Evolve or face extinction, Forrester tells market insight providers

According to the survey, “nine out of ten” of the 30 market insights professionals quizzed said they had seen an increased demand for their services during the first quarter of the year. But this is not necessarily good news, according to Evensen. He said that the increased demand is due to clients needing more intelligence to operate in the new economic environment, but the market insight industry is struggling to keep up with the workload.

Interviewees are not seeing head count increases to help deal with the extra work, said Evensen. In fact, 30% report decreases in staff numbers. With limited staff to handle this extra demand, Evensen warned of threats on the horizon for insight providers. Directory listings like Greenbook.org make it easier for clients to find alternative insight suppliers and Evensen said that the offshore market intelligence solutions offered by the likes of Capgemini and IBM put “cost centre” insight agencies in a vulnerable position.

Cost centres, Evensen explained, are agencies that focus on data management rather than insight creation and companies that use transaction-based metrics to measure value. With these services available offshore and for less money, cost centres need to add something else to their offering or risk ending up on the “path to extinction”.

But how to evolve? Beginning at market insight habilis – the least developed on the agency evolution chart – Evensen said agencies who move up a step would become market insight erectus: tactical companies who can offer insight and recommendations for the short term. Clients see these firms as “valued advisers”, Evensen said, who add value to business units. The business world is a fairly safe place for this type of company, but sitting atop the insight evolutionary tree are the market insight sapiens, “highly proactive” agencies that “take the entire business to a higher level of performance” through their long-term strategic plans and data driven offerings.

Evensen said: “To better meet their and their stakeholders’ needs, market insights organisations need to move up the value chain from being low-cost information providers to high-value business drivers. This is a journey to becoming a successful business. Any journey starts with an assessment of where you are and a plan to successfully get where you want to go.”