Market Research: DIY or Hire an Expert?

 It’s a fair question that doesn’t have an easy answer ….

– Some say that engaging a consultant is simply too expensive, an exercise in paying someone else to do what we can and should be doing ourselves.

– Others argue that consultants more than pay for themselves by bring to bear a world of experience, a breadth of expertise, and an analytical objectivity that stretches beyond the capabilities of any company.

Having sat on both sides of the desk – as a buyer and as a provider of marketing research consulting services – my perspective may add some real-world wisdom to your “DIY or outsource” discussions.

Managers sometimes shy away from engaging a consultant because of the expense (or the worry that calling in an outsider may hint at some hidden inadequacy).  In many cases, however, hiring an expert is the smart business decision. 

Here are six situations in which the value that a consultant creates can justify the expense, many times over:

1. When your capacity is limited.

2. When a consultant brings specialized industry knowledge or contacts that you can’t easily duplicate

3. When anonymity is important – when your identity as the study sponsor would reveal too much about your plans, or where your name could influence the answers you hear

4. When you really need a dispassionate objective assessment, free from internal biases, preconceptions and office politics.

5. When a consultant can provide specialized techniques or methodologies that you don’t have – conjoint analysis or focus groups, for example

6. When a consultant can perform tasks more cheaply and efficiently, as is often the case with telephone surveys and data crunching, in-store interviews and mall intercepts, etc

In addition – unfortunate but too often true – an external consultant often brings an aura of credibility, authority and influence with upper management that an internal employee may not carry.

On the other hand, the out-of-pocket costs for consultant fees and expenses is a legitimate reason to consider doing market research projects with in-house resources.  More important, by outsourcing information gathering and analysis, you could pass up a chance to know your marketplace more intimately:

– The party that conducts the marketing research interviews naturally ‘owns’ the resulting relationship with the key players in the value chain.  These relationships may soon become the foundation for expanding your customer base, entering new markets, or introducing product innovations. 

– It is much easier to understand the context of your interviewees’ comments, and to internalize and ‘own’ the insights, conclusions and recommendations when you actually execute the study.

In an ideal world, then, the ideal answer is often “DIY.”  Few of us, however, live in an ideal world, and hiring a competent marketing research consultant is often the most practical, economical and timely alternative.

Coming soon:  “Successful Consulting Engagements:  How to Select a Consultant, Plan a Consulting Engagement, and Manage the Consulting Relationship”

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One Response to “Market Research: DIY or Hire an Expert?”

  1. Mike Morgan says:

    Before developing your own survey and collecting your own data, consider these three statements from my white paper, Market Segmentation:

    1. The successful marketer depends on uncovering hidden values in the market – new product opportunities, unmet consumer needs, and sources of demand from the very “edges” of every existing and potential target market.
    2. In order to identify market opportunities comprehensively and innovate towards them effectively, the marketer must not only uncover these hidden opportunities, but have a sense of their sheer range and complexity.
    3. It is towards understanding this range and complexity of hidden values that marketing research offers its strongest and most unique contribution to the marketer’s competitive arsenal and, ultimately, to customer satisfaction.

    If you agree with these statements, and you do not have the tools or training to apply research to uncover these opportunities, I strongly suggest a professional marketing research firm, one with strong marketing science expertise.

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