You are using an older browser version. Please use a supported version for the best MSN experience.

Going global? Country-specific research will be handy

Moneycontrol logo Moneycontrol 24-07-2021 Arun Sreenivasan
text: Going global? Country-specific research will be handy © Arun Sreenivasan Going global? Country-specific research will be handy

The fear of economic stagnation and low consumer confidence has caused companies to re-evaluate the amount and type of international market research they conduct. This is true even of companies committed to global expansion as a key means to growth. All too often this re-evaluation has resulted in an across-the-board percentage cuts in funding, drastic reductions in travel by company personnel or elimination of projects without regard to their importance to company strategy. This cuts not only the fat in your budget, but the muscle as well.

Consequently, companies are introducing marketing programmes or new products without sufficient understanding of the market, greatly increasing the risk of failure to expensive programmes while saving a few rupees in research costs. However, the reality of reduced research funds can be addressed by tailoring expenses in order to be more effective and efficient in spending a company's research funds while still reducing the risk in marketing programmes and new product introduction. Two key methods for doing this are by carefully selecting the countries to be researched and evaluating the need for travel. These can make your spending match your leaner budgets without damaging the muscle you need.

How to select the countries to be researched? Often companies select countries for primary research based on less-than-systematic criteria. Thinking often proceeds in this manner: "We need to understand Europe. So, let's do the UK because they speak English, and we'll understand what they're saying without translation. Let's do Germany because that economy is going great. And, we need one more country ... how about Norway? And let's not forget that the senior VP is from Liechtenstein, so we must work there too."

A more systematic approach will save money and increase understanding. Doing a little homework on potential market size, company capabilities, business goals vs. company politics, and research cost by country will allow you to focus your financial and travel resources on the countries with the most potential payoff for your company.

Country population is crucial

First, consider the size of the market using country population as a surrogate. If you want to penetrate the five largest markets in Europe, then you should be conducting your research in Russia, Germany, France, the United Kingdom and Italy.

Second, consider your company's true business capabilities. One of the fastest ways to waste research money is to conduct a study in an area where your company has no clue on how to operate.

Third, consider, of course, how to deal with company politics. Yes, it's difficult not to include the home country of the senior vice president who is heading up the international effort in your study. However, if that country is Sweden and you wish to market beach umbrellas, some reasonable argument could be found to eliminate Sweden from the list in favour of Portugal (both have between 10 million and 11 million people, but Portugal has more beaches).

Fourth, consider research costs. Nearly twice as many focus groups can be conducted in the Czech Republic as in the United Kingdom for the same cost.

Once you have considered this list of issues, you should be able to select the right markets to provide you the best information at the minimum expense for your marketing programme.

How to decide whether or not to visit the countries being researched? When deciding whether to personally visit the countries being researched, consider more than mere personal preference. Key factors include: your or the project team's previous experience with the culture, complexity of the issues being researched and the method being used (including whether the research is quantitative or qualitative) and availability of alternative methods of experiencing the research.

Don't waste research money 

First, if your company already has extensive experience with the issues to be researched in the target country, or if you and the project team already have extensive personal and business experience with the target country, then travelling to observe research is an avoidable waste of your company's research funds. However, if this is not the case, there is no substitute for even minimal first-hand experience with the culture being researched when you are trying to interpret a report.

Second, less involved research doesn't really require on-site observation or supervision. A simple awareness and trial survey is worth less personal attention than a qualitative exploratory effort.

Third, alternative methods of monitoring or participating in research often provide savings in travel. Watching focus groups from a conference room in your own company's building obviously costs less in travel rupees than visiting three countries in a week.

If you use the criteria discussed above to evaluate the countries that you research and the ones you visit personally, you will almost certainly spend your marketing research money more efficiently and travel only when business issues justify it. You will leave the knowledge-gaining muscle in your research, while cutting the fat.

More from Moneycontrol

Moneycontrol
Moneycontrol
image beaconimage beaconimage beacon