By Alexander Shashkin
The Second Russian Research Week (www.researchweek.ru) was conducted in Moscow and other Russian cities in March 13-17, 2017. The event gathered over 4000 participants, including research suppliers, clients, media, government, NGO’s, and students. 18 different events were held during the course of the week under the umbrella topic of ‘Future’. Researchers discussed the future of society for the next 10-20 years as well as the future of sociological and marketing research itself. How such instrument and technologies as big data, online panels, face recognition, virtual shopping environment, geomarketing solutions and many other will change the research that we know today?
A report from the MRSI’s 26th Annual Conference
By Umesh Kumar
I recently had the pleasure to attend the Market Research Society of India’s 26th annual conference, whose theme was “Looking Beyond”. Today, in an era of obsession with data, this metaphor can be well applied to the market research industry. With the advent of Technology and Big Data, the researchers & marketers of today are on a journey…a few are flummoxed or just plain aloof. Others are fretful about the change that will follow. Some fear about their ability to cope with the challenges. But those who can look beyond are fascinated by the opportunities that lie ahead.
by John Presutti
As we prepare for the 2017 MENAP forum, I was asked to write an article about the region that would pique interest, particularly from a researcher’s perspective. I blithely accepted this task; after all, I have been involved in conducting research across MENAP for nearly 25 years – I have seen a lot. I have done a lot. The task, however, is formidable. Collapsing the region into a tidy five letter acronym belies its scale, complexity, diversity, and historical richness. The MENAP region unfurls into more than 20 countries, a population of more than 600 Million, a culture and history that boasts accomplishments such as the cradle of civilization, the birth of Abrahamic religions, the invention of Algebra, countless musical instruments, and yes, believe it or not, soap. So, in retrospect, what I have seen and done in the past quarter century is barely the proverbial tip of the sand dune. MENAP is a region filled with constant surprise, cultural diversity, political upheaval, and economic complexity. Attempting an exhaustive discussion is quixotic. As such, I would like share with you 5 observations I believe important for anyone conducting research within the region.
1.Look beyond the narrative of turmoil, violence, and ultra-conservatism perpetuated by mainstream media
Mainstream media coverage of the MENAP region is littered with words such as “violence”, “terror”, “radical Islam”, “extremism”, and countless other fear invoking adjectives that create a perception of mayhem and instability. Looking beyond this narrative reveals a vibrant region with a bourgeoning middle-class, with well-developed financial and retail infrastructure, with well-regulated legal and commercial environments providing protection for brand owners, businesses, and consumers alike. A UN study commissioned by the Economic and Social Commission for Western Asia, estimates the size of the Arab middle class at between 32%-43% of the population for less developed markets and between 55%-60% for more developed markets. In Pakistan, conservative estimates from the Pakistan Institute of Development Economics estimate the size of the middle-class at around 19% of the population. Iran, long considered the seat of anti-western dogma and religious conservatism and until recently isolated by global economic sanctions is now capturing the attention of global brands from automotive to consumer electronics to luxury. While reliable current statistics on the size of the Iranian middle-class are not yet available various estimates place the size to be between 40%-50% of the population, nearly 40 million consumers.
The implication of these staggering statistics is a middle-class market of nearly 200 million consumers with discretionary spending power available for non-essential goods and services. In other words, there is great opportunity for goods and service providers to address growing consumer demand within the MENAP region.
2.The countries of MENAP are highly diverse and cannot be treated similarly.
I am often asked by international clients concerned with budget and time constraints which countries should be included within a regional research program. However, the countries within MENAP, while predominantly Muslim are vastly different from each other and reflect unique cultural and societal journeys. This translates into differences in language to societal values & attitudes, collectively impacting a variety of topics from career and leisure to relationships and aspirations to savings and discretionary spending.
