Ray Poynter, 6 January 2023
I spend quite a bit of my year consulting with organizations about the future and helping with a wide range of projects that try to assess current trends and future possibilities. Here are my thoughts about ‘where we are right now’ and where things might be heading in 2023 and beyond.
Where are we now?
Before I consult with people about where we are going, I always start with ‘where are we now’. Without knowing where we are, it is highly improbable that we will know where we are heading and how to handle it.
In brief, drawing on sources such as ESOMAR, MRS, IA, GreenBook and NewMR, this is where Insights and Research were at the end of 2022, going into 2023.
- We are a large industry, over $120 billion.
- About 50% of this is NOT traditional market research (e.g. is not surveys, is not focus groups, and is not depth interviews)
- About 50% of all research dollars are spent in North America, with around two-thirds being spent in English-speaking countries.
- About 50% of research projects are conducted internally by clients.
- The fastest growing sector is ResTech, driven by the growth of platforms, especially DIY or self-serve.
Key Drivers
The key drivers are already in place and will shape our industry for the next year or two. These drivers are:
- The global economy, especially inflation. Prices will keep changing (mostly increasing), exchange rates will be less stable, interest rates are high and could go higher, and consumers are under pressure and will in many cases change habits.
- The growth in platforms is relentless. Many (i.e. most of them) will fail, but the sheer number of new platforms and new options will be destabilizing – and some will be successful.
- The shortage of talent. In many fields and in most countries, there are simply not enough good and experienced people to fill all of the insight roles. This is likely to cause wage inflation, shortages, and drive the need for automation even harder.
- Interest in AI, ML, the Metaverse, Web3, and conversational AI. Things like ChatGPT have really kickstarted the interest in the cutting edge of tech in 2023. Don’t expect too many actual products or changes – but do expect to see investment, presentations, ideas, and experiments. Move too fast and you could be the next FTX or DeLorean, move too slow and you could be the next Kodak or Nokia.
- Data protection and privacy regulation, driven in part by data breaches, data abuse, and domestic political concerns. The European GDPR was not the end of a journey, it was the springboard in to more and more regulation. The rules are going to become more and more onerous, year by year.
The Potential Data Quality Disaster?
One item that I think needs highlighting is the risk of a Data Quality Disaster in 2023. In 2022, there were a large number of studies and reports that showed the massive problem with bad and fraudulent data in online panels. The Insights Association has been particularly active in showing the problems and risks. Studies report that the amount of suspect data that make it through to the buyers of data can be as high as 20% or 30%.
The panel companies are fighting a massive battle against fraudulent takers of online surveys, but maybe they are fighting a losing a battle? The rise of AI tools will make it ever harder for panels to screen out bogus survey takers.
This problem has been an open secret for many years, think back to reports from Grey Matter in 2012. However, the problem has proved intractable, and we seem to be increasingly sure that the problem is large enough to cast doubt on the results of research.
My big fear in 2023 is that one or more clients will have a marketing or strategic disaster and discover that that the research they used contained large amounts of bogus data. It might not matter that the direction of the research was little impacted by the bogus responses, nor that the research was the main problem causing the marketing or strategic failure. The existence of the failure, the line of evidence to the bogus data, and wish to litigate would be enough.
I think the place where the problem will happen most often is in the large self-serve, automated platforms, where non-researchers load materials for testing to a platform, press a few buttons and wait for the results. In these cases, no human is involved in selecting the sample, no human is involved in checking the data, and no human assesses whether bogus responses could have changed the results.
The fear about panels will tend to drive research towards communities, CX and non-survey alternatives.
Hot Topics for 2023
I think the five key things to watch are.
1 Even more, cheaper, and easier-to-use platforms
The growth we have seen in the number of platforms over the last few years will accelerate further this year. This will clearly power more self-serve / DIY solutions and options. It will also expand the range of things that agencies and new providers are able to offer. Clients will have opportunities to reduce costs and increase output. Agencies will be able to leverage platforms to increase their efficiencies, to help mitigate the talent shortage.
2 More tactical research, some with fancy names
Most companies only need strategic research periodically. The need for strategic insights grows in a linear sort of way. However, tactical needs happen all the time, for example, which ad to use, which UX feature to optimize, and how best to layout a retail store department this season. With the growth of platforms, the democratization of insights will grow, we are seeing a geometric growth in the use of tactical research. Tactical research is not very sexy, so we often see it extolled as agile research or as part of the build-measure-learn method. One common feature of most tactical research is that it tends to be simple, simple to apply and simple to interpret. The growth in research will mostly be in simple research, not complex research.
3 The rise of open responses, as opposed to closed responses
The bedrock of research for the last 100 years has been closed questions, for example, a Likert scale. They are consistent and amenable to simple statistical analysis. The trend now is towards open responses. We are seeing more video, more conversational AI, and more text analytics. One of the key things you should do this year is to review your use of open responses, including in your surveys.
4 Specialists and services
The growth in platforms, the democratization of insights, the shift to simpler more tactical research makes the role of specialists and those offering services even more important. The bulk of the revenue will go to automated, simple research, but the demand for specialists will remain strong. In terms of specialisms, I am talking about things like qual researchers, data analysts, business consultants, storytellers, semiotics, market modellers, etc. In terms of service, I am particularly thinking of customer success managers – the people who can help clients be really successful with the platforms they buy. This underpins the need for training and skill acquisition.
5 New faces
I think we will see a growth in the number of new faces in the global insights ecosystem, and a shift away from the more established thought leaders. There seems to be a burst of energy that reflects our emergence from the pandemic years. Of course, most of these faces have been around for a while (especially in their home countries), but they are now gaining a bigger audience. Examples of the people I am talking about include (with links to their LinkedIn profiles): Kendra Speed, Priya Lobo, Olga Keating, Alex Orlap, Hannah Rogers, Molly Strawn, Sami Wong, and Alexandra Kuzimina.
Who would you add to this list of New Faces to watch?