Cheap marketing research is like a cheap date:
Sure, you have a transient and temporal moment of involvement, but nothing longer term ever comes from it and it can lead to nasty infections.
This comparison recently came to mind when a client asked if there was any way we could scale back a proposal for performing market research.
As with most everything else, market research presents a tradeoff between cost and quality.
The results from seeking inexpensive alternatives are the same.
A discount paramour might deliver a life threatening disease and discount market research could deliver a fiscal death sentence.
Either way you get … well, let’s not go there.
Many miss three essentials about market research, namely qualitative breadth, quantitative depth, and statistical strength.
If any of these three elements are missing, your market research will lead you astray.
Hence, anyone attempting to understand their market needs to commit to researching the human factors of purchasing motivations, the degree to which each element concerns the entire market, and be sure that enough hands were counted to correctly model the market’s needs.
It is doable, but rarely is it cheap.
Qualitative research attempts to capture the wide variety of issues buyers and influencers have.
Despite nearly seven million quarter inch drill bits being sold last year, nobody wanted a quarter inch drill bit. They wanted a quarter-inch hole.
They also wanted quarter inch holes in wood and ceramic and steel, a minimum of fracturing/splintering, a minimum number of sustainable RPMs, and a choice of colors (the pink drill bits were not big movers).
Drill operators also wanted twist, tapers, extenders and left handed rotations.
All these reflected the qualities (qualitative) nature of the users, their work and the varied essences of quarter inch holes.
Qualitative research typically involves talking to people until they are sick of talking to you.
Deep interviews with a large handful of target buyer genotypes is a common approach.
Even the smallest start-up occasionally performs accidental or ad hoc qualitative research – otherwise they would never have a single buyer (which seems to be the case with many start-ups).
Quantitative research mainly deals in how many people want one or another qualitative aspect, or how seriously they want it compared to other features.
Since you cannot possibly deliver every possible feature to every possible buyer, you need to know which whole product features are in most demand and why.
Members of the United Brotherhood of Carpenters showed a distinct lack of interest in pink drill bits, even in metric sizes.
Quantitative research almost always swings toward surveys, which creates two problems.
First, there is a science to surveying – from survey instrument design, to question cross testing, to covariant analysis – it is a non-trivial activity.
The other problem is that online survey tools became so popular so fast that email inboxes everywhere were instantly flooded with requests to participate in surveys.
Thus, you have to bribe people to take serious surveys (American Idol text polling doesn’t count) and the longer the survey, the larger the bribe.
Which leads us directly to statistical validity. Attempting to perform research on the cheap typically causes an insufficient number of responses to be gathered to obtain a statistically strong measurement of a market.
Granted, if there are huge divergences in smallish samples, the research may be valid (like when 99.998 percent of the members of the United Brotherhood of Carpenters said they would never buy a pink drill bit, and the one fellow who did was nail-gunned to a beam).
Restricted responses produce dicey decisions.
Yet many businesses make million dollar mistakes based on substandard surveys.
With one exception, you need to bite the financial bullet and outsource market research.
Your ultimate business decisions rest on the results.
Using cheaply produced research to launch or grow your business is like using masonry bit to anchor crown molding – the results ain’t pretty.
The exception is for companies designing products in the ‘innovator’ phase of the technology adoption lifecycle.
This earliest of moments in a product’s life cycle is like when Michelangelo first stuck a raw hunk of marble with a chisel.
The process is about knocking of huge imperfections in order to see the basic shape of the art/product.
Most of the direction comes from you and some very participative patrons.
You conceptualized the core product idea because you had talked to enough potential users to see an opportunity.
In the innovator phase you are building the core product, and expensive formalized research can wait … for a while.
Guy Smith is the founder and chief consultant for Silicon Strategies Marketing, a marketing consultancy specializing in strategy development for high tech firms. Guy has led marketing strategy for a variety of technology companies vending high-availability backup software, wireless middleware, enterprise software, infrastructure software, mobile applications,
server virtualization, secure remote access, risk management applications, application development tools and several open source ventures. Before turning to marketing, Guy was a technologist for NASA, McDonnell Douglas, Circuit City Corporate Headquarters and other organizations.
Cheap marketing research is like a cheap date: