FEATURE1 November 2011

The UK market research industry in review

2010 will be remembered as the year that wasn’t as painful as the one before. The UK industry may have been flat – but there were still some growth stories worth talking about.


The best you can say about 2010 is that it wasn’t as bad as 2009. Globally, revenue grew 2.8% after inflation, following a decline of 3.7% the previous year – a fact cheered by Esomar as a sign that “investment in research had returned”. But in Europe, growth was just 1%, and the UK down 0.2%. Still, the Market Research Society’s director general David Barr saw cause for optimism in the figures.

Indeed, the UK industry looks more rosy at the micro-level than it does at the macro. The seemingly flat expanse, an estimated £2.06bn in size, hides within it pockets of exceptional growth, and the agencies that bucked the trend most spectacularly are interviewed later in this piece.

“The recession led everybody to look at doing things differently – it provided a gap in the ‘business as usual’ mentality,” says Firefish’s Jem Fawcus

One interesting observation is that five of the 10 fastest growers lie squarely in the mid-range of the top 100 UK agencies. These are the medium-sized agencies that, wisdom has it, are most likely to be squeezed out as the industry continues to split between a handful of big, globe-straddling giants and boutique shops.

But perhaps it is the pressure of being part of the squeezed middle that forces some agencies to excel, to try new things which puts them on an upward trajectory. Many did in fact credit their success to offering something different. John Gambles, chairman of Quadrangle – one of the fastest growers – says: “Unique is an overused word, but we are certainly unusual. We don’t focus on the process of research, but what happens as a result of the work that is done.” Likewise, Firefish tries not to dwell on “the widget” that is used, says CEO Jem Fawcus. “We focus on the results.”

Results are ultimately what matter to clients, of course, and many of the fastest-growing agencies believe the recession helped them in turn by forcing clients to reappraise the results they were getting from their existing suppliers. “The recession led everybody to look at doing things differently – it provided a gap in the ‘business as usual’ mentality,” says Fawcus.

BrainJuicer CEO John Kearon agrees. “No one changes their mind in a state of equilibrium,” he says. “As a new company in the marketplace you want to work with the visionary and the desperate, because they’re the people that have their minds open, or have had to open their minds, to better ways of doing things.”

Several of the agencies we spoke to talked of winning work away from bigger competitors as another fortunate by-product of the recession. When it comes to the big public companies especially, many small and medium-sized firms are at a distinct advantage. Being privately held, they can take the sorts of decisions that the CEOs of public companies can’t, says Incite MD Roger Banks, who is a former CEO of WPP-owned Research International.

“I’ve always taken the view that good financial performance is a desirable outcome of getting the basics right,” says Banks. “That’s not to say we don’t look at our finances regularly, but I just think that if you focus too much on the money you do the wrong things. So stick to your guns and keep doing the things you know will deliver great work to your clients.”

Some advice to heed going forward. But, for now, let’s take a look back over the UK research industry in 2010.

If you wanted to visualise the UK market research industry, and every agency’s place in it, it would look something like the above. The image encapsulates the estimated £2.06bn in turnover generated last year by UK-based research companies, all but some 8% of which is accounted for by 100 companies – ranging in size from £2.7m to £160m.

Click here to download a high-res version of the graphic.

The MR firms that outpaced the market in 2010

Growth is not the be-all and end-all of running a company, but it is a good indicator that your business is doing something right. Research wanted to understand where growth was coming from in an otherwise flat market so we sat down with the heads of the fastest-growing companies in the top 100 to get them to share the secrets of their success.

Jem Fawcus, CEO, Firefish
Revenue: £6.3m, up 59%

Two pillars of our growth were quality and innovation. We’ve always added a strategic element to what we do and when budgets are trying to go further that is very useful. Innovation has always been in our DNA – we originated out of youth research and that was all about doing things differently and we have kept that philosophy. It’s an ongoing process: fine-tuning existing methodologies or inventing new ones if there’s a need. But we try not to focus on the machine – the widget. We focus on the results. Some of the tools we use are traditional but some are new and interesting, and it’s that combination that works really well. As a client you are comfortable with what you know, plus there’s a bit of excitement and added interest.

John Gambles, chairman, Quadrangle
Revenue: £6.4m, up 39%

If a client has got a lot of money they can actually afford to do a lot of research that is going to have less of an impact on the business but is interesting to know. In a recession you have to ruthlessly prioritise and that prioritisation has got to be around what will create value for the business, increase customer performance or make new things possible. From our perspective that is a gift from heaven. We don’t have any magic in terms of methodology or products. What we have is a much more commercial, business-oriented approach. We tell clients: don’t talk to us about research, talk to us about your business, your ambitions, the issues you are trying to resolve. From an understanding of that we will work out what the best research solution is.

