In my short span of seven years of doing fieldwork and data collection in market research, the rate of change in the industry has been astonishing. Much of it is due to the rapid changes and improvements in technology.
For instance, when I first started as a fresh-faced graduate with zero experience in the market research industry, online data collection was unheard of. We were mainly just doing face-to-face and telephone research. It was the norm to spend three to five months carrying out fieldwork. But within just five years, online data collection has become the norm. In comparison, it took the market almost 10 years to accept the methodologies of face-to-face and telephone data collection.
More importantly, the life cycle of any data collection is getting shorter today. Markets like Indonesia, Laos and other countries in Asia and Africa skip online data collection almost entirely and rely largely on the use of mobile phones to collect data because of high mobile penetration compared to online access. This has led to a price war in the market research industry.
It is thus critical for us to think about how we collect and use data. We are no longer only competing with our direct rivals or others in the same industry. The level of competition has expanded to include advertising and tech start-ups, such as Fitbits, Snapchat and Facebook. These are media owners who are able to collect massive amounts of data through reaching out to real users. Their entry into our industry means that the line between market research and marketing & advertising is becoming thinner, if not disappearing altogether.
If, for example, start-ups are able to target daily joggers and ask them about their preferences for sports shoes and equipment, and so promote a brand of sneakers to them, then these companies have little need to engage the services of a traditional or online research agency. After all, how authentic and accurate are the research findings of these firms that rely on just a sample of users?
We are living in an era where change is rapid. Research companies are asking to add APIs (application program interfaces) to panel databases at the backend so they can launch studies immediately and get instant results for their clients. The number of cookies and automation requests are increasing day by day. Gone are the days of standard studies where clients wait patiently for three months to get results, by which time they might already be obsolete.
But the strength of rigorous research will stand the test of time and the challenges of fast-changing technologies. More and more studies have shown that ‘self-claimed’ data offers only 20% accuracy at best (compared to heartbeat information and receipts). Clients are aware of this. Hence, they are moving away from data collection methods that use self-claimed data. Instead, there are more requests for passive data, which enable them to do specific targeting and marketing. For example, Snapchat and Facebook are working with Nielsen, and Fitbit is working with Kantar Health.
If other industries such as tech, media and advertising are slowly ‘seeping’ into the market research world, and trying to monetise their passive data and big databases of active market research, then market research companies should also step out from their comfort zones, learn from these other industries, adapt, compete and try to collaborate. Better yet, gain a share of their pie too. The only thing that is constant in life is change. Either we have the foresight to change now and be leaders, or stay as we are and always lag behind in the game. The competition is getting more intense. The stakes are getting higher. Are we willing to change our mindsets on how to play the game of using data? Or do we wait and engage in this price war game, only to become obsolete?
At the end of the day, companies do market research to improve their bottom line – directly or indirectly. Anyone who can help them better target their customers and competitors through data collection and marketing, hence increasing sales in the shortest span of time, will be the winner in this fast-changing game.
By Christine Tan, Senior Director, Southeast Asia, Toluna
This article was first published in the Q2 2016 edition of the Asia Research Magazine