Experts Marketing Research

A Brief History Of Market Research

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History Of Market Research

Market research is a process of collecting and analysing market data to answer questions related to business, product development, or marketing.

Market research has been around since ancient times. The earliest market research was conducted by the ancient Greeks, who used questionnaires to study consumer behaviour. Marketers have also been using this process for decades.

Market research has evolved from a simple questionnaire-based approach to an increasingly more sophisticated one that uses quantitative and qualitative methods. Market research is a long-standing tradition that is continuously evolving. There are many different types of research methods that have stood the test of time. Use this timeline to understand the origins of these methodologies and how they evolved into today’s market analytics.

Introduction

Market research is an integral part of any marketing plan. It helps brands understand & connect with their consumers in new and unique ways that would have been impossible before. It’s fascinating to think that most marketing strategies didn’t even exist in the digital era until relatively recently.

Research expertise is becoming more and more critical in the industry. This is due to constantly evolving market conditions and a need for constant innovation amongst businesses to stay competitive.

Market research isn’t readily available to every person. Sure, you can always do a little research on your own, but why not use this timeline to help you out? It’s designed to teach you the origins of the methods that you rely on today.

History of market research
A brief history of market research

The era of quantitative questionnaire (1900s–1940s)

Primary objective: Understanding the target audience

Market research started taking shape in the 1920s through the work of Daniel Starch, who made it a part of his theory that advertising could only be successful if it were seen, read, believed, and acted on.

Starch and his associates would approach people on the streets, asking them if they had read certain publications–such as magazines–and could remember specific ads within them. So, they would first compare the number of people they interviewed with the circulation of their magazine and then decide whether or not their ads were effective. After that, a lot of other companies began offering comparable services.

Also read: What Responsibilities Do Market Researchers Have?

George Gallup, a contemporary of Ernest Starch, developed the concept of aided recall. He asked people to remember an ad they saw in a publication without actually showing it to them. Who knew this system would later be adapted and used to measure the effectiveness of radio & television advertising?

The era of qualitative questionnaire (1940s–1960s)

Primary objective: Developing a comprehensive understanding of the individual

As consumerism became more and more prevalent in American society, there was a need to understand consumers better and what they loved or despised. Better understanding allowed businesses to adapt better & take action towards growth.

Even though qualitative studies remain the standard of the day, quantitative researchers started developing newer practices beyond just numbers. Techniques like focus groups became started gaining popularity[1]. However, it was found that the respondent’s actions, thoughts, or likes did not match up with what they reported.

Ernest Dichter created a form of research called Motivational Research in the late 1940s [2]. It was based on Freudian concepts and captured consumers’ desires and repressed thoughts (taboos). He also believed that every product had an image, even a ‘soul’, and was purchased simply because of its values and symbolic meanings. Dichter challenged the idea that when advertising begins to target a group of people as a unified community, it will have better success. In fact, by understanding the personality of a product and adapting your marketing plan around this knowledge, you can end up with more for your money.

Dichter’s practice focused largely on conducting Depth Interviews, closely resembling therapy sessions, and observing consumers’ interactions with products in simulated or real environments.

However, the industry lost faith in his theory when Dichter’s claimed to Proctor and Gamble that people used soap to cleanse themselves of sin and other unwanted character traits.

The era of refining (1960s–1980s)

Primary objective: Understanding the mindsets

Quantitative methods started to come back during the 1960s, with the advent and assistance of new technologies, including computers, phone systems the internet. Qualitative methodologies once again went behind the curtains for refinement.

This was when John Howard incorporated varied perspectives from other social sciences into his marketing research. He subsequently encouraged multiple disciplines to approach the marketing problem to find a solution that suits their needs [3]. Consumer experience has become a focus for many businesses and scholars during this period. Beyond the process of buying, researchers also started studying the actual experience of owning and consuming. They studied the role of emotions, feelings, moods, and other affective aspects of consumption to understand customers. Helped by a newfound way of thinking about consumer behaviour, marketers once again turned towards focus groups and, at the same time, refined Dichter’s theory and came up with the present-day idea of market research.

