In today’s globalized world, big brands maintain their market share through producing superior products. They accomplish this through rigorous market research and product testing.
While some corporations prefer a one-stop-shop for market researchers, increasingly they are asking their research partners to work with specialists, for the following four reasons:
- Best-in-Class Practices: Deliver better base-line results.
- Innovation: Specialists are more likely to be on the cutting edge of their science.
- Responsibility: Specialists work in a niche, where reputation is everything, and performance for each client is key.
- Service: Tired of the service and communication gaps from large teams, Big Brands demand the service a specialist focused on only their work can give.
Global Fast Moving Consumer Good brands like Coca Cola, McDonalds, and Colgate are examples of time-tested brands that recognize the value of innovation. They fully realize that to be the leaders in their respective markets requires anticipating their customers’ needs. By understanding customer’s behavior and preferences almost better than the customers do themselves.
That is what separates leaders from followers.
To achieve this level of insight, big brands work with leading market research firms to design and implement qualitative and quantitative research projects to guide product development. Considering the importance of these research insights in maintaining market leadership, it is imperative that market research firms are best-in-class.
Not surprisingly, one critical piece of the market research puzzle is a transcription provider. Globally, transcription is probably one of the most fragmented industries. As the required skill set is often a 5th grad writing level, the threshold to open a transcription business or work as a transcriber is negligible. Hence, it’s not a surprise that just in U.S., there are more than 5000 transcription companies (Source: US Economic Census 2007) operating. Most of these are small to medium sized businesses with 1-15 employees.
Due to their limited capacity, small, manual transcription companies are faced with the following challenges – challenges that fundamentally prohibit them from being able deliver world-class performance:
- Limited Capacity: With limited in-house transcription capacity, most companies can accept a limited amount of work, and cannot afford to employ extra workers before contracts are at hand. This inability to scale limits the number of firms Big Brands can turn to, and also increases the price that larger companies can demand.
- Slow Turnaround: Due to the fast and iterative cycle of market research feedback and product development, it’s critical to have available within hours of interview completion, so that the questions can be altered based on the learning’s from the previous respondents. When a transcriptionist begins working on a one hour interview, on average, it will take them 3x to complete the file (i.e. a one hour file takes three hours to transcribe). Limited capacity, combined with lack of innovative ways to process large amounts of audio makes it impossible for manual transcription companies to work with higher workload.
- Dealing with Diversity: Big Brands are present in multiple countries, and their products are also customized to meet the needs of each individual market. Consequently, focus groups happen in multiple locations, languages, and accents. This geographic and cultural diversity makes it difficult for transcription partners to deliver highly accurate work.
- Lack of IT Infrastructure: While its possible to use third party file transfer solutions as a one-off, it is not ideal for market research firms working with multinationals to work with transcription companies that have no internal IT infrastructure to manage client information and confidentiality.
Big brands expect their market research firms to work with transcription partners that are able to address the challenges outlined above. However, these specialists are often very expensive, commanding high wages for their services.
What are the takeaways?
- Big Brands like industry credibility. They prefer to work with specialist businesses with market leadership.
- Market research firms assist in product development. They work closely with the big brands to design, develop and implement research projects to guide the product development efforts
- Non-specialist transcription partners face significant challenges in working on projects involving big brands.
In the next post, we will look at some of the new business processes combined with rapid innovation in technology that would help address the above-mentioned challenges.
Written by Chirag Ahuja and Bethanie Maples Krogstad.