Within the countries themselves, there are stark regional differences. The Western region of Saudi Arabia is considered “culturally” different from the Central & Eastern region and in Pakistan the same is said of Lahore and Karachi, one being predominantly Punjabi and the other Sindhi. Even in the traditional Arab countries of the Arabian Peninsula, North Africa, and Levant, the Arabic language exhibits dialectic and idiomatic idiosyncrasies that can pose a challenge when developing research materials. The country of research will determine whether the Arabic used in Levantine, Khaleeji, Hijazi, Maghreb, or Egyptian. In Pakistan, while the official languages are Urdu and English, there are widely spoken provincial languages of Punjabi, Sindhi, Pashtu, and Balochi.
While a singular bellwether country does not exist for understanding the MENAP region, we do tend to build research programs based on individual market priorities. Typical MENAP research programs will include Saudi Arabia, UAE, Kuwait, Egypt, Morocco, Turkey, and Pakistan. Having said this, however, there has been increasing interest in emerging markets such as Algeria, Iraq including the Kurdistan Regional Government.
3.The economic outlook across the region is varied
While unmistakably tapping into the spending power of MENAP’s middle-class represents a great opportunity, the current economic climate is inconsistent across the region. GCC markets have been horribly affected by the drop of oil prices from a high of over $100 per barrel to around $50 per barrel today and as such were forced to adapt to the new harsh economic reality. These countries were accustomed to large fiscal budget surpluses driven by oil industry revenues but in the face of deficits have begun to implement harsh austerity programs to reduce budget deficits. Saudi Arabia, the largest and perhaps most influential of the GCC economies ended 2016 with an estimated budget deficit of $87 billion. Across the GCC governments have either implemented or are planning austerity measures including the elimination of consumer subsidies on fuel, water, and electricity, the introduction of 5% VAT, reduction and scaling back of government contracts, and potentially the introduction of personal and corporate income tax. In Egypt, the economic outlook is still dire but improving as it continues to grapple with the effects of fiscal reform implemented by the government to deal with the uncertainty and chaos following the Arab Spring. Egypt’s economy has suffered numerous shocks including soaring inflation, currency shortages, and a failing tourism sector. The government economic reform program has included initiatives such as the introduction of VAT, a free-floating currency, and reduction in consumer fuel subsidies.
The economic blowback from government austerity measures will mean both lower GDP growth and lower consumer discretionary spending in these countries. From a consumer perspective, this means greater emphasis on value and affordability as consumers seek ways to stretch their decreasing disposable income.
Despite the somewhat glum economic outlook for some of the countries, there are bright spots across the region. Iran is expected to enjoy economic growth as it comes in from the cold of years of economic sanctions. The forecast from the Iranian government as well as the financial community is that Iran will experience a surge in oil and non-oil exports as well as in foreign direct investment. Pakistan is also looking at a rosy economic picture as South Asia’s second largest economy is eyeing robust GDP growth driven by lower oil prices and heavy foreign direct investment in infrastructure, particularly from China. The economic growth of Pakistan and Iran combined represent expanding prosperity for a market of 260 million consumers.
4.Digital disruption has taken hold across the region
Any brand thinking about developing their strategies to connect and engage with consumers in the MENAP region must be willing to embrace digital technology. MENAP consumers are creating digitally enabled lives. With smart phone penetration rapidly moving towards universal penetration, MENAP consumers are using their mobiles for just about everything imaginable. According to the recently released annual report form We Are Social and Hootsuite, Digital in 2017 Global Overview, in the Middle East, there are 312 million mobile subscriptions, 93 million active social media users of which 90% are active mobile social media users. Furthermore, the Internet of Things (IoT) within the region is experiencing rapid growth with organizational spending expected to increase at a compound annual growth rate of over 21%, reaching $14.3 Billion by 2020. eCommerce and mCommerce are gaining rapid momentum as consumer acceptance to pay for goods and services online grows. According to online payment service provider, Payfort, consumer acceptance of online payment within the Middle East stands at more than 50% with online purchases expected reach $69 Billion by 2020. Furthermore, according to Criteo, a global provider of digital performance advertising, more than one third of GCC online purchases was made via mobile. Businesses that successfully leverage the deepening relationship between MENAP consumers and digital technology to meaningfully connect and engage their target audiences will surely reap huge rewards.
