Trend watchers no doubt have noticed that traditional players in the market research space are having an increasingly hard time keeping up and scaling their business practices with changing times. In a recent article, analysts have reported a flat growth rate of 2% in the market research industry. This is not good, especially when you factor in inflation.
Perhaps the highest impact change involves the digitally-savvy consumer who demands more data-driven analysis and quicker results. Traditional market research firms can be slow to adapt. Are there ways for the old dog to learn some new tricks that can help to evolve a firm and get it moving towards positive growth?
Sure. Some experts suggest that specialization might be the answer.
Think about the niche your firm’s business fits best. What is it that you do uniquely in terms of data delivery or technology? The firms bucking the flat growth trendline are the ones offering expertise within a domain along with strong data inventories that set them apart.
So what do we really mean by specialization? In a market research context, it might mean improvements with infrastructure, speed, size, creative solutions, or methodology.
Identify one or two core competencies and focus on them. This is your niche, the “special sauce,” the unique value your firm adds and the substance you explain to prospective clients: here is why they should hire you. The goal is to become known for something. This is the niche, your “word on the street” reputation.
Fully embrace new technologies. Data-hungry, digitally-savvy clients are looking for speed and quality results. They expect all decisions to be backstopped with data and research. Evidence-based criteria is king. Is your firm moving beyond traditional data collection and analysis? Are you collecting user “experiences” and offering support for impact measurement and taking action? Consider investments in services geared towards high-end analytics and customized tools that deliver data and analysis quicker than ever.
Alongside the new technology, realize the importance of expert advice. Guidance is where your domain expertise comes into play, and it shouldn’t be underestimated as a selling point. Odds are that clients have already researched the vendor space before they ever pick up the phone and probably have a sense of what your expertise is already (if not, take the opportunity to inform them). This means your main objective should be assuring them that yes, you have the expert know-how to serve the client’s needs.
For client needs outside your “competency zone”, considering turning to acquisitions and partnerships.
Acquisitions. If you can’t beat them, buy them. This can work for a large firm, but medium-sized firms are having trouble competing, because they may not have the capital to acquire niche firms. They rely on in-house research instead of partnerships.
Strategic partnerships. Competition isn’t just occurring at the level of operations, services, and pricing. Can you perform the turnaround faster? Sometimes the only way to meet those goals is to establish strategic partnerships in any number of areas like setup, automation, or infrastructure, to name a few.
To recap, the specialized market research firm becomes great at one or two core competencies, is willing to embrace new technology, makes acquisitions and forms strategic partnerships when needed. Flexibility and agility are key.
Keep in mind that being nimble is no guarantee of success, however. Being agile means you are primarily in reactive mode. Why not get proactive? The growth-based firms are the ones who are innovating. Prepare your firm for innovation by incubating your core competencies, which should lead to a creative problem-solving approach. Think more about the kinds of problems you can solve for your clients and less about the categorical label. Remember, you are in the solutions business.