Many small and mid-size companies fail to conduct marketing research because they feel they can’t afford it. Indeed, if you go to a full-service research supplier for say a much needed customer satisfaction study, and deal with them in the traditional manner, you might experience sticker shock. But there are many ways to get the data you need to grow your business without paying through the nose.
In pricing studies to clients, research suppliers make money buy taking mark ups on both out-of-pocket costs they must pay to their suppliers as well as on their internal staff costs. The price they quote you to conduct your study is therefore based on these mark ups.
Often the busier the research supplier are the higher their markups and prices quoted to clients as they don’t need to offset fixed costs by getting business in the door. In fact, the very nature of the mark up system often inhibits smaller companies from conducting research as they are priced out of doing so.
What many buyers of research don’t realize is that they can purchase directly the same outside services purchased by research suppliers at the non-marked up cost.
They also don’t realize that many research suppliers, especially the smaller shops, are eager to price their internal time at far less then the generally accepted staff time mark ups taken by larger suppliers.
Therefore, the next time you have study you want to conduct try one or more of these suggestions.
1.Get at least two bids. The first being from a supplier who quotes in the traditional manner, that is quotes you one cost for everything. From the second supplier get two costs, with “a” being for their professional time in executing your study and “b” being for their out-of-pocket costs associated with collecting your data.
I’ll bet you find the two-tier costing saves you money. This is especially so if you tell supplier “b” to take a smaller mark up on their out of pocket costs because you’ll contract to pay their suppliers directly thus eliminating potential cash flow problems they may have on your study.
2. Find a research supplier who will work with you on a consultative
time only basis. Determine if their hourly fees are reasonable for you and if so let them estimate their time for helping you plan the study, write the questionnaire, choose the right data collection agencies and tabulation firms and interpret the results. Rather than having them deal directly with the data collection and tabulation firms and charge you a mark up, you take on that responsibility. It isn’t that all complex or time consuming and it will save you a great deal of money.
3. If you’re conducting focus groups, brainstorming or other qualitative studies, find a moderator who will quote you a fee for moderating and a report only (if you even need a report). Go to http://www.impulsesurvey.com and become familiar with the service.
Once you’ve done so, you’ll be able to find the right focus group facility in your area and by working with your moderator to ensure you’re recruiting the right respondents, you set up your groups directly with the facility. You’ll be amazed how much you save in marked up fees when you take on this generally easy task.
4. Rather than hire a traditional research supplier, find a marketing
research professor at a local college or university. Not a marketing professor but a marketing research professor. Screen them to be sure they have worked as research supplier before going into teaching. Most will work with you to complete your study at far less cost than you’d imagine. Remember, they aren’t in business anymore and consultancy fees are frosting on the cake to them.
There are many ways to save money and still conduct solid marketing research. The more effort you put into understanding the nuances of buying research, the more you’ll save.