5.MENAP research is going digital
Rapid consumer adoption of digital technology has created exciting possibilities for engaging and researching consumers across MENAP. Over the past 3 years, digital technology has put some spring back into the step of a region where the industry has plodded along slowly unable to keep pace with changes taking place in more developed research markets.
Until recently, most face-to-face surveys were conducted using paper and pencil. Today, web enabled geotagged CAPI is increasingly the norm. Online access panel providers were few and provided limited geographic coverage. Today, there has been a proliferation of panel providers and MENAP coverage is near universal. Furthermore, mobile market research triggered through SMS invitations has experienced meteoric growth offering clients fast, cheap, and high quality data collection. Permanent private online brand communities are also beginning to gain acceptance amongst clients who appreciate immediate access to a large base of customers that can be engaged in a candid dialog about brand and product experiences. Digital technology within the quantitative research space is spelling an end to the dreaded face-to-face survey which has long been criticized for inconsistent data quality.
Digital technology is also influencing how qualitative research is conducted within the region. VVOIP platforms such as Skype are being used reach and interview respondents in less stable places such as Baghdad or Gaza. Online focus groups whether organized as a live chat or a bulletin board discussion are also gaining acceptance as clients appreciate their speed, convenience, and cost effectiveness. Within the ethnography space such as shop-alongs and in-home visits, mobile ethnography platforms are making their debut with such features as push to talk audio and live stream audio, allowing researchers and observers to virtually accompany respondents in a less intrusive manner, while saving considerably on cost and time.
Finally, as researchers find their sea legs in the ocean of digital technology, they are becoming more open to the avant-garde of technology driven methods including neuromarketing sciences and big data analytics. Neuromarketing research projects utilizing eye-tracking, EEG, and facial coding are becoming more commonplace. Clients are also actively contemplating how to leverage the Big Kahuna of big data, particularly as they gain exposure to the power of social media listening. While this area of research is still early days for MENAP, the conversation is becoming louder amongst researchers and clients, perhaps a harbinger of things to come. As the cost of neuromarketing and big data tools drops, this area will experience rapid growth as researchers seek out methods of increasing the predictive power of data.
In closing, my parting thought is that the MENAP region is huge, diverse, and full of surprise. Conducting, research within the region requires careful planning, a hands-on approach, and a great deal of cultural sensitivity and patience. While the region is currently experiencing economic and political difficulties, there is a massive thriving middle-class that should not be ignored. Finally, the rapid adoption of digital technology has provided researchers unprecedented access to consumers willing to engage them in a meaningful always connected always on dialog.
Join us at our upcoming MENAP forum for more regional insights and innovation!
John Presutti is CEO market-i research and consultancy and ESOMAR UAE representative
By Nino Gogoladze
The role of an ESOMAR country representative is not only about supporting the industry in the country, but also about helping citizens to be aware of specific local market conditions and future prospects.
Georgia is a small, pleasant, newly established post-Soviet country. Can you imagine how big the research sector might be in such a country? The reality is that the research market in Georgia is very small; the first Georgian research company, according to the official data of the Statistics Department, was founded in 1995- IPM Research.
So, where is the source for evaluation of this 20-year-old small market? The country’s economy is in crisis now, struggling to recover from the 2008 Russia-Georgia war; experiencing local currency inflation and low economic growth- all of which affect the research market. The above resulted in a decline in marketing research budgets and increase in political research budgets. There are few truly reputable research companies here possessing the sufficient skills, knowledge and experience, and so the competition is high.
For me, as an ESOMAR country representative, the first goal was to establish good relationships with association members. The dramatic effect of competition often nudged competing companies and professionals to avoid meetings, communication with the same audience, or the chance to share their experience. It was very important to break the ice and offer them a neutral communication format. Thus, my first goal was to encourage the seven current members of the association to become real ambassadors not only of their companies but also for ESOMAR.
