Insights Industry News

June 12, 2012

A Technologist’s Research Manifesto: Introduction

The practice of market research is itself an information industry, initially existing as a result of industrialization.

Jason Anderson

by Jason Anderson

Owner at Datagame

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By Jason Anderson

Prologue: This introduction to “the Manifesto” is also a preview to my presentation topic at Market Research in the Mobile World, July 18-19 in Cincinnati. You can register here with discount code SPK20 to get 20% off.

Introduction

The Internet. The Information Age. The Digital Age. The Information Economy. We continue to invent language for describing the scale of change that our society is living through. Much like witnesses to the Industrial Revolution, every aspect of our daily lives has been touched — some more than others.

The practice of market research is itself an information industry. It was only after the impact of industrialization began to temper that companies began searching for new forms of competitive advantage; before that point, human labor and industrialists with access to capital could generally ‘win’ by investing more resources than the other guy. “Research” was the creation of proprietary networks of information, closely guarded and controlled by family empires.

Today, the Internet has turned everything on its ear. It continues to do so. The list of industries forever changed is lengthy; by and large, these changes have benefited citizens at the expense of power brokers. For example:

  • Mass media (music, movies, radio, TV). All forced into radical redesigns of business models that they would never have signed up for if not for those wily consumers and their peer-to-peer networks.
  • Real estate. Whither the standard 6% commission, an entrenched business practice that has been destroyed by online searchable property databases (RedfinZillowTruliaZipRealty).
  • Telecommunications. AT&T and others continue to work mightily to protect profit margins and maintain control of networks and protocols, but the days of metered voice and text communication are gone.
  • Postal services. More digital services = less physical mail. This is not a problem unique to the US; from England to South Africa, governments are privatizing and/or modifying services to stay afloat.
  • Banking. Ten years ago, online banking was a “premium” (pay extra) service for most consumers. Today, banks encourage online banking.
  • Insurance. Purchasing life, auto, property, disability, and medical insurance is no longer dominated by thousands of independent insurance agents. Pricing no longer favors a seller’s information advantage.

As an information industry, market research experiences larger effects from changes in information technology. With landline telephones came the phone interview. With Web 1.0 came online surveys. With Web 2.0 came social media and explosive growth in panel size and survey volumes. For the most part, we have responded reactively to each wave of technology. We did not create telephone networks, but we harnessed them. We did not create web browsers or Facebook or Twitter, but we leverage them when it becomes impossible to ignore their impact.

But the Internet has drastically reduced the cost of doing research, forcing practitioners to “move up the value chain”. Talk about insights, not data. Become strategic advisors. Maintain revenue and profits in an environment where the marginal cost of collecting data continues to approach zero. The Internet is a dangerous place for reactive businesses; some of the most glorious business failures of the new millennium have happened to previously high-flying, successful companies:

  • Borders. Defeated by Amazon.
  • Blockbuster. Defeated by Netflix.
  • Nortel. Failed to transition from traditional telecom to IP-based telecom technology.
  • Silicon Graphics. Obsessively committed to proprietary hardware, while the Internet committed to open standards.
  • Tower Records. Defeated by Apple and Napster.
  • Napster. Defeated by…well, Napster, and the RIAA. But Napster changed consumer behavior with music and video forever.
  • Kodak. Held tight to film-based photography until it was too late.

We are at a Galileo moment. Some believe that research is the Earth and the Internet is the orbiting Sun; I believe the opposite. Research orbits the Internet, because that is what the Internet was designed to do: to serve as the center of gravity for the exchange of information and knowledge. These are completely different views of how the world works, and they are incompatible with each other.

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