Let’s Talk Price: How Much Does Market Research Cost?

One of the most frequently asked questions we get at Dr. Wallace Consultancy is “how much does custom research cost?” That’s like walking into a car dealership and asking, “how much does a new car cost?” Before answering either question, several factors need to be considered. In our car analogy, you need to answer questions about size, safety, reliability, luxury and other key factors that are important. Likewise, it’s important to understand your own budget and what you prioritize.

The same can be said when asking about the cost of research. Whether it’s focus groups, in-depth interviews or surveys, the price tag will depend on many factors, including what you want to achieve through the research, who you want to ask the questions of, and how you plan to act on the results. Similar to any major purchase, understanding your budget and priorities is important to help us ensure we can properly scope the project to best meet your needs and priorities. This is not to gauge you to the top of your range, but to maximize what we can provide, given any constraints.

We don’t want to sell you on a Lamborghini when what you really need is a minivan.

QUALITATIVE RESEARCH

Consider the price of a focus group study. Prices would vary depending on the number of groups, seniority of participants, narrowness of profession/expertise or location of groups. You may be able to secure a single, simple group of government IT professionals for £1000 or an eight-group study of mid-to senior-level professionals across multiple cities for £10,000. More typically, two groups of business or government participants can cost between £2000-£3500 and four groups may cost £3500-£7500. In order to get a precise quote, any market research firm worth its salt needs to ask you a battery of questions.

The people you want participating in the study are the single biggest price driver: it takes far more time and effort to recruit – and therefore costs much more to interview – a lieutenant general or Fortune 500 CEO than it does to speak to a high school student.

Here are some other price-related issues affected by the target audience:

• The budget depends on the number of audience types you are targeting and whether it makes sense to mix them into the same group or give them their own group to ensure an unbiased and more relevant discussion. We would not normally mix customers and prospects in the same group because their awareness of you, their experience with your products and services, and their perception of your brand could sharply differ. It could also easily lead to those more familiar with your brand dominating the discussion and skewing the findings.
• Where are your customers located? If they are scattered across the country or across the globe, we might very well drop the idea of an in-person group and recommend instead an online focus group as more economical for you and more convenient for the participants.
• Are you able to provide a contact list of the people you want us to recruit, or do you want us to compile that list? This can affect the price dramatically, depending on who the target is.
• Is the target audience very senior, or a very specific and hard-to-reach segment? Do you intend to discuss highly complex or sensitive issues? Any of these conditions may call for a change in strategy to more private one-on-one in-depth interviews.

While these are the most commonly asked questions, there may be additional factors that could affect the cost of the project. The type of recording, analysis, reporting, participant incentives and travel can also impact the budget.

Qualitative Research: In-Depth Interviews or Focus Groups? Which Method Is Best for Your Needs?

QUANTITATIVE RESEARCH

Conversely, the price for quantitative research can range widely, from £1500 to over £10,000, with most studies in the £3000-£5500 range.

In these cases, you need to consider several issues:

• The target audience(s) you want to survey. Think again of the effort required to survey generals vs. students. This is the biggest driver of price.
• Your objectives: what do you want to learn from one or more audience segments? Your goals and the number of targets may require us to slice and dice the data when we analyze the results, and since we’ll need to ensure each subgroup contains enough completed surveys to run a statistical analysis, this will drive the number of surveys required and thus drive the price. In tandem with that, the number of completed interviews per target group is also a factor.
• Telephone or online? Related to your objectives, the audience, and the nature of the questions to be asked, there is another set of considerations around whether a telephone or online methodology makes more sense.
• The number of questions you want to ask. This could reduce or lengthen the survey, in turn affecting respondents’ willingness to take the time to answer the questions, and is thus another driver of price.
• The types of questions to ask. Are there many open-ended questions that require probing by the interviewer, or long lists of statements for respondents to address?

Some other factors affecting quantitative survey pricing include translation (if multiple languages and/or countries are required), as well as any applicable incentives, analysis, coding of open-ended questions, and reporting.

As you can see, there is a lot to consider. It is the research firm’s job to walk you through these considerations. It may sound daunting, but by going through this exercise up-front you will benefit from a much more focused research effort, eliminate misunderstandings along the way, and get the value you expect.

This brings me back to the price of the car you want. A good salesperson will ask what you need most from your car. Depending on if you want to buy a car for the occasional Sunday drive around your neighborhood, off-roading in the Sahara, or as your main mode of transportation for your family, a good salesperson will advise you on the best car for your budget. The same principles apply to a good market research partner when asked, “how much does research cost?”

If you’re interested in custom research to help inform your business strategies, contact Dr. Wallace at [email protected]