Research technology and implications for market research companies
Big Picture
The Global Market Research industry was valued at $89bn by ESOMAR in 2021. The tech-enabled Sector has grown to 30% of total research spend.
The need for faster and more robust insights has been growing due to continued pressure on budgets and timelines; and has only been accelerated by the pandemic. Technology enhances what market research can already do.
The average market research toolkit has now expanded to include everything from automated, do-it-yourself market research platforms and artificial intelligence (AI)/machine learning.
Demand in particular for DIY market research is growing. According to ESOMAR, global turnover of the sector was $1.9billion in FY22 (at $1.2b in 2020). Having easy to use platforms such as DIY, automation of surveys from templates, or AI/ML to assist in analysis all benefit time-to-value. These make finding insights easier and faster, prioritising the end-user experience — foundational to product led growth.
Investors are funding ResTech faster. In 2018, SAP purchased Qualtrics for $8 billion, Cint acquired Lucid for a whopping $1.1 billion, and Zendesk acquired Momentive Global (Survey Monkey) in a $4 billion deal.
Lets dive in…
Technology is transforming the market research landscape. The need for faster and more robust insights has been growing due to continued pressure on budgets and timelines and has only been accelerated by the coronavirus pandemic. These factors have been critical in driving the transformation of research technology (ResTech).
The Global Market Research industry was valued at $89bn by ESOMAR in 2021, with the US and Europe accounting for over 77% of the overall value. The tech-enabled Sector has grown to 30% of total research spend, 5 points more than in 2019.
The average market research toolkit has now expanded to include everything from automated, do-it-yourself market research platforms, to artificial intelligence (AI)/machine learning. These technologies have become an essential part of the global consumer insights machine, enabling brands to keep up with accelerating changes in consumer behaviour and attitudes.
With over $1.2B in sector investment and Qualtrics going public, technology is going to become core to the evolution of the insights industry in 2022 and beyond.
The online sample market was thrust into the spotlight in late 2021 with two big announcements; Cint acquired Lucid for a whopping $1.1 billion and Zendesk acquired Momentive Global (Survey Monkey) in a $4 billion deal.
Watch out for regulation
The explosion of global privacy laws — including Europe’s GDPR, California’s CCPA, and dozens of others in various other states and countries — have begun to significantly hamper the collection of consumer data through traditional online sources such as website cookies and mobile tracking data.
Now that Google has cracked down on third-party cookies in Chrome and Apple has increased app-tracking privacy on their devices, companies have to find new and less intrusive ways to obtain web-user data.
The need for consensual, first-party data sources that can be accessed on-demand and at scale has become even more acute. A trend towards a greater collection of user-generated content is expected. Organisations are adopting their own privacy measure such as privacy sandboxes.
Automation
Automation has benefitted insights-seekers by drastically shortening the time between putting a survey in-field and retrieving valuable consumer feedback. With automated market research, deliverables that once took weeks can now be completed in as little as a few hours.
Activating audiences is a part of automation. Activation allows brands to connect customer interactions across multiple channels, to deliver a centralised profile and audience that can be activated to all channels.
Use Resonate’s 14,000 proprietary attributes to create well-defined, multi-attribute segments and deliver individual device IDs to any DSP, DMP or social platform for activation across all digital channels.
Automation has also streamlined the market research process by making survey research more repeatable. For example, brands can get feedback on innovation concepts or test their creativity faster by inputting a few simple parameters into a templated online survey, rather than recreating the survey each time.
DIY/self-serve research platforms
Demand for DIY market research is exploding; ESOMAR reported global turnover of sector at $1.9billion (at $1.2 in 2020). DIY survey software firm SurveyMonkey reports a full-year revenue rise of 21% to US$307.4m.
DIY platforms also facilitate greater agility, allowing market research teams to bring smaller projects in-house and execute them as soon as needs emerge. The rise in the quick DIY approach suggests robustness and rigour aren’t as key to non-expert research users.
Some competitors in this space use “algorithmic audience management” to monitor each respondents’ activity and attribute a confidence and validity rating to every user. This increases user confidence that the data they’re using for DIY research is accurate and representative.
AI & Machine Learning
DSIGHT, a concatenation of Decisions based on inSIGHT, will revolutionise how decisions will be made in the future with technology and AI to automate the bottom of the insights value chain (connecting and synthesising data points via decision trees).
This will free up and also guide insights professionals to drive insights creation, implications, recommendations and eventually, business decisions. Stronger and better conclusions and decisions will be more cost-effective and efficient by leveraging decision trees and cutting-edge AI technology. Modelled out across data sets — fusion fused data sets are key
There has been a shift from “consumer insights” to “human insights” as marketers look to marry numbers with narratives.
While technology is making market research professionals more efficient, enabling them to analyse larger volumes of data and make data-based recommendations, the industry continues to prioritise humans — both employees and customers.
Using voice, photos, videos, etc are all part of this ‘human’ touch, then technology such as natural language processing frameworks or Streetbees predictive tech synthesise the analysis of the data making it easier for research professionals to get to the insight.
Strategic implications
Users
Improved ResTech offerings speak to personal needs for increased speed of insights. Non-expert resrecahers want quick insights to compile key insights to support brand health measures.
This has only increased since the pandemic. Pre-pandemic you’d have 18 or 36 periods of data to model, now it has all changed and researchers cannot use past data, because everything has changed.
The second most mentioned theme in the GRIT report, Easier implementation, was closely aligned across suppliers and buyers, clearly showing the importance of technology solutions that focus on user experience during their solution architecting sessions.
Tech advancements such as DIY platforms allow for decisions made upfront to be cheaper. Every dollar one may spend on pre-production research is equivalent to around $10,000 in research performed after products are produced. So not only are they getting faster, more meaningful research exactly when they need it, but they are getting it at a much lower cost.
Company Value Proposition
ResTech is, in fact, a key player in today’s global markets — the predicted growth in the tech sector overall which, according to IDC, is the most significant stock market sector with an estimated global market value of around $5 trillion USD.
When you drill down into the sector, the ResTech story sits within a critical part of the overall market: software, which currently represents the fastest growing segment of IT spending in 2021 overall, according to Gartner, while Forrester recently predicted tech services as a whole will ‘ride on the coattails of software demand’ to lead growth in the sector.
Investors are Funding ResTech Faster. In 2018, SAP purchased Qualtrics for $8 billion. Adding Qualtrics’s user data to their own operational data is a huge competitive move for SAP. Research Now and SSI combined forces to create Dynata, one of the world’s largest market research providers. In March 2020, Usertesting received $100m in Series F financing from Insight Partners. Investors are funding ResTech because it informs strategies, insights, or simply answers. And the industry is only continuing to grow.
By 2020 there was $1.2B invested in the sector.
The GRIT report for Most Innovative in the industry lists disruptors Ipsos, Zappi, Qualtrics, and SurveyMonkey all saw double-digit YoY growth. Compared to the giants in the industry (Kantar 2.7% YoY growth in FY21, Nielsen 1.6% YoY growth in FY21) that carry big revenues and little growth. Furthermore, Restech player Delineate ranks in the top 150 of the FT 1000 top growing companies in Europe.
