The second market research industry stakeholder survey was conducted by Asia Research in June 2013. This survey among 274 respondents from client organisations, agencies, and support industries across Asia assessed the opportunities, threats, and potential changes to the industry expected in the next few years.
The good news is that on balance, stakeholders see more opportunities than threats in the industry (66% versus 13%) although similar to 2011 some of those in middle management are less positive about the industry’s prospects compared to both their seniors and juniors. There is a rise in positive sentiment from client organisations, possibly due to the increasing choices they have as a result of further industry fragmentation as reported in the last issue of Asia Research.
Most notably the rate of change expected in the industry is now much higher than when we first surveyed stakeholders on the subject in 2011. 44% of the industry state that by 2018 the industry will see big changes in the types of supply-side organisations and some claim the research departments and suppliers we see today will no longer exist.
The drivers of change are not surprisingly technology-related. In terms of new methods being adopted by the industry, over half of those surveyed expect online research, community panels, mobile-based research, and social media monitoring to be in more demand in the next few years. However, some of the other new technologies are gaining less traction. For example only 30% state there will be more demand for online qualitative research, 25% for eye-tracking and 15% for facial recognition – similar figures for those who have actually used these methods in the last year. Feedback from the industry suggests that some of these new techniques are simply impractical or too expensive to implement.
The adoption of new survey methodologies varies considerably between markets – online research and data mining is still quite rare in Indonesia and few expect these methods to make gains in the next two years. Online research has advanced in India but notably half of the researchers surveyed have also undertaken research through mobile devices. Australia, being the most developed of the markets surveyed, sees universal use of online panels, although use of community panels (built from client organisations own proprietary customer databases) is considerably lower than other markets such as Singapore, Malaysia, and Greater China. The proliferation of access panels in Australia might suppress demand for community panels in this market, or the community panel companies such as Toluna and Vision Critical have simply been more active in other parts of Asia.
The perceived opportunities in the research industry are similar to two years ago, mainly being leveraging off technology and providing to clients more value add research. Again, there is considerable variation by market influenced by their stage of development. Even though it is already an advanced market, Australia still sees further leveraging off technology as the main opportunity to the industry. In India, which is a market with over-capacity and where price discounting is seen as more of a competitive advantage, the industry is responding by seeking opportunities among mid-sized corporations who might not have undertaken research before and who are relatively less sold to by research firms.
The main changes in the last two years are the perceived threats to the industry – in 2011 one of the biggest threats was seen as the inability to attract and retain talent in the market research industry, but in 2013 the salience of this has dropped. It is possible that the fragmentation of the industry and the range of new, up-and-coming players using new technology are now making the industry more appealing to a wider range of talent.
Perhaps surprisingly, respondent co-operation rates are viewed as a less of a threat to the industry today compared to two years ago, although the growth of opt-in access and community panels that is becoming increasingly available across Asia might account for this.
The fragmentation of the industry is partly a contributor of an emerging threat to the industry – the supply of agencies outstripping the demand. However, the most notable new threat in 2013 is clients undertaking more of their research in-house. This is evident in the increasing trend of clients going direct to online panel companies or using in-house analytics personnel. Indeed among the research buyers who took part in the stakeholder survey, 73% are currently in sourcing some of their research and about one in four or five are using freelancer researchers and even their own interviewers for their survey needs. While currently 25% of clients in our survey go direct to panel companies, 42% expect to do so in the next 2 years.
There is also high demand for ‘alternative suppliers’ including specialist analytics and data mining companies, and web and social media analytics companies. To find their ‘value add’, many research buyers are also going to media companies, brand consultants, and industry experts for their research needs. A minority are engaging product innovation consultants and academic institutions.
The industry feels that the appropriate response to these changes needs to come in both people development and product development. Similar to 2011, what stakeholders think will provide the greatest competitive advantage today is more investment in staff training and development, and more product innovation. Despite these claims, the provision of training was actually ranked as one of the least important employee benefits in Asia Research’s year end staff satisfaction surveys, and there is little evidence of companies investing more in training, especially with external training firms.
The competition for staff is also very different between markets. Indonesia and particularly India feel that increasing staff salaries are threats to the industry, while this is almost non-existent in Singapore perhaps due to the current stagnation of the market.
In summary, the industry is noticing faster change than before, but it is still optimistic about maintaining its relevance to both the corporations it serves and the new talent that comes into the market. Technology is accessible to more stakeholders, and this makes it a more attractive industry to work for. While there is a rush towards technology, specifically online and community panels, some of the new methods such as eye tracking, facial recognition, and neuro-insights might struggle to gain wider acceptance meaning research will still rely on traditional question and answers for some time to come. Where the real change is expected is in the type of research suppliers who will ask these questions and the type of research buyer who will use the answers.