At the 2015 ESOMAR congress in Dublin, the representatives’ meeting addressed the reasons for the low involvement of young people within the association and aimed to introduce them to the industry and society of researchers. Everyone agrees that youngsters should be encouraged to join the ESOMAR society, but there is uncertainty as to how to persuade them of the importance of joining. My idea was to arrange a meeting with students in local universities to promote association principles and benefits. Students of the sociology, psychology, statistics, and marketing faculties are the main target groups for meetings in which they hear directly from research professionals who not only promote the industry but also help a new generation to get information about the highest standards in the research industry.
The idea of the communication format helped me to involve most association members within the activities and proved helpful to students because all members of the association fully understand their responsibility to support future industry growth and to take part in the educational process of the next generation of researchers.
After receiving confirmation from key association members: Giorgi Abramishvili (Director, Market Intelligence Caucasus, Licensee of TNS Georgia); Tinatin Rukhadze (General Director, ACT Georgia); Gocha Tskitishvili (Director, IPM Research Georgia) to participate, the first meeting was planned in one of the biggest Georgian universities – Caucasus University. The eagerness of students of the sociology and psychology faculties there was impressive. Four presenters from the different Georgian research companies chose the best practice research projects to present the students, and each member talked about ESOMAR, the benefits they receive and the importance of ethical norms, codes and guidelines for the research industry.
Following that first successful meeting, we planned a second, and started thinking about inviting a guest speaker from ESOMAR to talk about a selected topic. A lack of budget meant that we were limited in options, so I chose to invite a foreign guest speaker from abroad to speak to attendees via online presentation rather than in the flesh. We were fortunate that ESOMAR helped by inviting Dr. Stephen Needel, Managing Partner of U.S.-based Advanced Simulations, to talk via e-conference. The resulting meeting was extremely interesting, informative and engaging and extended from the planned 2.5 hours to 3 hours. A journalist from local newspaper Georgia Today attended the meeting and wrote an article about it available here.
After that second successful meeting, the Georgian ESOMAR members’ group received an invitation from another university to hold a meeting there. It too, proved successful- in fact, we saw even greater motivation from students than in the first. We will continue this good work throughout 2017, and already have another university visit lined up.
Global events are of utmost importance for the information they provide, but small ones can also serve to change local environments and help the research industry’s current and future members. That is our aim and our current mission.
Nino Gogoladze is Managing Director at TV MR GE, Nielsen Television Audience Measurement’s official licensee
By the ESOMAR USA Representatives
Although North America was unable to retain fastest growing market for research for a second year running, the overall market size has increased by almost 20% according to the latest ESOMAR Global Market Research report. But, while the overall market growth figure may have implied a slowing down, the market measure has expanded to include two additional new sectors, giving the region a net growth of 0.5%. Following on from this we asked the ESOMAR representatives in the US about the challenges, opportunities and trends in their market.
Did someone say mobile? Again?
As this series of articles continue, having looked at the LATAM, APAC an MENAP regions, we do indeed see the same patterns emerging, even more so in a developed market such as the United States. It’s of course, the conversation about mobile and internet penetration rearing its head again. Jackie Lorch, Vice President, Global Knowledge Management, SSI USA, comments, “With online penetration approaching 90%, online is the go-to data collection methodology, and don’t even think about fielding a questionnaire that can’t be completed on a mobile phone.” Yet, although this knowledge is commonplace, it doesn’t mean the industry has caught up yet. With US smartphone penetration near 60%, survey participants are increasingly choosing to take surveys on mobile devices. Lorch observes, “The industry has not made it a priority to put participants first and design mobile-friendly questionnaires. Likewise mobile in-the-moment research presents wonderful opportunities to interact at the moment of decision-making with video or image capture. Yet we have largely failed to engage.”
