How leading brands are switching budget from agencies to insight platforms
A recent survey of CMOs found that 72% plan to in-house more marketing activity over the next three years.
It’s easy to see how this might happen when you look at the tools available to help:
5,000 providers and counting in the ad tech / martech ecosystem.
[BTW – can anyone find Survey Monkey?]
When marketing teams can in-source on these platforms, it really does change the game for agencies.
And insight teams are following suit.
A few weeks ago, I attended the MR Summit 2017 in London, where I chaired a panel discussion with a diverse mix of insight leaders:
- Richard Clarkson, Head of Strategic Consumer Insights and Segmentation at Orange
- Brendan Hogan, Strategy & Insights Manager at Worldpay
- Rufus Weston, Head of Insight at Just Eat.
The discussion was about this tension between software and people.
What value do you get from insight platforms (managed in-house) and from research agencies?
I learned how these brands are adopting technology, how they work with agencies and how they see the future of insight.
Whether you work in a client team, an agency or a platform provider – there are lessons here for everyone.
Sorry … what are insight platforms?
I’m going to attempt a definition. It’s not perfect.
Insight platforms are software applications that help gather, manage, integrate, analyse and present data.[Tell me if you have something better than this.]
Over the last few years, the market research industry has seen a big increase in the number of insight platforms, and we can expect more to come.
Some examples of categories and brands:
- Knowledge Management (Market Logic, KnowledgeHound)
- Video Management (Big Sofa, Living Lens, VoxPopMe)
- Customer Experience (Medallia, Clarabridge, Qualtrics)
- Analytics and Data Visualisation (Infotools, Tableau, PowerBI)
- Panels and Communities (Vision Critical, Toluna, FocusVision)
- Research Automation (Zappistore, Methodify, proved.co)
- Agile Survey Tools (attest, OnePulse, Usurv)
- Survey Platforms (QuestionPro, SurveyGizmo, Decipher)
- … hopefully you get the picture
These platforms are all being adopted – to varying degrees – by in-house insight and research teams.
Our panellists discussed some of the main advantages they offer.
What’s driving adoption of insight platforms?
OK. No surprise there.
Yes, there are other costs beyond the software setup and subscription. No, these aren’t always recognised or captured properly. But the panel was unanimous in pointing to the cost-saving potential of these tools.
“Smaller businesses and challenger brands like us are big users of these tools,” says Just Eat’s Rufus Weston.
“We don’t have the same research budgets as big companies.”
Yeah. Also obvious.
Everyone demands faster answers. The pressure is especially acute in technology-driven businesses, where stakeholders judge the speed of research against data analytics.
A consistent platform helps create a single version of the truth, ensuring everyone has the same base data.
Enterprise-wide Customer Experience Management systems, for example, are replacing fragmented feedback and satisfaction surveys - as happened at Worldpay.
“When I started my role,” says Brendan Hogan, “there were dozens of different CSI surveys being done all over the organisation. It was a bit chaotic, with all these different metrics in little pockets.
“So we went down the platform route to get it all under control. We’ve had help setting it up, but we’ll be managing it in-house once it is fully up and running.”
Platforms also offer the potential to connect different sources of data together.
This can be pretty basic: customer panel surveys can avoid asking for information that is already captured in CRM, or results from different studies can be combined in a single dashboard visualisation.
"We have brand tracking results from Millward Brown,” says Orange’s Richard Clarkson, “and customer satisfaction data from SSI pulling into an Infotools dashboard. As a Group marketing team, we need to be able to see the big picture across our markets in one place."
For data-rich organisations, the potential benefits are even greater.
“If you’re a legacy kind of business, you won’t have the same advantages," says Just Eat’s Rufus Weston.
“But we’ve invested a lot in our data warehouse, and it gives us some great capabilities for insight. That data is our first port of call, and we integrate it as much as we can."
It’s an over-used word.
Sorry about that.
But some of these tools offer genuinely new ways to uncover insight.
According to Orange’s Clarkson, these tools are helping different teams to change the way they work.
“Our brand team have started to trial Zappistore - which is great in terms of speed. It gives more ownership to them and encourages more pre-testing.”
What do agencies offer that insight platforms lack?
So there is a clear trend, led by brands that built on data, to bring work in-house with software.
In fact, based on a quick show of hands, the audience at this panel discussion unanimously forecast that the trend would continue over the next few years.
