Market Research Pricing: How is market research priced?
Amidst ballooning inflation hitting a 40-year high of 9.1% in June (US Bureau of Labor Statistics, 2022), the thickening of the fog of the Russia-Ukraine war, swathes of layoffs in the tech industry landscape, the post-pandemic phenomenon coined ‘the Great Resignation’ and a looming recession, US companies are grappling with a kaleidoscope of socio-economic trends that need to be deciphered in order to make business decisions that translate into business growth.
Market research has the potential to decipher these socio-economic trends and offer businesses consumer-centric strategies that drive business growth and propel them into the realms of exponential success. However, companies are deterred from investing due to the cost of market research and fears of a loss on investment.
COST OF MARKET RESEARCH: THE COST CONUNDRUM ANSWERED
The cost of market research pales in comparison to the cost of a bad business decision. While bad business decisions can cripple companies and inch businesses closer to the edge of bankruptcy, market research offers high value consumer insights that save businesses from the pitfalls of market uncertainty and ill-informed business decisions.
Deloitte’s CMO Survey (September 2022) reveals that while companies spent 13.8% of their overall budget on marketing in 2022, companies increased spending on marketing research and intelligence by 10.45%, relative to the prior 12 months. This increase signals a growing need for companies to understand the state of the market across industries, especially in the post-pandemic era, in order to develop consumer-centric strategies that drive business growth.
Our Founder and CEO, Jenny Karubian explains all you need to know about how market research is priced in Episode 1 of our new series ‘FAQs with Jenny’. Watch the video or read on to learn all about the factors that determine market research pricing.
HOW IS THE COST OF MARKET RESEARCH DETERMINED?
Providing a market research cost breakdown, Jenny reveals that market research pricing boils down to 2 primary factors: intended audience and sample size.
- INTENDED AUDIENCE
According to Jenny, ‘The more complex the audience, the higher the cost. The easier the audience is to find, the lower the cost’, succinctly capturing how the intended audience factors into the cost of market research. For instance, Jenny shares that college students who regularly use their cell phones are an easier sample to engage in market research studies as they are relatively inexpensive and willing to participate. On the other hand, Jenny, who has co-authored a number of patient-centric cancer research studies for the Cancer Support Community, shares that lab managers of laboratories that focus on DNA of oncology are a much more expensive sample as they are a rarer demographic to procure for a market research study.
- SAMPLE SIZE
The second factor Jenny points out is the sample size of the market research study. Essentially, how many people do you want to speak with? The number of participants you want to glean answers from to extract key consumer insights, also determines the cost of a market research study. While qualitative market research studies involve smaller sample sizes of around 10 -12 respondents, quantitative market research studies involve sample sizes as large as 500 – 1000 respondents. According to Jenny, as the cost per respondent is factored into the entire market research study, smaller sample sizes usually cost less than studies that involve larger sample sizes, provided the intended audience is the same for each study.
HOW MUCH OF A BUDGET DO COMPANIES NEED TO ALLOCATE FOR MARKET RESEARCH?
Jenny, delving into budgeting for market research, highlights that how much of a budget companies need to allocate depends on the style of research required.
Accordingly, the pricing strategy for market research depends on which research methodology companies need to invest in to derive actionable insights into their key consumer questions. The company’s research objectives will dictate the methodology of choice.
Jenny states that ‘quick surveys are probably one of the least expensive costs’, whereas ‘focus groups or very in depth surveys’ require larger investments. Jenny reveals that one of the greatest variables here, is the amount of time respondents have to spend answering research questions. For instance, Jenny reveals that a 2 and a half hour focus group could cost US$ 150 and upward per respondent. As earlier stated, the market research pricing strategy per respondent will depend on how rare it is to find the respective participant.
WHAT’S INCLUDED IN THE MARKET RESEARCH PACKAGE?
Companies seeking to leverage market research to understand the intricate web of socio-economic trends and how they affect consumer mindsets and the competitive landscape, can expect to receive the following:
- CUSTOM RESEARCH DESIGN
Once you request a bid via email or call, we’ll provide a free consultation to identify and recommend the most effective market research methodology that caters to your business need. We’ll then provide a ballpark cost based on your custom research design. Our team will then launch your customized requirements with the use of industry best-practices to deliver the desired actionable insights.
- RAW DATA DISCLOSURE
You’ll also have access to all the raw data derived from your market research study. This includes everything from raw video interviews of research participants to the raw transcripts, and detailed spreadsheets disclosing all the statistics.
- ANALYSIS AND RECOMMENDATIONS
Once all the data has been collected and collated, we’ll also provide in depth analysis that will include key recommendations based on insights gleaned, marketing and business strategy recommendations including product / service optimization and rebranding recommendations and a summary of all key findings.
IN CONCLUSION
The market research cost breakdown depends on – among other factors – the intended audience, sample size and style of research. Based on these variables, companies can expect to allocate a budget of anywhere from US$ 20,000 – US$ 50,000 for primary market research.
If you’re looking to invest in and leverage our custom research design solutions, raw data disclosures, research analysis and recommendations, get in touch.