).

I send you an email with a French (sorry, I didn’t translate so far) document I wrote about it: glad to share (see my point above) and look forward at getting your feedback about it.

My comment was cut in the middle

My second point about Innovation challenge is not complete, sorry:

- The Innovation challenge: Set up USEFUL solutions (no more nice to have "consumer blogs" for instance but methods that offer real improvement vs. standard results) by developing TRANSVERSE approaches (both in terms of issues as corporate/branding/products are mixing in the 2.0 world and in terms of methods as Quant/qual, Interview/Monitoring are also mixing) relying on INVOLVED people (Innovation as an involvement driver and process).

Thanks! Got your email. I'll

Thanks! Got your email. I'll take a look!

Traditional market research died a long time ago ...

Dear Tamara,

"The Death of Market Research" is not a new concept and not even a recent concept, so I'm not sure what the hot topic is here.

Traditional market research died about 15 years ago when the big surge in the market began. This surge was a direct response to the "consumer insights" that traditional market research companies began to provide. For example, a company like Ipsos has seen huge growth and a lot of resiliency in the past 10 years partly due to providing these kinds of insights.

If there are any market research companies out there that aren't considering themselves as strategic partners with their clients then they might as well give up now.

Follow me on Twitter: http://www.twitter.com/copeland1985

As a client side Research

As a client side Research buyer, I totally embrace much of what you have to say, Tamara. Management consultants long ago saw the power of research, used it to support their general management-level inputs. Research that gets too technical tends to lose the plot at boardroom level. Research that plugs into marketing, sales, finance and general management issues will tend to find its impact higher. Its more than just a support function - it can and should drive actions.

Not Surprised, but Excited to See This Topic!

Tamara, I love this title, however shocking it may seem to some. I have to say, the article itself doesn't surprise me, and I'm very excited to see this topic getting some attention. It's a philosophy echoed by 5 of the top 10 CPG companies that commissioned and helped design ConsumerBase our Social Research tool well over 2 years ago. I'm interested to see how all of this plays out...

Couldn't agree more Tamara!

Couldn't agree more Tamara! Traditional researchers are "traditionally" slow to adopt and change, just my personal observation.

Human nature drives people to hold onto the tried and true and MR professionals with PhDs sometimes have a hard time understanding that clients are taking budget away from trusting their brain power and diverting it to technology.

Jim

The Death of Marketing Research is Greatly Exaggerated

Traditional research methods like focus groups, which with over $1B spent annually, are certainly not dead. In my new book, Refocusing Focus Groups, I discuss focus group fundamentals along with inventive techniques that can revitalize this still valuable kind of research. Refocusing Focus Groups is available at Amazon.com or at Paramountbooks.com.

"The rumors of my death have been greatly exaggerated"

Tamara,

Yes, the title got a number of reader's attention but the premise is certainly not new. Having been involved in market research and now insights for nearly two decades this has been a reoccurring theme for much of that time. Certainly, technologies and social media are changing rapidly, and market researchers must adapt to the new landscape but change has also been a constant. Perhaps change is faster today so researchers are challenged to pick up the pace. Insights have been in vogue for many years now; it’s what I strive for in every research engagement and have for many years.

I just hope that a buzz marketing program (The Big Idea) doesn’t lead to a lot of hand wringing and self-flagellation within client organizations, as the readers and other researchers will be the ones most affected. By the way, you see similar premises being toss around in other industry groups like advertising and marketing. I recently saw a similar premise among advertising pros and marketers. I’d speculate that most Fortune 500 CMOs have a shorter average tenure (~3 yrs) than market researchers. I wonder why? Could it be that many professions are challenged in similar ways?

Rock'n Roll is dead too!

Rock'n Roll died years ago, but music is still alive.
We, Market Research professsionals, just have to learn how to play a different kind of music. Thank you for taking this leading role in explaining this to customers and industry veterans who love Rock'n Roll too much sometimes!

"Times They are a Changing!"

I really enjoy Rock'n Roll and we have Rock'n Roll to thank for building the foundation for much of the music we enjoy today. However, I also enjoy many of today's new music genres. Last I checked I had a little of everything on my Ipod and Droid X. Everything from classic Rock'n Roll to Katy Perry, Usher, One Republic, Coldplay, Rihanna and many others.

Is one better than the other? I don't know, but I do know you have to adapt and change with the times, that is, without throwing the baby out with the bath water.

"Times They are a Changing!" Bob Dylan

MR is not dead

Tamara:

You speak the truth and I am happy to pariticipate in your project any way possible. I remember when data mining became the rage, about ten years ago. At that point people were pronouncing MR dead. Then they realized that surveys were useful at getting to the "why" behind the behavior captured in data mining. Now with social media on the rise, what we see is a third river being added to our data sources.

With new, and existing data sources, becoming deeper and richer those of us in market research have additional arrows that we can use to help our internal clients target their resources.

Market research is not dead, but ever evolving!

Greg Timpany
http://www.linkedin.com/in/gregtimpany

Great start to the

Great start to the conversation!
Having traditionally been focused on quant research using external sample to aggregate our data, we've recently been adding into our studies data we receive from our client's own analytics or data warehouse...particularly in the case of media company or eCommerce company market research.
Additionally, we've recently been diving into social media market research using tools like NetBase's ConsumerBase product to analyze the qualitative values found in the amalgamated "conversation" happening online about our client's brands and shows.
When these "non-traditional" data sources are approached with a thoughtful hypothesis and the same scientific rigor as our more traditional research efforts, we are able to derive some very powerful insights. And these insights translate well into strategic as well as tactical brand and product strategy.
It's a new world, and very exciting!

Thank you David, its so great

Thank you David, its so great to be working with you and to see the strategic and tactical value that NetBase is driving for you. Wait till you see all the cool things we have planned for 2011!

Lisa Joy

Profound!

I too share your views and am very passionate about the difference between data and insights. I am not a report pusher. I, as a consumer insights consultant, connect dots to make the information relevant and usable. The best decisions are made through INSIGHTS!

I look forward to your future reports.

The impact of the purchase funnel on today's research.

Great post. "Research" needs to change to reflect the significant change in a consumer's purchase decision journey. The linear purchase funnel of days gone by is gone due primarily to the internet. (e.g., any segmentation study that is based on the old awareness-consideration-purchase-loyalty purchase funnel should be completely revamped.) Our "research" and insights must reflect this new consumer journey, recognizing that consumers are more powerful than ever, armed with scores of information that they can get with the click of a button anytime, anywhere. Their journey is anything but linear and our research should reflect that.

You're absolutely right

I have a few related blog posts on just that about how as a result of the ways in which we consume content requires that you rethink the purchase funnel. I question whether things like "reach and frequency" are dated analytics? Consumers are far more complex than the ever have been and our thinking in large part is flat out old.

http://seldomtypql.com/353/all-about-the-screens

http://seldomtypql.com/257/david-lubars-thinks-youre-dumb

Purchase Funnel continued

Will take a look. McKinsey and OMD/Yahoo have some published great research to this effect. I have done research for a major tele-com client that absolutely confirmed this. There are significant strategic messaging implications for large and small brands, as well as media planning - especially in the online/social media space. Twitter- @susanborst.

I have been looking for

I have been looking for information on this very topic and I am pleased to say that I found this blog to be concise and to the point. I appreciate that very much.