here - Burke Inc.

November 2007
13 years of delivering MR business
insights, from the publisher of
Research Business
Report
Spe
c
12-P ial
ag
Issu e
e
RESEARCH CONFERENCE REPORT
RESEARCH DEPARTMENT REPORT
PHARMA MARKET RESEARCH REPORT
www.rflonline.com
Technological, Methodological, Economic & Business Changes Impacting MR
RBR ’ s 2 0 0 7 “ E x e c u t i v e o f t h e Y e a r ”
Taught Us All About Data Quality
Every growth industry inevitably faces a challenge that
threatens the collective good, but is difficult to overcome
because solutions can constitute a proprietary competitive
advantage for the companies that develop them. But when a
company can give back without risking its position in the
marketplace, it can propel an entire industry forward.
That’s precisely what happened when Jeff Miller, COO
of Burke (Cincinnati, OH), went public last year with his
company’s research-on-research that identified and classified several “undesirable” behaviors exhibited in online
panels and the extent to which they occurred across a
spectrum of de-identified panel providers. Miller also
shared several solutions for “trapping” the bad apples
(Continued on page 3)
“MR Dept Audit” Earns
High Impact MR Award
Up until two years ago, other than by contrasting its personnel’s personal experiences or picking the brains of peers
at other MRDs, a research department had no formal or
physical way to benchmark its productivity, efficiency or
responsiveness. Assessing those in line with your company’s needs was
completely out of
the question.
Any curiosity in
this regard is also
squelched by the
realities of everyday MRD life. Executives are asking research
to do more, identify more opportunities and get a feel for
where the company should go, in addition to remaining on
(Continued on page 5)
I N S I D E :
Editor’s Column: Signs of Intelligence Life
IRI Grows Healthcare Presence Thru IMS Alliance
RBR Special Report
Quarterly Research Company Financial Reports
2
6
11
RBR’s 2007 Executive of the Year: Burke COO Jeff Miller
The Month’s MR News that Impacts You
Broadcasters Derail PPM Rollout
Arbitron (New York, NY) postponed commercial launch of
Portable People Meter (PPM) ratings in nine markets after
broadcasters besieged the system over response and
sample shortfalls in the 18-34 age bracket and
ethnic demos. Three NY markets slated to go live in
December 2007 were pushed back to September
‘08, and other major markets slated for subsequent
launch were delayed by as much as six months.
Arbitron CEO Steve Morris in a conference call
Steve Morris
11/27 pledged to work with MRC and broadcasters,
estimating it would take six
months to realign panels in affected
markets, which will remain active,
while diaries sub as the interim
currency. Houston and Philadelphia PPM service
was unaffected. The delay prompted Arbitron to lower
2008 earnings projections by 22%-33% per share
diluted, and stock fell roughly 20%.
(Continued on page 9)
R E S E A R C H
B U S I N E S S
R E P O R T
2007 Executive of the Year
(Continued from page 1)
Thoughts from the Editor & Publisher
• Companies reassessing how they serve
content to consumers with business models
based much more on engaging consumers in a
If you could see what I’ve seen in news reports, letters,
relationship.
e-mails and faxes–not to mention what I’ve heard in
By 2012, the report forecasts the landscape
personal conversations–here’s what might be on
will change so profoundly that to survive,
your mind this month. Tell me what you think.
advertising industry players need to take
aggressive, innovative steps related to:
RBR Editor & Publisher
1) Consumers–Making micro-segmentation and
Bob Lederer
Audience development positions have begun
personalization paramount in marketing, and
to blossom at newspaper companies… That trend was just
2) Business design and infrastructure–All players need to
highlighted by the Newspaper Association of America
redesign organizational and operating capabilities across the
(Arlington, VA). “What is striking, though, is how dramatically
advertising lifecycle to support consumer and business
these positions vary,” said a summary at naa.org. “Few of
model innovation (consumer analytics and more).
the executives…have held the title for more than a year,
“IBM believes all players will need to invest heavily in
and their roles and responsibilities vary dramatically. In
consumer analytics and automation to gain more insights
the broadest terms, audience-development executives are
about the consumer and how to reach them,” read a
involved in strategy, market research and the creation of
release by the company. “For example, interactive advernew productions. More significantly, they are involved in
tising paired with consumer analytics provides compelling
fusing these tasks and ensuring that the reader, Web user
knowledge of who viewed and acted on an ad rather
or underserved audience member remains at the heart of
than estimates of impressions, allowing advertisers to
the newspaper’s entire portfolio of products.” The NAA’s
maximize revenue and yield management.”
impressive 11-page report details the challenges and
Read the report at www.ibm.com/media/endofadvertising.
responsibilities of audience-building executives at eight
different newspapers.
Marketing answers from “the activity happening
The report also stated: “While other media organizations,
below the conscious surface of our minds”… I’ve
notably broadcast companies, employ people in similar
noted some great opportunities for MR, but there are
positions, job responsibilities in such cases lean more
also potentially huge obstacles facing the profession. Lee
toward specific advertising and product development iniOdden, President/founder of TopRank Online Marketing,
tiatives. At newspapers, audience-development executives
foresees marketing taking an evolutionary course that
must think more strategically about the company’s overall
doesn’t look good for research. “MR…in its current
brand(s).” That sounds like just the sort of opportunity a
incarnation, is hopelessly flawed. It (marketing decisions)
lot of market researchers I know would relish.
will come from diving deep into the workings of our
brains…It will allow us to begin to measure leading indi“The End of Advertising as We Know It”… That’s the
cators. It will keep us from the trap of relying on selfnew IBM Global Business Services report (after a global
reported rationalizations, and (enable us to) dig deeper
survey of better than 2,400 consumers and 80 advertisers)
into all the activity that’s happening below the conscious
that forecasts “greater disruption for the advertising
surface of our minds.” His closing advice: “Take a break
industry in the next 5 years than has occurred in the previous
from looking at ‘what’ and start to explore ‘why.’ Dig
50.” The study anticipates changes that I see strenuously impactinto things like the triune brain, selective perception,
ing–in fact probably overturning–the already uncertain world
bounded rationality, working memory and some other
of advertising research. For instance:
basic cognitive concepts. It will be time well spent.”
