How to Procure Market Research Services

Quick Answer: How do you procure market research services?

Procuring market research services is a strategic 4-step process. It involves: 1) Identifying Potential Providers by defining your research needs and creating a "longlist" of specialized firms. 2) Evaluating a "Shortlist" of Providers by issuing a Request for Proposal (RFP) and assessing their methodology, expertise, and past work. 3) Negotiating the Contract, focusing on scope, deliverables, timeline, and data ownership. 4) Managing the Project through regular communication and quality assurance to ensure you receive actionable insights.

Why is Procuring Market Research a Specialized Skill?

Procuring market research is not like buying a simple product. You are buying intangible insights, data, and expertise. The success of a multi-million dollar business strategy can depend on the quality of the research you procure.

A strategic procurement process is essential to find a partner that noth only fits your budget but also has the correct methodology and industry expertise to deliver clear, unbiased, and actionable insights that your business can use to make high-stakes decisions.

Let's walk through the 4-step process using a real-world example: A tech company's new fitness app has very low downloads, and they need to find out why.

The 4-Step Process for Procuring Market Research

Step 1: Identify Potential Service Providers (The Longlist)

• What it is: The first step is to clearly define your research question and find a broad list of firms qualified to answer it.

• Key Actions:

  • Define Your Need: You must first understand your own research objective. Is it a broad exploratory question or a specific, quantitative one?

  • Conduct Research: Use industry directories, professional networks (like LinkedIn), and peer recommendations to find firms.

  • Segment by Specialty: Are you looking for a large, global firm with broad data, or a small, niche agency that specializes in your specific area?

• Case Study Example: The tech company's need is "Why are we failing to get downloads?" They need a firm with expertise in mobile app user experience (UX) and consumer behavior. They conduct research and create a "longlist" of 8 firms that specialize in this.

Step 2: Evaluate a Shortlist (The RFP Process)

• What it is: This is the formal process of narrowing your longlist by sending out a Request for Proposal (RFP). This document outlines your needs and asks firms to submit a detailed proposal.

• Key Actions:

  • Issue a Clear RFP: Your RFP must include your research objectives, timeline, and budget.

  • Evaluate Proposals on Key Criteria:

    • Methodology: This is the most important part. How do they plan to get the answer? (e.g., focus groups, surveys, user interviews).

    • Industry Experience: Do they understand the tech/fitness app market?

    • Past Work: Do their case studies show they've solved similar problems?

• Case Study Example: The tech company sends its RFP. The 3 shortlisted firms all propose different methodologies. The procurement team chooses to move forward with a firm that proposed a two-phase approach: 15 in-depth user interviews (qualitative) followed by a 1,000-person survey (quantitative).

Step 3: Negotiate the Contract & Scope

• What it is: Once you've selected a finalist based on their proposal, you must negotiate the final contract and Scope of Work (SOW).

• Key Actions:

  • Focus on Value, Not Just Price: The cheapest research is often the worst. Negotiate for the best value and the most actionable insights.

  • Define Clear Deliverables: Be specific. What is the final output? A 50-page report? A live presentation with recommendations? Access to the raw data?

  • Set the Timeline: Agree on firm deadlines for key milestones (e.g., survey completion, final report delivery).

• Case Study Example: The tech company negotiates a price of $40,000 for the project. The contract SOW specifies the final deliverable as "a 20-page insights report and a 1-hour live presentation with actionable recommendations."

Step 4: Manage the Project & Relationship

• What it is: The procurement process doesn't end when the contract is signed. You must actively manage the project to ensure it stays on track and delivers what you paid for.

• Key Actions:

  • Hold Regular Check-ins: Schedule regular communication (e.g., a weekly 30-minute call) to monitor progress and address roadblocks.

  • Provide Timely Feedback: The research firm will need your input. Be available to answer questions and provide feedback quickly.

  • Quality Assurance: Review interim reports to ensure the research is high-quality and directly answering your business question.

• Case Study Example: The tech company's project manager holds a weekly call with the research firm, ensuring the insights from the user interviews are aligning with their objectives before the firm launches the expensive survey phase.

Frequently Asked Questions (FAQ)

Q1: What's the difference between qualitative and quantitative research? A: Qualitative research is exploratory and seeks to understand why people feel a certain way. It uses small samples and methods like focus groups or in-depth interviews. Quantitative research is statistical and seeks to measure how many people feel a certain way. It uses large samples and methods like surveys to get hard numbers.

Q2: What is the biggest mistake to avoid when procuring market research? A: The biggest mistake is focusing on the lowest price. Bad research is worse than no research at all because it can lead to confident, but completely wrong, strategic decisions. The focus should always be on the quality of the methodology and the actionability of the insights.

Q3: What's the difference between an RFI and an RFP in this process? A: An RFI (Request for Information) is a preliminary document you might send to a very long list of 10-15 firms to gather basic information (e.g., "Do you have experience in our industry?"). An RFP (Request for Proposal) is a much more detailed document sent to a shortlist of 3-5 firms, asking them to create a custom proposal to solve your specific problem.