Transforming market research

The internal market research department is under attack. Times are tough and market research, like every other function, is being called upon to demonstrate its value. Some companies have already outsourced the entire function and more are considering a similar move, so market researchers must justify their existence.

Market research departments will be a thing of the past within a decade unless they embrace a fundamentally different vision of their roles. First, they must deliver more than just data. Senior managers will no longer sit through a presentation of 200 slides; now, market researchers must make clear recommendations that address a specific business question. They must deliver insights that are rooted in good quality data and forged by personal experience and expertise. Second, they must act as internal consultants, taking responsibility for their opinions and recommendations. Market researchers who merely pass along a question from the Board or a senior manager to an outside consultant will never be seen as adding value.

Delivering the vision
In order to realise this vision, there are six preconditions that market researchers must meet. First, they need the right skills and the right personality. Required skills include: a solid background in statistics and experience in research design and analysis; an understanding of the strengths and weaknesses of secondary data sources and experience in strategic forecasting. Soft skills are just as important and market researchers of the future must be analytical, objective and accurate, great communicators with inspiring, convincing personalities. Importantly, they must understand emotional drivers and be passionate about everything they do.

The second precondition focuses on time. By outsourcing all activities that do not add value, market researchers will have more time to spend on value-adding activities, such as formulating insight-based recommendations. At Bayer Healthcare Pharmaceuticals, for example, the market research department produces around 1,500 Powerpoint slides during the quarterly reporting process. This is a time-consuming process but because most of the slides are converted from existing spreadsheets, it is possible to outsource their preparation to a company in India.

Third, researchers must maintain a business focus if they are to become internal consultants, keeping their attention focused on the products and/or therapeutic areas for which they are responsible.

The fourth requirement is to embrace diversity, which sparks new insights, stimulates new ways of thinking and increases innovation. Diversity in all forms, in cultural and educational background, in experience and skills, as well as in personality types, enriches the thinking process and is particularly important when considering new markets.

Fifth, maintain the independence of the market research function. While the budget for the research itself must remain with the internal customer – otherwise he will order every study he can think of – market research must be impartial if it is to consult from a neutral point of view. Marketers may not always like what researchers tell them, but CEOs and the Board are always interested in their evidence-based insights.

The final precondition is to give researchers a clearly defined career path. Traditionally, market research has not been seen as a 'sexy' area for motivated, talented people to choose as a career, with many taking up marketing or business development instead. However, attracting and retaining top people is clearly a crucial component in creating a flourishing market research function.

Even with a clear roadmap, transformation and change are never easy. Resistance is inevitable. Plus, each company is different, with a unique structure, goals and ways of working, so approaches must be carefully shaped to match the specific needs of each organisation. However, help is at hand.

The best way to develop innovative and effective solutions is through close collaboration. In addition to bolstering the overall future health of pharmaceutical market research through its Code of Conduct, which pushes for higher and consistent standards across the industry, its extensive training programme and its lobbying activities, the European Pharmaceutical Market Research Association (EphMRA) also provides vital public forums for discussion and debate.

Discussing issues, debating mutual problems and sharing insights are crucial to transform market researchers from data crunchers to value-adding internal consultants. The Association's most recent meeting discussed this issue and others, providing a great deal of insight for attendees. The questions asked included: 'How do I maintain the independence of my department in times of cost cutting?' The answer: fight for it! Expect your independence to be challenged and prepare for it; gather your data and arguments as you go, including examples of the path not travelled, where your advice saved money. Another question: 'How do I gain the buy-in of senior management?' Sell the value of what you do but owning your decisions. Never start a sentence with 'It depends'; always start with 'I think' or 'I believe'. Have the courage to speak up when the wrong conclusions are being drawn from the data and senior managers will see the value of market research.

Purpose of study
Another query was: 'How do we maintain a business focus?' The role of the market researcher is to ask questions of the person commissioning the research, to ask: 'What business decision has led to this study?' If the answer is vague then the researcher should advise that the study be revised. There must be a concrete business rationale for all studies.

In answer to the questions 'How do we ensure that we attract the right people with the right skills and retain them?' and 'How do we make market research an attractive option?' the answer is that, through demonstrating skills and value, the more visibility there is with the brand team. The better market research is regarded within the business, the more people will want to build a career in it.

The role of agencies
External market research consultancies also have a vital role to play in the transformation of market research. However, in turbulent times, the temptation to bypass market research in order to reach the marketing department or senior management directly is powerful. Agencies must resist this urge as this approach is always unconstructive.

The internal market researcher can be an agency's best friend. In smaller companies that lack a significant market research function, a closer link with marketing might be preferable, but never in larger organisations. Effective internal researchers understand the needs of the research, can help to choose the best methodologies, plus they have access to secondary data and they know the politics and personalities within their organisations.

As market research transforms, agencies too must take a serious look at their offering and be prepared to adapt. Project leads must be fully skilled market researchers, who understand all aspects of a project rather than just being salespeople. Agencies must offer in-depth statistical knowledge across the full range of market research methodologies, resisting the urge to shoehorn a customer's problem into their own methodology portfolio. Finally, agencies must understand the client and be empathic; they must ask more questions about a project and should feel able to challenge a client if they believe they have a better approach to answer the business question.

The Author
Dr Thomas Hein has more than 20 years of experience in market research, specialising in primary and secondary market research, as well as forecasting. Since 2007 he has been the vice president of global market research at Bayer Healthcare Pharmaceuticals. Prior to that, he was the vice president of global market research at Schering AG, having previously worked at Schering subsidiaries in Germany and the US. He studied Psychology at the Natural Sciences faculty of the University of Düsseldorf. He joined the pharmaceutical industry in 1995. He is a full member of the European Pharmaceutical Market Research Association (EphMRA).