Robert Heeg

New tech-based entrants to the market research and information business are booming. Who are they? What services do they offer? And of course, for established research suppliers, will these newcomers replace us or work alongside us?

Like most industries, market research has been strongly affected by that big disruptor, the internet. The web has changed where consumers interact, and the swift advancements in online technology have allowed an overwhelming number of new players to enter the research and information business. Mostly software based, these firms supply market research online communities (MROCs), DIY software, digital qualitative, enterprise feedback management (EFM), voice of the customer (VOC), market research outsourcing and more.

Some of these new entrants cooperate with established research suppliers, others sell their products and services directly to clients. Some regard themselves very much as research companies, others don’t.

AbsolutData is a consulting-oriented analytics and research firm with a number of Fortune 500 clients in a wide variety of industries across more than 40 countries. It provides data analytics and marketing research services, using its India centre as the primary delivery location.  AbsolutData CEO Anil Kaul explains that part of his business provides full-service marketing research, as well as support services such as analytics with survey data, online data collection and data tabulation. Yet, he notes, his firm differs from traditional suppliers in two ways: “First, our deep focus on analytics means that we also work with other areas in an organisation, such as CRM and marketing effectiveness, and tend to weave marketing research into such areas. Second, our focus is on providing marketing research services on an on-going retainer basis, while leveraging our delivery team in India.”

Silent partner
Norway-based QuestBack certainly doesn’t regard itself as a market research company. They  specialise in enterprise feedback management  social CRM and market research panel, community and survey software solutions. They partner with research companies, providing them with best-of-breed technology to help them deliver their services to their customers, says CEO Ivar Kroghrud. “And in addition to our technology,” he continues, “we do have in-house methodologists that work alongside our market research clients to help support their projects and optimise the results for their customers.”

Kroghrud likes to regard QuestBack as a silent partner to research companies. “Our technology enables market research teams to conduct the most sophisticated research powered by state-of-the-art technology,” he says. “This also means they spend less time on data collection and management, and can spend more time where they can add the most value – interpreting the results and making insightful recommendations to their stakeholders – thus ensuring they keep their seat at the business decision-making table.”

Answers in minutes
Passenger is a Los Angeles-based company that provides market research online communities and both qualitative and quantitative reports covering the results of surveys, polls, segmentation, engagement tracking, online focus groups, digital ethnography, product sampling, customer trend analysis, and usage and attitude insights. Marketing manager Kareen Vilnai explains what sets Passenger apart from regular research suppliers: “Through a highly engaged audience, our web and mobile software platforms capture insights faster than with other methods.”

GutCheck operates out of Denver, Colorado, and provides on-demand community platform services and access to these targeted consumers for gathering rich qualitative feedback. Clients can utilise the platform on their own or GutCheck can find the answers for them. Its focus as a company is on providing innovative technology for the marketing and research industries. The platform can be leveraged by brands, agencies, moderators and indeed research firms, says CEO Matt Warta. “In many cases, market research companies are GutCheck customers, leveraging our platform for their own clients. These research firms want the ability to leverage a qualitative platform that provides answers to business questions in minutes.”

Fraction of the cost
In addition to the technological developments, the rise of these firms was further boosted by the difficult economic climate of recent years. Many of these software- and online-based companies claim to offer a more affordable alternative to traditional research services. AbsolutData is based in the San Francisco Bay area, with local offices throughout the US and a delivery centre in New Delhi. This makes the company very competitive, stresses Kaul. “Most of our team is located in India, which provides a cost advantage to our clients.” At Passenger, Vilnai makes a similar claim: “Passenger online communities is a more affordable alternative to traditional market research services.”

GutCheck even give this promise a prominent place on its website, stating “We understand budgets are tight.” That, coupled with a commitment to deliver “answers in minutes, not weeks,” makes them a competitor for both established and newer, web-based suppliers. Warta doesn’t deny it: “We are more affordable versus panels and communities, and we are a fraction of the cost of in-person methods.”

At QuestBack, Kroghrud offers another reason for the newcomers’ success. “Classically, market research teams have often managed different research platforms. This becomes very time consuming from a data-gathering perspective, when you are drawing from multiple channels for a single study. We offer a comprehensive, end-to-end platform that allows you to streamline and focus your research projects on one platform.”

Working together
Despite their competitiveness, all of these young companies claim to be complementary to traditional research suppliers, rather than replacements. Anil Kaul says that his AbsolutData often works with established research firms. “Our retained model means that we tend to work on on-going projects and develop support teams for our clients. We do provide our analytics support services to traditional market research companies.” Kroghrud, too, claims that QuestBack commonly collaborates with market research services of all varieties and disciplines. “We have over 100 research companies that utilise our software and services, and view us as a key underlying element in their ability to deliver.”

Passenger’s Kareen Vilnai says that it depends on the client. “We typically work across departments, with researchers, analysts, brand and product managers being the most common users.” Warta claims that GutCheck is also complementary. “Our platform is leveraged by market research agencies as well as brands.” He cites a study published in the Harvard Business Review that suggested that consumer data is only leveraged 11% of the time to make consumer-based decisions. “The reason this is true is that most market research takes too much time and money to be a relevant option. We believe we have a platform that can take that number much higher, which creates opportunities for those in the research industry.”

Expansion
GutCheck’s revenue grew by nearly eight times in 2012, and it is expecting significant growth in 2013. AbsolutData grew faster than 40% year-on-year for the last few years. The company recently raised US $20 million in equity funding from Fidelity Growth Partners. “We have plans to grow our business significantly, and are planning international expansion to open offices in London, Singapore and Dubai in January, 2013,” announces Kaul.

Passenger is growing more rapidly now than ever before, says Vilnai. “In the next few months, we are releasing new products for enterprise communities and recruitment via Facebook, adding new features to our existing web products and expanding our mobile applications.” QuestBack, too, has been experiencing impressive growth year after year. For 2013, Ivar Kroghrud says his firm is focusing on supporting its customer base and continuing to launch incremental updates and new features to the platform. “These will continue to deliver greater efficiencies for our market research customers, so that it is easier to both capture the intelligence they need and to generate impactful reports and get into them into the hands of those that matter to the business – from the frontline employees to the chairman of the board.”

It looks like the research industry had better get used to having these tech-based suppliers around.

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