• Budgets shifting rapidly to new, interactive formats,
which are expected to grow at nearly five times that of
Finally, at the risk of piling on… My first reaction
traditional advertising;
to Ford Motor Co.’s recent ad campaign was probably
• A transformation to an even stronger mindset that
the same as yours. It couldn’t happen for legal reasons,
caters to niche consumer segments;
but how would Ford react to a competitor borrowing
• Advertising agencies forced to experiment creatively,
the image of Henry Ford to trick people into doing
become brokers of consumer insights and guide allocation of
something for one of their campaigns? They’d feel
advertising dollars amid exploding choices;
used, as the MR profession did in the automaker’s
• The advertising community needing to dramatically re“Swap Your Ride” commercials. RBR
orient its business to serve consumers, who increasingly
What do you think? Email Bob at:
[email protected]
access content in non-linear formats;
Signs of Intelligence Life
2
RBR Editor & Publisher Bob Lederer (R) presents the 2007 Executive of the Year Award to Jeff Miller at The Research Industry Summit on Data Quality in Chicago
on November 5. The public announcement aroused noticeable cheers from the audience, which included many of Jeff’s competitors.
with a room full of his peers, many of them competitors.
Findings from the survey (fielded in mid-2006 across 17
well-known U.S. commercial access panels) were revealed
at “The Research Industry Summit on Respondent
Cooperation” in September 2006. By popular demand, his
presentation was repeated at a number of industry forums,
and his findings were a focal point in a broad-based panel
discussion at “The Research Industry Summit on Data
Quality” in Chicago this past November.
Since his initial presentation, Miller has become widely
recognized as one of this industry’s foremost experts on
online panel composition and sampling. More importantly, Miller’s revelations not only raised awareness and
understanding of the dimensions and scope of the problem for both agencies and clients, but helped spark an
industry-wide focus on online panel quality reform.
As a direct result of Burke’s proprietary testing, Miller
has learned more about the composition of most commercial research panels–strengths, weaknesses,
etc.–than, in some cases, even the companies that provide
them have. “Any panel company that wants to do business with us must first field a study on their own dime,
using a standardized questionnaire that gives me a very
good read on the quality of their membership,” Miller
shared. “They also need to meet some pretty rigorous
standards, the ‘ESOMAR 27,’ plus a whole lot more.”
Major client researchers who have compared Burke with
other suppliers affirmed Miller’s expertise.
In recognition of his innovative work and generous
contribution to the industry’s betterment, and for
demonstrating that good corporate citizenship is still
alive and well in the MR profession, RBR proudly names
Jeff Miller its 2007 Executive of the Year.
Of his decision to share Burke’s findings with the rest of the
industry, Miller commented, “The first step in any 12-step
program is recognizing that you have a problem. Even today,
not everyone accepts that there is a problem, which is not
only naïve, but dangerous. If we don’t take responsibility for
improving the signal-to-noise ratio in the data we’re providing to clients, we’re not only doing them a disservice; we’re
risking our reputation and viability as a profession. This
affects everyone who buys and sells research, and there are
both short- and long-term consequences for inaction.
(Continued on next page)
3
R E S E A R C H
B U S I N E S S
2007 Executive of the Year
4
R E P O R T
(Continued from page 3)
“By my estimation, a lot of money is being wasted on
company has a strong tradition of R&D. For example,
online research because respondents are either not
we’ve had our own telephone data collection center for
qualified to take the survey or their responses are so
years. The training our interviewers receive is somewhat
underwhelming that they aren’t worth the price paid to
legendary and we’ve always prided ourselves on having
collect them,” Miller told RBR. “Client organizations that
one of the thickest SOP manuals in the industry–and our
don’t have the ability to separate the wheat from the
telephone work has never been cheap.”
chaff are buying a lot more garbage than they realize,
Around 1999, Miller had an “aha” moment when a study
and passing it on to decision-makers.”
using two matched groups–one online and one via teleMiller’s Internet sampling expertise is the product of an
phone–yielded results that were within a statistically acceptongoing process that dates back to the mid-90s. “I was
able margin of measurement error. “We had embraced
originally tasked as Burke’s Director of Decision Sciences
multi-mode projects at a time when they were considered
in 1995 to investigate the Internet as an alternative data
fairly controversial, and I knew the Internet would be part of
collection modality,” he recalled. “Diligent analyst that I
the mix. This R&D basically enabled us to design a better
was, I came back with a pretty negative view, but I also
survey to minimize some of those measurement differences
knew things would change as Internet penetration grew,
and be sure data from one method wasn’t terribly different
so I took a keen interest in monitoring its progress.
from data collected via the other method. That dispelled
“In the face of early pressure
some of my personal misconfrom some of our technology
ceptions about the quality of
RBR “Executive of the Year Award” Recipients
clients and the marketplace,
data collected online and gave
1995: John Dimling, Nielsen Media Research
we took a very measured, 1996: Tod Johnson and Steve Coffey, The NPD Group me a better appreciation for
cautious approach to online 1997: Steve Schmidt, ACNielsen U.S.
the Internet’s long-term potenresearch and viewed the 1998: Gordon Black and David Clemm,
tial as a data collection vehicle.”
promise of ‘better, faster,
Miller personally kept a
Harris Black International, Ltd.
cheaper’ with a healthy dose
tight
rein over Burke’s use of
1999: Bill Schlegel, MarketTools
of skepticism. As the percent- 2000: Doug Rivers, Knowledge Networks
the Internet. In 2005 he
age of Burke’s projects gradu- 2001: Gayle Fuguitt and the MRD of General Mills
began noticing some disturbally shifted online,” he related, 2002: Mike Connors and Steve Schmidt, VNU
ing trends. “My analytical
“we eventually had to decide 2003: Jim Medick, MRCGroup
background was something
whether or not to build our 2004: Dan Frawley, Iconoculture
of an advantage, as it’s fairly
own panel.
