Asia Research has interviewed Joaquim Bretcha, the new president of ESOMAR, about what the research business should be doing to adapt to the new consumer insight ecosystem.
Despite the pressure on the research business, ESOMAR continues to report year-on-year growth, with Asia Pacific still being one of the fastest growing regions, albeit at a moderate 2.4%. But the industry is no longer just the domain of the traditional insights firms. Many other professionals, including data scientists and analytics firms, are making a significant contribution.
Globally, the traditional market is worth $46 billion, but the new area of data analytics takes this figure up to $75 billion. In APAC, the analytics component is still quite small – for example, in China and Japan it is less than 10% – but Joaquim comments that it is quite challenging to size the analytics market in Asia, although it is certainly growing.
The development of the analytics business creates opportunities, but also some challenges. Joaquim adds that we are seeing some level of ‘drift of practice’. Today, we can get insights with no interaction with consumers – for example, just by looking at behaviour through transactions and activity online. We know what consumers do, and from this we can attempt to infer what their preferences would be for other products, propositions, or offers.
The challenge for the industry is to bridge these two very large but disparate parts of the industry. The focus should be on the outcome, with a holistic understanding of the consumer that integrates both sides, and to do this we need to have a higher level of expertise and to ask the right questions.
Techies are great at what they do, but the traditional researchers need to understand more about the business issues and the ‘so what’? They need to know how to translate these findings into a compelling story so that clients can make better decisions.
We see widespread insourcing of research into client organisations, encouraged by the benefits of speed and cost saving. Technology is enabling this trend. But often the client organisation becomes too dependent on analytics; there can be many biases in the models, and they are not seeing the ‘why’ that is delivered by traditional research. A big challenge to clients who insource is how to command what you are doing and to understand it all. Relying heavily on just one side is weak, and if you want to make a firm, important decision then cost is not going to be a factor in the method.
What can Asia learn from the European research business?
In APAC, there is more growth in the general economy and there can be more room for trial and error in business, meaning that decisions might not need to be supported by such thorough research. In Europe, a business investment mistake can be that much more expensive. Technology has allowed corporations to get more insight at a lower cost, but with a higher impact. Europe is more digitally homogenous, whereas APAC has markets at many more different stages of digital development. China, for example, has jumped massively into mobile research and can be more advanced than what is available in Europe.
Historically, attracting talent to the consumer insights industry has been a challenge, but automation and AI are reducing the laborious tasks for researchers, freeing up more of their time for the ‘fun stuff’.
Also, it is a lot cooler for young people to call themselves ‘data scientists’ (rather than researchers), and these days they are more industry agnostics – for example, this year they could work in market research, and next year they might work for a power company, helping them to implement a new algorithm based on completely different types of data input.
However, as a profession, Joaquim feels that we are just not good enough at selling what we do.
Today, market researchers are the most privileged in having access to data, but we need to sell this better, and add value to what we bring to consumers, businesses, governments, and societies. Data is just data unless you get the insights.
We have been too humble in selling what we have because we have been too obsessed with the process of data collection and not the outcome. We need to ensure that we properly manage people’s data, build that trust with the end user, and focus on what to make of it.