When you work with an online panel vendor you will undoubtedly be quoted a CPI. When you saw this acronym first come by your inbox you probably had no idea what it meant. Sound about right?
You may have seen CPC (cost per complete), LOI (length of interview), or one of these 20 market research acronyms you need to know but CPI?
In this market research glossary post you'll learn about CPI, what it means, how it impacts your market research survey, and how the cost changes. CPI is one of the most common terms in market research particularly if you are dealing with online survey vendors.
Read more below.
CPI uses a basic economic principle of supply.
What is CPI?
CPI in market research stands for cost-per-incidence which is the cost per complete based on the qualifying rate of participants. Incidence rate (IR) is the percentage of respondents who qualify for a survey based on a targeted population. If you are surveying the general public and want to screen out males to only talk to females your incidence rate is 50%.
If your general population survey wants to survey left-handed, red haired, females who work as accountants your incidence rate will very likely be less than 1%. So in basic terms "good luck". Either that or you better have a large budget for your market research.
So the CPI of a a study to females may be $5.00 per complete while a study to left-handed, red haired, females who work as accountants may be $50.00 per complete (or more).
It's a simple rule of supply and demand. The CPI is lower if there are a lot of people in a sample you are trying to survey. The CPI is higher if the sample pool is extremely small and your respondents are difficult to find.
Costs increase for difficult to reach audiences because it requires more effort. This effort revolves around invites, reminders, project management time, and rewards to qualify a respondent. In panels, those who disqualify for a study still often receive a reward or points. This keeps them engaged and participating in surveys regardless of whether they qualify or not.
When you reach out to a market research firm in New York, you'll likely get quoted a CPI. This is dependent on the audience you are trying to reach so when you are searching for a market research quote make sure you have an understanding of your target audience.
If the incidence rate changes from what was expected at the beginning of the project, the cost of your market research will undoubtedly be impacted. Sometimes you are quoted a CPI for an incidence rate of 80% but after your soft-launch or test drive, the incidence rate turns out to be more like 20%. This will raise the CPI for your project.
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