David's IT Tips

by Amy Caira, Data Analyst, Polaris Marketing Research

After a company determines they want to conduct marketing research, one of the many other decisions they need to consider is whether to work with a professional marketing research firm or whether to conduct the research themselves.

More and more companies are deciding to outsource marketing research. A study by Forrester Research concluded that of 650 marketing executives, 53 percent strove to outsource more than half of their marketing actions in 2004, including marketing research (McGovern & Quelch, Outsourcing Marketing, Harvard Business Review, 2005.) Best Buy now out-sources database management and marketing analysis for their business and high-end customers, which comprise two out of their six segments. Why are so many companies deciding to outsource instead of doing it themselves?

Leave it to the Experts

One reason to outsource marketing research is just to leave it to the professionals. As marketing is evolving from a discipline that was once primarily creative to one that is becoming more and more analytic and strategic, many companies are realizing they do not have the left brain knowledge in-house that many marketing research companies do. Marketing research companies also have access to and leverage with many facilities, such as focus group rooms with two-way mirrors and large call centers, that companies (with more limited marketing research activity) do not.  

Avoid Conflicts of Interest

Another very important reason to hire an outside marketing research company is to avoid the conflicts of interest and ethical challenges that can arise and adversely affect your results when you conduct your own research. If employees are not answering questions honestly because they’re not convinced on the anonymity of their responses, conducting employee satisfaction research in-house can produce inaccurate results. Customer satisfaction research where incentives of fellow coworkers are tied to the results can also result in data quality being compromised.

Ferrell, Hartline, & McDaniel conducted a study in which they surveyed 431 research practitioners that were also members of the American Marketing Association. Respondents were asked 19 questions regarding the frequency of unethical practices. They found that marketing research firms emphasize and implement ethics to a greater extent than corporate research departments.

When you consider each sector’s motivation, this should come as no surprise. Corporate research departments both supply and use marketing research, but they are evaluated by their management more on the success of their recommendations than their adherence to any ethical guidelines. This causes their role as a supplier to take precedence over their role as a user.

Marketing research firms, on the other hand, are evaluated on both the success of their recommendations and their compliance with ethical practices. Often, compliance with certain codes and membership to certain organizations such as AMA, the Marketing Research Association and the Council of American Survey Research Organizations that signify compliance with these codes are used to signal quality service to potential and current customers. Internal marketing research departments don’t have the need to prove their integrity because their customer, the company they work for, is already set (Ferrell, Hartline, & McDaniel, Codes of Ethics Among Corporate Research…, Journal of Business Ethics, 1998.) Using a marketing research company instead of an in-house marketing department avoids these possible complications.

Know your Limits

The abundance online tools and sample sources that are available today are very tempting to the would-be researcher. These tools, when used properly and professionally, can be a great resource for the corporate marketer. However, it is important to know your strengths and weaknesses to avoid getting in over your head or producing erroneous information. If you are going to take on marketing research yourself, be careful. It may end up like do-it-yourself home improvement projects with you having to call in the experts after you have already wasted time and money trying to do it yourself.

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Amy Caira is a data analyst in the analytics department of Polaris Marketing Research Inc., where she is responsible for handling a myriad of data manipulation tasks involved in survey research. She holds a bachelor’s degree in psychology from the University of Florida.