This sentiment is echoed by Melanie Courtright, EVP, Products and Client Services, Research Now. “The biggest challenge is learning how to evolve for mobile devices — the questionnaires themselves have to change, and we are really struggling with moving fast enough in America.” Although the market research world might be lagging behind, there are big opportunities here, comments Courtright, “Biggest opportunity is in automation of basic research types so that through standardization we can integrate other forms of data better and spend more time on interpretation and make decisions more quickly.”
While the rest of the world might have an inbuilt stereotype of Americans (can anyone blame them, Donald Trump anyone?) – it couldn’t be further from the truth. Lorch comments, “Most of the stereotypes you have heard about America are exaggerations. Most Americans enjoy foods other than burgers, fries and buckets of cola and many are well-informed about and interested in other countries in the world!” Indeed, Courtright observes, “The US is very diverse, both in business and with consumers. It’s like many small countries grouped together, so to try and approach it as one market is not possible.”
The US shouldn’t be treated as one country – this is a population of almost 319 million people, spanning across more than 9 million km. That’s a lot of people, can we really expect them to have the same thoughts and opinions? Lorch expands on this further, “Different geographies, attitudes and cultures can be found within its borders. You’re likely to find doing business in the fast-paced, intense, “in-your-face” culture of New York City different from the more laid-back, proudly non-conformist, technology-driven Northern California, for example. Street signs you may see along the way help tell the story!”
Very visible in the US, but not just limited to here, is a major new societal trend that will impact research – fragmentation – in almost every aspect of modern life. Lorch notes, “From people’s time and attention, the data sources they use, their digital device habits, to the diversity of their beliefs, lifestyles, attitudes and interests. Institutions in the media, government and communities that used to help define large groups among the population have largely vanished to be replaced by customisation of the individual experience to a massive degree. As society fragments, are our traditional research taxonomies relevant anymore? We still group people by age, by ethnicity, by geography, in ways that haven’t changed for generations. We should instead consider life stages, and new attitudinal groupings as ways to better understand the consumer. This is equally true for B2B research where titles, responsibilities and purchase patterns are changing rapidly and we need to target based on the reality of today’s job functions and responsibilities.”
There are many trends impacting on America, and indeed society at large, none more so than technology. Lorch comments, “The idea of technology as not just enabler, but also driver of our business is a phenomenon noted by Unilever’s Stan Sthanunathan. Technology has made research more efficient, and improved its quality for companies who have invested in it. Now technology is doing more: actively directing where research will be and go in the future. It is taking over many research tasks that humans used to do. The challenge is that powerful technology and the expertise to run it is usually only available to the larger players, so many smaller enterprises need to find a new raison d’etre, or risk being swallowed up.”
Big data and the internet of things will also shape the future of market research, but we first need to get over the problems. “The practical and operational obstacles in the way of getting value from all the data now available are not trivial, yet the potential rewards are massive. If we can overcome the obstacles, research can use big data to answer the what, when and where questions and surveys to get at the why and what next – resulting in shorter, more interesting surveys and more accurate factual data.”
And a further trend to look out for, comes from Courtright, who comments, “A trend we’re seeing is definitely privacy and what that means in a world of cookies and meters and observational data collection. And in turn, society’s reaction to those practices, along with their expectations of transparency and responsibility.”
How to do business here
While we know we need to let go of those stereotypes of Americans we seen in the media, how do we do business here?
Lorch has some sound advice, “Americans are informal and direct in business dealings and make decisions relatively quickly – so don’t be afraid to ask for the business and discuss specifics like delivery times and costs.” But, don’t mistake that good old American positivity for success. “A positive attitude is much admired in the US, so even if someone tells you they’re “incredibly excited” about meeting you and hearing about your product it doesn’t mean you’ve made the sale!” observes Lorch.
So what have we learnt about doing business in the United States? Don’t treat this country as one…
Special thanks to Jackie and Melanie for this article.
Jackie Lorch, Vice President, Global Knowledge Management, SSI USA
Melanie Courtright, EVP, Products and Client Services, Research Now