As with most industries, innovation is the route to tomorrow’s profitable revenue. As Professor Gary Hamel, leading strategy guru, points out: by the time an organization has wrung 5% of efficiency out of the current business concept, someone else would have already changed the rules of the game. Yet “the imagination required to invent new business concepts comes cheap, and in the end it is imagination, not investment, that drives innovation.”
The market research industry has not ignored this advice, and being in the “knowledge business”, imagination and innovation should be core to the business process.
However many firms (research included) place too much emphasis on incremental improvements and cost cutting as a method of retaining profit. However this approach is unsustainable in a market where the life-blood of the industry, the researchers and interviewers, is highly sort after and are highly mobile.
But what has been the research business’s approach to innovation? The quest for competitive differentiation is a continuous one, but with perhaps one with more pitfalls in research than in other industries.
The array of new products, concepts, and methodologies emerging from the research industry is huge, but are often inappropriate, and marketed to clients in a desperate attempt to demonstrate differentiation and sometimes as a method of hiding the research company’s inexperience within the client’s own industry sector.
The problem in Asia is the “black-box” solutions widely marketed by the multi-national research firms tend to rely on having a considerable amount of historical consumer data. Although such tools have a place in developed markets, in emerging markets (where often the best business opportunities can be expected), such tools fail to add value or only serve to confuse.
Tim Smyth of Indochina Research Limited (IRL) gave an example of the mobile telecom market in Vietnam. “Clients are sometimes concerned about the sales and marketing battle over current subscribers rather than the so far untouched consumers. Since all developing markets have more potential with non-subscribers, the greater opportunity is through understanding the basic functional and emotional motives, identifying the target segments, and building the brands”. Such markets are usually better handled by standard demographics and Usage & Attitude than through the application of overly complicated solutions. These are often forced on emerging markets from the head offices in the mature markets.
Piers Lee from Kadence raised this point but from a different angle. “The problem is that innovative product solutions are sometimes marketed without the client’s interest at heart. The ulterior online pharmacy usa motive can be to force clients into a customer satisfaction or brand tracking model that they can’t escape from. Clients often sit through product presentations on ‘branded solutions’, without the research firm ever asking what the clients needs are. Furthermore in the drive for innovation, the products are becoming so sophisticated that neither the client nor the researcher can really understand the approach or application of the product to a point where it is almost unusable”.
Kevin Meyer from Opinion Research Taiwan commented, “The fact that Asian markets have developed so quickly means there are relatively few clients with solid research and marketing background to integrate really sophisticated research into their marketing effort. Market research professionals in Asia therefore need to play a role as consultants on how to address the critical issues their clients face rather than baffle them with bells and whistles.” But fulfilling this role is tricky when firms are increasingly delegating projects to more junior, inexperienced staff.
Worst still, the complex questioning that is sometimes an integral to these black box solutions, often means that neither the interviewer nor the respondent really understands the questions and answers undermining the very integrity of the data.
“Back to Basics” however, does not necessarily mean rejecting innovation. One of the most under-rated areas of the entire research industry is the drive to ensure quality of data collection. Indochina Research, for example, has developed methods of use showcards and prompt material with respondents who cannot read.
The Leading Edge have introduced “Industry Architects”, specialized in specific industry sectors and who work with the research teams to identify the marketing implications of the survey findings.
There is also client demand for more insightful qualitative research. Although an approach to finding insights can involve sitting consumers on multi-coloured bean bags and having them perform certain “tasks”, clients are often bewildered by such techniques and cannot interpret the very expensive reports that come out from this at the end of the project.
In a different approach, Kadence has been developing a new but quite straight forward method for identifying and recruiting the really advanced consumers in a market, with the best ideas for the next generation of products within a sector.
A lot of these new techniques can be created simply from a pragmatic overview of the research process rather than engaging boffins and statisticians to work in bunkers. Perhaps just go and talk to those consumers with imagination… it can be cheaper!