How Low Can We Go – Price Pressure in the Market Research Industry

 What Market Research Software Really Costs

money questionsIt is no secret that there has been continued downward price pressure in the market research industry since its inception.  The industry has, for decades, sought technology solutions that help deliver more and “better” data, with faster turnaround times, and at lower cost. The trend continues to be evident to this day; from the biggest DIY players such as SurveyMonkey to the newest and most powerful entrant, Google Consumer Surveys, companies demand technology and software that cheaper, faster and easier to use.  Software suppliers that provide more feature-rich, end-to-end market research solutions (such as Kinesis) feel this pricing pressure as well. Ongoing development and maintenance of highly advanced survey and panel management platforms naturally require significant time and cost investments, and setting pricing models are among the most pivotal strategic decisions faced by each supplier.

Perhaps downward pricing pressure is felt deepest by the market research firms. With clients who continue to demand that more data and richer insights be delivered on smaller budgets and timelines – and the constant DIY threat looming – traditional researchers may feel as though they work inside of a pressure cooker. One of the most critical tools that can determine their projects’ success or failure is the software solution(s) used to execute and analyze the research. Often market research companies realize that their current software no longer provides the functionality and usability necessary to achieve success, but the initiative of changing software platforms seems like a massively daunting task.  Or, conversely, they utilize a solution or set of solutions that serves the purpose, but is no longer realistically priced based upon the expectations of end clients.  Either scenario prompts a reevaluation of the solutions landscape.

For these reasons, we thought this is an appropriate time to review the true costs of market research software acquisition. Points of consideration include:

  • Evaluation: evaluating various solutions often requires a team approach and can last for several months.  To shorten the evaluation process, it is often easiest to come up with a list of “must have” features that are submitted to each vendor under consideration.
  • Retraining: no matter how intuitive the solution, all platform changes require training. The retraining initiative will involve not only staff, but outsourcing partners as well. Time to train differs significantly based upon the platform.
  • Migration:  ongoing trackers and panel data will require a thoroughly planned conversion or reprogramming, and the larger the data sets, the more headaches involved (see Kinesis’ whitepaper on migration issues for detailed information).  Make decisions early-on regarding what historical data must be retained and what must be migrated, and negotiate it as part of the overall onboarding price (or at least factor it into the budget).
  • Reviewing points of integration: some companies have many integrated solutions that must be considered – third-party reporting tools, in-house project management and CRMs, and other third-party solutions.  These costs should be factored into the budget as well.

The greatest cost, however, is always related to the people required to use the software. The time that it takes to program, launch and analyze each project is the most expensive portion of the project. The implications are that any evaluation that includes cost reduction as an element of its objectives should conduct side-by-side comparisons of the time needed to complete certain tasks (e.g. programming a complex table grid or nested quotas, or developing a survey for dual mode desktop/mobile delivery).  This comparison is not easily accomplished and requires a time investment, since familiarity levels with the tools will vary, but is an absolutely essential metric when calculating the true costs of a software platform change.

As all of the various players within the market research industry continue to feel downward pricing pressure, we must routinely examine the processes, solutions and available functionality utilized by our businesses – and the ROI each delivers. This may also be the time to evaluate other core strategies such as whether to control processes in-house or outsource, and to shore up any business practices that are currently not working to our company’s advantage.

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