Inside Red Brick is back for the new year! This time, it’s Managing Director Tim Daplyn sharing his insight into what 2019 has in store for the market research sector, particularly in the wider context of how agencies must evolve to stay relevant in the digital age.
The challenges shaping the sector’s evolution
Market research is going through a forced period of transformation. That’s for several reasons. One is public perception of research: while political polling has nothing to do with 99% of market research, its well-publicised recent misfires have coloured public perception of what market research is.
Another major issue is that, with the rise of automated business intelligence and data sciences, traditional market researchers are still getting to grips with communicating the additional value they bring. While these all offer the same thing at heart – information to assist decision-making and managing the risks associated with it – automated data analytics are fast and cheap, offering tools for speedy decision making to businesses. But without the context that traditional market research brings, you lose the understanding of human psychology and experience that helps to contextualise and inform data.
Recognition of the importance of market researchers and social science skills in interpreting all this new data is growing, but the sector has typically been poor at articulating its benefits in this area. This needs to change.
So I think that one of the ways that market research will evolve over the next few years is agencies getting better at building systems. These insight systems are what our clients need in order to deliver actionable insight in a more rapid, useable and action-oriented way than a traditional two to three month project with a report and presentation at the end. There will still be a place for those projects, but these approaches will start to mix.
Building very strong, trusted relationships with clients is the goal in any service-based sector, but it’s more crucial than ever in market research. This is specifically because with the flood of data now available to clients (particularly behavioural data such as point of sale data, website browsing data, Google Analytics and social media), they’re not necessarily happy to share it on an ad-hoc basis. There needs to be trust that an agency will use their data in a controlled way.
The most successful agencies will not only build trusted relationships with clients, but demonstrate the value of augmenting primary research with existing and streaming data sets. That makes it very difficult for any research agency that lacks high technical proficiency to survive.
So what does that mean for 2019?
Many of these changes have already begun. Some agencies, like Red Brick, are already strategically advanced along this path.
However, I think there will be small-to-midsized, owner-managed agencies that will struggle in the next few years, because they aren’t happy to build the tech platforms required, or lack the skill sets needed for navigating this new world.
Successful agencies will operate either on a high volume level, or a high value basis. By ‘high value’, I mean consulting-focused sector specialists with great advisory skills and the ability to interpret, analyse and deliver insights in a way that’s really compelling and relevant to a particular client. At the other end of the spectrum, ‘high volume’ mean agencies that focus on successful research ‘transactions’ that deliver seamless service built on strong assets like high-quality data, panels and recruitment processes. That includes businesses like Google and Amazon – owners of data sets that are valuable to researchers, and can be mined at a scale and cost that is attractive. I think agencies that lie between those two ends of the spectrum risk being hollowed out.
Let’s talk about where we’re at now, with 2019’s economic climate and what it means for the sector’s journey. We have, in the UK at least, weathered the uncertainty around our future political situation relatively well. But market research will be hit by the same economic issues as everywhere else – new barriers to trade, a significant slowdown in China, and questions about whether developed nations are reaching a state of peak stuff (a question particularly pertinent in light of the success of Netflix’s Tidying With Marie Kondo show, which encourages viewers to streamline their possessions).
This affects marketers and market researchers because, in this uncertain climate, everyone is keeping their expenditure and investment on research and insight very focused and targeted. As a sector, we have to be focused more than ever on delivering provable bottom-line results for our clients. That means successful product launches, successful entry into new markets, etc. There can be a lot of navel-gazing in the sector, over-analysing and being self-critical – but we need to look outwards, and be focused on clients and what they want to achieve.
A word that crops up a lot in relation to market research is ‘interesting’. But with research budgets being limited for the moment, we’re going to see that ‘interesting’ isn’t enough. It’s not about being interesting! It’s about translating insight into specific product feature changes, specific messaging, specific strategic decisions that will deliver growth in an economy where we may not be able to rely quite so much on the growth of the global economy to drive our individual organisation’s growth.
The key takeaway for market researchers in 2019 is to have a really sharp focus on product.
For us, specialising in higher education, we have a host of factors to consider in 2019: the demographic dip in young people of university-starting age, universities having to grow market share to stand still, institutions finding new revenue sources such as commercial services and overseas recruitment.
So we need to really understand these factors, and focus on getting the right products to the market. From a student recruitment perspective, that means the right course portfolio, the right course module structure, the right course tariff and the right course brand.
Are you ready to evolve?
On the agency side, the transformation of market research as a function is really exciting. It’s been building up for a number of years as the world becomes more digital, and in many ways I think we’ve been ready and waiting for it. Red Brick is perfectly set up to succeed in the new environment; it plays to all our strengths.
Essentially, we all – as market researchers – need to be better business people, whether we’re working in higher education, the charity sector, or commercial organisations. We need to speak the language of boards and directors, and demonstrate how our work delivers growth and profit, so that clients will invest. If we can do that, the future is rosy. People will be queuing up to invest in research and insight!
If we can’t do that, we shouldn’t be surprised if we get replaced by automated, computerised number-crunching systems which offer limited insight, but are cheap and quick.
We know our value – so let’s articulate that to the world.
Follow Tim for more professional insights on Twitter and LinkedIn.
Missed the previous instalments of Inside Red Brick? Read Research Manager Zoe‘s piece on Student Union communications here, and Research Director Ben‘s piece on successful segmentation projects here.