Impact of the financial crisis on the market research industry
22th May, 2009.
The Sample
The sample population was comprised of market research agencies who are registered
with MarketResearchAgencies.eu, an online directory of market research agencies
worldwide. Approximately 370 members received an invitation by e-mail to participate
in the online survey and 132 of them responded with completed questionnaires. The
response was global with 60 different countries represented in total.
Effects of the crisis on the market research industry
According to the responses more than 70% of the agencies believe that the market
research industry is suffering greatly in the economic crisis. However, 50% of respondents
think that their own agency is less affected than the industry generally.
Turnover expectations
60% of the agencies reported a slight or substantial decrease in their turnover
for the last six months.
Despite this, the agencies are optimistic; more than two thirds of those whose turnover
has fallen in the past six months expect a slight or substantial increase in the
next 6 months.
Client loss
Most of the agencies are concerned about losing clients. In fact, only 18% of
them claim that they are not worried. 40% reported that they have already lost clients
and 37% claim that they have not lost any yet but expect to lose some in the near
future.
Volume of domestic and international projects
53% of the agencies reported fewer domestic projects in the past six months,
while 44% of the agencies reported fewer international projects in the same period.
Layoffs
In the past six months 31% of the agencies had layoffs due to the financial
crisis. There was no change in the headcount at 54% of agencies, while 15% actually
hired new people. Most of the agencies hiring over the past six months were those
who had experienced slight or significant increases in turnover. However, the expectations
regarding future layoffs does not differ significantly between the agencies whose
turnover increased and those whose turnover decreased in the last 6 months.
Strategies
Market research agencies have several options for cost cutting in a weak economy.
Their strategies often include avoiding participation in conferences and other marketing
events. Another option is to lay off employees, 45% of the agencies use this method.
In order to reduce the impact of the crisis, agencies are making more effort to
get new business and they are trying to strengthen the relationship with their current
clients. Different strategies are chosen by the agencies depending on whether their
turnover has decreased or increased in the past 6 months; generally we can say that
the former put greater emphasis on the client relationship (they try to get new
business, offer their services at reduced prices, and try to retain their existing
clients), while the latter make more effort to enhance the quality of the service
provided and product development.
Length of the crisis
Nearly two thirds of the agencies expect the crisis to be over within one year
and one in ten believes that the crisis in the market research industry will last
less than six months.
The survey methodology
The population chosen for this study is the entire list of market research agencies
registered at MarketResearchAgencies.eu, a Global Directory of Market Research Agencies.
Method: CAWI
Fieldwork: 4th May to 11th May 2009.
Population size: 370, includes only one person from each agency.
Starts: 142
Completed: 132, only completed interviews were used in the analysis
Response rate: 36%
