Research Budgets - Down, Down, but Why?
Market research budgets are under ongoing pressure in the UK, it seems.
The Q3 Bellwether report issued a few weeks ago by the influential IPA revealed that research is suffering consistently in terms of budget allocation in 2022.
The Report - for those of you not familiar with it - is a quarterly survey amongst UK managers, asking them on their overall ad spend for the quarter - will it increase/decrease, or stay the same. The components are then identified - including main media spend, exhibitions, PR...and Market Research.The IPA reports on "net" scores - comparing those who will increase their spend versus those who say they will decrease it.
So how do the Quarters pan out for research? Not good, in two words:
Q1 - -3.5%
Q2 - -6.5%
Q3 - -4.1%
Three negative quarters. To put it into context for Q1 - the overall figure for marketing was a whopping +14.1%. In Q2 it was equally healthy, at +10.8%.
The survey makes no claims to be representative - but is influential, based on talking to around 300 marketing professionals per quarter in the UK.
You can download the full summary versions here: IPA Bellwether Reports 2022
So what's going on - or down - with MR?
Some thoughts:
1. Lack of Impact on Sales
When you cut your market research budget, nothing happens. At first.
Operations continue as normal, sales cycles move on, campaign planning gets by - and "insights" can be generated differently.
Cheaply. Quickly.
If you're looking to boost sales in the short-term, make the year end goals, then re-allocating moneyfrom the MR budget to say sales promotion might make sense.
But for how long is "all good"?
If your audiences lives are changing fast - as I would say they are currently pretty much across the world - then your brand context is too. That means everything - from perceptions through to path-to-purchase, the "decision journey".
So how valid are your brand assumptions - and vision?
Tomorrow's problem maybe - but the long-and-the-short of it at the very least points out the connection between strategic funnel-front-end stuff and activation activities.
Front end becoming more foggy than fuzzy? - you need research to get to the bottom of stuff.
2. In-Sourcing On-going
DIY is an ongoing trend in market research. This likely doesn't get captured in the Bellwether reports.
And why not in-source? Research can be done by anybody with access to affordable software and a database. From someone in IT through sales, marketing, etc. Targetted, lower-cost and quick.
As long as there's adequate understanding of what an insight is, some basic principles of market research: including bias, sample sizes, statistics and more. Quality stuff.
Is this the case?
Difficult to generalise - but worth pointing out that agendas are very different if you're coming from an operational standpoint, and are effectively both judge and jury in development and evaluation. And short-cuts can be tempting. Not to mention the pitfalls of bias....
Maybe a list of biases should be top-of-screen on all DIY market research software. Surveys aren't for monkeys.
Promoting Market Research - way to go
Wrapping up - is the above a purely UK thing? It's the world's second largest MR market, so not insignificant - but probably has its own dynamics. Would be interested to hear from other geographies, especially the huge US market.
And a final thought - if research budgets are being cut consistently, as in the UK in 2022, then the job of communicating research impact isn't really working. An issue for everybody - at a company, individual or assocation level. Marketing matters.
And that's not just PR - internal marketing is critical.
For example: maybe execute more snappy summaries of where research links to impact - 1 pagers might be too long, maybe just paragraphs.
Suggestive of expertise, but at the same time risk - get your reserach wrong, don't do any for too long, rely on data that's no longer relevant, and you are setting the scene for failure. Getting out of touch, flying blind. Which is even worse than marketing myopia.
Curious, as ever, as to others' views.
(Photo by Bruce Christianson on Unsplash)