Are some kinds of market research (MR) better value than others? As an industry we have debates about modes of research but little effort is spent, it seems, thinking about whether some research applications are inherently more valuable than others. What should a client consider when thinking about his or her research budget?
If you had to choose to do only one study in the next year, would it be an advertising effectiveness study (pre; post analysis of market), a brand measurement study, a new product development study or something else?
The criteria for evaluating which study to conduct can probably be reduced to three:
1> Risk — what are the risks involved with not conducting the research? Risks can be varied from a bad investment of time or money to failing to see an emerging threat.
2> Budget — different types of studies cost more than others (e.g. a market segmentation study is more expensive than an advertising testing study) so sometimes budget will be determining. Arguably, this is a good reason not to do something but rarely a good reason to substitute.
3> Effectiveness — how much insight will the research offer? In other words, how much value will it provide?
The first two are questions largely aimed at the client, trying to sort out his or her priorities and the tolerance for risk. The third is one which is interesting to both buyers and sellers alike because it asks a fundamental question? Is a market research study more likely to provide actionable insights for some types of studies? Or, in other words, do some studies tend to be more decisive in helping you make decisions?
MR, like all information is always useful and can add incremental value, but at the same risk and cost, two different types of studies may offer considerably different value to the decision-making process. From my perspective, studies are less valuable when the survey creates an artificial environment that is different from the decision-making process people normally encounter. By necessity, lots of advertising, new product development and pricing studies do just that. So, do they inherently provide less value?