unusual for an analyst to be
2005: Larry Brownell, Market Research Association
“I argued against it,
in charge of data collection,”
2006: Kim Dedeker, Procter & Gamble
because I believed that, 2007: Jeff Miller, Burke
he related. “Digging into
over time, no one panel
data, I started to see responwould be sufficient to meet
dent duplication and satisficour needs, and enough commercial panels would emerge
ing issues at distressing levels. The satisficing more than
to become a resource like electricity. Burke wouldn’t
the fraudulence motivated me to do this last round of
need to build our own power plant, just great appliances
research. There was a much greater tendency for panto run on that power. It was a calculated gamble that
elists to take shortcuts in online surveys,” he recalled.
paid off in that it allowed us to concentrate on quality.”
“We didn’t grasp the true severity of the issue,” admitted
Miller estimates the share of Burke’s project volume conMiller. “Burke competes on quality, and our sampling producted online grew by 15%-20% annually. Today, it
cedures are a little atypical–which probably gave us a slightaccounts for more than 60% of the firm’s research, which
ly false sense of security. We pay close attention to the
Miller notes exceeds the industry average by a significant
number of completes and to the sampling plan. For years,
margin. “We now do more online research as a percentwe’ve been very particular about our vendors and have
age of our overall business than some of the start-up
restricted our portfolio to those providers that allowed us
Internet research companies,” he asserted. “But the transito draw samples according to our own increasingly specific
tion proceeded cautiously. In the mid- to late-’90s, we
requirements. What might have started as a ‘convenience
reserved the Internet primarily for B2B studies with our
sample’ rapidly became, ‘This is how many invitations we
high-tech clients using their customer lists. But it wasn’t a
want you to send to females in California.’ Rather than buystretch to envision it as a dominant consumer research
ing 300 completes, we would buy an email distribution plan
modality down the road, so we invested a fair share of
that provided the exact sample we needed.”
resources in understanding its strengths and weaknesses.
(Continued on page 8)
“Burke doesn’t like to take risks,” he explained. “This
Audit Makes High Impact
(Continued from page 1)
top of everyday client needs and staff management. MRDs
certainly don’t have time to think about where they are and
how they’re doing in any substantial way.
However, this past March, RBR’s sister publication, Research
Conference Report, summarized a Solution Partners
Consulting (SPC) presentation at AMA’s Executive Insights
Conference. Co-Partners Larry Stanek (based in Prescott,
AZ) and Blair Peters (Greensboro, NC) outlined SPC’s new
Market Research Department Audit process, a systematic
review of an MRD’s capabilities and output, as communicated
by internal clients throughout the corporate organization.
The core of the presentation featured the SPC audit’s initial users–the MRD heads of Schaumburg, IL-based Zurich
Financial Services (SVP
& MR Director Steve
Magnino) and Seattle,
WA-headquartered
Washington Mutual
(SVP-Research
&
Customer Insight Ron
Gailey)–who documented its viability
and value.
Their
remarks
helped
Solution
Partners Consulting
earn RBR’s 2007 High
Solution Partners’ Larry Stanek
Impact MR Project
Award, a citation recognizing the MR project that most affects industry progress
and business viability, and that has the potential to propel
methodology, which has evolved into several different
approaches and modules depending on what issues a company raises and what they see as being important.”
Magnino received a blueprint to improve the focus and
direction of Zurich’s research, and that helped demonstrate
to senior management the benefit of a large department
expansion. The audit identified a number of new initiatives
that got divisions and research working together and
communicating in a common language.
For Ron Gailey, “the greatest benefit of our 2005 audit was
the clarity it gave me about changes I need to make over the
next few years.” Solution Partners presented Gailey’s team
with a client-side needs assessment and coached it on how
to fulfill identified
needs. “The audit
reviewed our operations and the measurement systems
behind our research,
and recommended
sound changes,”
shared Gailey. “It
gave me a five-year
plan and helped us
see the need for a
reorganization that
would align us with
Solution Partners’ Blair Peters
the business more
effectively.”
Asked about differences thus far between its completed
audits, Peters and Stanker say they come from differentiated
Audits have proven highly useful to MR departments at WaMu and Zurich NA
the industry forward in new positive directions. This honor
has an interesting recent history: RBR’s 2006 High Impact
MR Project Award went to Arbitron for its Portable
People Meter (PPM) project, which TIME Magazine just
selected as one of the “Best Inventions of 2007.”
Stanek (former research head at Kraft Foods and Minute
Maid), Peters (ex-Kraft Research Director, as well as onetime VP at ACNielsen and MARC) and former McDonald’s
research head Larry Chandler set up Solution Partners in
fall 2003. “Larry, Blair and I reviewed our collective career
experiences and built an inventory of things we could focus
on,” Stanek said. “Then we spoke to prospective clients and
found questions that were keeping research department
heads awake at night. That’s where Steve (Magnino) was at,
because he had built his department to a certain point and
asked us, ‘How do I figure out how I’m doing and where I
need to go next?’ That moved us to formulate the audit
MRD business drivers and department culture. “In some
cases, we’re building some fairly fundamental things,” said
Stanek. “But WaMu was doing a lot of innovative work,
product forecasting and marketing mix modeling. In a
couple of cases, the departments were pretty well developed but needed training with regard to insights and how
they can be recognized and built upon. We’re helping
one team to improve its writing and presentation skills
for more executive-level presenting and influencing.”
An 8-14 week audit (based on company and department
size and complexity) costs between $50,000 and $60,000.
