We’ve said it to countless marketing executives nationwide —traditional market research is a lagging indicator of past performance and social market research is a leading indicator of future performance. A bold statement, I know, but one that we truly believe in because, as we prepare social market audits for our corporate clients, we see evidence of it each and every day. What exactly do I mean and what specifically do we find during our process?
When conducting these social audits, we initially look at the traditional market research relevant to our client’s industry, and then we see how effective their marketing efforts are compared to their competitors. While that data does help us learn more about the space our client navigates in, we also know that the information is only representative of previous investments made by our client (and their competitors). It doesn’t give us a snapshot of what is going on now, what happened two weeks, or two months ago for that matter. More specifically, it doesn’t tell us if our client’s competitors have, for example, launched a new campaign that is swaying chatter in their direction and taking 1Q or 2Q market share away from our client. In a time when even the largest of organizations need to be nimble and neutralize all lead generation obstacles, lagging data doesn’t help our client lead tomorrow —and lead competitively.
Today’s market share is reflective of a company’s ability to retain customers, expand their revenue relationship with existing customers and their ability to acquire new customers which for many years has been based upon traditional buying processes. Given the changes in communications over recent years, it is clear that tomorrow’s market share is now dependent on the social customer life cycle.
The buying process, or the social customer life cycle, in most cases now begins online. As an example, when speaking with a CIO recently, their company was looking to make an investment in a business intelligence (BI) solution. The first step in the process was to reach out to peer-to-peer networks to learn about what other CIOs were using, why they selected the product/solution they did, why they eliminated others, and what impact did these products/solutions have on their business. In parallel with that research, the members of their own IT organization, with specific roles as it applies to their BI program, have also been reaching out to their own peer-to-peer networks to learn from others just like them. Often they are conducting online searches and/or reading and engaging with key bloggers and thought leaders to get a sense of which companies are the visionaries and are most likely to be of assistance. They are also looking to see which BI vendors are engaged online. Are they listening? Participating? Driving? Leading? Are they a player? Are they dominant? This is how companies get on the short list.
You see, this is just the beginning of the social buying cycle. At this point they have not yet reached out to the vendors directly. They are narrowing the field and will only contact the vendors they are most interested in, when they are ready. What about the other vendors? They don’t even know that they missed an opportunity.
What many don’t realize is that customers are now creating their own, customized, personalized buying process. The companies that understand and embrace this and build their strategies around this new reality in order to maintain market share, become thought leaders, and establish a corporate image that makes them the easiest vendor to find (and of choice) within their key market.
Markets today are more fluid and dynamic in nature than ever before.
In our opinion, traditional market research is a static snapshot and is as accurate as the information that was available at the point that the report was published. For example if, according to Wikipedia, the Gartner Magic Quadrant is published every 1-2 years, can it truly represent the current state of the market?
Social market research, when done correctly, on an on-going basis, provides a more real time, dynamic understanding of the market conditions, the competitive landscape and the social footprint of individual companies.
Companies can now learn with greater granularity what impact their thought leadership, products, services, solutions, and so forth have on the market. An indication of the important of this are investment firms who are now seeking the social market analysis on companies in order to make decisions about which companies and markets to invest in, whether angel fund, venture capital or corporate.
Fluid markets provide the ability for small companies to capture market leadership position based upon their ability to embrace the social technology disruption. What does this mean? A small company, responding to the realities in the marketplace, can actually tap into market share a large organization earned over many years. We’ve seen this type of disruption before with the web, when over a 10 year span there were 62 new companies that jumped onto the Fortune 100. We believe social media is creating another disruption in the marketplace —do you have the right data in your hands to lead your organization effectively during this important change?
Just to be clear, you might think that we are not advocates for traditional market research, and that’s simply not the case. All we’re suggesting is that companies should keenly be aware of their current social market position and gather timely data to help them put forth strategies that will ensure they continue to be the leaders within their industry in the new social marketplace.
