Online Research: The Great Equalizer?

The value of the online research market is set to triple in three years, reaching $4 billion by 2008 and introducing a large number of smaller users, according to a new study conducted for solutions provider GMI by Simon Chadwick of Cambiar.

Apart from delivering another rosy report on the future of online research, this study was intended to answer the question, 'is online research the great equalizer it is touted to be?', by looking at the potential market among smaller buyers.

'At first glance the study supports the conclusion that current online usage is firmly established among larger corporations', says Chadwick, 'but this is only half of the picture. The report strongly suggests that future growth is set to come from the smaller companies entering the online space, with 51% of non-users surveyed saying they definitely or probably will start using this medium in the next three years. This is where the real opportunity lies for the industry'.

The study consisted of two parts, conducted simultaneously, surveying forty-three senior level known users and buyers of market research from large global corporations (primarily $100m+ turnover) and more than 400 managers of smaller companies (mainly less than $100m).

Two-thirds of larger research users currently conduct research online and two-thirds of the remainder say they intend to move online over the next three years. By contrast, only 20% of executives representing smaller corporations were conducting research online, but as above, half the remainder intend to start within the next three years.

Chadwick says that 'among the small companies currently online, 28% of research budget is already devoted to this medium, which is the same percentage allocated by the sample of established research buyers... this suggests that once online research has been adopted, it swiftly commands a large portion of research dollars'. Current users forecast a rise to 33% by 2006. Based on the above, the authors suggest that 'by the time the growth in online research levels off (perhaps by 2010) 25-30% of all survey research budgets worldwide will be allotted to online methods'.

Despite industry efforts to address major issues over response rates and quality of sample, these are still the most widely mentioned causes for concern when considering online research. Meanwhile brand tracking, focus groups and market studies are expected to be key growth areas for both large and smaller users of online research.

Rob Monster, CEO of GMI (Global Market Insite) says the findings show the huge opportunity for companies like his own: 'Cambiar's research suggests that once a company, of whatever size or provenance, adopts online research, about 30% of its research budget will be devoted to this medium... The quality of our sample, the ease of use of our software and the level of customer service, will be critical success differentiators and imperative to enabling this growth over the next few years'.

Cambiar also conducted a parallel study among 50 research companies worldwide, representing c.$1.2bn in research revenue, and found commitment to heavy investment in online over the next three years: 55% intend to increase their scripting resources, 77% to invest in panel expansion and 55% to build new panels. 78% 'already conduct online research and have invested heavily in order to compete in this market' and 59% are able to manage entire studies using their own resources. Online reporting is becoming the norm even more rapidly than data collection: the survey suggests that worldwide, 'more than 50% of reporting volume will be over the web in the next three years'.

Cambiar was founded in 2004 by Simon Chadwick and William 'Jay' Wilson, former leaders of NOPWorld and respectively past Chairman of CASRO and current co-Chair of CMOR. The new firm offers change management consulting for the MR and associated industries.

Cambiar is online at www.consultcambiar.com and GMI at www.gmi-mr.com

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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