AI Will Change Everything About Market Research
The Martech sector has experienced massive growth in the past several years, but over the same period, the market research industry has been in decline. Global revenue was down from a 2014 high of $46.1 billion to $45.8 billion in 2017. But AI is poised to revitalize the market research function, and that will change everything about how market research is conducted and used worldwide.
To understand the potential for AI’s transformative effect on market research, it’s necessary to appreciate the factors that contributed to the decline of the sector in its traditional form. One factor is that market research has been the domain of customer insights. However, this role within an enterprise has been undermined to a significant degree by the rise of big data as a business intelligence tool.
Traditional market research projects are labor intensive, expensive and time-consuming, and they require advance knowledge of what information is needed to formulate business strategy. That’s why market research has been used almost exclusively to make high-stakes decisions on big-ticket items like branding, product design or pricing — it’s too costly and time consuming to use for more granular decisions.
Another drawback to traditional market research is that the data and insights generated are closely held by a small group and not leveraged across the enterprise. The results are usually used one time to answer a business question and then consigned to the scrapheap. And while insight is the product traditional market research generates, users are left to define next steps on their own.
How AI Is Redefining Market Research?
AI will virtually change all the dynamics that define traditional market research — and it is already doing so. Prior to recent AI-driven innovations, market research was largely immune to the digital revolution over the past decade or two, aside from the limited introduction of automation (think SurveyMonkey). AI will change market research in a fundamental way, addressing costs, time, distribution and application.
The use of algorithms and Machine Learning is making market research faster and cheaper, cutting down project timelines from weeks and months to hours and days. That change alone is making the use of market research feasible beyond big decisions; With quick results, it’s possible to apply AI-driven market research to day-to-day decisions.
The ability to include real-time data from a variety of sources in market research projects is another fundamental change. Now, it’s possible to add up-to-the-minute data from sources like sales, texts, social media, behavioral information, and passive data, which can transform market research from a backward-looking analytics function to a future-focused discipline.
AI-Driven Market Research in Action
Organizations are already using AI-driven market research in ways that demonstrate how the approach expands access to data and drives tactical decision-making. For example, global telecom companies will invest billions into building out 5G capabilities in the coming years. In the past, they would rely on market research to tell them where to upgrade networks.
With AI-driven market research, telecom companies can leverage the vast amount of data they have in-house and add other real-time information to identify where network upgrades will deliver the best return on their investment. That’s a huge leap forward, and Fortune 500 telecom companies are using AI and Machine Learning right now to secure that competitive advantage.
Supply chain optimization is another use case for AI-driven market research. AI has transformed the supply chain sector, but its application in market research is enabling truly future-focused outcomes like predictive supply chains, which anticipate needs and optimize the supply chain to meet demand before they materialize.
AI Will Change Everything
In light of these developments, it’s a good time for companies that have cut back on their market research efforts (and those that have been priced out of the traditional market) to consider how AI-driven market research can deliver scalable impact. The companies that incorporate AI-driven research into their operations first can gain a sustainable edge, as AI gets smarter over time.
AI-driven market research is accessible because it doesn’t require a team of experts to develop a study and interpret results. Users can go to a portal and simply ask a business question, and Natural Language Processing (NLP) capabilities enable the AI solution to access the right data and return actionable recommendations in language anyone can understand, meaning more people can use market research across the enterprise.
AI will democratize market research by expanding access and eliminating research skills requirements. It will make market research more broadly applicable, extending use cases beyond strategic decisions to inform tactical choices. For all these reasons and more, AI will change everything about market research, and companies that get in on the ground floor will benefit the most.