“In most companies, you can’t get the executives together
for interviews in eight weeks,” Peters said. Stanek asserted
that department size is inconsequential to the worth of an
audit. “It always comes down to identifying the needs of the
organization, and helping the researcher visualize what’s
(Continued on page 7, right-hand column)
5
Research Business Special Report
November 2007
IRI Grows Healthcare Presence Thru IMS Alliance
IMS Health’s (Fairfield, CT) global information and
knowledge dominance in the Rx drug marketplace knows
few bounds. But the problem of closing a conspicuous
OTC data loophole prompted senior management in
2007 to investigate a global alliance with one of two qualified
companies. Despite ACNielsen’s broader global footprint and
the pre-existing relationship
between the two, IMS
found compelling reasons
to ink a deal with
Information Resources,
Inc. (Chicago, IL), a leader
in the OTC market information space.
The pair’s global information alliance was
announced October 8 but
actually became effective
this past summer when
IRI began providing global
data feeds to IMS for
“OTC IMS,” its global,
geographically-segmentable view of health categories.
The information flowing from this alliance is most directly
focused on pharma and OTC companies anxious for
insights into both the Rx and OTC sectors.
The IMS-IRI “win-win proposition” leverages the two
companies’ complementary,
necessary data assets into
a single Rx/OTC offering.
It can also be seen as a
major coup for IRI, which
has become a prominent
pharmaco player (servicing
J&J, Wyeth, Bayer,
Boehringer Ingelheim,
Novartis, and other pharma companies) in the past
three
years.
IRI’s
Healthcare Solutions
Group is said to be one of
its fastest growing business sectors.
“The IMS-IRI alliance creates improved market coverage and
a better product for clients of both companies,” IRI EVP &
GM-Healthcare Solutions Group Steve Johnson told RBR.
“We see the new IRI/IMS Medicine Cabinet solution as the
only way to view integrated Rx and OTC therapeutic market
data. It’s a source that gives ready access to the full sales
and pricing trends picture, analyzing and evaluating the
entire Rx and OTC market to uncover opportunities, develop
6
new marketing and pricing strategies, and generally create a
more holistic view of the total healthcare market.”
The agreement accelerates the expansion of IRI’s proprietary
products and services inside its current pharmaco clients
and provides new access and solutions to new pharma
businesses that are already IMS clientele. Although the
U.S. Rx data market is fragmented between IMS and
three bonafide competitors
(Verispan, Wolters Kluwer
and SDI), the alliance gives
IRI a leg up in helping
pharmacos optimize their
financial results in a worldwide non-Rx healthcare
market with $400B in
spending that is said to be
growing 6% annually.
Johnson said U.S. and
European companies are
the immediate geographic
focus, with Europe’s liberalized OTC market regulation of particular interest.
“Currently, there are no OTC drug channel constraints in
the U.S., unlike in Europe where OTC products–even a
product like Advil–have been limited to pharmacies in certain
countries. Recently, in Germany and Italy, OTCs have
become available in food
and other mass market
channels.” Johnson said
the expectation is that
other European countries will follow this joint
convenience and access
trend. This emerging
swing is a catalyst for
more collaborative products and services from
IMS and IRI.
Johnson
further
explained that “in
Europe, the collaboration and combined market coverage
gives our clients a more complete view of the marketplace
between the pharmacy and mass market channels. In the
U.S., an additional benefit to IMS is the application of IRI’s
analytic competencies on the pharma market’s newly
evolved patient-centric, consumer-centric model. However,
we believe our analytic skill sets are well-matched to the
business and insight requirements of both pharmaceutical
and OTC manufacturers here and in Europe.” Among IRI’s
Audit Makes High Impact
information advantages, Johnson listed out-of-pocket price,
product form, size and pill count as among the 12 measures
that IRI’s Rx Count records from Rx drug transactions.
“The overall benefit of this alliance for our clients is a onestop-shop for health information, market data and analytical
consulting,” he continued. “That’s clearly beneficial to pharma
and OTC companies, as well as retailers. All are attempting
to make sense of the ‘whys’ behind consumer choices and
changing behavior due to wide-ranging consumer healthcare
choices in an evolving marketplace, elements like Medicare
Part D, discounted generic drugs, tiered co-pays, health savings accounts and expanding Rx-to-OTC switches.”
IMS and IRI clients will have more rapid, deeper access
to key trends, both in Rx and OTC drugs. “As an example, we have very well developed,
proprietary BehaviorScan® TV
advertising testing capabilities which
have been extended to now address
Rx direct-to-consumer TV creative,”
remarked Johnson. “Another example
“We see the IRI/IMS
Medicine Cabinet
solution as the only
way to view integrated Rx and OTC
data in a therapeutic market.”
IRI GM-Healthcare Solutions Steve Johnson
is our proprietary RxPulse™ Patient Panel that empowers
both IRI and IMS clients to better understand the market
impact as products switch from Rx to OTC status,
exemplified by brands like Prilosec and Claritin.”
IRI and IMS anticipate the rollout of new syndicated and
custom research services. “Market coverage and new
market views that lead to analytics opportunities will
probably be the most immediate areas of impact,”
Johnson offered, “and then more understanding from
wrapping the analytics around the new views.”
One of those improved views, Johnson believes, will
aid corporations that are in buying mode. “We are
positioned to present data and insights to manufacturers on a global basis to support their acquisition strategies by providing a more holistic, useful and meaningful
view of companies and brands worth buying across
OTC, Rx and CPG,” concluded Johnson. RBR
For more information, contact:
[email protected]
(Continued from page 5)
required to fill those needs,” he noted. “There has to be
some research traction from comprehension of what MR
can provide and some level of sophistication.”
Stanek enumerated circumstances that lend themselves to
an audit: “A new department lead could use it to take stock
in an objective, fast-paced way. That’s what happened at our
third audit, Humana (Louisville, KY). Or if you’ve had a short
period of rapid growth where you might have been involved
early on in all of the components, but everything has grown
in size and complexity and you need to evaluate where you
are. The third one is internal pressure, where you get asked
about your contribution to the company in terms of profitable growth. Peters described WaMu and Zurich as “dareto-be-great” situations for the respective directors.
