There is a perception that market research has, over time, lost its place in the boardroom. However, that is not the case. Market research has, and always will, play a role - even if that role could be improved and expanded.
For example, any conversation about a particular brand (or set of brands) often quickly transitions from a discussion about sales revenue to one which includes market share. The latter is only obtainable from a market research supplier. It is this supplier that will track sales of all brands within the product category in order to determine market share, as well as other important measures such as distribution, promotional support and actual pricing.
Further, any discussion in the boardroom regarding customer satisfaction, Net Promoter Score (NPS), brand or advertising awareness all require the competitive intelligence of market research suppliers who provide such research oriented insight.
Of course market research is used outside of the boardroom to make a huge variety of decisions. It is a vital aspect of day-to-day business activities for both marketing and insight departments. Although the boardroom might discuss individual data points on occasion, it is far too granular and inefficient for business leaders do so on a regular basis. C-Suite executives have far broader issues to discuss -such as overall financial results, acquisitions, investment strategy, employee satisfaction and more.
Market Research Validation
It is clear that one of the core challenges for market research to overcome is that of validation. In this context, validation involves clearly attributing changes in performance to the decision which caused it. This is best achieved through exploratory market research.
However, validation is difficult because organisations are only able to control their own actions. Almost every action of theirs results in some type of response by key competitors. Therefore, it is almost impossible to obtain a clean read and generate accurate, reliable attributions between action and performance.
If more time and attention were dedicated to validating in-market results, then subsequently tying these back to market research findings – executive boards would be better equipped to make informed decisions. Further, the research results would demonstrate a clear ROI that could be used to calculate appropriate levels of future investment in market research services.
The True Challenges of Market Research
The market research industry ought to be less concerned about visibility in the boardroom and more concerned with issues closer to home, such as marketing professionals who do not believe in research, or the constant pressure for faster and cheaper insight. These are issues which often have a direct impact on quality and accuracy. They also lead to smaller brands & companies concluding that they cannot afford research when, in reality, online methods and tools have made it more affordable than ever. We are in an age where you cannot afford not to conduct market research.
Ultimately, it is marketing professionals who set the tone for whether research is required within an organisation. Otherwise they are encouraging and supporting decision making without the need for research. This issue is amplified by the fact that there are often no penalties to making decisions void of considered research. Most brand managers are likely to have moved onto another brand or assignment anyway before the complete impact of their decisions has been fully realised.
Faster and cheaper research has certainly been made possible through the onset of online methods through which most market research can be conducted today. However, at some point, the acceleration of research speed must slow down.
Improvements in speed are not simply down to computing power, but have also been made by all of the steps in the research process. There is a point at which this cannot progress any further. While researchers strive to improve turnaround times, it is also vital to that market research is being conducted correctly and in a considered manner. This takes time. And, in addition, many of these steps simply cannot be automated.
As well as the improvements of speed, the cost structure on some elements (such as sample) have and continue to decline. However, other aspects of a research project, such as questionnaire design or moderation (particularly in a focus group environment) have changed very little in terms of the skilled staff required, speed and consequentially, cost.
Market Research and Small Enterprise
Smaller brands with lower budgets need research just as much (sometimes even more) than their national counterparts. Because smaller brands have far more to lose, they must do everything in their power to make the right decision. It is far too easy for a small brand to simply choose a strategy with which to follow without any insight or testing.
However, the risk of not testing before deciding means that the brand could perform worse as a result and this means lower sales, lower profit and a risk of not even surviving to go onto the next stage. Research to support the launch of a new brand is of particular importance, as a successful launch is likely to determine whether future investment and support can be secured.
The bottom line is that market research has been around for close to 100 years and no doubt has undergone a lot of change. Yet the fundamental need and use for it has consistently grown during that time. Today, there is more research being conducted than ever before, in large part due to broad access to DIY research platforms and respondents. Combined with the massive reach that a connected offers in terms of participants and data sources, it is no surprise the research industry is blossoming.
The boardroom should definitely have an awareness of market research, its results and value. But executives should also be able to trust their marketing and insight teams to apply all of the research tools and services required to provide the information that informs decisions. After all, that’s our job!
Find out how you can use make use of research in the boardroom with our free on-demand webinar. Or, watch a short, two-minute demo to see our enterprise grade research platform in action.