As the Market Research is torn away around it’s relevancy in a digital world, this article will try to investigate how the Market Research industry is impacted by the all-digital economy and how it can take advantage of it. This post will try to define threats posed by digital to the Market Research industry then see what’s the future of market research and how mobile market research is poised to lead the market industry.
As we know, the Market Research industry is traditionally divided between Qualitative and Quantitative market research. The former and the later regroups multiple technics whose primary target is to collect data (complex or simple) in order to know the current and future state of a specific dimension of a business. These studies can be punctual or happens on a regular basis and become barometers or index that helps defined and anticipate trends. Used over the past century, those technics are indeed threatened by the digital economy.
WHY TRADITIONAL MARKET RESEARCH IS THREATEN BY THE DIGITAL INDUSTRY
As with any traditional businesses, the Market Research industry should expect digital enterprises to commit a budget to perform market research activities. For instance, e-commerce businesses needs to know their customers and the trends with regards to goods sold. Mobile Application developers need to know what are the next features they should focus on. And so on. However, those businesses rarely works with traditional market research company for the 3 following reasons:
1- Market Research is all about data and digital businesses are great with data.
Voice of the customers market studies have lost value in the Web 2.0 economy as Digital enterprises know exactly their customer behavior, and do not need to survey them. It takes a few click for a web product manager to follow up in real time their customer behavior: how the customer interact with the products, what does he likes and don’t like, how much is he willing to pay. This data can be collected directly by the company digging into their backend system or by pluging third party system. You can create you website heatmap in second with crazy egg, view and analyse your customers segment with Kiss Metrics and perform advanced customer’s behavior queries with Google analytics. Similarly, some mobile Application tracking systems such as Flurry Analytics or Capptain helps track all in-app behavior. When it comes to the TV screen, the new platforms such as Hulu, Netflix or Apple TV are doing a much better job at tracking real-time audience and viewer’s behavior than did Nielsen tracking system over the past century.
Hence, you do not need to ask market Research company what the customer do and feel. You just know it in real time. Last year acquisition of Vizu, a web advertising tracking solution, by Nielsen was a right move to keep in the game of measuring audience and delivering recommendations to brands.
2- Prospective research is all about statistic and digital businesses are great at statistics
Analyzing historical data to predict future behavior has long been the job of statisticians using complex models ensuring unbiased forecasts…that seldomly materialized. In the digital world, the future is now and we can question it on the spot. Digital companies are often familiar with lean management method and the need to improve through iteration. Based on current customer behavior, digital companies can tweak their product instantly and rapidly reckon if their prediction were correct or not. Continous iteration allows seeking for the optimal product strategy without the need for Market Research firm. In this area as well, off-the-shelfs software such as unbounce or Optimizely exists in order to conduct A/B or multivariable testing on web pages.
Amazon.com probably epitomize the threat that well managed digital businesses pose to the Market Research Industry. Amazon knows all information they need about prospects and customers (maybe even more data than only what they need) and Amazon collect a massive amount of data across tons of verticals that can be aggregated and segmented to predict behavior. Specifically, Amazon periodically analyzes user-browsing histories to identify correlations between purchases, viewing events or other actions performed with respect to particular products. As a result, Amazon can recommend the best products to their visitors, using only their internal data.
Note that there’s no mention here of “social data” or other “big data” to make market research irrelevant. Simply mentioning internal data combined with smart analytical tools.
3- Digital companies trust their budget with digital company, turning pure software company into new Market Research Leaders
If most of the software and tools listed above works for product/company specific analysis, there’s still a need for broad data and research at an industry/ecosystem level. Here again, traditional data collection methods are fast becoming irrelevant. You need research about the web? Turn to SEO data company such as Alexa Ranking or Google to drill down the World Wide Web and get instant and accurate data. You need research about the Mobile application market? Turn to mobile analytics companies such as App Annie or Distimo to deep into the intimacy of the Apple AppStore market or Google Play marketplace. You need research about Facebook app ecosystem? Visit specialist data provider such as Appdata and gain access to your favorite social network trends.
Market Research in the digital world is about automatic data collection and analytics. Most of traditional Market Research companies did not invest in this area or did not provide the right ecosystem to attract relevant talent to build these products.
HOW TO TURN DIGITAL INTO OPPORTUNITIES FOR MARKET RESEARCH COMPANIES
Smart market research companies could use those threats at their advantage. Key trends that we believe will emerge in the near future:
1 – Market Research company will become Software Company
Market Research company that do not invest enough in software will loose the game as they will not be able to collect the right data at the right moment. Market Research Company will need to become technological companies or else build strong partnership with technological company. This can be quite challenging, as the mindset between those industries is relatively different.
2 – Market Research company will become Consultancy
Hopefully, most software won’t be able to provide directly actionable recommendation for brands. The modern market researcher should master I.T tools to get most accurate data but human brains would do final recommendations. For instance, understanding the impact and opportunities arising from Meme website for a traditional pet food company is clearly a job for the smart market researchers. Winning Market Research Company will be providing insight and consultancy.
3- Primary market for Market Research will be… mobility
However large is the digital sector, brick and mortar companies are here to stay. People will still buy at retailers, supermarkets and coffee shops, go entertain, travel,visit their banks and local brokers. Traditional customers of Market Research will never be able to only rely on their facebook page to understand and anticipate their customer’s needs. Where software is not available, market research should be. Collecting data on site, at the point of interaction between brands and customers will become more and more relevant. It’s a safe bet to believe that in the near future, brands will add kiosks and tablets at all point of interaction with their customers. Offline businesses will then be able to instantly and globally collect relevant customer data. This may prove a chance to regain a trusted position for those investing in the right technologies. Tablet based technology such as Datafield will be ubiquitous, with instant and fun data collection method, taking advantage of stickers, smileys, Thumbs up or any other non-text method to collect customer feedback.
4- Face-to-face survey will still exist, but empowered by mobile
Market Research companies focusing on the distribution sectors, performing mystery shopping and retail audit works, have already taken advantage of rugged devices. They scan barcode at light speed and report key data instantly. The ubiquity and power of smartphones will spread the use of mobile devices to almost all onsite research. Simple customer satisfaction surveys delivered at the point of interaction, whether it is through the customer smartphone or the brand’s screen, will be the norm. Brands will monitor instantly and in real time customer happiness in the offline world. Customers will take back control of when and how much they want to share when interacting with a brand.
5- CAPI will be mobile only
The relative use of phone, mail or email method to conduct interviews is bound to diminish as those intrusive and easy to reject methods are becoming less and less efficient. Direct, face-to-face, methods with the use of tablet and mobile will probably be cheaper and bring higher responses rate. Several survey app already flourish on the market. Kantar took a stake in Lumi mobile, Survey Monkey is preparing it’s own, and independent player such as Datafield are providing platforms on which the market research industry and panel provider can make profits. Market Research company will need to adopt a Mobile First strategy in developed countries and and even Mobile only strategy in emerging market.
Indeed, the market research industry is at a crossroad, and should decide whether it will be taken over by technology companies or else will be able to integrate software and improve their value proposition to stay relevant to brands. Anyhow, mobility is poised to be the key elements on which Market Research company will survive or decline.
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