A guide to navigating the market research industry

Now is a great time to be an entrepreneur, figures from Start Up Britain show that the number of new businesses launching in the past year alone has increased by 5% from 581,173 in 2014 to 608,110 in 2015. There is clearly a growing appetite for starting up a business amongst British entrepreneurs, and this is particularly true for the market research industry.

shutterstock_313786031According to a report by PwC for the Market Research Society (MRS), the industry houses 73,000 professionals and has generated an annual turnover of £4.8bn, a 62% growth in the last three and a half years. Clearly, positive relationships between businesses are constantly being made.

Despite impressive growth in the industry, some limitations still exist as many businesses do not exploit the tools available to them, and so do not reach their full potential. For example, a fifth of businesses (21%) cite not knowing where to source potential research suppliers as one of the main obstacles to commissioning a new project, and nearly two thirds (57%) admit that they do not know which suppliers are of a high enough quality. Although these barriers still exist, there are plenty of ways research businesses can make new connections in the industry. And with market research informing seven in ten business decisions (68%), it is crucial that the supplier used is the right one for the brief, whether a large or small agency.

So how can businesses connect with each other to develop stronger relationships with new research partners? Below are my top tips for success:

Look for the brightest sparks

It can be tempting in this industry, and many others, to work predominantly with well-known organisations and mistake their recognisable brand and high prices for expertise. This is a common pitfall. There are some brilliant minds across the market research sector, and often the most suitable supplier may in fact be a smaller, lesser known agency which has the required experience and determination to fulfil a brief. Expertise comes in all shapes and sizes, so even if a company isn’t familiar with an agency, it pays to branch out and be flexible when choosing a research supplier.

Start as you mean to go on, with research

Half of briefs (49%) are commissioned based on recommendations from friends, and whilst building up that little black book of connections is useful, it is not always the best route to sourcing a supplier. Choosing a research agency based on recommendations or being a recognisable brand can be counter-productive, as they may not have the capabilities required for a specific research brief. Our own research indicates that one in five buyers (18%) have been left disappointed because the supplier they commissioned did not have the expertise they thought they did when hiring them. Additionally, a quarter of research suppliers (25%) spend between £50,000 and £100,000 on market research each year, and with a third (36%) spending more than £100,000, it’s crucial to get it right. Rather than relying on recommendations, it is much more beneficial and lucrative in the long run to ensure research projects are conducted with suitable suppliers who are able to deliver.

Submit a detailed brief

Before commissioning a project, buyers must be explicit in their brief, giving clear objectives and target outcomes, so that only potential suppliers who are confident they have the capabilities will pitch. Not only will this ensure buyers take suitable suppliers to the pitching stage, but it provides suppliers with the opportunity to ask appropriate questions and demonstrate their knowledge and expertise, which will add credit to their capability in the buyer’s eyes.

Be explicit with expectations

Those wishing to buy market research need to be very clear on what they expect to achieve from the research project. Pre-empting questions by providing sufficient details around key points including timings, budget and samples will serve companies well when they are reviewing pitches. If a buyer takes suppliers through to the pitching stage without providing them with enough information from the beginning, they may find the supplier is not compatible too late and they do not receive the desired results.

With such a great number of growing businesses in Britain at present, and the untapped potential in the market research industry, it is essential that buyers and suppliers alike follow these pieces of advice to forge the best business relationships. They need to make the most of the tools and technology available to them to make these connections and get the best results. In doing so, businesses can encourage spend in the industry, ultimately taking the economy to greater heights.

By Richard Waring, CEO and co-founder, ResearchExchange.com