When you see or hear the term "Market Research" what comes to mind?
Are you thinking of terms like costly? Expensive? Time consuming? Not worth the investment? Perhaps you are familiar with one of these 5 myths about the industry then. And possibly unicorns, leprechauns, and other folklore. Sorry we won't be addressing those on this market research blog.
Did you think of any of those terms regarding market research? Well we are about to debunk each of those for you. 1 by 1. We'll tackle 5 of the most common market research myths in this post including cost, response rates, timelines, ROI, and using a consultant.
Each of these 5 myths is outlined below.
Appropriate. Here are 5 market research myths Drive Research runs over.
Myth 1: Market Research is Too Expensive
Let's start here. Market research has a bad reputation for being extremely expensive. This has been driven up by the market research consultant you choose recommending high margin or non-optimal methodologies.
Why suggest a telephone survey when you can get comparable results for a fraction of the cost?
Online surveys are a cost-effective methodology and are far less expensive than other options. When compared to mail surveys or telephone surveys, online surveys are completed for a fraction of the cost.
The myth that market research is too expensive is just that, a myth. A market research consultant should work with you to not only select the most appropriate and cost-effective methodology but they should also work with you to manage the budget within the methodology.
Suggestions here include shortening the length of the survey or lowering the number of completed surveys. Little adjustments like these can often have a large impact on price. A shorter survey results in less design and programming time for the market research consultant.
Something can always be done with market research to fit your budgetary needs.
Myth 2: The 100% Response Rate
Another common misconception in market research is the 100% response rate. In leprechaun terms, this is the proverbial pot of gold at the end of the rainbow. You may always be chasing it, but never find it.
This myth assumes that if a company send out 100 invites to customers using a market research consultant, the organization will in fact, get 100 survey responses back. Every single invite you send receives a response. Unfortunately, it's unrealistic.
This is virtually impossible to do. At some point, the cost in the effort far outweighs the cost of the effort. This means that after 2 or 3 email reminders and a phone call reminder, the market research consultant is unlikely to continue work to obtain additional completes.
So why should a company continue to pay the market research consultant to reach out when only a handful of additional completes will be returned. The consultant should have a good understanding of this threshold and when enough is enough when it comes to reach out and reminders.
For example, it may cost $5,000 to obtain 400 completed surveys but $10,000 to obtain 450. Is the additional $5,000 worth only 50 additional completed surveys? Likely, no.
This is also true with qualitative. If you are looking to conduct 12 executive interviews with stakeholders, you will need to pass more than 12 names to your market research consultant. Along the way, no matter how much time and money you spend to achieve a 100% response rate, you'll likely get a few refusals anyway.
Myth 3: Market Research Takes Too Much Time
Another market research myth we debunk with every market research project at Drive Research. We push the limits with our clients with regard to timeline. This is particularly true with the introduction of online surveys and online recruitment to the industry.
Surveys and recruitment that used to take weeks if not months can now be completed in hours or days. When it comes to online surveys, it's 1 invite sent to 10,000 customers versus 1 individual call placed to each of the 10,000 customers by phone. Which is quicker?
If your market research is taking too much time perhaps you are working with the wrong market research consultant. Or at least one who is not forward thinking and ambitious. The quicker you can turn around your data and feedback, the fast you can take action on the results. Time is of the essence and each additional delay in the market research pushes your action items back 1 day further.
Myth 4: There is No Return on Investment
This is a classic myth when it comes to market research. Some market research has more immediate impact and ROI than others, but nonetheless they all offer short-term and long-term ROI. When it comes to long-term ROI of market research, it can be used to improve marketing, operations, and strategy.
Other market research studies can offer more immediate ROI. Here is an example of how User Experience (UX) market research provided a 665% ROI for an e-commerce client of Drive Research. Results of the UX research were immediately implemented to make changes to the navigation to improve the website experience for visitors.
Other little steps can be taken to improve the ROI in a simple customer survey. Here are 3 simple examples of how to improve the return on your customer surveys. These include asking survey participants if they would like a follow-up (additional sales, customer service issue, etc.), asking survey participants if they would provide a testimonial (for your website or marketing materials), and asking customers to join an ongoing panel (for future deeper dives and follow-up).
Myth 5: Anyone Can Do Market Research
Another common claim in market research, but myth number 5. Much like any other profession, market research and Voice of Customer (VoC) requires years of experience and training to do well. The art of writing and designing a survey is a science. The survey writer must understand timing, flow, engagement, skip logic, and bias. Any one of which can create inaccurate and unreliable results.
The largest benefit of conducting market research in-house ties into market research myth number 1. There are some presumed cost benefits of running a market research project in-house including set up, fieldwork, and reporting. But the trade off is you will not be working with an objective market research consultant, the project may take longer than expected, and while you are working on the market research, you will not be working on other company priorities (opportunity cost).
So you must ask yourself if completing the market research project in-house worth it?
What do you think about these 5 myths? Do you have others? Comment below.
Drive Research is a market research consultant that serves all of Upstate New York and clients across the country. Our market research services include online surveys, focus groups, and executive interviews.
Interested in learning more about our market research services?
Contact us at [email protected] or call us at 315-303-2040.