What does a tough economic climate mean for User Research

Recessions are brutal. Most experts agree that the global economy is rapidly slowing down and several forecast a recession in the coming weeks and months.

For the UXR community these first few months of 2023 have been tough, with mandates to improve efficiencies, remove redundancies and other euphemisms doing the rounds. As the focus turns from building for the future to short-term earnings, businesses have had to disband talented teams across disciplines, with a significant impact on research teams.

In times of economic uncertainty, businesses often cut costs to weather the storm. Unfortunately, one of the first areas to be sacrificed is user research. One can only hope that this does not hurt the crucial function of market validation and product market fit, fulfilled by research teams in affected businesses.

Two skills that Researchers value and hone will hold them in good stead, to help the research community navigate this tricky period:

1. Use empathy, as you make a case for research: Just as good researchers can empathize with product users and participants, they would do well to put themselves in the shoes of business leaders. Proactive measures to identify efficiencies, reduce costs, embrace automation will help secure goodwill to keep building the case for continued investment in user research.
2. Demonstrate adaptability to build a lean, cost-effective research playbook: While user research is critical to business success in the long term, it can also be deployed for projects with a focus on near-term cash flow. The research operations playbook can be rewritten to incorporate new services, tools and technologies that can improve the quality of insights at reduced costs.

In this article, we will explore how researchers and businesses can work through these tough economic conditions and emerge stronger, with a research operations playbook that is tuned for efficiency and resiliency. 

The Case For User Research

Choppy economic conditions call for more user research, not less (note that more research does mean higher costs, we'll get to that shortly). Here's why.

Ensure product market fit

One of the main reasons businesses fail is due to a lack of product market fit. This occurs when a product is developed without proper market validation or understanding of the target audience. By conducting user research, businesses can gain valuable insights into their target market and ensure that their product meets their needs. This, in turn, increases the likelihood of success and reduces the risk of failure.

Identify opportunities

In uncertain economic times, businesses need to be agile and identify new opportunities quickly. User research can help businesses identify new market segments or untapped needs that can be leveraged to develop new products or services. By understanding their target market, businesses can identify new opportunities and pivot their strategy to take advantage of them.

Improve customer retention by delivering better user experience

User research is not just about developing new products or services. It can also be used to improve the user experience of existing products or services. By understanding how customers interact with a product or service, businesses can identify pain points or areas for improvement. This can lead to increased customer satisfaction, loyalty, and ultimately, recurring revenue. Isn't that the moat every business craves!

Reduce costs

Cutting user research may seem like a cost-saving measure, but it can actually lead to increased costs in the long run. Developing a product without proper market validation can result in costly mistakes, such as developing a product that doesn't meet customer needs or developing a product that is too expensive to produce. These mistakes can lead to wasted resources and lost revenue.

Stay ahead of the competition

In choppy economic conditions, competition is high, and standing out in the market can be challenging. User research can help companies to differentiate their product by identifying unique features that meet customer needs. By conducting user research, companies can create products that stand out from the competition and provide value to customers.

Now that we've laid out the reasons for doing at least as much research as during normal economic conditions, we need to take a step back to emphasize that More research does not mean more spending on research. Let's explore how.

How to cut costs without compromising on the quality of User Research

This has been the big question in UXR circles lately: how can businesses reduce costs without sacrificing the quality of user research.

Use remote research methods

This is not exactly a new idea, and has seen widespread adoption over the past 3 years. However, if your organization is still yet to embrace remote research, there is no time like now!

Remote research methods such as online surveys, remote interviews, and remote usability testing can be cost-effective alternatives to traditional research methods. Remote research eliminates the need for travel, venue rental, and other expenses associated with in-person research. Remote research methods can provide valuable insights into user behavior and attitudes without compromising on the quality of research.

Leverage existing data

Businesses can leverage existing data to inform their user research. Data from customer support tickets, website analytics, and social media can provide valuable insights into user behavior and preferences. By analyzing existing data, often with the aid of new technology tools such as machine language models for sentiment analysis, transcription and AI-assisted analytical tools, businesses can identify patterns and trends, which can inform their research questions and objectives. Leveraging existing data can save businesses time and money while still providing valuable insights into user behavior.

Re-evaluate prioritization of research objectives

Businesses should prioritize their research objectives to ensure that they are focusing on the most important questions, in the current economic climate. Organizations may have launched exploratory research projects aimed at long-term growth, but if the business reality dictates a pivot to short-term cash flow, revisit the priority of research objectives.

Research teams must be nimble and agile to recognize that they need to chip in to the revised market reality and accordingly turn focus to helping identify product features and market opportunities that can help shore up short-term revenue and customer retention. Prioritizing research objectives helps businesses to allocate their resources more effectively. By focusing on the most important research objectives, businesses can ensure that they are conducting research that is valuable and impactful.

Use research participant recruiting panels

Recruiting participants for user research can be time-consuming and expensive. Using platforms such as Respondent to recruit participants for research can help businesses to reduce the associated time and costs. Recruiting panels consist of pre-screened participants who have agreed to participate in research studies and offer powerful ways to target your research project to find exactly the participants you want. Respondent provides access to a 2.6M+ strong, diverse pool of quality participants, and provides a variety of scalable and affordable participant recruitment pricing options.

Optimize research processes

Businesses can optimize their research processes to reduce the time and cost associated with research. Optimizing research processes involves streamlining research procedures, automating tasks, and reducing unnecessary steps. This can take the form of using integrations between different tools in your research stack, to automate participant approval, session tracking, insight mining and incentive payments. By optimizing research processes, businesses can save time and money while still conducting high-quality research.

In conclusion, reducing user research activity may seem like a quick fix, but it can result in costly mistakes and missed opportunities. Research teams can help businesses to reduce costs without compromising on the quality of user research by leveraging the above strategies. As businesses navigate uncertain times, user research should be viewed as a critical investment in their future success.

Other interesting takes on this topic in the recent past:

UX Research Reckoning

Future of UXR in the age of AI