According to Inside Research, Internet-based questionnaires will be responsible for close to one-third of U.S. spending in market-research surveys. Not only does it produce results quicker, but at a much lower cost. The other major upside is that it is the consumers themselves that are inputing the data, getting results quicker and with less labor involved.
The growth in online marketing research has been phenomenal. In 1996 spending was $3.8 million, compare with this year which will yield $1.35 billion.
Jonathan Jephcott, exec VP of Synovate ViewsNet, the online research and panel division of global research firm Synovate said, "The migration from mail and face-to-face to phone research as a mainstream data-capture platform took more than 10 years. The move to online from phone is taking half that, it is inevitable that online panels will be a basis for the majority of ad-hoc quantitative research around the developed world within the next two to three years."
History shows that marketers are able to lower costs by 15%-20% through changing from mail to online surveys and almost 30% by going from phone to online surveys. The benefits are obvious: your marketing department can essentially add 15%-30% by its department bottom line by simply using the Internet to do its surveys.
This has created tremendous pressure upon the market-research industry because it has forced a price war to emerge. The result is that with the drop in prices has come lower margins and less profits.
At the time of this writing, online research is accounting for around 17% of the overall U.S. market-research spending; most of it via surveys.
Qualitative research (focus groups or in-depth interviews) hasn't taken off on the web yet as it accounts for only 1% of online research spending.
U.S. online spending by type of research - Based on revenue reports from 25 research firms:
Concept/Product Testing - 30%
Sales Tracking - 20%
Attitude and Usage Studies - 11%
Advertising/Brand Tracking - 10%
Customer Satisfaction Measurement - 8%
Copy Testing - 6%
Site Evaluation/User Profiles - 5%
Opinion Polling - 3%
Qualitative Research/Focus Groups - 1%
Other - 6%
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