FEATURE1 December 2010

2010 and all that

So, how was it for you? Whether you were buffeted by recession or whether you bucked the trend, 2010 was a pretty turbulent year. We look at some of the major research themes that surfaced and revisit some of the people and companies that made the headlines.

Neuroscience

Neuroscience has been lurking in market research’s unconscious mind for some time now, but in 2010 it moved to the fore. Millward Brown launched a dedicated neuroscience division, and New Scientist even used a brain-scanning study to help design a front cover. Still, the proponents of brain science are impatient at the research industry’s sluggishness in adopting the methods.

But such caution may be justified. A July article in the Harvard Review of Psychiatry raised concern over simplistic claims about what neuromarketing can achieve and the lack of transparency in a field whose academic foundations “are difficult to identify”.

As if on cue, the Advertising Research Foundation announced a project in which eight neuromarketing companies will submit their methods for review, with a view to establishing guidelines (NeuroFocus, one of the biggest players in the field, didn’t take part, but offered to share with companies its own set of ‘neurostandards’). 2011 could be the year when the caution surrounding brain science gives way to confidence.

Privacy

Almost every week in 2010 there was a new story of technology surging ahead in its exploitation of data, while regulators and consumers struggled to keep up. The scandals and missteps keep mounting up, with tech giants Google, Apple and Facebook accused of mishandling personal data in cases involving email contact lists, online purchase histories and mobile handset IDs.

Legislators are rightly concerned but difficulties lie ahead, as illustrated by a draft data privacy bill in the US that, if it had been enacted, would have required written consent to be obtained before asking about things like ethnicity and religion in phone interviews. The UK agreed to toughen its laws on online behaviour tracking, but only after being pressured by the European Commission to bring its rules in line with EU directives.

Meanwhile, as the business of social media monitoring grows, firms have begun to ponder the ethics of eavesdropping on online conversations. If privacy is, as Wired UK editor David Rowan believes, “no longer a social norm”, then can we all stop worrying about it? Well, no. Personal data is becoming a commodity, which means that individuals are not as powerless as they sometimes look. Researchers should not get too used to having access to data on anyone’s terms except the consumer’s.

Social media

The hype surrounding social media is gradually dissipating to reveal more seriousness about how it can best be used in business. Against a dismal economic background, 2010 saw continued growth for firms engaging in buzz mining, online communities and other social media techniques.

Experiments by researchers at Carnegie Mellon University, social media startup Tweetminster and HP Labs showed that analysis of activity on Twitter could be used to track public opinion and predict box office takings. The claims were met with a certain amount of scepticism, but they represent significant first steps.

Few researchers really believe that social media is going to replace traditional methods, but most realise that a lot of consumers can no longer be bothered to take part in surveys because they’re too busy uploading photos to Facebook or writing product reviews online. Those who haven’t yet put two and two together and spotted an opportunity might want to consider other careers.

The research associations have so far not had much to say about social media, and have faced criticism when their guidelines have not made room for new approaches. Frank and open conversations will be needed among practitioners and regulators as these techniques move into the mainstream.

Economic turmoil

As in 2009, the state of the economy was an ever-present concern this year. For most companies, the worst appeared to be over by the first quarter, with client confidence picking up and revenues rising again, although the latest Bellwether Report on UK marketing budgets continues to urge caution.

And with the UK government wielding the axe on spending, public sector researchers had a particularly bad year. Chancellor George Osborne announced average budget cuts of 19% across government departments in October, and 300 publicly-funded bodies were scrapped. With advertising spend frozen, about 40% of staff lost their jobs at the Central Office of Information (which had spent £27m on research in 2009-10 ), while social research specialist MRUK shed all but three of its 32 staff and there were further redundancies at TNS-BMRB.

Public sector researchers will need to work hard to promote the value of research in these difficult times.

Behavioural economics

One of the ways the government hopes to cope without spending any more money is by putting behavioural theory into practice. It’s a hot topic in the worlds of business and politics (particularly since the publication of the 2008 book Nudge), offering a response to big behavioural challenges like climate change and obesity as well as increasingly elusive consumers and, of course, the tough economic situation.

Richard Thaler, co-author of Nudge, has been brought on board by the government as part of its new Behavioural Insight Team, which is looking at how people’s behaviour on social issues – particularly health – might be changed by the way choices are presented.