John Kearon, CEO, BrainJuicer
Revenue: £7.9m, up 43%

What has happened, and what has helped us grow, is that the biggest corporations have had to open their minds to better ways of doing things because the old way of doing things weren’t achieving what they needed to achieve. Hard times have made them less tolerant of the rather average, pedestrian performance of the big research factories, and they are giving us more opportunities than they previously did. One area that stood out particularly for us was product testing. We have a very unusual product called Predictive Markets, which is massively more discriminating between good and average concepts than typical testing tools. It helps companies focus more on ideas worth spending time and money on. They cannot afford the luxury of wasting time and money on deeply average ideas.

Rob Sheldon, MD, Accent Research
Revenue: £4.6m, up 39%

Looking at our growth, I think we’ve just put more effort into communication with our clients as to what we can offer. Almost 90% of our work is from repeat business. I would say that we are putting our message across much more clearly and we’ve focused a lot more on academic relationships. We have funded two academic posts, one in behavioural economics and one in conjoint, to make sure that any academic learning, any innovation and any new ideas are being put to work in the commercial sector. A lot of our work is in competition and regulation, which is a key component of our growth because those are areas with a continuous need for research, development and dialogue.

Andy Dexter, founder, Truth
Revenue: £7.2m, up 36%

There were a few sectors that were strong for us: healthcare, technology and financial. We broadened out quite rapidly through hiring new senior people who brought new client connections in terms of retail, food and drink – that was all incremental business for us. The critical point in terms of growth is that it is very much about people. We’re still a very young company, so every year we are looking to acquire new clients, build new key accounts. We’re only just over four years old so there’s still plenty of stretch in that. Obviously the economy makes you consider some of these hiring decisions closely, but you roll the dice and these things pay off if the people are right.

Wayne Phillips, CEO Double Helix Development
Revenue: £16.4m, up 34%

We’ve never had any acquisitions or borrowings. I basically started the business with £5,000 in 1995 and everything since has been down to organic growth. We retain a great amount of business but we also added some very good new clients in 2010. Expansion has come from all operations: market research and market access in the UK and the US, and it’s continuing this year. Emerging markets has been an area where we’ve grown. It’s really the clients that prompted us to open an Asia Pacific office in Singapore, and we’re getting more and more business in China, Brazil etc. But most of our business comes from operations in the US, UK and Europe.

Roger Banks, MD, Incite
Revenue: £7.4m, up 31%

When it came to the recession and its aftermath in 2010, we took the view that we wouldn’t let it affect our activities and our priorities, which have always been to hire the best people we can and do the best work we can for the best clients in the market. If anything, during the recession, we had even more resolve to focus on those things. But there were changes in the market too. Clients were coming to us for the type of work they would have historically given to very large agencies. The reason that they came to us, they were saying, was that it was increasingly difficult to get the attention of senior, experienced people in those large agencies. In times of recession, the big public companies look to the bottom line in a very focused way. What that means is that the very people clients want to work on their projects are probably spending time having to get rid of people and explaining their numbers internally rather than delivering great client work.

Robert Senior, chairman, Euromonitor
Revenue: £43.5m, up 26%

We’re a global publisher of market information, bought all over the world by big companies – mainly consumer goods and services, that kind of thing. So we tell these companies what’s happening in their industries. Our growth is all organic; we don’t acquire. We just have a really good product that people want. Our geographical spread has been very beneficial. We’ve just opened up in Bangalore, Tokyo and Sydney. In terms of new offices we’re looking at Brazil. Generally speaking among our client base those companies are also doing well for the same reasons – they are globalising.

How the information was compiled
Many information sources were used, including the financial and business press and related websites

  • Companies House has been the principal source of comparative data in the public domain but reporting dates vary within the year. Most are December but a few are as early as February and March
  • Annual reports of public companies
  • Private companies have in many cases supplied their turnover data directly to us, particularly if they file only modified accounts at Companies House. In a few cases these are round numbers rather than precise figures
  • For some companies turnover has been estimated, based on known turnover ranges in the Research Buyer’s Guide and other information
  • Many participants in the MRS Annual Survey of the industry agreed to the publication of their turnover
  • Figures relate to turnover by UK-based organisations regardless of the location of their ultimate ownership or of their clients
  • The top 100 includes only companies engaged in the collection, processing, analysis, interpretation and dissemination of information about markets and social issues
  • Companies that are wholly dedicated to data collection, panels and fieldwork are not included
  • It should also be remembered that there are many successful and reputable enterprises whose turnover is below the threshold for inclusion in the top 100. It remains a huge advantage of the UK industry that it continues to generate start-ups and new entrants, some of which have very high growth rates from a modest base and constitute compelling business development case studies

Thanks to Keen as Mustard Marketing for the infographics