The era of evolution (1980-2010)

Primary objective: Understanding the context

This era marked some significant developments in the field of market research. Today, with dozens of tools and methodologies at our disposal, market research agencies pull from a large ecosystem of methods and tools to provide a much more comprehensive view of the consumer. Integrated qualitative and quantitative approaches enable marketers to understand consumers individually and in groups. 

1980s – Attitudes and behaviours get linked

Martin Fishbein and Icek Ajzen pioneered the theories of reasoned action (TRA) and planned behaviour (TBA) that formed the conceptual framework for understanding, predicting, and changing human social behaviours.

TRA uses individuals’ behavioural and innate attitudes to predict their behaviour in a given situation Whereas, TBA provides an extension to TRA to evaluate how the person behaves when they feel their behaviour is in their control.

Fishbein invented a multi-attribute model for brands that used three components of attitude—salient beliefs, object-attribute linkages, and evaluation—to determine a measurable score representing the consumer’s attitude.

1990s – Web analytics become an integral part of the mix

There is a lot of emphasis on market research for businesses nowadays. However, the history of market research is incomplete without considering the impact of the World Wide Web on the field. The first website went live in 1991, leading to the foundation of consumer tracking.

Analog, or web log analysis software, was launched in 1995, and for the first time, marketers got the power that was till now restricted to computer scientists. It allowed server owners to see where their website was being viewed and what impact traffic from specific countries or regions had on the information displayed.

2000s – Invention of The Net Promoter Score

Fred Reichheld created the Net Promoter Score (NPS) to assess customer service levels. In 2003, he shared his findings in an HBR article, “The One Number You Need To Grow” [4].

The long-term goal of the NPS is to distinguish successful companies from those that are failing. It allows brands to benchmark performance against other brands.

Net Promoter Scores have become the go-to way to measure customer satisfaction. They are helpful for both big and small companies & are often used alongside other measures like lead quality. People might dislike them only because of their opinion, with some believing that NPS doesn’t provide enough insight. Nevertheless, it is still a widely used tool by companies to measure customer satisfaction.

2010s – Consumer Insight on demand is now a reality

The last decade pioneered the most exciting development in the market research history– the availability of on demand insights.

Smartphones transformed consumer access, and Attest was set up to capitalise on the massive volume of newly available data. It opened up an audience of 100 million consumers in 80 markets to brands and companies requiring consumer data.

Founded Attest in 2015 by Jeremy King, this analytics startup quickly attracted notable brands like Deliveroo, TransferWise, Fever-Tree, Samsung and Uber as its clients.

The era of ease and pace (2020-present)

Primary objective: Data aggregation and analysis simplified and automated

Market research has come a long way in recent years. It used to be difficult & time-consuming, but owing to the contribution of so many hard-working researchers, it is now more accessible than ever. Thanks to them, modern solutions like Attest for data collection can help you do your job with ease and at a higher pace.

The newest contributor in the field is AI. With the help of tools like conversational chatbots, AI is doing wonders in simplifying the data collection process, and AI-based analytics is doing an excellent job at providing actionable insights to improve operations.

Market research is a complex and costly task. These new tools help make it more manageable while providing users with actionable insights in just a few clicks. Anyone in any brand can carry it out at any time. One may say that it is actually the best time to be in marketing. The marketing research machine is now equipped with enough tools to determine what people say about an organisation. The next step is to discover how these findings can be turned into a viable business, where the actual value of these new machines lies.

Also recommended: MIA Research Report: Shifting Marketing Priorities

Endnotes
  1. JEŘÁBEK, HYNEK. “Merton and Lazarsfeld: Collaboration on Communication Research—Two Papers, Two Research Instruments, and Two Kindred Concepts.” Sociologický Časopis / Czech Sociological Review, vol. 47, no. 6, 2011, pp. 1191–214. JSTOR, http://www.jstor.org/stable/23535019. Accessed 18 Oct. 2022.
  2. Fullerton, R. (2010). Ernest Dichter: The Motivational Researcher. In: Schwarzkopf, S., Gries, R. (eds) Ernest Dichter and Motivation Research. Palgrave Macmillan, London. https://doi.org/10.1057/9780230293946_3
  3. https://www.jagsheth.com/marketing-theory/howards-contributions-to-marketing-some-thoughts/
  4. https://hbr.org/2003/12/the-one-number-you-need-to-grow
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