“Also, if you have a leader who is good at envisioning
where they think the department should be, because
while they see the need they don’t have time to address
it.” Peters added, “There’s great value in being able to
take information from an objective third party and present it to management. I think people that don’t consider
this are probably much more worried that the information may harm them in some way.”
“I’ve wondered if I was still running a department, would
I want an audit? I think I would,” Stanek said. “I think back
to Steve Magnino, who was reluctant at first. He wasn’t
sure he saw the need, but kept asking the right questions
that lend themselves to this methodology. We addressed
those and showed him a host of unknown areas.”
While the issue of ROI has not been raised with respect to
an audit, Stanek mentioned that “each time we’ve finished,
people have felt they have received a very solid strategic
blueprint of how to proceed. It builds a future vision and
a way to go there, rather than a review of what exists
and how to make it more effective and efficient.”
Solution Partners’ most recent audit, with Humana,
occurred this year. Asked why there haven’t been more,
Stanek noted, “We’ve been heavily involved with Zurich, and
to a lesser degree with Humana, in implementing audit
results and recommendations. There have been so many
new capabilities and processes to put in place. In a couple
of instances we’ve done a two- or three-day workshop
to help galvanize internal resources against initiatives and
objectives. In Zurich’s case, we’ve been building a global
research network, complicated by the different business
divisions and very uneven capabilities across their network.
There hasn’t been time to push our audit idea or even to
start another one with a new client.”
Hopefully they can rectify that situation after receiving
the 2007 RBR High-Impact Award! Congratulations. RBR
For more information, contact: [email protected]
[email protected]
7
R E S E A R C H
B U S I N E S S
2007 Executive of the Year
R E P O R T
November News Notes
(Continued from page 4)
Miller designed his study with multiple objectives in mind,
including helping the panel companies improve their deliverable by providing a Burke scorecard for them and deidentified competitors. The results were not encouraging.
“None of the panel companies had an acceptable level of
quality that I could rely on without some controls of my
own,” he reported. “Clearly, a greater degree of intervention was required to ensure appropriate quality. For Burke,
that meant extensive modeling to predict whether a person
is one of two different flavors of undesirable: a ‘fraudulent’
or a ‘satisficer.’ Without the luxury on any given study to
ask 30 minutes worth of test questions, I needed to build a
robust model using a handful of questions that allowed me
to predict with tremendous accuracy whether someone fits
my definition of undesirable.
“This was very serious,” Miller continued, “because we
couldn’t afford to throw a panelist out based on suspicion. We needed clear and convincing evidence before we
done, and some of them are now trying to compete on
the basis of that quality. There’s some marketing fluff,
sure, but I’ve also seen significant procedural changes.”
Despite progress, Miller concludes the overall problem
is more complicated than it may seem. “Some of Burke’s
practices are at odds with panel company business models. Tensions still exist within panels as to how frequently you can survey a panelist, etc., and the story hasn’t
been fully written as to best practices in the long term.
But at least there’s a recognition and emphasis on quality that wasn’t present before, which makes me feel good
about the future. And I’m extremely proud if some of
our R&D contributed to that change.”
Miller added that the current situation is workable.
“Every panel has both good and undesirable members. We
use some of the panels that didn’t do particularly well
from time to time because I have a reasonably good mechanism to achieve quality by separating good respondents
“None of the panel companies had an acceptable level of quality that I could
rely on without some internal controls…That meant extensive modeling to
predict whether a person is one of two different flavors of undesirable.”
8
condemned any respondent to the survey death penalty
and removed their data after they completed a survey.”
Based on the R&D, providers that failed to meet quality
standards–some were Burke vendors, and others were auditioning for the job–were cut from Burke’s list of acceptable
panels. The panel providers were generally very receptive to
his feedback. “Two of the weaker performers even asked to
be tested again,” he disclosed. “And one did significantly better the second time. I challenged the panel companies to
address their weaknesses as best they could. Many of them
came up with pretty creative ways to identify fraudulent people, for example, that I would have no ability to identify otherwise because I didn’t have access to the panel data.”
Miller said that, to its credit, the panel community was
quicker to acknowledge and address the problem than
many of the research companies with proprietary panels.
“I don’t think the research companies with panels got the
message until [P&G’s research head, Kim Dedeker, took
the issue up at the Respondent Cooperation Summit] last
year,” he observed. “Prior to that, you didn’t hear those
agencies volunteering any information on the subject.”
In the last year, Miller says the industry has made substantial progress toward improving panel quality.
“Providers, in general, have made an effort to weed out
the bad people from the good. I believe major panel
companies, by and large, understand what needs to be
from the bad ones. Any panel may have some substandard
practices and may promote–wittingly or unwittingly–some
undesirable behaviors, but I can identify those panelists.
“There are companies that clearly underperform domestically but are fine for international research because the
panel concept and the maturity of the market aren’t as
advanced outside the U.S. as they are here,” he added.
“Problems exist, but at much lower levels. Eventually,
though, I think similar issues will probably crop up.
While panel quality is becoming a key concern at most
research companies, Miller has turned his attention to
next steps. “Our industry’s challenge is to get beyond the
identification stage and focus on prevention and rehabilitation,” Miller stressed. “We may be fixing problems, but
the deeper underlying problem is our finite resource. We
can’t keep eliminating people who, for whatever reason,
don’t behave well on a given day. I doubt we’ll ever return
to response and cooperation rates we took for granted
30 years ago. And while emerging tools like online communities are a great option, you can’t scale communities
to do the $1.4B of research we’re currently doing online.
So we need to foster a better quid pro quo relationship
to preserve and protect the respondent pool we do have,
because it’s not just a renewable resource.”
