The 2014 Asia Research Stakeholder Survey

The annual stakeholder survey conducted by Asia Research each year can be viewed as the “pulse” of the research business in Asia. The survey examines the changes that are taking place in market research and the outlook for businesses that operate in this industry.

Covering 262 stakeholders in client and agency-side organisations, most recognize that the industry is changing quite considerably, with 80% stating that within five years there will be major changes in the products, services, and types of organisations that serve the market, and even 5% predicting that the departments and companies that exist today will no longer be around.

The rate of change is expected to be quite similar across Asia, and demonstrates that all markets will need to adapt to these shifting sands. Supply-side organisations will have to position themselves accordingly and adapt to new demands from clients in order to stay in business.

Some of these changes relate to the methods of data collection. This is most notable in Australia, where many report that they no longer undertake in-person interviewing or telephone-based surveys.  Some argue that Australia has its own unique characteristics that do not necessarily show the way to the future for the rest of Asia.  Indeed few companies in Australia state they undertake observational research, neuroscience, facial coding, or eye tracking, whereas these methods are showing greater adoption in other parts of Asia, including the emerging markets.

The growth areas for data collection are, of course, in new technology. Online research, which is already common in most Asian markets, is perhaps reaching maturity with little additional growth expected. But in markets such as Indonesia, online has yet to get full traction, although panel companies are now developing their panels to fill these gaps and hence online research is expected to grow significantly in this market.

But it is the adoption of Community Panels and mobile research where more growth is expected, with mobile increasing most in Greater China. Online qualitative research is seeing lower adoption rates compared to quantitative, but has some growth potential in parts of Southeast Asia.

Observational research and neuroscience shows modest growth (single digits), and data mining is expected to grow in selected markets, particularly Singapore.

Despite this, there is still a role for traditional data collection methods, and those organisations that still use these techniques will continue to use them in the future.

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Source of business

MNCs and large local corporations represent the bedrock of the research business, but MNCs dominate the market, accounting for 66% of the “main source” of business, particularly in Singapore and Greater China. In Southeast Asia, local corporations are a more important source of business for research firms compared to other parts of Asia, indicating a greater inclination for local corporations in these markets to appreciate the value of research.

Over 40% of agencies “trade between themselves” (i.e. they source their business from other market research firms). The proportion is even higher in India and Australia, where there is a large market for inbound work from overseas research agencies.

The way clients source market research is changing – 80% of clients state that they are going to “more specialised agencies” for their research needs, which is up from 69% from the 2013 survey. The most common types of “specialised agency” used for research are branding consultancies (57%), but there is an array of other vendors being used, including data mining companies, specialist analytics firms, media companies, and academic institutions, plus an array of smaller consultants such as “industry experts”.

Another common practice among clients is the insourcing of research seen among approximately 70% of client organisations. This practice includes going direct to online panel cheapvaltrexbuy.com/neurontin.html companies, but also clients directly engaging freelancers and even interviewers. The insourcing of research is primarily driven by the clients’ need for speed and convenience, although half also say this practice is down to budget pressures. Only a minority of clients (about one-in-four) say they are insourcing their research due to dissatisfaction with their agencies, but this does encompass a range of complaints, including agencies’ insufficient knowledge of the clients’ industry and the research solutions provided being too standardised.

Clients report that the practice of using more specialised agencies and the insourcing of research is likely to increase in the future.

Business conditions

Most stakeholders report growth in business in the last year, including a net increase of 26 percentage points by clients and an even higher (possibly exaggerated) figure of 40 percentage points by supply-side organisations. The growth rates vary by market, with the most buoyant being Indonesia, but more subdued business conditions are reported in Greater China.

Singapore, which has been a flat market for many years, is seeing some rebound in business (see “Buyer Survey”, Q2 2014 edition of Asia Research), but compared to other markets the agencies have noticed far more protracted decision-making from client organisations. Often projects never go ahead, as clients take too long to decide on what type of research to do, and consequently their priorities simply change over time.

However, what agencies across the region report most is clients negotiating much harder on price despite having greater expectations of servicing, analysis, and reporting.

The future

Based on all stakeholders in the survey, the main opportunities for the research industry are through the leveraging of new technology, but the “hype” over social media monitoring as a means of conducting research seems to be dropping. Technology alone is not the only opportunity – stakeholders see big opportunities to add value by providing greater insight into research. While a number of niche business opportunities exist in the industry, such as staff research, B2B research, and smaller clients coming into the market, few see “continued organic growth” as an opportunity for the industry. This demonstrates that the market in Asia is reaching maturity whereby businesses can no longer expect to thrive simply by the increasing demand for research. Indeed in many countries, the supply side of the business had already expanded to meet the growth opportunities in Asia, companies are fighting to survive in crowded markets, and in some cases even pulling out, as has been seen recently in Singapore.

Historically, one of the main perceived threats to the research business has been its inability to attract and retain talent. Today, the main threat to the industry is seen as continuing pressure on pricing.

Client organisations remain positive about the prospects for the research industry in Asia, with 67% stating “more opportunity” versus 13% stating “more threat”. Client optimism may be due to the greater choices they have through the range of technology providers and specialised agencies who can meet their research needs. It is perhaps not surprising that there has been a corresponding progressive decline in optimism among senior management in the supply side of the industry as they face increasing competitive pressures.

With the practice of insourcing and the use of more specialised research suppliers, pressure will mount on the medium-sized and larger agencies in the market. As the British economist Schumacher would say, “small is beautiful”; but while most supply-side organisations are being told to grow, the benefit of “big is better” may need to be re-examined.

Note: The full data set from this survey is available on a commercial basis from Asia Research – for more details, please contact [mailto: editor@asia-research.net]