Is the market research industry really interested in next gen innovation and quality?
For those of you who haven’t heard yet, the greatest source for B-B market research sample just closed their doors. That’s right, LinkedIn is no longer offering sample to market research suppliers.
For some this news will probably come as a huge relief. For other Next Gen Market Researchers like myself, with great disappointment. Unfortunately, probably for the majority of market researchers though will be indifferent to the news. For if they were not, LinkedIn sample would still be available.
So what happened? Surely an industry which gives quality and innovation so much attention would flock to something as innovative and high in quality as LinkedIn sample?
Anderson Analytics was lucky enough to be one of the first companies to work with LinkedIn sample in 2008, and as far as I know the only outside company to merge behavioral and text data with survey data. One of the areas we investigated when segmenting LinkedIn users was their membership across various market research panels.
Among the n=2000 LinkedIn members who responded to that first survey, 68% had never been on a research panel, 18% had been on a panel but left, and 14% were currently in some panel. More interesting perhaps was that when comparing current panel members to lapsed panel members, lapsed panel members were significantly more likely to have higher salaries, higher positions at their companies.
Should this be a surprise for anyone? What serious business person has 30 minutes of time to waste on a survey for an Amazon certificate?!
I reached out to a few current and former LinkedIn employees as well as some other MR colleagues who had worked with LinkedIn to understand what had happened. [Bob Lederer is also covering the news in this month's RBR]
The official answer given to me by LinkedIn’s Senior Director of Enterprise Solutions, Dan Shapero is that
…Research continues to be a strategic focus at LinkedIn, though we’ve decided to refocus our research efforts to help LinkedIn grow its largest revenue lines faster. We’re deploying research products that help us build larger relationships with our HR and advertising clients, as well as continuing to offer sample to a handful of strategic clients… We are no longer making our sample generally available…
Dan preferred to talk about the decision as a re-prioritization of assets rather than an economic one.
I can’t blame LinkedIn at all. All businesses are limited in resources and must focus their attention where it will yield the biggest return on investment.
Basically, there is more money in advertising and other areas than in market research. Market research will be provided as part of large advertising sales. But margins on pure market research just aren’t worth the effort.
As much lip service as is given to the desire for innovative techniques and higher quality sample. When push comes to shove, market researchers aren’t willing to give up their 30 minute surveys for more reasonable 5-10 minute better thought out concise instruments, and aren’t willing to pay for greater quality.
This focus on cost cutting, with disregard of almost everything else, may explain why the concept of knowledge process offshoring seems to have grown so fantastically since 2001.
What does this mean for us market researchers who are truly devoted to quality and innovation? Will we have to accept low margins or move towards a different industry?
For now I remain cautiously optimistic about the potential for market research and social networks, and seek to work with other market researchers who are also truly serious about innovation and quality.
@TomHCAnderson
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20 responses so far ↓
1 Trent Collins // Mar 26, 2010 at 1:07 am
Excellent post Tom.
I think you summed it up well when saying that ‘When push comes to shove, market researchers aren’t willing to give up their 30 minute surveys’.
2 uberVU - social comments // Mar 26, 2010 at 3:00 am
Social comments and analytics for this post…
This post was mentioned on Twitter by tcollins: VERY Surprising- LinkedIn Says Bye Bye to Market Researchers- http://bit.ly/bjCCdT #MR #MarketResearch #AMSRS…
3 Joe Hendricks // Mar 26, 2010 at 9:01 am
I am pretty surprised at this. I wonder if LinkedIn “apps” will be able to step in, but don’t know how flexible their API is.. and as you point out, prime B2B panelists have little time so probably would ignore a LinkedIn MR app anyway. Thanks for the informative post!
4 Johanna Skilling // Mar 26, 2010 at 9:17 am
Tom, You just inspired me to write a shorter survey! Thanks for the insight.
5 Jill Wynn // Mar 26, 2010 at 9:20 am
Tom, thanks for staying on top of important issues. I too remain cautiously optimistic about the use of social networks in primary market research.
6 Tom H C Anderson // Mar 26, 2010 at 9:42 am
@Trent
Anderson Analytics typically doesn’t give clients option to go over 15 minutes as we design the surveys. If its not under 15 then either A. You don’t know what you’re doing B. You should have done some upfront qual or C. You need a different design/2 studies.
I don’t like wasting our time analyzing crap data.
But what worries me more than survey length is the lack of desire to pay for innovation. We’ve been investing in R&D in the area of text analytics and predictive analytics for MR. Beginning to wonder if this is wasted effort too. Should perhaps use it to predict stock prices instead. So the real question for me is, should Anderson Analytics be in finance industry rather than MR (as much as I dislike the scoundrels in that industry).
These are one of the thoughts that crossed my mind when I wrote Wednesdays post about market research mentors:
http://www.tomhcanderson.com/2010/03/24/market-research-mentors/
@Joe
Will let you know about LI API, we’ve been talking to them about that since 2008. Very strict about that as well though. Can’t blame them, user experience is important. One of the many reasons I don’t allow surveys over 15 minutes to our GenX2Z panelists.
7 GerryK // Mar 26, 2010 at 12:03 pm
I wonder if Linkedin will get into supplying research themselves.
