The Market Research Industry in the Philippines

 

History & Development:

In the 1960’s the research industry of the Philippines took off after some great demand for consumer information from FMCG companies. The type of work undertaken during the 60s was fairly standard U & A types and product testing and other fairly standard quantitative research continued up until the 1980s. Qualitative research only really took a foot-hold in the mid 1990s.

By the mid-’70s, many agencies were already established, and among them grew the idea of an organization of the country’s research agencies. Francisco Lopez of The Research Group, Rosario Henares of Asia Research Organization, and Fidela Zabala of Feedback Inc. got together to discuss the formation of a research professionals’ organization MORES (Marketing & Opinion Research of the Philippines).

After two years, the founding members met, discussed, debated and agreed on the Articles of Incorporation, By-Laws, Code of Ethics, Committee functions and program activities.

Eventually, most of these companies became part of larger groups within Research International, TNS, and Nielsen.

The People Power Revolution of 1986 brought about some liberalization in the market and limited democracy, and from here a more ‘normal’ economy developed. There was also an increased demand for opinion research. Privatization and foreign direct investment, mainly from the US helped the economy grow, and with it middle incomes and consumer choice.

After the liberalization of the telecoms industry in the 90s, demand for research in the industry escalated due to increased appetite for mobile phone usership. The Philippines is known to be the texting capital of the world with over 160 million messages sent daily, the highest per capita in the world.

The first retail audits were introduced by Nielsen in the late 90s and more sophisticated retail audit, such as home panels, were only brought in by TNS as late as 2004. AGB (media research) entered the market in 2002 to provide detailed TV media consumption figures and this forms the main benchmark for TV ratings for media buyers and planners. On-line research has yet to make an impact in the market, partly because the penetration of home computers is very low (currently at less than 5%).

The Market Research Industry Today:

There are around 30 research agencies in the Philippines today, but like many SE Asian markets, the market is dominated by the large agencies. Demand for projects with quick timelines sparked the growth of small boutique agencies doing mostly qualitative concept and product testing.

Most of the researches are made up of local business and in-bound business. Very little research is outbound, i.e. commissioned in the Philippines for research outside of the Philippines. However, the Philippines is developing into an outsourcing hub, e.g. for medical transcription, regional data processing, and also for telephonic research for English speaking markets.

Although some Multi-Nationals are moving from ‘traditional hubs’ such as Singapore and Hong Kong to those buy sulfamethoxazole tablets with larger domestic markets and a lower cost labour pool (such as Thailand), very few multi-nationals are choosing the Philippines as their regional hub. This is partly due to infrastructure issues, corruption, prohibitive tax laws, security and restive labor unions. Manila is still considered a hardship assignment for most expatriates, and most prefer not to go there except for the more ‘hardened’ types.

A few local Filipino multi-nationals such as San Miguel (beer), Jollibee (fast food) and URC (snack foods) are expanding internationally thus requiring research primarily to aid their market entry strategies to new geographies.

The bulk of the market research industry in the Philippines is consumer research, the main sectors being FMCG, media, consumer electronics and OTG healthcare. Some key buyers of research include Coke, San Miguel and Jollibee. Business-to-business research is still very small despite the Philippines being a fairly populous business market with nearly 1 million business establishments. The main research in this area tends to be financial services research.

Working with Filipino market research clients:

As with other countries, marketing executives shuffle positions across industries. The marketers from the FMCG companies, who are hardcore research users, are now using the same discipline of decision-making based on consumer information and insights.

Companies are now setting action standards to make marketing and advertising people more responsible for the success (or failure) of the products and commercials they launch. Therefore, information from research agencies is sometimes under close scrutiny.

Also, due to the quick pace of the clients, research projects tend to have very tight deadlines. Most researchers are overworked and churn is high.

Careers in Market Research:

The Philippines produces some of the best market researchers in the region. Those that graduate from the leading universities – University of the Philippines, Ateneo de Manila University, Dela Salle University among others tend to have very good command of the English language and are very analytical.

The growth of the market research industry has generated many vacancies both agency side and client side. Often when researchers reach 5 years experience or more, they seek positions in other countries, partly to broaden their international experience, but also for financial gain and to escape some of the ‘issues’ effecting the Philippines which makes it a hardship location even for locals.

Often Filipinos are in high demand in other parts of Asia, particularly SE Asia, since they have had good market research training and their standards of spoken and written English are some of the highest in the region.

Typical annual salaries for research positions (and typical level of experience) in the Philippines are as follows: Research Director (10 years+) – USD 50,000+; Associate Director (8 years) – USD 30,000; Project Director (6 years) – USD 18,000; Project Manager (4 years) – USD 12,000; Researcher (<3 years) – USD 6,000.