Leonard Murphy, GreenBook “As researchers we need to become better marketers”
In the latest edition of the GRIT Report for Q1/Q2 2018 the overarching message was "change". While some discrete data points remained relatively static compared to previous waves (views on sample, the steady adoption of automation), most question areas we explored resulted in an awareness of significant pressure on the industry manifesting in change at all levels as a response. As we look at the idea of innovation in our industry, this general "change" dynamic is the driving force.
For instance, no where was this better exemplified than in the new "GRITscape" segmentation approach. The exercise was simple: respondents were asked to place their company, either supplier or client, into one of several categories. For the supplier side, the categories covered different types of companies, based on their primary focus - research, analytics, technology, research process, etc. On the client side, the focus was more on the nature of interaction with internal clients.
After cleaning all data, we ended up with 681 client organizations and 1,297 suppliers classifying themselves. This rich data set gave us a global view of how companies describe themselves, and via some additional analysis and interpretation the results gave us a deep and wide view of the industry as it defines itself today during this era of great change.
What does this tell us about research suppliers?
The first thing that we learned in this analysis is something we have been observing for many years – researchers don’t make good marketers. The premise of positioning is knowing what you do and what you don’t do. In this survey, there was a lot of inconsistency from the respondents within a company as to what that company does. Here is an example, just one of many: This particular supplier had seven people from their company respond to the GRITscape question. These seven people categorized their company in five different categories. The takeaway is that their own employees aren’t really sure what the company does, or don’t know how to talk about it consistently. This inconsistency was more pronounced within some supplier companies than others, but it was evident to some degree in almost every supplier that had three or more respondents. A quick sample of twenty different suppliers that fit the profile showed that 19 of them exhibited this issue. This means that leaders of supplier companies need to clarify their market positioning and communicate that definition effectively throughout their organizations. As companies scramble to adapt and innovate, this lack of focus on heir own positioning in the market is a significant challenge.
One of the most notable findings concerns the shift from "research" to "insights". The categories to choose from included both Full Service Research Provider and Strategic Insights Consultancy. When looking at the actual firms that were listed in each one of these, there was a lot of overlap – both from our perspective and the respondent’s perspective (see prior paragraph). However, positioning yourself as a Strategic Insights Consultancy is much more popular (42 percent respondents categorized their company that way) compared to positioning as a Full Service Research Provider (6 percent categorized that way). While we all want to be recognized for the deepest level of engagement, knowledge, and skills that is reasonable, being a Strategic Insights Consultancy doesn’t buy you marketplace advantage unless you are bringing something more to the table than what a Full Service Research Provider usually offers. In a review of revenue growth, both categories see about the same percentage expecting growth (59 percent for Strategic Insights and 54 percent for Full Service Research).
Strategic Insights Consultancy was just one of the consultancy options, the other consultancies (either listed or gleaned from open ends) include Product Innovation, Marketing Communication, Customer/User Experience, Brand Strategy, Marketing, and Management. Consultancies of any kind accounted for a little over 60 percent of all categorizations, dominated by Strategic Insights.
Is this positioning shift a reflection of innovation? Only time will tell, but those firms that are actually backing up the positioning with offerings and capabilities certainly seem to be succeeding.
Supplier categories and growth expectations
If we look at growth expectations across all suppliers, the average we are working from is 57 percent. That is the percentage of supplier respondents that expect some growth (slight or significant) from last year to this year. We then looked at the categories that have at least 10 responses. The process of research is the most disrupted - it is both the area with the most expected growth and the least expected growth. Tools and platforms are replacing more traditional approaches.
Sample providers are the category with the most respondents within those companies who are expecting growth (80 percent). Tools that make the research process happen are also expecting growth that is above the average; Quantitative data collection tools/platforms (68 percent), Qualitative data collection tools/platforms (71 percent), and Analytical tool/platforms (67 percent).
There are three categories that are meaningfully below the average growth expectation. All three are being impacted by automation and new tools and methodologies. Quantitative data collection (48 percent), qualitative field services (36 percent), and analytical services (45 percent) are all seeing less than 50 percent expected growth in their companies.
What does this tell us about client organizations?
Three functions dominate client-side research organizations: strategic insights consultants (29 percent), voice of the customer for the organization (22 percent), or a hybrid of these and other research/analytic functions (33 percent). There was no correlation between these three options and research budget growth expectations. All other research functions listed represented less than 10 respondents. There does not appear to be any meaningful variations by the size of the organization or the industry vertical.
The issue of positioning also occurs in client organizations, but the problem is not nearly as pronounced. There could be a couple of explanations: The first is that client organizations are often more focused in their scope and therefore, know both what they do and what they don’t do. Secondly, there are fewer possibilities of categories, and therefore more consistency. However, the fact that this does exist means, once again, that as researchers, we need to become better marketers. Not just for our benefit, but also for the benefit of our clients – internal or external.
The Big Picture
The research industry is a very segmented marketplace, to no one’s surprise. Understanding where you play, especially as a supplier, is important for positioning and marketplace success. And, based on the data from this edition of the GRIT study, this understanding of where a supplier fits is often not clear or is not communicated effectively within organizations.
Based on the changing nature of the industry due to automation and other technologies, methodology changes, and resource constraints (including time), we would expect to see significant shifts in the number and size of the companies in the categories that we defined in the GRITscape exercise. The shift in how research is done will continue to impact processes, within both supplier and client organizations. Our understanding of what we do (and what we don’t) will have to constantly evolve.
Leonard Murphy, Executive Editor & Producer, GreenBook, has been in the Market Research industry for over 15 years in various senior level roles. A major aspect of his work focuses on collaborating with multiple organizations to help advance innovation and strategic positioning of the market research industry, most prominently as the Editor-in-Chief of the GreenBook Blog and GreenBook Research Industry Trends Report.