We talk to Didier Truchot, founder and CEO of Ipsos, the world’s third-largest research company.
Having acquired Synovate last year, Ipsos spans 84 countries and has 16,000 employees. Truchot talks to Jo Bowman about integration, expansion and thriving in an increasingly competitive market.
Your company’s tagline is ‘Nobody’s unpredictable.’ How true is that today, when the Arab Spring, for instance, caught many commentators and researchers by surprise?
You’re right that the Arab Spring wasn’t predicted, and not just by researchers! But it’s a dynamic thing and it’s difficult to predict something that worked and developed by itself. But then if you look at the Egyptian elections, they have been reasonably anticipated by the polls, including who would win and by what margin, so I think the techniques we’re using are still able to understand and measure what people are doing and what they’ll do in the near future. Of course, short-term forecasting is easier than long-term. But overall what our clients are asking us to do is help them measure what’s going on and give some understanding of the likely impact of their activities, and in most cases that’s easier to predict than political uprising.
The Ipsos 2011 annual report points out that as consumers become more informed, communications need to be more refined. How does this affect market research?
It means market research is even more important than in the past. It’s vital to understand the links between market share, prices and who’s willing to pay what price for what product. Probably even five years ago consumers were more naïve; now they’re more exposed to advertising and they’re more educated, they understand better what’s going on. So if we want to convince them of an offer, market research can help create the level of emotion and persuasion to either stay with or switch to your brand. The level of competition for brands is higher than ever, so marketing activities need to be more refined.
What are the three biggest changes that you see affecting the industry?
More and more clients are asking us to work on a global and an on-going basis, and that’s good for companies that are able to work on a large scale in many parts of the world at the same time. Clients are, of course, looking for a higher level of quality-attribution and faster delivery. They have always wanted quality, but when you’re working across multiple markets at the same time, very small things like precise translation can have a big impact. It’s more complicated but, because the contracts are larger, it’s more rewarding to do it well.
There’s a fundamental change in the market right now because the traditional way for market research companies to work with their clients was to produce data, analyse it and deliver it. Now, clients want us to contextualise more what we do, to bring together different sources of information and give them a more holistic view of their market position and how, from that, they can make the best possible business decisions based on the most complete view we can give them. That’s quite a challenge for us as an industry, after a hundred years of working one way.
Is that where the opportunities lie, in providing this additional layer of context and analysis?
Yes, but of course we’re not the only industry trying to tap into the needs that our clients have in terms of understanding their market and their customers – a lot of people are moving into that space, including the media agencies, consultants and research foundations. But we have some specific competencies that put us in a strong position compared to these newcomers. One, we’re definitely neutral. Two, we have a deep knowledge of our clients and what they’re looking for. And three, because what we’re producing includes a significant proportion of our own research – it’s not just about combining sources.
We’re developing a new group of ‘strategic insight directors’ who work directly with our clients, to look at how we can mobilise different sources of information and analysis and in some cases new pieces of research, to look at what their options are and how best to get them what they need. It’s not about project management – it’s about managing information.
What have been the most challenging aspects of merging Synovate into the rest of Ipsos?
It’s true Synovate didn’t work exactly how we were working, but we were all in the same business and shared a lot of clients. Our new organisation now has more skilled teams who work on a broader base of projects. We closed the first phase of our integration in February, so everybody knows what they have to do. We’ve selected more than five hundred managers on the research side. Now we’re developing our offer, looking more closely at what clients are expecting and what we should develop, and that will close during the summer. Then the third phase will be to track through our business how competitive and relevant to our clients we are and then make some adjustments.
Many companies are looking to the emerging markets for future growth; which are the markets that excite you most?
Many of what people call emerging markets have already emerged and are very large. But Nigeria, for instance, or Indonesia, aren’t as large as they’ll be 10 years from now. We are, overall, pretty active in these markets. If you look at the ESOMAR numbers, emerging markets represent about 20% of the overall market, but for Ipsos it’s about a third of our revenue. We’re already over-represented in these markets, especially the big ones like China, Russia, Brazil, Mexico and Korea. We’re definitely where our clients want us to be. One of the reasons we acquired Synovate is they have a long tradition of working in emerging markets, especially in Asia, including India. So now we have the scale in these markets that we need.
What are the particular challenges you face in researching emerging regions?
It’s the same problem for everybody – there’s a lack of qualified research talent and everybody wants the best possible team, including our clients, who are poaching our people when they think they’re good. It’s an on-going task to try and keep talented people at a cost which can be covered by the price that we’re able to sell our services there. There’s a balance to find, but all professional services industries are finding the same thing.
How much does mobile change the game, and how big a priority is it for Ipsos?
It’s a new opportunity because there’s a lot of research to be done around mobile phones – penetration, usage, new features – it’s a market by itself. But more importantly, it’s a very interesting opportunity, especially as more people get smartphones, because lots of new ways to interact with people and research them will be developed in the coming years. People have their mobile phones with them all the time, and if we can link that with what they do, then it will be very interesting. At the beginning of this year we identified three priorities for innovation: neuroscience and other ways to measure and track emotions; social spaces, communities and web listening; and developing ways to use the mobile devices, especially related to geo-location. That’s a dream for researchers – to understand where people are and then ask them questions in relation to where they are and what they’re doing.
How do you strike the right balance between exploiting these opportunities and respecting privacy?
It’s all about how you engage people and being clear about what you want to do, and getting their clear agreement to do that. If people agree to have their movement tracked through a GPS system, they must be very clear about giving permission for that. The market research industry has always been pretty honest about this kind of thing. We need to stick to our principles, and interact with people in a transparent way.
What’s the role of industry associations in moving market research forward?
What organisations like ESOMAR do is track the development of the market by tracking services that are sold by market research companies. But in fact, many market research services are sold by other companies – consulting firms, media agencies and foundations. We need to work on a definition of what market research services are, and then give a clear picture of the evolution of the market, which is broader and probably more dynamic than the market we’re currently tracking. We need to understand the market research services that are bought by our clients in one way or another.
Our industry’s at a turning point. The next ten years could be great for us. Or, we stick more or less with what we’ve always done and there’s a risk the market research industry will die, and we let other players have a more strategic role with our clients. I don’t want to see Ipsos become a provider of data to consulting firms.
Didier Truchot is CEO of Ipsos