By Eric Miscoll, EMSNOW Publisher
When I began in the electronics manufacturing industry in 1998 with Technology Forecasters Inc (TFI), we were one of many market research firms covering the EMS industry. This was of course early in the history of the EMS industry, when Wallstreet was still enamored with it and analysts covered the movers and shakers with great interest.
The number of research firms covering the industry has since plummeted to only a few brave souls left standing today. Of course, there are still research firms selling reports generated by bot web crawlers that suck data off public websites, and then dump it into a pre-formatted template. These don’t count in my opinion because the electronics outsourcing/EMS industry has considerable nuance that takes a human with understanding to sort through and make sense of the numbers.
The purpose of market research is to provide insight to help guide strategic planning. This means the researcher starts with data gathering from reliable and rational sources; and then provides analysis of the data, generates insights based on a thorough understanding of the challenges and opportunities of the industry, and finally makes informed recommendations.
Most researchers stop at data gathering, which leads to some pretty inane and unhelpful end products. Some reports do little more than offer analysis such as the one David Letterman once cited, “USA Today has come out with a new survey – apparently, three out of every four people make up 75% of the population.”
The challenge for market research firms has always been monetizing their efforts. This is especially true today when so much data is available online. Put simply: It’s hard to get people to pay for quality reports when the perception is an unlimited amount of data about anything is available for free.
In response to this challenge, firms have adopted novel ideas to fund their research such as sponsorships or consulting. The underlying challenge is that reading reports and developing thoughtful and reasoned strategic plans requires thinking. As a past boss of mine once said: “I like to know, I don’t like to learn!” This is the root of the issue with market research. People want to know and be informed about the industry, but the commitment to supporting quality research and then doing the requisite thinking is often not there. Who has time?
But doesn’t this fact of business life make the argument that there is considerable value in quality market research? Having an informed person or group study an issue/industry and offer insights based on knowledge and experience is still valid and important, is it not?
The other option is for companies to spend their own time and resources on researching the issue or industry. They will then learn that it is a time-consuming process fraught with challenges; like getting companies to even share data, which they won’t if it’s a competitor asking the questions rather than an objective third party. I always found this to be one of the key values we provided. In the end I figured companies would find it less expensive and far more convenient to just buy the research from a firm.
Getting companies to value the outcome and pay for it, however, will remain a challenge. So to all my past competitors in the market research arena who have left the playing field, RIP. For those of you still standing…I applaud you and wish you bon chance.