Industry Market Trends

DIY Market Research for Manufacturers

Mar 15, 2011

Increasingly more manufacturers are bypassing full-service market research agencies and performing their own in-house research, as GovPro.com's Mike Keating writes in this Expert's Corner.

A growing number of manufacturers are looking to tackle market research projects on a do-it-yourself basis. The practice is so popular that the Chicago, Ill.-based American Marketing Association recently staged a program that asked the question, "Is do-it-yourself the future of market research?"

Indianapolis, Ind.-based Delta Faucet performs its market research in-house for two reasons: to stay close to the customer and to remain nimble.

With DIY research, "we have more control over exactly what's going on," Paul Ponsford, Delta's market research analyst, says in the report The Pros and Cons of DIY Research, from 20/20 Research. "If we want to change the direction of the discussion based on the feedback we're getting, we can do that easily." 20/20 Research is a Nashville, Tenn.-based provider of qualitative research fieldwork services and software.

Doing its own research gives Delta a better understanding of the findings, as it is involved in all aspects of the research project. "If we're the ones running through all of the data, that will help us become better experts in our business," Ponsford says.

Corning Cable Systems, a Hickory, N.C.-based manufacturer of end-to-end fiber optic and copper products for telecommunications, also does its market research in-house. "Connecting with our customers for guidance and affirmation of our product and service innovations has become critically important to our business success," Martyn Easton, Corning Cable's commercial analytics manager, says.

Easton's team relies on DIY research tools from Seattle, Wash.-based SurveyAnalytics, whose Enterprise Research Platform provides flexibility for conducting online surveys and analyzing data. Easton says the platform "allows us to reach out to our customers and get their feedback in a manner that is easy and appealing to them."

Size also matters, says Cynthia Lesky, president of Evanston, Ill.-based Threshold Information, which offers custom knowledge services to answer business, science and tech questions. Manufacturers like Boeing, Caterpillar and Hewlett-Packard rely on professional market research services, but, Lesky notes, "ratchet down to smaller companies in the same industries, and the mind-set changes — it becomes DIY or nothing."

Manufacturers should proceed with caution, however.

"Yes, some manufacturing execs do rely on DIY research in an effort to save money; and this method of acquiring critical information can produce disastrous results," according to Cathy Williams-Owen, president and CFO of Port Washington, N.Y.-based Dri Mark Products, Inc., a manufacturer of writing instruments, security marking systems and inks. "It is somewhat like working in a vortex. The information obtained may not produce the valuable insight that, say, a well-formulated focus group can provide. The conclusions that are reached can skew results with the potential for a disastrous outcome."

Manfred Bluemel, Ph.D., at Seattle-based Zeitgeist Research, is a proponent of DIY research tools like Survey Monkey, Survey Analytics and Zoomerang, with a caveat: "They work as long as you have a skilled market researcher who knows what to do with those tools."

"To use DIY market research most effectively, you need to talk to a marketing expert or consultant that understands research or product management and can help you design a good survey — then use the online survey tools that are available to help," Ivana Taylor, publisher of the online resource DIY Marketers, says.

New tools and technology are speeding up the acceptance of DIY research. More customized survey apps are being developed for both Apple's iPad and Google's Android-based tablets that will enable small manufacturers to do their own market research. (For examples, see SurveyAnalytics.com, iSurveySoft.com and SurveyGizmo.com.)

If a manufacturer needs qualitative research without reams of data, GutCheck is a possible solution, as it connects companies with their target customers through interactive survey tools. GutCheck lets do-it-yourself researchers build a questionnaire that goes to screened consumers in a target market. The pool of prospective survey respondents is 3.5 million U.S. consumers, aged 18 and older. The service, which offers real-time feedback, is a quicker alternative to traditional focus groups.

The U.S. Census Bureau is also making life easier for DIY researchers. According to Andy Hait, an analyst at the U.S. Census Bureau's Economics Division, paper documents, CD-ROMs and PDFs have been put out to pasture.

"We put everything now on American Factfinder," Hait says. "It's a powerful way to get in, filter and select the information you're interested in.

"Over the last two economic censuses, we've made a significant change to online database access," Hait continues. "For the 2007 Economic Census, all of the data was available in American Factfinder."

Companies can take advantage of the Census Bureau's County Business Patterns and Economic Census to compare their payroll per employee and other benchmarks with competitors in their industry or firms in the same geographic area. "Businesses use the Census data to construct their own surveys that they then use to benchmark back to County Business Patterns and Economic Census figures," Hait says.

Manufacturers may want to consider the Census Bureau's comparison tool, which "enables companies to type in their own payroll and employment data, and the app goes out and takes those numbers that they type in and compares them to averages for other firms in the same industry," Hait says.

The comparison tool is on the Census Bureau's Industry Snapshots site. Once you've drilled down to the industry you want, click "Compare Your Business" at the bottom of the "Industry Ratios" table.

For business leaders thinking of embracing do-it-yourself market research, check out Polaris.com's Marketing Research Education Center, which offers the paper 20 Pitfalls to Avoid When Conducting Marketing Research and other tipsheets. Also visit SurveyAnalytics.com for a variety of research resources and guides, including How to Effectively Conduct an Online Survey.

Michael Keating is senior editor for Government Product News and a contributing editor for American City and County, both published by Penton Media Inc. His complete 2011 government budget forecast is available at GovPro.com. Keating has written articles on the government market for more than 100 publications, including USA Today, Sanitary Maintenance, IndustryWeek and the Costco Connection. Mike can be reached through his website, MikeKeat.net.