Many companies believe data gathering from social media and other online sources is an easily available and cheaper shortcut. This year, with COVID-19 hurting the economy, the decline in market research services is expected to accelerate.
Market research is suffering from a long-term decline in investment that is being heightened by the Covid-19 pandemic, according to data exclusively compiled by Marketing Week.
Using the IPA’s (Institute of Practitioners in Advertising, UK) quarterly Bellwether report, we found that market research has been on a resolutely downward trend for the past five years, with that decline accelerating over the past 18 months.
During the first quarter of 2020, a net balance of 21% of marketers said they planned to cut spending. By the second quarter the number had plummeted to a nadir of 42%, although in the third quarter it rebounded slightly to 33%.
Market researchers have spent much of the past 12 months coping with drastic changes in the way interviews are carried out, information is collated and results are assessed. The drive to be flexible and speed up data harvesting, so brands can be seen as more reactive, is putting added pressure on old school methodologies.
It’s a view echoed by Market Research Society President Jan Gooding, who insists that any kind of reboot will still need to adhere to the basic building blocks. She said, “As has always been the case, the research industry is heaving with incredibly bright people who are very interested in what makes people tick and are genuinely motivated to try to get to the truth of what’s happening and realize that different methodologies can produce different kinds of results.”
Clearly, market research has had to evolve quickly in the context of the pandemic and migrating online offers a range of advantages, one of which is, inevitably, cost-cutting.
Please note that the graph shows the net balance of marketers planning to increase/decrease market research spend – not the percent loss of market research volume.
Source: Barker, M. (2020, November 25). Market research spend slumps as shift to digital and Covid hit. MarketingWeek.