Toto, We’re Not in Kansas Anymore!

 

Editor’s Note: Our colleagues at Cambiar have just released their  4^th Annual Future of Research Report, which along with our own GreenBook Research Industry Trends Report and the ESOMAR Annual Report serve as the three key strategic planning reports for much of the industry. Each report provide insight into specific business questions, and one of the key areas that FoR  explores well is the perception of change occurring on the client-side of the industry.

In this post Beth Rounds pulls out some of the results from FoR that indicate that perhaps the pace of change we have been discussing for many years here on GreenBook has not just accelerated, but has passed the tipping point and the changes in the industry are both rapid and massive at all levels.

We’re hard at work on analyzing the latest data from the GRIT survey and will be releasing the new report at the end of November. We see corroborating trends in GRIT as well, and the gist certainly seems to be that 2016 (and beyond) will be interesting years for the industry indeed.

 

By Beth Rounds,

It’s great to be back working with the Cambiar team as we assist clients, both corporate MR teams and global agencies, with their transformation challenges and in many cases, their opportunities

For those that are embracing the notion that we aren’t in Kansas anymore, it is likely that you are re-thinking your business model.  At Cambiar, we see three models needing transformation, driven by three existential questions that manifest themselves in three meta-trends:

 

So how quickly is change happening and what are corporate clients saying about the rate of change and their role in this new world?

In our 4^th Annual Future of Research Survey, when asked to evaluate the pace of change in the last two years (on a 5-point scale where 1 was “minor” and 5 was “massive”), fully 49% of suppliers and 37% of clients opted for the top two boxes. This would suggest that suppliers downstream of changes in client organizations are experiencing that change fairly viscerally in their own organizations and business models. But it does not end there: when asked to evaluate the likely rate of change over the next five years, clients and suppliers alike expected a significant increase in the pace.

 

The good news, in the midst of all this change, is that fully two-thirds of clients feel they are having a greater impact on the decision-making of their business partners than they did two years ago. Only half of suppliers felt the same thing, a figure which is open to numerous interpretations that will need to be the subject of more and later study. Interestingly, these figures are even higher when the researchers involved are integrating numerous sources of data and/or using social media analysis as a complement to more traditional methods.

And who are the key partners upon whom corporate researchers are having greater impact?

• Brands and marketing (80%)
• Senior management (C-Suite) (64%)
• Customer marketing (51%)
• Corporate strategy (43%)
• Sales (35%)

It is probable that we would not have seen such strong identification of the C-Suite and Corporate strategy folks as key business partners for research even five years ago.

It is also clear that clients are excited about their future role. When asked to identify the expected differences in their roles five years from now, participants stressed aspects of the job that were of a higher order, including strategic thought partnership, being consultants and opportunity identifiers and providers of business recommendations.

 

This chart also highlights a number of other findings going on in the client side of our profession:

• Today’s roles remain relatively limited compared to the aspirations we saw in the 1^st Annual Future of Research Report. Primarily the role of corporate market research and insights functions are still seen as being voice of the customer and insights generation (with little thought as to how those insights are then taken on through the rest of the business).
• The proportion of the clients saying that they play the role of strategic thought partner is identical today to what it was in our first annual report (37%). Given that the aspiration to become a strategic thought partner was as strong then as it is now, it is clear that progress in the client world is uneven at best.
• While clients are aspiring to higher order roles, it is also clear that they expect to be taking on more roles in the future—even ones which had largely been confined to the back room, such as “risk reducer.” Will they have the capacity to fulfill all these roles? Will there be the corporate vision to let this be so? Disturbingly, only 44% of clients rate the role of market research in their own organization as being “clear” or “very clear.”

So what is holding us back? What are the barriers to success in market researchers’ quests to have more impact and play a greater role? When broken down, it seems to be a story either of reduced budgets or of research not being able to be in the right place (structurally or tactically) at the right time to influence a decision.

 

 

Interestingly, clients tend to emphasize the tendency for senior management to make decisions on gut instinct, a factor that Corporate Executive Board brought to the forefront two years ago when they found that only 5% of customer-centric decisions actually involved research. Suppliers tended to emphasize market research departments not having enough influence among senior management. This would suggest that they have less confidence in their clients than perhaps they ought!

Perhaps most intriguing of all is that large clients (those with corporate revenues in excess of $10 billion) are much more likely to emphasize the influence of large consulting firms as usurping the research or insights department as thought leaders within the organization. Are the years of researchers shouting, “The consultants are coming!” really now starting to become true?

Key Takeaways From Our Research

When the 1^st Annual Future of Research Report was released, clients and suppliers forewarned of major change to come. That change has arrived and its pace is only expected to quicken in the next five years.

Among clients there is a genuine feeling of having made progress in terms of the impact that they are having on their internal business partners, whom they identify as being much higher up in the organization than in the past.

There is both anticipation and aspiration in the roles that clients believe they will be playing in the future, but this is not quite matched by the progress we have seen in their roles in the last five years. Will aspirations be fulfilled or does disappointment lie ahead?

Some of the barriers that may lead to disappointment lie in reduced budget and headcount, as well as market research just not being in the room when decisions are made. In larger client companies, the consultants may be there ahead of them.

Next Blog – How MR Agencies Are Winning In the Change Game.