Market Research Fails the Relevancy Test

Every time a client asks our consultancy to handle a research project for them, we jump at the opportunity. But to make the research actionable, it is our job to help the client express what he intends to do with the research once it is completed.

The consultant, in cooperation with the client, must clearly define the project's scope. Otherwise, all the research will do is frustrate the participants with several hundred pages of data devoid of any useful executive summary or marketing recommendations.

Forrester Research addresses this frustration with its January 7. 2009 report entitled "Role Insights: Market Researchers Struggle For Strategic Relevance." 

Here are a few quotes made in the report that show what is happening with research from the researchers' perspective.

"Market research leaders report finding themselves sidelined because they are often viewed more as service bureaus focused on tactical, not strategic, questions and research... Only six of the 40 market researchers (or 15%) we surveyed classified their market research group as having a definite strategic role within their organization. When asked if their market research team was viewed as a critical strategic partner, only 12.5% of the surveyed market researchers report that this statement is highly descriptive of their group."

The report goes on to explain why this is happening.

"Distributing research effectively internally is the biggest challenge... Can internal customers digest and make sense of the data and analysis from the market research group? Probably not."

Forrester reports that researchers have failed to make their research relevant to the marketers who must act on the information. 

In my opinion, researchers leave the impression that their job is done once the analysis is provided on spreadsheets and charts without the critical INTERPRETATION of what it all means from a marketing perspective.

In a sense, researchers allow the project to launch without a crystal clear understanding of what the marketer is looking for. So is it any wonder that the researcher cannot communicate the information the marketer seeks in the form of a relevant synopsis with specific action items?

Having completed a number of research projects for clients, here is my take on what is needed to make research more strategic and actionable.

To keep this post to a manageable size, I would like to talk about large research and data aggregator organizations in the direct marketing BtoC space such as Experian, PRIZM, and Acxiom Corporation.

These data aggregators match their master file with the client's customer or response data appending the enhanced data to come up with customer profiles. These profiles include such things as full customer demographics, home ownership, credit rating, media reading habits, response propensities and other behavior information depending upon the supplier's data portfolio.

The usefulness of the findings depend upon what the client intends to do with the information.

If the client wants to target prospects based on the types of customers the company presently attracts, then the targeting capability offered by such analyses proves quite useful.

Starting with the targeting capability of direct mail, such data can easily reduce circulation by 20-30% with little reduction in sales and a substantial increase in profits depending upon what targeting was used prior to the research.

Another major application of this type of research is store location planning. 

Why locate in geographic areas that have little representation of the types of customers the company attracts? It is most cost effective to locate stores in areas that have deep representation of the company's typical or best customers.

But most clients need more than media targeting or store location tools. They want to understand how their offerings motivate or demotivate their existing and potential future customers. Such customer profiles yield limited information of this nature.

This is where primary research or survey research comes into play.

Properly planned and implemented primary research reveals the customer psyche and gets into the why they buy a client's products rather than those from competitors. This research often uncovers weaknesses in the client's present offerings giving the direct marketers the information they need to develop more compelling offers. Primary research findings may transform loosing products into winners.

Relevant market research revolves around answering the client's questions about their customers. 

-Who are my best customers? 

-What do they look like? 

-What is their lifestyle? Do they look different from my competitors' customers? If so, how?

-Why are they buying our products?

The list of questions goes on.

In summary: The most important question researchers, clients and consultants sometimes forget to ask is this. How do you intend to apply the findings from this research?