The year 2011 is drawing to a close. November and December are not only in Germany traditionally fully packed market research months. But there is the TMRE 11 in Orlando, Florida knocking on the door.
That’s exactly the right time to think about market research leadership. Almost exactly 2.5 years ago Boston Consulting Group has introduced the Consumer Insight Benchmarking. A study among clients an vendors of market research related services which a lot of interesting stuff.
One of the key findings at the time: market research often isn’t able to draw on its full potential, regardless of whether it is called Customer Insight Research or not 😉
There are four stages of progress, which outlines the process of development of market research in their role of „orders from the internal divisions“ to a „source of competitive advantage„.
Level 1 is defined as „Traditional Market Research Funcion“. The focus here is on the tactical use of market research. Any qualitative and / or quantitative test scenarios fall into this group. Market research here is usually a demand from marketing, always with a specific requirement (eg product or campaign testing). Or, as a CEO is quoted in the study: „The sample-size police in the back room … Which research is focused on and is not valid rather than provide meaningful business advice.“
Level 2 is titled as „Business Contribution Team“. The role of market research goes further than in level 1, because here a greater level of cooperation between Market Research and (internal) client has been created. This often leads to a more strategic use of market research services. Recommendations that are strongly related to business processes are kind of output of market research at Level 2. Nevertheless, the insight department (just to use a synonym for market research) only acts if it is asked to support. Synchronization with other information from the past or from other sources does not take place here.
Stage 3 is called „Strategic Insight Organization“ and the role of market research is more important than level 1 and 2. Market research is an integral part of critical business processes across marketing and sales and beyond of it. Market researchers are required as part of project teams, regardless of whether it is a market research project or not. Relevance for the divisions is caused by a close cooperation of market research with the relevant project managers. And knowledge of the sales force is growing little by little.
Stage 4 is in very many ways the supreme discipline, which can only work under certain conditions. It is called „Strategic Foresight Organization“ and expands the processes from step 3 by a thinking that dissolves the boundaries of individual business units. This means that market research occupies a cross company position, which enables it to attend strategic decisions and support and steer them. This positioning includes extending the focus on – besides the status quo – future trends and predictions.
In 2009 we learned that 90% of companies surveyed are located at Level 1 or Level 2. This matches perfectly what we experience here in Germany. So we try to achieve a constant „up-levelling“ for market research leadeship.
The remaining companies are mainly found in stage 3 and only a few companies are on stage 4. Also quite interesting is the different perception of the terms of the quality of output between those who produce it and those who buys. 73% of the „manufacturers“ say that they answer all „so-what?-questions“ with their results. If you ask the recipients of the results only 34% agree to this.