8 Alberto Stracuzzi // Mar 26, 2010 at 1:10 pm
I knew Research Now had an agreement to use Linkedin accounts in its panel…
9 Tom H C Anderson // Mar 26, 2010 at 1:25 pm
@Alberto, May be wrong here but I understood most/all of these contracts with traditional panel/mr co’s were for 1 year and have expired
10 Peter Hill // Mar 26, 2010 at 3:21 pm
Tom,
I read your very thoughtful post — thanks for taking time to share it with us. I learned of this news several months ago as I was using them for sample on some contracts I was working on that required very rare IT type folks. The sample was excellent, response fantastic and there was absolutely no problem finding and getting response from this very low incidence group in a very short period of time. I was extremely disappointed to hear the news, to say the least.
The contact I was speaking with had the same basic response as the one you posted, however, he did also come right out and say that they are continuing to provide sample for their customers who are purchasing large volumes from them. This makes entire business sense to me, and I know it’s a business in itself to sell/manage sample from a higher number of lower-volume clients, however, as a panel services provider and researcher, I think this was a huge loss.
I work for Delvinia. We pride ourselves on the quality of our sample (check out http://www.askingcanadians.com — http://www.quenpensez-vous.com ), online surveys and our online research and panel practices — we have an average response rate of more than 50%, eclipsing anything in the Canadian market by 20% or more. Our panel’s attrition rate has been 2% or less since its launch. The reason I mention this is because you ask if researchers still care about quality…my experience is that many don’t, but our business depends upon those who do. I find that while perhaps the minority (many go for cheapie sample and accept response rates of 15% or less which I don’t understand), there are still lots of other researchers (our main clients) and their clients who do.
As a panel services provider, I strongly believe the drive for lower CPC is only doing our industry harm. I’ve been a receiver of some of this cheapie sample…and I can tell you how many time [sic] I did business with those companies. The drive for lower CPC is causing some to push beyond the limits of what’s acceptable, cut corners, etc…and, while they can deliver their studies within budget and still make some money…personally, I think they’re fooling themselves. I’d be worried about the reliability of the data and the advice they’re providing.
I guess we’re lucky as due to the fact that as we’re not in the business of providing cheap sample, our clients are those who appreciate and value good response rates, proper coverage, etc., and are willing to pay a fair price for the work we do to ensure they get it. I think we need to do a better job of educating ourselves and clients with respect to why good sample costs more, why having good sample, response rates, etc. is valuable and why we should insist on it. Anyway, enough ranting about crappy sample…
…getting back to the original reason for your post…yes, it’s very sad that LinkedIn is no longer providing sample for the majority of us. It is great sample and I would use it again in a nano-second. I hope one day they can find a profitable business in this at the “lower volume” end and reconsider this decision.
Have a great day.
Peter
11 Lisa Horwich // Mar 26, 2010 at 3:45 pm
Tom-
I also wonder if their ’strategic clients’ are utilizing the panel more and don’t want their sample being overused.
It is a shame they aren’t offering it anymore as the quality was excellent.
12 Ian Davidson // Mar 26, 2010 at 3:45 pm
Interesting move. I guess, as you say, they did not make enough money. I think there’s money to be made in B2B sample (eRewards does well and has similar low recruitment costs).
Ultimately, I presume that the money went to more flexible providers who did not mind launching longer surveys whenever to whoever for less money.
As a side note, it would be nice if the industry could really try to get survey lengths down…everyone starts glazing over after 10 mins of questions, whether you’re writing the questions, completing the questions or analysing them…but their seems to be some major suspension of disbelief going on..
13 Gayle Fluster // Mar 26, 2010 at 3:55 pm
Nice article Tom. I wonder if LinkedIn wants to become their own head hunting service/contract to HR firms - and use their database that way.
I would suspect that many people on LinkedIn don’t want to receive requests for focus groups or surveys - but I could be wrong. I wonder if they had too many opt out requests from members. One thing I do love about LinkedIn - it seems really like a grown up business networking tool - and I don’t seem to get a lot of “pitch” or sales like emails. I would imagine - they have some of the cleanest sample out there to offer. Most lists I have seen are really not very good - especially those with email addresses.
14 Caryn Goldsmith // Mar 26, 2010 at 4:01 pm
@Tom, totally with you on innovation. Sad to hear your comments about whether your investment has been worth it or not. Investing time/money is the only way to innovate.
Personally, I think LinkedIn may not have given it enough time. Most of my clients have been willing to start doing online qualitative research in just the past couple of years - even though I’ve been doing online research in one form or another for about 10 years. It takes time for more traditional companies, especially those in B2B with heavy reliance on sales forces, to make the leap. Just yesterday I had a call with a client about using LinkedIn for a recruit and they were open to it. I’m disheartened, to say the least, that this quality option won’t be open to me.
15 Bob Lederer // Mar 28, 2010 at 4:39 pm
Anyone who would like to better understand LinkedIn’s thinking about its near-departure from sample dissemination can read about it in Research Business Report. I believe we broke the story on March 20. We’ll send a complimentary copy to anyone who responds directly to me.
16 Tom H C Anderson // Mar 28, 2010 at 7:03 pm
Sure, Bob. How should they contact you?
17 Tom H C Anderson // Mar 29, 2010 at 8:53 am
You can reach Bob at rlederer@rflonline.com
18 Mike Harris // Mar 29, 2010 at 1:44 pm
Tom, your company and comments are spot on. For those who want to experiment with a guerilla style approach to market research here’s a good resource. http://www.harconllc.com/guerrilla_market_concept_testing/
19 LinkedIn Customer Service Net Promoter Survey // Apr 6, 2010 at 5:43 pm
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