The era of Big Data is upon us, and market research companies and think tanks are now being consulted by all kinds of organizations to help them in ways that were inconceivable a generation earlier. But while most research firms today have a wide array of tools at their disposal, not all of them have the training to properly use them or a sufficient grasp of the fundamentals of research.
Hiring the wrong firm can lead to misinformed decisions, starting a chain of consequences that could be fatal to your organization. The red flags below may not mean much on their own, but taken together could indicate that your research firm isn’t all that it says it is.
Their Data Lacks Depth
While there certainly are limits to what data anyone can get, you should certainly expect a real market research company to be able to provide you with better data than you yourself could gather. Data should definitely be more than just surface-level information. Deep dives are always necessary for providing useful insights as well as competitive advantages in the market.
Their Analysis Is Out-Of-Date
History is important, sure. But so is the news. If they talk as if social media is still a new thing, or otherwise fail to account for current events, this can be an indication that the market researchers assigned to you may have missed other more recent developments. While a couple of outdated references might not always mean anything, you should watch out for patterns that indicate they may not be the firm to turn to for timely research.
Their Work Has A Lot Of Segmentation Errors
Proper market segmentation is necessary for well-targeted, efficient marketing. Bad segmentation, on the other hand, can render an entire data set completely useless, putting any marketing efforts based on it to complete waste. Almost as bad, it can also potentially lead to missed opportunities for growth.
Poor segmentation, especially on a basic level, can be indicative of a failure to feel the pulse of the market.
They Take Reports And Studies At Face Value
Nothing is truly neutral, including this article. Studies and reports will inherently carry some bias, which can sometimes be difficult to see through. Even numbers can be manipulated in order to provide a picture that is a gross misrepresentation of reality.
Unfortunately, even a tiny bit of bias can completely change the context and the required level of understanding of a report. Market research companies and think tanks should, ideally, do their best efforts to detect bias and make the necessary adjustments to their analysis and understanding of a report or data set.
They’re Unable To Clearly Explain Their Methodology
The world is becoming more and more data-based. By and large, this is a good thing, as properly gathered data can make it much simpler to make objective decisions. Unfortunately, sloppy methodology is rife in the market research industry.
Sometimes may even have a situation where the people performing the research no longer understand the rationale behind many of the processes they perform. This can lead to a misapplication of methodology which can quickly pollute a data set and render it useless.
If they’re unable to explain their methods and rationales to your satisfaction, perhaps it’s time to get in touch with another market research firm.
They Haven’t Been Cited By Anyone
If the market research firm you’re considering is making all kinds of bold claims, be sure to do a social media and Google search to look for evidence of those claims as well industry events they may have joined, and news stories where their research was cited. No industry or news recognition can prove to be a huge red flag, as that could mean that the market research agency was not taken seriously for some reason or another.
What Are Your Thoughts And Experiences On Market Research Companies?
What other red flags can you share? Drop us a line on our Contact Page or tweet us @BootstrapsBiz #BootstrapBusiness. We’d love to know your thoughts and experiences on market research companies to seek and avoid.