However, where research fits into this remains unclear. The IPA’s Rory Sutherland suggested in an interview with Research that behavioural economics could present an opportunity for research to regain influence it has lost in the boardroom by relying too heavily on proxy measures of behaviour. It’s an opportunity that needs to be grasped with both hands.

Respondents

It’s hard to imagine a world where respondents didn’t represent a major MR issue, but it’s fair to say that the industry has at times not shown them the attention and respect that they deserve. Fortunately, the debate around quality in online research is turning from one about sampling to one about experience design. We highlighted some of the issues in July when we signed up to several panels, filled in every survey they sent us for a month and reflected on the experience. It was a simple (if time-consuming) exercise, but we suspect it’s more effort than some of the firms fielding these surveys have gone to.

As we all know, consumers have numerous ways of getting into conversations with companies and brands nowadays, so if surveys fail to engage them they’ll just go elsewhere. At the Research 2010 conference Doron Meyassed of Promise suggested that, in this increasingly ‘social’ world, research is being conducted according to the wrong rules. Should we stop obsessing over anonymity and scientific purity, and instead start to obey the social norms on which trust and relationships are based? Research needs rules, but they can’t be in opposition to what Meyassed calls ‘the rules of people’. In the future things will be done on respondents’ terms – or not at all.

DIY

DIY tools strike fear into the hearts of researcher suppliers, who claim that in the wrong hands they will undermine confidence in research (and cut into agencies’ revenues).

In 2010 it was time for a more grown-up debate about DIY. Cint presented a survey suggesting clients were relatively sanguine about it, while Volkswagen’s Steve Gatt argued that the rise of DIY is just a symptom of client disillusionment with inadequate research.

The fact is that agencies have to live with DIY. Jonathan Pickup of McCallum Layton went as far as offering tips for clients who want to bypass agencies – saying that if they’re going to run research themselves, they should at least do it well. With luck this kind of attitude will help researchers hold their ground as trusted advisers in a world where any idiot with a laptop can field a survey.

Cross-media measurement

Research is not adapting itself to cross-media as easily as consumers have. Paul Goode of ComScore said at November’s Media Research Group conference that the lack of unity between the UK’s media currencies was “a mess” which was holding back cross-media planning.

Meanwhile in the US media firms and advertisers are putting pressure on dominant ratings provider Nielsen through a consortium looking at cross-platform ad measurement opportunities, and planning a US version of the UK’s TouchPoints survey on multimedia usage.

The UK’s National Readership Survey is looking at combining its data with internet audience figures from the new UK Online Measurement Company (which began releasing data in February) – although chief executive Mike Ironside is keen to stress it’s only a test.

Among the examples of cross-media measurement in practice that we saw in 2010 was sports broadcaster ESPN using the World Cup as an opportunity to track advertising in TV, radio, internet, mobile and print – something it hopes to be doing all year round by 2012.

ROI

ROI could probably be said to define any year in the recent history of research, but the economic downturn has put value for money under even more scrutiny. “Research for research’s sake is over”, said Forrester’s Reineke Reitsma at the start of the year. Speaking more recently she said that budgets in 2010 have been “much more defined by whether there’s an internal need, what it brings to the business”.

Tricky questions are being asked about large brand-tracking studies, and public sector performance measurement exercises that may have owed more to habit than necessity.

Coca-Cola’s insight boss Stan Sthanunathan caused a stir when he floated the idea of paying agencies by performance (see page 34 ), but talking about ROI in research is a lot harder than actually pinning it down.

For one thing, much of the blame for poor return on research investment lies with client organisations buying it for the wrong reasons. So the challenge for agencies is not just to make sure they provide the best possible value for money, but to be willing to say when the best value for money might lie in not commissioning research at all. And that’s a lot to ask at the best of times.

There’s gradual progress on this front, but we won’t get there without more controversy.

Mobile

According to the latest software survey by Meaning, mobile still accounts for just 2% of quant research spending. This suggests that the excitement about mobile among research suppliers is mirrored by anxiety among clients.

But the figure can only go in one direction. In the US one in four households is now mobile-only, while the average figure for Europe is about one in three. This makes a real difference: compared with combined landline and mobile samples, landline-only voting intention polls favoured Republican candidates over Democrats in three cases out of four examined by the Pew Research Center this year.

As for online surveys, people are already doing them on their phones – or at least trying to. So even if you don’t think you’re doing mobile research, you probably are. The question is, are you doing it well?