Go get ‘em, Jeff! RBR salutes your commitment, and congratulates you on some well-deserved recognition! RBR
For more information, contact:
[email protected]
(Continued from page 1)
Top of the News
In November, the mass media reported a “push poll” had
been done in New Hampshire that asked questions about
the religion and beliefs of Republican presidential
candidate former MA Governor Mitt Romney,
who is Morman. Western Watts (Orem, UT)
was cited as the firm conducting the survey. CEO
David Haynes told RBR his company does not conduct push polls and he could not disclose for
whom this or any other poll had been done.
David Haynes
“Oftentimes, we don’t even know who we’re working for when we accept a project,” he explained,
“and we don’t ask because that by itself can create bias. Nor
do we know how the information is used.”
In a $1.2B deal, The Nielsen Co. (New York, NY) is
outsourcing small-scale operations in India and other
locations to Tata Consulting
Services (Mumbai), which CEO David
Calhoun said has “significantly more
scale, access to higher-level people and
more capacity”… Separately, Nielsen
laid off 1,250 employees worldwide to cut
David Calhoun
costs… Calhoun said Nielsen will be “less
hungry” for acquisitions in coming
months, but some moves will be made to “fill out niches.”
Mergers & Acquisitions
IBM (Armonk, NY) purchased BI software firm
Cognos (Ottawa, ON, Canada) for about $5B…
Microsoft (Redmond, WA) acquired a stake in Facebook
(Palo Alto, CA), representing a gargantuan
research opportunity in the key young male
demo… ValueAct Capital (San Francisco, CA)
and Silver Lake (Menlo Park, CA) dropped
their proposed $2.25B Acxiom (Little Rock,
AR) purchase… Opinion Research
(Princeton, NJ) acquired Northwest
Research Group (Boise, ID)… FlakeWilkerson Market Insights (Little
Rock AR) merged with Market
Strategies International (Livonia, MI).
The FTC approved Cognizant’s (Teaneck,
NJ) $135M takeover of data analytics specialist
MarketRx (Bridgewater, NJ)… Stockholders in
Mike Connors’ Information Services Group
(Stamford, CT) approved the TPI (Houston, TX)
buy… InTouch Inc. (Arden Hills, MN) was sold to
MECLABS Group (parent company of MarketingSherpa).…
Dun & Bradstreet (Short Hills, NJ) acquired data integration and analytics firm Purisma (Redwood City, CA).
European Commission authorities denied
Google’s (Mountain View, CA) $3.1B DoubleClick
(New York, NY) buy… Synovate (London, UK)
bought Research Solutions (Auckland, New
Zealand)… GfK Group (Nuremberg, Germany)
acquired Sino-MR (Beijing, China) and CMM (Beijing,
China)… Cello snapped up 2CV (both London,
UK)… Screen Digest (London, UK) bought U.S. counterpart Adams Media Research (Carmel, CA)…
Novintel merged with Global Intelligence Alliance (both
Helsinki, Finland), adopting the GIA name.
Partnerships & Deals
Nielsen inked a deal to provide audience measurement
data for Google’s TV Ads platform… ESPN
(Bristol, CT) is working with Nielsen Co.
to develop a new cross-media
measurement model, using
data from Nielsen’s TV/Internet Convergence
panel and Nielsen Mobile… In agreements with
eight top convenience store retailers, Nielsen will provide
CPG manufacturers with weekly data and sales insights for
those retailers’ corporate stores… BASES (Covington,
KY) and Eureka! Ranch Technology (Newtown, OH)
teamed up to offer an integrated approach to identifying
and developing new products.
NPD Group (New York, NY) linked up with Fusion
Marketing (Los Angeles, CA) to provide insights into the
food and drink industry… BzzAgent (Boston,
MA) struck a deal with Interpublic (New
York, NY) to run word-of-mouth campaigns
and research the effectiveness of conversational marketing… PR PLUS combines Opinion
Research Corporation’s (Princeton, NJ) polling expertise
with The Hastings Group’s (Washington, D.C.) ability to
generate media interest in sponsored surveys… TNS
(New York, NY) partnered with Intellidyn (Hingham,
MA) to form a global customer intelligence practice
that will combine demographic and financial data with
behavioral and attitudinal research… Publicis Group
(Paris, France) members Leo Burnett
(Chicago, IL), Starcom MediaVest
(Chicago, IL) and Digitas (Boston,
MA) are pooling their research,
knowledge and resources to create
“The Insight Factory”,
which will allow for better
collaboration.
Pulse Group (Kamloops, BC, Canada) partnered with
iTracks (Saskatoon, SK, Canada) for online qual in Asia…
9
R E S E A R C H
B U S I N E S S
R E P O R T
Millward Brown (Naperville, IL) is working with Scangroup
(Nairobi, Kenya) to expand across Africa, starting with the
planned January launch of majority-owned Millward Brown
East Africa in Nairobi… A deal between Toluna and Incisive
Media (London, UK) gives the panel provider exclusive access to recruit B2B panelists from subscribers
to Incisive’s print and online titles… M:Metrics
(London, UK) and the British Market Research
Bureau (London, UK) joined forces to produce
mobile media consumption metrics for advertisers… Starfish Research (Singapore) partnered with
Bellwether Interactive (Greenwich, CT) to develop online
customer communities for Asian clients.
New Nielsen Online combines NetRatings and
BuzzMetrics services, with plans to expand into an “all-inone” ratings system in 2008 covering television and the
Internet. Mobile and consumer generated video viewing are expected to
eventually be included, too… Nielsen
Mobile folds recent acquisition Telephia into
existing mobile initiatives to create “large
scale” mobile consumer panels…
DemoWatch by Nielsen Co. links demos from overnight
TV ratings to commercials… Nielsen Retailer Category
Shopper & Buyer Scorecard, originally developed for
Wal-Mart, is available for manufacturers and retailers to
assess how product categories draw shoppers into stores.
