Market Research

The market research industry is slowly recovering from the effects of the pandemic, with more than 3 percent growth from 2018 to 2023, and more than 3 percent growth in the first quarter of 2023 alone. Consumer confidence is on the rise as the economy stabilizes, and more companies are turning to market research to learn how to best meet consumers' needs. According to IBISWorld, companies are investing money in developing new products and need market research to target their products to the right consumers. Companies are hiring market research companies for qualitative and quantitative research that measures consumers' interactions with their products.

One ongoing trend has been that a growing number of advertising agencies have been expanding their services to include market research. IBISWorld also reports that among the market research industry’s larger players, advertising companies have been entering the industry through acquisitions. Advertisers want to provide more value-added services to their global clients and so this trend is expected to continue.

Mobile devices, social media, and big data continue to affect the market research industry, providing market researchers with not only more areas to study but also more methods and tools with which to conduct their studies. Mobile Internet usage had grown dramatically from 2005 through 2016, but that growth has stabilized recently, according to a Pew Research Center survey. In 2021, nearly all Americans (97 percent) owned or used a cellphone; 89 percent used the Internet; 85 percent had a smartphone; 77 percent owned or used a desktop or laptop computer; 69 percent used social media; 34 percent owned or used a tablet; and 24 percent owned or used an e-reader. These numbers are only a slight increase over the previous years, and Pew explains that this slow growth is due to the fact that the adoption of these technologies has reached levels of near saturation. With so many people now using mobile devices, computers, social media, etc., there are few non-users remaining. To validate this point about near-saturation even further, the survey revealed that nine-in-ten or more adults younger than 50 say they go online or own a smartphone." Another ongoing trend in mobile usage is that an increasing number of people own a smartphone but have cut the cord and gotten rid of, or never signed on for, traditional home broadband service; this number grew from 12 percent in 2016 to 15 percent in 2021.

Social media usage has grown over the years as more people use it for everything from personal to professional reasons. According to the Pew Research Center findings, the adoption of social media platforms has remained stable in the past few years, however, as near-saturation levels are also being reached. Approximately 81 percent of Americans use YouTube, 69 percent use Facebook, 40 percent use Instagram, 28 percent use LinkedIn, 25 percent use Snapchat, 23 percent use Twitter, 23 percent use WhatsApp, 21 percent use TikTok, 18 percent use Reddit, and 13 percent use Nextdoor. While a growing number of older adults are using social media, specific platforms, namely Instagram, Snapchat, and TikTok, continue to be especially popular with 18- to 29-year-olds.

Since social media is a relatively recent innovation, with the first social sites introduced to the mass market in the late 1990s, the research findings cover usually the past 17 or so years. For example, the Pew Research Center began tracking social media usage in 2005. It has since researched and reported in detail on how social media usage affects various things, including work, politics, political deliberations, and communication patterns around the world. It has also done market research and published reports on how social media affects the ways in which people get and share information on news consumption, communities, civic life, health, parenting, teenage life, dating, and people’s stress levels. Aspects that the Pew Research Center studied in the social media usage report included: age, gender, socio-economic levels, household income, education, race and ethnicity, geographical location of the users (rural, suburban, urban).

Social media has also provided more tools and techniques than ever before for market researchers to use to quickly and efficiently collect and analyze data. Social platforms such as Facebook, Instagram, LinkedIn, TikTok, Google Search, and Google Trends are enabling market researchers to gather analytics about the behavior of individual users and also learn more about group activities on these sites. The challenge many market research professionals face, however, is learning how to use the social analytics tools and knowing what to do with all of the social media insights that are collected. New technology and social media tools are introduced all the time, and market research professionals may already be overburdened with the number of tools their company uses to gather and study information.

Big data presents opportunities and also challenges for market researchers. As McKinsey & Company described in a report, “The amount of data in our world has been exploding, and analyzing large data sets—so-called big data—will become a key basis of competition, underpinning new waves of productivity growth, innovation, and consumer surplus… Leaders in every sector will have to grapple with the implications of big data… The increasing volume and detail of information captured by enterprises, the rise of multimedia, social media, and the Internet of Things will fuel exponential growth in data for the foreseeable future.” Many companies are using technologies such as Hadoop and NoSQL to handle large datasets and analytics. The two technologies are used together: NoSQL helps with managing transactions data and sensor data, and customer profile data; Hadoop is then used to analyze that data for generating recommendations and predictive analysis.

Market research professional Kirk Henderson stated in a trend report for GreenBook Blog: “Big Data represents an enormous challenge for market research, which is historically based on comparably smaller, point of time datasets. While Big Data is certainly a disruptor that the industry is fully aware of, it also represents a tremendous opportunity for researchers to incorporate real insights from huge datasets with a wealth of information. When this information is shared, incorporating this performance data into research initiatives not only provides deeper context, but a more well-rounded story.”

More companies are integrating artificial intelligence into their market research efforts, to process and analyze data from social media, consumer feedback, and product and company reviews. A.I. is helping companies gain insights into consumer behavior and forecast trends. Companies are also realizing the benefits of using A.I. for developing their products, creating marketing strategies, and determining pricing. As reported in Entrepreneur, the types of A.I.-powered technologies that are being used include sentiment analysis, facial coding, tonality analysis, and voice A.I.

Privacy and security issues are another ongoing challenge for the market research industry. One organization that has been establishing codes of conduct and best practices in the survey research industry is the American Association for Public Opinion Research (AAPOR), which was founded in 1947 when public opinion research was a budding field. The organization provides education for survey professionals and also publishes the journals Public Opinion Quarterly, Journal of Survey Statistics and Methodology, and Survey Practice.

Since AAPOR’s inception, it has encouraged objective survey standards and public disclosure of survey procedures. To further establish best business practices in the field, the AAPOR launched the Transparency Initiative in 2014. The Transparency Initiative aims to promote the disclosure of survey methodology. Organizations that join the initiative pledge to abide by AAPOR’s disclosure standards, train their employees with AAPOR educational modules, and document that educational requirements have been met. The Transparency Initiative contributes to the public’s understanding of the distinction between transparent and non-transparent research, and provides them with the information they need to determine the quality of the survey. The Transparency Initiative has been formally endorsed by the Association of Academic Survey Research Organizations, the American Statistical Association, and the World Association for Public Opinion Research. Organizations must formally apply for membership to the TI. Organizations across the country have joined, including many university-based research centers, organizations such as AARP, media groups such as ABC News, and well-known organizations such as Gallup and the Pew Research Center.