Then there are all the other applications of mobiles for research. Ipsos MediaCT is testing a system using mobiles to measure radio listening, location-based mobile services are attracting increasing interest, and iPhone apps have been developed to help participants in ethnographic studies share photos and videos.

Suppliers will have to hope that clients’ fear of losing touch with respondents outweighs their inexperience with mobile in 2011.

In the news…

January
A new organisation set out to shed light on what it called the research industry’s “dirty little secret” – offshoring. The initiative urged agencies to certify what processes they offshore, and where. Although generally well-received, the initiative risked, critics said, looking like a protectionist anti-offshoring club.

February
Michael Skarzynski resigned suddenly from his job as CEO of Arbitron after giving false testimony to a House of Representatives committee hearing on how the firm’s measurement systems affect minority-owned radio stations. Skarzynski stated that he had personally taken part in a visit to Arbitron panel members’ homes. He hadn’t.

March
Shareholders in IMS Health backed the firm’s takeover by private investors. The firm, which was part way through a year-long cost-cutting drive at the time, reported a 3% revenue rise in its final quarterly result as a publicly traded firm. Meanwhile troubled online researcher Harris Interactive turned its first quarterly profit in 21 months.

April
As financial results for 2009 began to be released, the picture looked dismal: revenue was down for GfK, Cello and Ipsos (which saw its first fall in 30 years) and flat for Nielsen. But there were reports of improvement in the second half of the year, and smaller agencies such as BrainJuicer and Truth had continued to grow strongly.

May
The American Association for Public Opinion Research urged online panel researchers to avoid the term ‘representativeness’ when describing their non-probability samples. IpsosMediaCT announced that it had embarked on a major trial of its mobile-phone-based radio measurement system in London, using a panel of 200 people.

June
Following the gloom of 2009, several of research’s biggest players reported client confidence returning. But there was also news of fresh competition for the industry: tests by Carnegie Mellon University and social media startup Tweetminster (which predicted the UK election result) showed the potential for online buzz analysis to rival surveys.

July
The Marketing Research Association warned that a draft data privacy bill would create a “nearly impossible challenge” for research by requiring written consent from respondents before collecting personal information on race, ethnicity or religious beliefs – even in interviews conducted by phone.

August
Industry association Esomar dropped its US representative Tom Anderson after he ridiculed the ISO standard initiative, which Esomar supports. In other news, political blog Daily Kos sued Research 2000, claiming that opinion polls it had been running since 2008 had been falsified. Research 2000 said the allegations were “pure lies”.

September
Rivals GfK and Kantar came together to form a not-for-profit consortium to create new quality tools for online research. A version of the UK’s Touchpoints multimedia usage study is to come to the US, backed by a consortium of media firms and advertisers. Participants in the study use an iPhone app to keep a diary of their media usage over 10 days.

October
Esomar’s industry revenue estimates and Jack Honomichl’s agency rankings showed 2009 to have been a record-breakingly bad year for the research business. But as results for the first half of 2010 began to trickle in from firms including WPP and Synovate, things could be seen to improve.

November
Eight firms that use neuroscience for market research agreed to submit their methods for review in a project launched by the Advertising Research Foundation, and backed by clients including General Motors and Hershey’s. Meanwhile there was bad news on privacy, as numerous mobile and social network apps were caught ‘leaking’ personal data to advertisers.

December
The impact of the new UK government’s spending review began to be felt in the research sector, with MRUK letting all but three of its 32 staff go, and further redundancies at TNS-BMRB. The BBC tendered for a new market research roster – but said it was looking to appoint fewer agencies this time around in the hope of keeping costs down.


Most popular stories on Research-live in 2010

Insight is dead
Nick Johnson on an end to ‘insight’

Research in a word…
Researchers sum up their expectations for 2010

Automated sentiment analysis gives poor showing in accuracy test
FreshNetworks takes an uncompromising view of buzz-tracking tools

Meet the man who wants to make surveys history
Philip Graves on why market research is living in the past

Facing up to difficult questions about panels
Jeffrey Henning examines efforts to improve quality in online panels

The innovation delusion
A designer’s view on why innovation is tougher than most companies think

Online unplugged
Facing up to tough questions on quality and trust in online research

Coca-Cola VP says pay-for-performance is on its way
Stan Sthanunathan intends to get what he pays for in his research

Volkswagen’s insight boss on ‘inadequate’ research
Steve Gatt on why most of the research he sees just isn’t good enough

This month we… became a fake respondent
Robert Bain goes undercover as an online survey respondent

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