Expansions & Moves
Zogby (Utica, NY) prepared for Latin America entry
with a new Miami, FL office… Invoke Solutions
(Waltham, MA) opened shop in London,
UK… SSI (Fairfield, CT) opened a Toronto,
ON, Canada office… Decipher Inc. (Fresno,
CA) set up in New York, NY… BuzzBack
(New York, NY) will base European operations out of a new UK office run by inaugural
Martin Oxley
MD-Europe Martin Oxley.
TiVo (Alviso, CA), backed by Starcom USA (Chicago, IL),
launched the PowerWatch Consumer Panel,
combining viewing behavior with demographic data for
20,000 DVR HHs and outstripping Nielsen Media’s
3,000 HH DVR measurement service… GMI (Mercer
Island, WA) introduced a 100,000-member AfricanAmerican online panel… Research Now (London,
UK) launched a 400,000-plus, invitation-only U.S. panel
with English and Spanish surveys.
Angus Reid Strategies (Vancouver, BC, Canada) opened a
San Francisco, CA branch… Annik (Gurgaon, India) established a Florida office… Acrobat Research (Toronto,
ON, Canada) opened its first U.S. call center in Calais,
ME… TMR, Inc. (Broomall, PA) will create 50 new positions and retain 25 after relocating from Aurora, CO to
Scranton, PA in a $1M expansion… Market Directions
moved HQ to a new Kansas City, MO location.
Confirmit’s (Oslo, Norway) release 12 includes a breakthrough billed as the world’s first Concurrent
Sampling engine… MarketTools (San Francisco, CA)
now offers mobile text surveys via
Zoomerang Anywhere… Opinion
Research Corp. (Princeton, NJ)
introduced Customer Experience Evaluation, an online
survey tool for small-to-medium sized businesses.
Research Company Reported Financial Results
1st Quarter
Company
Revenue (Mil)
Harris Interactive1 $ 55.2 (+16.9%)
1st Quarter
Net (Mil)
$ 1.1 (+22.5%)
3rd Quarter
Revenue (Mil)
Arbitron
$ 96.5 (+6.4%)
comScore
$ 22.4 (+38.5%)
Confirmit2
$ 8.9 (+82.3%)
Forrester
$ 51.1 (+16.0%)
Gartner3
$ 170.2 (+18.1%)
InfoUSA4,5
$ 185.0 (+73.9%)
Greenfield Online $ 32.3 (+29.9%)
In-Touch Survey $ 1.4 (+47.8%)
Ipsos7,8
EUR221.1 (+7.6%)
MDC Partners5 $ 140.1 (+38.5%)
Nielsen Co.
$ 1188.0 (+11.0%)
SPSS
$ 72.3 (+11.7%)
Visual Sciences9 $ 20.4 (+17.0%)
WPP10,11
£ 218.5 (+2.2%)
3rd Quarter
Net (Mil)
$ 17.2 (-14.7%)
$ 3.8 (+137.7%)
$ 0.6 (+76.7%)
$ 6.8 (+8.2%)
N/A
$ 17.0 (+52.8%)
$ 3.3 (+80.3%)
$ 0.2 (+15,760%)6
N/A
$ 6.8 net loss
$ 100.0 net loss
$ 8.4 (+45.5%)
$ 1.0 net loss
N/A
Cello10
Optimisa4,10
Synovate10
TNS10
Six-Month
Revenue (Mil)
£ 45.8 (+44%)
£ 4.7 (+67.8%)
£192.8 (+5.8%)
£ 497.4 (+3.5%)
Six-Month
Net (Mil)
£ 24.4 (+38%)12
£ 0.8 (+84.0%)13
£ 7.0 (-6.7%)13
£45.4 (+8.9%)13
Company
Arbitron
comScore
Confirmit2
Forrester
Gartner3
InfoUSA4,5
GfK Group4,7
Greenfield Online
In-Touch Survey
Ipsos7,8
MDC Partners5
Nielsen Co.
SPSS
Visual Sciences9
WPP10,11
Company
You Gov10,14
Nine-Month
Revenue (Mil)
$ 267.3 (+6.9%)
$ 61.9 (+28.8%)
$ 21.4 (+50.8%)
$ 153.6 (+15.9%)
$ 492.8 (+17.5%)
$ 502.9 (+62.4%)
EUR833.9 (+4.2%)
$ 90.6 (+27.9%)
$ 3.6 (+30.2%)
EUR664.2 (+8.3%)
$ 394.8 (+31.9%)
$ 3429.0 (+11.0%)
$ 211.4 (+11.0%)
$ 60.6 (+31.4%)
£ 650.3 (-0.4%)
Nine-Month
Net (Mil)
$ 36.5 (-20.2%)
$ 6.6 (+114.0%)
$ 1.6 (+82.2%)
$ 13.3 (+15.7%)
N/A
$ 29.7 (+33.3%)
EUR87.9 (+7.1%)
$ 8.4 (+69.7%)
$ 0.04 (+499%)6
N/A
$ 18.2 net loss
$ 235.0 net loss
$ 23.7 (+80.4%)
$ 1.7 net loss
N/A
12-Month
12-Month
Net (Mil)
£ 5.5 (+41.8%)13
Revenue (Mil)
£ 14.3 (+51.0%)
1 Revenue from Services
2 Formerly FIRM
4 Sales
5.Includes non-MR
3 Research Only
6. Net Comprehensive Earnings
7 Euros
8 Consolidated Revenues
10 Pounds Sterling
9 Formerly WebSideStory
11 Information, Insight & Consultancy results only
13 Operating Profit
12Operating Income
14 Group Turnover-Continuing Operations
Source: Companies’ quarterly corporate reports
The Launch Pad
Ex-Synovate exec Mike Page launched Cognicient (New
York, NY), an “integration agency” dedicated to fusing
companies’ primary research data with non-MR intelligence to unearth holistic insights… Networked Insights
(Madison, WI), with $4M in VC backing, is a new online
community provider offering continual, real-time mining and analysis of members’ conversations.
