CPG Looks for a Universal Platform for Market Research

Two giants in the consumer packaged goods industry, General Mills and Procter & Gamble, are aiming to save costs on market research by partnering with a Web-based knowledge management player.

The two companies — which compete in several markets — each have tapped Mill Valley, Calif.-based MarketTools, a provider of Web-based market research tools and services that’s promising increased speed and efficiency for the two rivals.

MarketTools is predicated on the idea that if the companies that use market research standardize their research methodology, databases, and reporting system, both they and their clients could save money and time.

CPG companies typically spend millions of dollars annually with a slew of market research firms, ad agencies and consultants, often in addition to in-house research staff. Each supplier brings its own technology and procedure, making it difficult to move data between systems, and also complicating the sharing and distribution of information between companies utilizing market research.

Not only does MarketTool aim to fill the gap by positioning itself as a “one-stop-shop” for Web-based knowledge management, it also says it can be faster than traditional market research tools — since mailing, data entry, data tabulation and manual reporting are all automated.

More specifically, General Mills said that a move to a unified, Web-based system could cut operating times for CPG firms’ research projects by 75 percent, while cutting costs by 50 percent.

If true, that’s good news in and of itself for manufacturers. But the partners also said a unified research platform could ensure more accurate results than traditional research methodologies — there’s a smaller chance of data becoming corrupted, since MarketTools’ data doesn’t need to be re-entered or re-configured as its passed from collector to agency to client.

It’s the first time that CPG players have worked together to support a common information platform for market research. Yet, despite competition and no real reputation for being early adopters of new technology — these are the companies who produce Bisquick, Pampers and Charmin, after all — the CPG industry’s adoption of a Web-based platform makes sense.

Indeed, their industry, which by some accounts makes up more than a third of the $15 billion spent on market research each year, seems a prime candidate for a Web-based overhaul. For one, CPG market research is heavily focused on brand impact — less so than most IT or heavy industrial products.

Secondly, it’s becoming harder to reach consumers who are bombarded by marketing messages, and who, as a result, perceive telephone, mail and shopping mall intercept surveys as invasive and burdensome.

So by cutting out some of the inefficiencies that crop up in the sharing of data, MarketTools and its supporters believe that the company stands a chance of being the universal platform for market research data.

“By helping our client companies gain more efficiency with their existing research data collection efforts, we are streamlining and improving worldwide market research efforts,” said MarketTools’ president and chief executive, Bill Schlegel. “With the support of the leading consumer packaged goods and research companies, we are able to set the standard for a higher quality of market research in various industries, while saving significant time and money across the board.”

But to become the common data management supplier, it has to dominate the vastly fragmented research tools industry with buy-in from the companies that use market research, and the research firms that pound the pavement (or telephone keypads) to get that research.

So far, the ASP has found clients in General Mills and P&G, who both have investments in the startup. In addition, Verizon, Microsoft and Ford Motor Company have used the company’s flagship Web service, zTelligence, in their research, and ad agency group WPP Group and market research firm SPSS also have deals with the company.

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