The insights industry was born approximately 100 years ago, Marketing departments in the media industry formed the first market research groups. They were largely a service function, doing merely what was requested of them.
Traditional market research evolved rapidly throughout the second half of the 21st century. Classic staples of market research emerged; focus groups, surveying, statistical analysis etc… and slowly the insights industry was born.
However, in the last 20 years this industry has experienced a paradigm shift and has transformed into a complex system: one that utilises multiple techniques, technologies and reconsidered its role within the business ecosystem.
So, why are 48% of companies still acting with traditional market research methods?
This article will identify the 3 main factors that have led the transformation of the industry and what FMCGs will need to do to keep pace in the future.
Explosion of Data
Data abounds in the 21st century, but it is not a new concept. We have always used data to inform our action since the inception of market research groups. Figures that outline Sales, distribution, and profitability et al. have been around as long as the industry.
The factor that has changed is the explosion of sources available to us. Just some examples of data sources including Social, weather, retailer loyalty, shopper behaviour and retail link (EPOS) to name a few.
The issues lie herein. Before this explosion it was more straightforward to draw insight from the data due to the vastly smaller sample size.
This has now been flipped on its head and market research is suffering from the tyranny of choice.
As Insights recruitment expert Elizabeth Norman notes
“Fast forward to 2019: time is scarce and requisite skills have diversified so much that companies now need answers, stories and recommendations to make sense of the data deluge they’re subjected to.”
If we can cross-reference all these various data in a fast and efficient way then we can paint the clearest picture of who our customers are and what motivates them.
Naturally this is not easy with such an overload of data and links to the second factor that has transformed our industry – consumer behaviour is evolving rapidly.
Changing Consumer Behaviour
Naturally, consumers have been changing and evolving throughout time. However, the speed at which this change takes place has grown exponentially.
For example, one FMCG specific change is the popularity of Veganuary. This was a relatively niche concept in 2017 with about 60,000 participants signed up to the pledge. By 2020 that figure had increased by 666% and nearly every fast-food chain has released a plant-based version of their best seller.
This expedited change in behaviour means that the insights industry does not have time to put together exhaustive studies. They need to react immediately or, better still, anticipate the changes and beat the trend. Otherwise, the consumer will have moved on to the next trend before you have even contemplated the current one.
Technical and Technological Advancement
The explosion of data has gone hand in hand with technological advancement and the formulation of new techniques.
This table highlights the vast number of skills demanded of the insights executive. This has meant that, in the 21st century, the role of the researcher has shifted. As ESOMAR Director General notes: “The exponentially growing number of avenues through which we can obtain information, such as social media, means we’re increasingly acting as both curators and synthesisers”.
Firstly, this means that we need to apply due prioritisation to which is the most appropriate of the above plethora of techniques to use and/or learn. Secondly, we need to be confident that we are using the most effective technique, in an agile manner, to gain sufficient confidence that the results can inform positive action within the business.
So, with the advent of these three factors, what are the next steps for the FMCG industry?
The Future
The insights industry needs to expedite the move from author to editor. That means to move away from the sole purpose of insight generation to entrenching the department’s role in the organisation as the strategic leader.
This is a journey that roughly half of companies have started, yet few have finished. Only 5% of companies see their insights structure as a “source of competitive advantage as fully fledged strategic leaders”.
Firstly, you need to assess where your organisation fits into this scale of insights maturity. Our eBook Why top FMCGs are seeking Insights on Demand and the 3-Phase Solution to beat them to it contains a toolkit to help you on this journey. Subsequently, the guide and Interrodata can aid you in determining the next steps bespoke to your business.
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