Sometimes market research (MR) takes literal rocket science, and sometimes it isn’t all that complicated, but ultimately, it’s always the right investment to make—so says the MR firm.
Really? How do you know if it’s the right investment?
Market research, like any investment in information, should demonstrate a clear return on investment (ROI). It should speak directly to a business need or opportunity that’s crucial to your organization. And, it must be trusted and actionable by the ultimate decision makers.
In other words, you have to be able to use the research to improve your results, or you shouldn’t do it at all.
The key questions
Unfortunately, because market research is often viewed as relatively intangible, significant investments are made without assurance that real benefits can be harvested. Here’s the good news: a better market research ROI is possible by starting with 5 fundamental questions about the proposed MR investment. They are as follows:
- Need: What is the need or opportunity that is driving the MR request?
- Implication: What are the financial implications of the need?
- Decision: What decision must be made, using the research results, in order to address the need?
- Decision maker: Who is the decision maker? How will they make the decision? What specific information do they need to confidently decide? What format and forum is most useful to the decision maker?
- Research trust: Does the decision maker agree with the MR-based approach for this decision? Do they trust the MR design enough to take action? Is the level of MR investment justified by the financial implications of the need?
These questions can appear to be so fundamental, so simple. However, really digging into these questions can take a lot of time and effort.
Many times MR is commissioned without much collaboration with the final decision makers. And even when they are consulted, they are not forced to clarify their exact needs and their decision process/requirements. Nor are they encouraged to formally buy into the MR-driven decision process.
As with many things, the process of clarifying needs and achieving alignment can be very difficult. However, this hard work on the front end of the MR process almost always pays off in spades.
Let’s fast forward to your next market research request and assume that you’ve powered through all 5 questions. Here’s where you will be. You will be confident that the research project you are responsible for will be well-received by the final decision maker (your internal client). Your client will be primed and prepared to act with confidence, because your questions resulted in alignment and trust. You will also know that you didn’t under-invest or over-invest on the research design and approach, and your internal client will feel good about the investment level.
Most importantly, you will know that your organization will be in a position to make decisions and take actions that will improve your results.
Stay tuned: this is just part 1. In parts 2 and 3 of the Market Research ROI series, we'll look at benchmarks and standards that boost results and how to create the advantage with a research-driven culture.