Nobody was brave enough to predict similar growth in budget for agencies.
But it would be a mistake to read this as a death knell for agencies.
The best will get stronger as they embrace change and adapt with their clients.
Here are five factors our panel highlighted that show the value agencies deliver - all of which are currently difficult for software to substitute.
The first three - authority, capacity, perspective - are things that agencies can do something about.
The last two – planning and control - are organisational factors within clients that will encourage the continued use of agencies.
Agencies have experts.
They frequently have niche skills, sector knowledge or proprietary IP. It is unrealistic for an in-house team to maintain the breadth or depth that exists in the agency ecosystem.
“Our brand tracking agency brings us expertise and deep dive insights that we’re not set up to find ourselves,” says Just Eat’s Rufus Weston.
Agencies are also called on as the ‘objective expert’ for internal decision making. If the research has ‘bad news’, an independent voice can be critical. Big name agency brands also bring credibility to public facing work for PR campaigns or government responses.
Clients say their best agencies are ‘extensions of our team’.
There are cultural and emotional dimensions to this, but it is also a simple factor of scale and resources.
“When we set up our brand tracker,” says Rufus Weston, “we could never have got it up and running ourselves so quickly. We were absolutely dependent on the agency and their team.”
At Worldpay, headcount constraints are a big driver of agency use.
“It’s a bandwidth issue: previously, I’ve worked in teams with 4-5 researchers and much more work got done in house. At Worldpay, there are only 2 of us so we have to outsource more to agencies.”
At Orange, Richard Clarkson says his team is still finding the right balance between self-reliance and working with agencies.
"We have started trailing Toluna’s platform for Quick Surveys. But it can be a challenge for us to do the analysis. It’s time-consuming, and we have to ask ourselves whether that should really be our focus – or whether our time is better spent engaging stakeholders and shaping business outcomes.”
Clients always ask their agencies, ‘what are other people doing?’
Agencies can tie together ‘lateral’ learnings from different brands, industries or geographies, bringing an external perspective that in-house teams often lack.
"We’re trying to change the way we work with agencies,” says Orange’s Clarkson.
“We want a more collaborative and iterative approach to insight generation, one that benefits from all the broader insights knowledge we have at Orange and with an agency. Going beyond looking at just the one piece of research for the answer.”
You don’t buy software on a whim.
(You shouldn’t, anyway).
Most software platforms are planned in advance, underpinned by a business case, and funded with central insight team budget.
When a stakeholder has an urgent need – and their own budget – agencies are often the only way to get projects done.
Without this flexibility, Worldpay’s Brendan Hogan sees a risk.
“If your research team is geared towards meeting your stakeholder needs (rather than setting its own research agenda), agencies will probably be essential for building the right custom solution.
“I’ve worked with companies previously where this wasn’t the case: all budget was centrally controlled, and it led to a research team pursuing its own agenda rather than responding to the business’s needs.”
Lower cost, easy-to-use tools have enabled more people to survey customers, and the panellists generally agreed that stakeholders benefit from this access.
But it can also be problematic without the right controls in place.
"Things like SurveyMonkey can actually be dangerous,” says Brendan Hogan.
“I’ve worked with companies where anyone could ask customers questions using a survey tool. It was anarchic. There was no control over look-and-feel, quality of research or frequency of contact. It actually damaged the customer experience.”
So how should clients and agencies adapt?
The demand for great customer insight will continue to grow. If you work in this field, that should excite you.
But there is no escaping the fact that software will disrupt jobs, workflow and business models across client teams and agencies.
The best of both sides will be successful if they embrace the opportunity and start changing now.
For client teams, there are three big areas to focus on.
- Build a vision for your new insight ecosystem that encompasses your team, your agencies and your platforms. All parties need a clear view of where you want to go so they can get on board.
- Adopt shared platforms that help you get more long term value and reduce the ‘inconsistency tax’ you pay to different partners with their own systems.
- Change your agency procurement and management models: most were built for an analogue era, and they work badly for everyone in this new reality.
For agencies, you need to:
- Ruthlessly take out cost from every process: do it now before you don’t have a choice, and reinvest what you save.
- Stop outsourcing technology expertise: if you don’t own it, you can’t turn it to your advantage, and you’re giving away margin you need to keep.
- Focus your value proposition around authority, capacity, perspective: this is what clients truly value, where you will find new premium services to offer and what will separate you from the robots.