Regardless of product, industry, or business size, market research is essential. It helps organizations understand fundamental questions like who their market is and what their customers want, as well as analyze countless other factors, such as the success of current products, the viability of new markets, and possible strategies for future growth. Now that businesses can use technology to focus on niche audiences and develop hyper-specific products and services, they are facing increased pressure to understand exactly what their customers want. Research has never been more vital than it is today.
However, despite this importance, the research industry has failed to innovate. Fortunately, understanding what has gone wrong with today’s market research can help your business focus on better strategies for discovering what your customers need — and how you can deliver it.
How Market Research Has Failed to Innovate
In the U.S. alone, the market research industry produced a revenue of more than$11 billionin 2016, a growth of 4.4 percent over the previous year. However, these impressive numbers have not translated into improved services. According to the 2017 Greenbook Research Industry Trends (GRIT) report, one of the most comprehensive surveys of the market research industry, only45 percentof corporate researchers were satisfied with their research providers.
These poor satisfaction level can be traced back to a simple reason: a failure to innovate how research participants are sourced. Researchers surveyed in the GRIT report cited this as their top concern: “Accessing quality and representative samples is the single biggest individual challenge mentioned,” the surveyors found. This lack of innovation manifests itself in three ways.
1. Poor Participant Data
Many market research companies have not adequately developed their sourcing methods. For instance, one of the most popular ways to source participants is by using market research panels. It’s common practice for research companies to recruit individuals en masse for these panels, then advertise their ability to instantly draw from “millions” of participants.
The problem with this is that there is little guarantee these panels are still relevant. This is because, after participants are recruited, their information is often stored offline, such as on Excel files, where it is difficult and time-consuming to update. As people switch jobs more frequently — on average, millennials hold around three jobs in the first five years after college, according to arecent surveyby LinkedIn — this means panel data will quickly decay. Although there may be a large number of potential participants listed, only a few will still have accurate contact information, employment credentials, and so on.
2. Professional Participants
As panel data becomes out of date, another danger is that those individuals who do remain will be “professional participants.” That is, they are interested less in giving honest, quality answers and more in receiving some sort of incentive — which can end up having serious effects on the validity of the research.
While the full extent of this problem is difficult to measure, there is evidence that it is becoming worse. Astudy of professionalparticipantsin online panelsfound that “fewer than 1 percent of panel members in the 10 largest market research online survey panels in the United States were responsible for 34 percent of the completed questionnaires.” What’s more, in a study of 19 panels in the Netherlands, the researchers discovered that 62 percent of participants belonged to multiple panels. All this suggests that, as the market research industry fails to meaningfully innovate how they source and verify their participants, the quality of their research suffers.
3. Industry Fragmentation
One way the market research industry has changed in recent years is in its response to the increasing niche focus of businesses. For instance, while it was once common for businesses to try to appeal to as many market segments as possible, technology now enables them to direct their messages to hyper-specific audiences instead. This trend, often referred to as “data-driven marketing,” continues to become more popular, with more than40 percentof brands now planning to expand their data-driven marketing budgets.
To accommodate this increased focus on niche markets, the market research industry has become more specialized as well. Instead of advertising their ability to source any type of participant, regardless of industry, many vendors are now only sourcing from very specific industries or verticals. Abroad lookat some of today’s most popular panel companies reveals how many of them are now niche-focused.
While this specialization may be beneficial to market research companies, it has fragmented the market research landscape and made it more difficult for companies to conduct research across their various niche target audiences. For example, instead of being able to source a variety of specific, high-quality participants using a single vendor, companies must now use multiple vendors. This can introduce further problems into the research process, such as a lack of consistency, across-the-board inefficiency, rising costs, and so forth.
To solve these issues, Respondent is laying the foundation for a new market research industry. By leveraging the power of a specialized marketplace, it presents an innovative solution to the problems that have been plaguing market research for years. In so doing, it is giving organizations and businesses access to the exact type of participants their research requires, helping them gain the insights they need to make intelligent decisions.
Move Beyond Panels
The practice of using pre-sourced panels is a relic of the industry’s past. Apart from being unreliable and difficult to update, they are simply inefficient. Instead, Respondent draws on its matching and referral algorithm to match researchers with verified business professionals.
Never Worry About Quality
Professional participants don’t have to be an inevitable aspect of research. Because Respondent does not rely on outdated lists and Excel spreadsheets, it can maintain a dynamic, always up-to-date database of market research participants. It does this by drawing from publicly available data, such as LinkedIn profiles, to continuously update and enrich participant information.
Source Using Just One Service
There’s no reason any organization should divide their research up among several different recruitment companies. Respondent’s flexibility allows it to dive deep into any industry, sector, or vertical to recruit the most relevant and qualified participants available. It can also integrate with existing lists of participants your organization might have, in order to keep them consistently up to date, as well as provide a simple way to keep track of all scheduling and participating. The effect of all of this is more consistency, transparency, and efficiency across research departments.