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Research Focus

By The Drum | Administrator

March 22, 2007 | 10 min read

Market research is vital for businesses – any businesses – looking to exploit a new commercial opportunity or expand their existing customer base. From discovering a gap in the market, to ensuring customer satisfaction and planning effective marketing campaigns, research can provide the market intelligence needed to encourage success, enhance competitiveness and maximise profits.

The market research industry in the UK is one of the largest and most effective in the world. And it’s continuing to grow, representing the rise in the number of businesses and organisations in the public and private sector which recognise the value of research and are willing to incorporate it as a fundamental part of their overall strategic planning. In today’s competitive business environment, the more knowledge a business has about its customers, the more likely it is to succeed.

The Scottish market also continues to bustle, busily getting on with other people’s business. A number of new firms have opened in Scotland, and a cache of existing teams from down south are increasingly looking north to establish new offices.

“The market research industry has always been a bit more fluid than other areas of marketing,” says Jim Law, managing director of MRUK, one of the UK’s largest independently owned market research agencies. “Because of the relatively small size of the market, Scotland-based research companies have always been in competition with southern firms.

“As the market research market has grown and matured, and Scottish companies have increased in sophistication, there has been some migration and takeovers, with a number of larger firms now having Scottish branch offices.

“From MRUK’s perspective, we embarked on a strategy to open offices in England a number of years ago, not just to address the issue of Scottish business potentially going south, but to organically grow our company. This has been highly successful for us – from a base of 100 per cent of our business being in Scotland ten years ago, 85 per cent of our turnover now comes from England and Wales.

“While our largest office and all back office functions have grown in Scotland, we feed in work from across the UK, and our biggest client – the Metropolitan Police – is via our London office.”

Others, though, have moved in the opposite direction. “We opened our Edinburgh office in 2004 in response to the increased number of requests we were receiving for research from clients based in Scotland,” says Miranda Mayes, director of marketing and research agency Accent, which also has offices in London and Bristol. “In a relatively short period of time we have built up a large, high-profile client base in Scotland with little marketing effort. We currently have repeat business with around a third of our clients and we anticipate this growing over the next few years as we become better known.”

Although the market continues to grow, not everyone would agree that market research in Scotland is booming. There are, perhaps, strong parallels to other marketing services industries, in that market research is seeing a higher level of competition in the number of suppliers in a relatively small market.

However, that’s not the only common trend. “Private sector work is perhaps diminishing in terms of strong Scottish-based brands,” says Chris Eynon, managing director of Edinburgh-based TNS System Three. “The public sector is much stronger these days. It’s interesting to note, looking at the nominations for the Roses Advertising Awards, that a majority of the work nominated from Scotland is public sector. That is indicative of the market. Research is not much different.

“There is a lot of work in Scotland, but it’s a very competitive and price-conscious market, and clearly there isn’t always the same budget available here as there is down south.

“There is a strong public sector influence within the market, and one of the factors we are noticing in this sector is the importance of procurement. This isn’t always a great thing in public services, as often the approach of procurement is commodity purchasing, and it’s very difficult to take into account the quality differences when they are not aware of the service sector or market in which we are operating.”

One solution to this problem, when looking for a research agency to work with on a project, could be in the brief. “If two tenders come in with very different costs, it may be that the high price has overspeced the job, but it is more often the case that the low price is naive,” says Chris Mason of Chris Mason Research & Marketing Services, based in Dalkeith.

“A client can get better value from the research by giving a clear and accurate brief. What do they really want to know? Why? How will the results be applied? Setting a budget is also a clever tool. It helps practitioners to test the brief and it lets the companies tendering show how much they can give for the money.

“If you are making an investment, your organisation should get the most from it. A strong proposal takes one to three days to write, sometimes longer. It is fair to ask a client to spend the same amount of time. If not, the same time will be taken answering phone calls and emails requesting clarification. Even if time is short, there should be a willingness to answer questions that arise during the project design.”

Clare Wade runs her own market research business from Fife, and she believes that it’s not just the bigger teams which are now looking south more than before to keep their order books full. However, she does agree that a client will get the best value for money if they give a good brief and are prepared to be open and responsive to any questions the researcher has while preparing the proposal.

“The better the information we get, the better job we can do,” she says. “It’s rubbish in, rubbish out. Clients should really think about what they want from the research rather than just cutting and pasting from a previous brief. Some briefs are 12 pages long, full of nothing, with ‘objectives’ that are not really objectives (for example, ‘deliver a debrief’ is not a research objective), or objectives that are hidden in another section of the brief.

“I run training courses for clients on how to write a brief and how to verbally brief a researcher. That’s the more important bit, because it gives the researcher the chance to ‘interview’ the client about what they really want.”

With the market for research growing, it would be easy to think that clients were starting to understand the importance of research to the strategic development of a business. However, this isn’t always the case.

Edinburgh’s Market Research Partners (MRP) opened in 2005 as a fieldwork service supplier, but it became apparent very quickly that there was a need to expand to offer a full service. Louise Walker, the company’s research director, says: “Research agencies are not always at the centre of clients’ strategic thoughts – but they should be. Bring research agencies in early on to better understand the business needs and have an agency that works closely with the organisation.

“And if agencies have to pitch every time for every piece of work, then it is unsurprising that research becomes an increasingly commoditised service.”

The cost of a service and delivering an informative brief aren’t the only factors which clients often consider, though. While not always fair or informed, the size and location of the market research team often play a part too – hence the move north for many of the networked research firms.

However, Jo Fawcett, managing director of George Street Research in Edinburgh, doesn’t believe that such factors do – or should – come into the equation. “The size and location of the team are rarely the most important factors,” she says.

“Local suppliers can make the communication process a lot simpler and teamwork much more effective. Smaller agencies can often be much more flexible in adapting to changing client needs. That said, resources can be an issue on ‘commodity’ style research based on very large-scale projects with tight timings.

“There are lots of topics and issues where localised opinion is critical to the overall success of the research and a broad brush is inappropriate – for example, in the retail sector where one product and one size will rarely or never fit all local communities.

“Most clients are pretty rigorous – or canny – in getting to know the teams available to them and selecting the best team for the job. That said, the growing use of

e-tendering and the ever-growing presence of procurement specialists in the selection process can sometimes make for a slightly forced fit.”

Fawcett’s point is that both large and small, local and national firms can be capable of providing excellent or poor research – and both are capable of delivering value for money. However, it is important to remember that the key issues in selecting the right research agency remain the same: focus on the ability of the researcher or team working on the project, the resources at the disposal of the research team, the attitudes of the client and the quality control standards.

And while it’s often considered boring to those in the creative industries, quality control needs to be at the heart of good research. Fast and loose might be exciting and refreshing, but when it comes to research, it tends to cut corners, compromise the integrity of the data, and make too many assumptions.

At the end of the day, do-it-yourself and short-cut research will only tell you what you want to hear. And ultimately that is not in the best interests of anyone.

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One of the biggest growth areas for market research over the past few years has been in the field of opinion research – understanding more about the public’s view on social topics such as politics, the environment, religion and moral issues.

According to the latest figures published by ESOMAR, in 2005 the total market for market research worldwide was $23.3billion. The EU and USA accounted for 81 per cent of the total world market. The largest market is the USA, followed by the UK and France.

According to figures published by the British Market Research Association in April 2006, the estimated size of the UK market research industry in 2005 was £1.32billion. During 2005, the UK market grew by 2.5 per cent on the previous year, accounting for 79 per cent of business for UK market research companies.

(The estimated size of the UK market research industry in 1998 was £915million.)

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