Online Exploratory Research: A Backdoor to Consumer Insights?

In ye olde times before the recession (circa 2006), I attended a conference presentation summarizing a fascinating ethnographic research project. For many months, a group contracted by a beer company had been traversing the USA selflessly spending their evenings in bar after bar in a search for the perfect pictures of men drinking beer to be modeled in the client’s future advertisement campaign. The ethnographers apparently bought drinks for everybody in the bars in exchange for the right to videotape the scenes. After spending an immense amount of time and money (and contributing to the increased beer consumption trends nationwide), they finally found the acceptable themes to be copied by the actors in the commercials.

Our life has changed dramatically since that time of accelerated consumer research spending. Today, when a bank’s note of insufficient funds on a bounced check needs a clarification (whether they mean you or them) and when toy car manufacturers’ stocks trade higher than GM, this project would not likely happen at all – there is just no budget for it. It does not mean that corporations completely abandon consumer research. Indeed, declining consumer disposable income intensifies the competition making actionable insights as valuable as ever. Businesses are desperate to find ways to do more with less. As for the project above, now an astute student can obtain comparable insights without leaving her dorm and enduring any out of pocket expenses. Well, the ‘student’ part might be a slight exaggeration. Let’s settle on “an astute researcher” with an access to the Internet and a supply of strong coffee, instead of a large budget.

I do not necessarily suggest en masse switching to questionnaires (the company that claims to be the leading survey tool on the web, ranked by Alexa, with over 80% of the Fortune 100 companies currently using SurveyMonkey). While in many cases their simplicity would suffice, especially given a very lucrative price – free, it does not count time and expertise of people who use this and other Do-it-Yourself (DIY) tools. Yet, when it comes to large-scale projects such as the one described above, a judicious consumer research professional can find comparable insights simply by analyzing the abundant quantity of photos and videos at media sharing sites such as Flickr and YouTube, with no out of pocket expenses whatsoever (unfortunately for the travel industry and bars). No doubt, this approach would raise a superfluity of legitimate but forlorn questions from traditional market researchers challenging the validity of the methodology, representativety of the consumers, error margins, etc.

This brings up two questions: What are the threats to the market research industry? What are the opportunities there? These are very difficult and highly distinct questions. Yet, the answers are deeply interlinked and in many cases are just plainly the same.

Over the years, traditional full service market research (MR) has been steadily marginalized under pressure from different players. Pressure has come from the lower end by the DIY tools and client-led non-systematic experimentation, and from the upper end - by the large management consulting firms. Now there is arguably an even bigger threat on the horizon. In fact, it is already on the screens of more than 250 million internet users, 120 million of whom log on to Facebook at least once a day. Contrary to popular belief, more than two-thirds of Facebook users are not in college and the fastest growing demographic segment is the 35+ year old.

Clients need access to the customers. This is the main reason, which led to the proliferation of panel providers in the last decade. Yet this trend is subject to ‘creative destruction’ by new, hugely powerful and highly democratizing players such as Facebook. When it comes to consumer intelligence, the action is where personal information tends to accumulate (with permission of course). It is hard to beat Facebook in this game. People behave quite differently on Facebook compared to other places. They dare to use their real names to talk about their real feelings, thoughts, tastes, preferences, impressions, expectations and fears openly showcasing their true inner beings. This does not look anything like “the Internet where nobody knows you are a dog” portrayed at many MR events a decade ago. It also does not resemble the Internet of that other giant, Google, which relies on averages knowing very little about visitors except for their browsing history.

The differences between Google and Facebook are evolving now into a battle over the future of the Internet itself. On one side of the mêlée are precise and highly sophisticated algorithms swamping and squeezing every bit of information in the world to create a technically perfect yet a dispassionate diagram of the virtual world. The opposite thinking, embraced by Facebook, is a humanized Web where we rely on our trusted network of friends to find information and judge its merits as humans naturally have done for millennia. Now, the process is instantaneous and larger than ever, often involving people separated by thousands of miles.
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This publication is based on the author’s articles in Research World (the monthly magazine of ESOMAR), his conference presentations and lectures expanded and updated to reflect the recent development in the industry and the feedback from the readers. 

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