While you read this, the fourth industrial revolution is in the midst. Big Data, Artificial Intelligence (AI), Internet of Things (IoT) and Virtual Reality (VR) will, for some industries and companies, turn out as Promethea of prosperity, while for the others – the four horsemen of the apocalypse. This disruptive innovation, not only transform the way business is done, but also the way our gray mass is networked. A three-year-old that has exclusively used a tablet will in its first encounter with a picture book try to swipe photos with its index finger. Alas, with no success. In that second of child’s finger swipe, the mankind will generate 30 PB of data (PB – petabyte, 1015 bytes or 1,000 TB or 1,000,000 GB).
Picture: Present-day children grow up with gadgets such as tablets, smartphones and smart TVs. Science shows that these are to blame for contraction in the attention span (see Newman 2010). The science is yet to answer and explain what other behavioural and cognitive changes have occurred on post-Internet generations.
According to McKinsey Global Institute, in 2015, international data exchange has generated more value than the international exchange of goods and services. Hence, data appears to be the new oil! Out of 8 devices currently connected to the Internet, only one is directly used by men, while other 7 are part of IoT. It has been forecasted that in the next five years, the number of IoT devices will increase 3.4 times faster than the number of Internet users. Expressed in numbers, by 2020, the number of IoT devices will skyrocket from 22 to 50 billion, while the number of Internet users will see a more moderate increase from 3.3 to 4.6 billion. In the same time, more than half of the mankind will have access to the Internet. The scope of generated data will be ahead of resource and capabilities to turn this data into extract actionable knowledge that can be used for business decision making, medical, scientific, educational and other purposes. The main reason will be the lack of data scientist. Said with the oil language – in the future, there will be more crude oil that the refineries able to create derivates with the higher market and use value.
Picture: Interior of Big Data centre. Large corporations such as Facebook have hangars size of football stadiums that serve as a depository of data generated by users. Each post, comment, photo, video etc. published on FB or Twitter is physically stored in one of the places like this.
Today, large retail chains, such as British Boots or American Target, use loyalty schemes to record purchase behaviour of their customers. Based on these purchases, one can not only predict if the (female) customer is pregnant but also which month of the pregnancy they are in. Based on predictive algorithms, retailers can perform better targeting and send coupons to the pregnant women for previously unused products that will soon become in demand. Because of this, some parents will have serious conversations with their, not guilty of anything, 16-years-old daughters (no one said that machine learning is infallible). Netflix will use similar techniques to predict your mood and based on that to suggest a movie or a sitcom. The machine algorithm developed by scholars of the Rochester University in the USA will assess whether you tweeted drunk and will you, alas, regret doing so. There are many other interesting examples out there.
Technological progress, the accessibility of vast amount of data, as well as, affordable or even free tools for data collection and analysis together with data visualisation are shaking the foundations of the market research industry. Due to the appearance of the above-mentioned technologies, survival of many traditional research agencies is brought to question. The most recent figures of ESOMAR show that global industry of market research has stagnated as it has achieved insignificant growth of 0.1%. A rollercoaster of our industry has reached its peak, and it appears that it is more likely that this vehicle will start plummeting downwards rather than keep maintaining the same old trajectory. The new environment offers two options: to adjust or to perish. Companies involved in market research and customer insight have a couple of good alternatives that will enable not only the salvation from technological tsunami but also surfing on the waves of new growth. The survival through transformation can be found in specialisation for:
- data brokerage;
- Data Science;
- Neuromarketing; and
- eclectic research.
The companies specialised for data brokerage will, similar to good librarians, be knowing where can be various already existing data be found either on the Internet or in the databases of third parties. They will have to act as brokers matching supply and demand and charging a fee for doing so.
Companies specialised for data science will respond to one of the largest gaps on the market. Their key task will be to get additional insight (the insight that cannot be obtained using traditional analytic techniques) from the already available data, to create actionable knowledge and forecasts. These companies will demolish previously known differentiation of companies on qualitative and quantitative research agencies as these will be able to manipulate and crunch both qualitative and quantitative data. An important aspect of work of such companies will be data visualisation and showing findings in a way that can be easily understood by amateur and non-technical audiences.
Picture: For an effective representation of the problem of CO2 emission and to impose a state of urgency among citizens of New York, Carbon Visuals has presented daily emission of the CO2 in an easily comprehensible way – in a form of a mountain made of spheres that contain 1 metric ton of this gas. On a daily base, New York emits 148,903 tonnes of CO2. Without visualisation, an average person could struggle to understand how large that amount is.
The next company type to survive the technological tsunami, without major adjustments, are neuromarketing consultancies. These companies, based on a small sample, are able to determine what respondents truly think of certain issue (even without verbalising it) or how they organically or instinctively react to various marketing stimuli and what on a package, print ad or commercial grabs the attention first. The equipment used for these studies has recently seen a significant decrease in price, and thus neuromarketing services will most likely be more accessible to a wider number of clients. These companies will survive and grow because the insight they offer cannot be obtained in any other way or form but through an interaction of respondents with the neuromarketing equipment.
Picture: Respondent with mounted eye-tracker and Emotiv EPOC electroencephalographer. The devices are tracking attention foci and emotion generated by stimuli.
Finally, one group of agencies will become specialised for integration of new technologies (BigData, IoT, VR, Cloud etc.) with traditional research techniques (such as online surveys or experiments) and will introduce an eclectic approach to work. These agencies will create partnerships with third parties so to be able to innovate their research process. For example, in cooperation with smart refrigerator manufacturers, such innovative agency could generate new solutions for market segmentation – in real time. Namely, smart refrigerators as a part of IoT universe, inform their users about the stock and the freshness of the food contained and can autonomously place orders to replenish food and beverage stocks that are running low or that have expired. Furthermore, such refrigerators can suggest cooking recipes based on the ingredients available in the kitchen. All this consumption information from all users owning a smart refrigerator are recorded and sent to a BigData cloud. Using aggregation, it is possible to generate an interactive map of a city that portrays a precise socio-demographic and lifestyle profiling of each neighbourhood, street and house. Based on these techniques it will be possible to determine if particular neighbourhood is populated by poor students, rich professionals, pensioners or a particular ethnic groups.
Picture: In ten years we can easily imagine that, with the price decrease, smart refrigerators such as Samsung French Door will become an integral part of many households. With critical user mass, market segmentation using data collected this way will become one of the very reliable and affordable ways to obtain a precise idea of market structure.
Though indicators show that the global market research industry stagnates, it appears that we have approached an important milestone marked by the technologies mentioned in the introduction of this article. In the Chinese language, the word crisis (wēijī) is coined from words jeopardy and chance. We from Genuine Market Research see a chance in these events and have already started offering services that are based on Big Data and survey data integration, as well as on machine learning. We believe that market research profession will survive because new market complexities will more or less often carry on happening and introducing new phenomena and variables that decision makers have to consider. The new phenomena need to be identified first and then explored so that a decision maker can create informed decisions. Knowing this, consultancies that level up their game will be the ones to survive in years to come. the one to be definitely looking forward to the future are clients that will get more reliable, more precise and less costly information than ever before.