10
Digital marketer One to One Interactive (Charlestown,
MA) unveiled a new neuromarketing (EEG, heart rate,
eye-tracking, facial analysis, etc.) media research unit,
OTOinsights… Predictify.com (Menlo Park, CA), a new
website/research service created by a Google alum,
offers visitors the chance to win cash by accurately
predicting the outcomes of questions on everything
from politics to entertainment posted by other members.
Only members who also answer “premium” questions
submitted by companies (e.g., “How much will the new
widget cost?”) qualify for payment.
Hitwise released Lifestyle V3.0, featuring Simmons’
(both New York, NY) MOSAIC™ system, combining
attitudinal and behavioral consumer segmentation on over
30,000 websites… Hitwise also opened Retail Data
Center, with weekly shopping trend data based on over
20,000 websites… Pay-per-call advertising and call tracking firm thinkingVOICE (San Francisco,
CA) debuted CallBeacon™, enabling
advertisers to embed cell tracking
on their websites to identify origination
of phone leads and enable affiliate networks to access
conversion, performance and revenue tracking… Acxiom
launched a suite of behavioral targeting platforms:
PersonicX segments the U.S. population into 21 lifestyle
stages, Relevant-X targets interactive
ads at households most likely to convert and ConnectionPoint-X offers
“real-time” customer information
including online and offline behaviors, interests and
lifestyles, and demographics.
Market discovery software firm Accelovation (Mountain
View, CA) introduced a text analytics tool that works like
a search engine to help food manufacturers find information
on scientific research, consumer trends and innovations.
Clients reportedly include Kraft and General Mills…
QL2 Software (Seattle, WA) introduced a suite of market
intelligence tools featuring a dashboard, customizable predefined reporting and data visualization and graphing to analyze data on product/price mix, competitive positioning and consumer opinion and preference… MR
consultancy FiveTwelve Group (Milwaukee, WI)
introduced the RADCL Research System, Web-based
software encompassing research project management, communication and library applications.
Domestic News Makers
Knowledge Networks (Menlo Park, CA) secured a patent
on a sample management technique that reportedly
minimizes skewing when sampling for multiple surveys from
the same respondent pool by adjusting the selection probabilities for panel members after each
sample pull… Political polling is
exempt from FTC’s Do Not Call
list, but a legally non-binding
“National Political Do Not Call Registry” established
by non-profit Citizens for Civil Discourse is collecting
names of citizens that wish to opt-out of telephone polls
during the 2008 election at its www.StopPoliticalCalls.org.
Candidates are being asked to voluntarily comply.
At ARF’s TV meeting in October, it was disclosed that a
surprising amount of NMR’s TV ratings data continue to
be error prone and an industry audit of its new commercial minute ratings will not be complete until January–and
not accredited by MRC until after… NMR plans to triple
Nielsen Families over the next four years… A judge
11
partially dismissed Telephia’s (now Nielsen Mobile) patent
infringement suit against M:Metrics, which launched its
syndicated mobile audience measurement
service in March. Telephia noted the
judge’s decision left in place “the majority of our claims.”
First, it announced its intention to buy Quantum
Research Services by early in 2008. Now, as part of its
plan to become a MR industry player, President Gary
Stein says Cable & Co. (Westport, CT) will apply for
an American Stock Exchange listing. More MR
agency purchases are to take place, and Cable & Co. will
be renamed Marketing & Research Corp…
Anatomy of a Trend, a new book by Danish “trend
sociologist” Henrik Vejlgaard, presents an analytical framework claimed to predict future
consumer needs and determine whether or not
emerging trends will go mainstream… University of
Henrik Vejlgaard
California-Irvine’s continuing education arm, UC
Irvine Extension, will offer a new Web
Intelligence certificate program in collaboration with
the Web Analytics Association (Washington, DC).
Kudos Korner
Schlesinger Associates and The Research House (Edison,
NJ) received the MRA Celebrated Company of the Year
award… Mediamark Research & Intelligence (New
York, NY) was awarded Best
Technical Paper at the
Worldwide
Readership
Research Symposium in Vienna,
Austria… MarketTools (San
Francisco, CA) was ranked
1,709th on the first-ever Inc.
Steve Schlesinger and Debby Schlesinger-Hellman (center)
5,000 list of fastest-growing priaccept MRA’s “Company of the Year” Award
vate U.S. companies.… Inc.
5,000 recognized Kelton Research (New York, NY) as
the fastest growing U.S. MR consultancy… Deloitte
& Touche USA LLP (New York, NY) ranked GMI (Seattle,
WA) seventh among the 50 fastest-growing technology
companies in Washington state. Greenfield Online
(WIlton, CT) ranked 10th in Connecticut… e-Rewards
(Dallas, TX) enrolled its four-millionth panelist.
12
BuzzBack Market Research was selected as a finalist for
The International MR Society and Association for Survey
Computing Joint Award for Technology Effectiveness
2007… David Smith of DVL
Smith Group (London, UK)
received ESOMAR’s John
Downham Award at the 60th Congress in
Berlin… MRIA recognized two firms for MR
excellence at its annual conference:
David Smith
Environics Research Group (Toronto, ON,
Canada) for Best in Class Project, and
CorbinPartners Inc. (Toronto, ON, Canada) for the
Best Integration of MR with other information sources.
MR Works
Konica Minolta Business Solutions (Ramsey, NJ) U.S.A.
signed as primary sponsor of the Gator Bowl, one of
college football’s premier events. PR Manager James
Norberto said MR indicated customer demographics
match up well with college football viewers.
But is sometimes misused…To boost its profile
among women, Dockers (San Francisco, CA) held eight
“trunk shows,” inviting 50 to 70 women, age 35-and-up
with an average income of $75,000, to each event. The
women were targeted from consumer databases
compiled by MR firms.
And sometimes ignored… The New York MTA wants
to raise subway fairs even though riders rate service
as mediocre in its own surveys. RBR
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