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2020 Top 50 U.S. Market Research and Data Analytics Companies

Diane Bowers

A full ranking of the top market research and data analytics companies in the U.S. for 2020

The “2020 Top 50 U.S. Report”—formerly known as “The Gold Report”—is developed by Diane Bowers and produced in partnership with the Insights Association and Michigan State University . The report is also sponsored by the AMA, ESOMAR and the Global Research Business Network . The report includes a ranking of the top 50 companies, a breakdown of trends by Bowers , and an analysis of the market research and analytics industry  by Michael Brereton, Melanie Courtright and Reg Baker.

50. RTi Research

Founded: 1979 2019 U.S. revenue: $12.9 million Percent change from 2018: -3% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $12.9 million U.S. employees: 45

In a world awash in data, the challenge is to turn data into something meaningful, something that can be communicated simply and acted upon effectively. RTi Research meets that challenge head-on, turning data into meaning through smart research design, flawless execution and innovative storytelling. Everything the company does is aimed at helping its clients move their ideas and insights through their organizations to influence change. 

RTi has conducted research in just about every category in the U.S. and globally. Informed by 40 years of experience across categories and cultures, RTi knows what works and what doesn’t, when to leverage new technology and methods, and when traditional approaches are best.

49. Hypothesis

Founded: 2000 2019 U.S. revenue: $18.3 million Percent change from 2018: -4.7% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $18.3 million U.S. employees: 61

Hypothesis uses insights, strategy and design to help important brands do amazing things. The company specializes in tough questions that take creative, multidimensional approaches, thoughtful strategy and a broad business perspective. Hypothesis’ approach combines inventive consumer-centric qualitative research, advanced analytics, strategic thinking and data visualization. Its award-winning design team translates complex information into compelling, easy-to-understand deliverables to socialize learnings and engage teams. 

In 2018, Hypothesis added important new capabilities with the launch of Momentum, a strategy that turns insight into application with downstream marketing and implementation planning. The Momentum team has worked alongside Hypothesis consultants on strategic engagements with clients focused on brand strategy, product development, and led dozens of workshops with senior and C-level executives to socialize insights and ideate on next steps. 

In 2019, Hypothesis’ focus on growth continued with its expansion to the Midwest and establishment of its Chicago office. From this office, the company will be able to service new and current clients in the Midwest and on the East Coast.

48. Bellomy Research

Founded: 1976 2019 U.S. revenue: $21 million Percent change from 2018: 1.4% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $21 million U.S. employees: 116

Bellomy is a privately held, family-owned, full-service market intelligence company. Bellomy focuses on driving successful business outcomes through the design and delivery of solutions that yield deeper customer understanding. The company surrounds its clients’ business challenges with an unparalleled mix of knowledge and experience, marketing science and proprietary research technology. 

Bellomy’s work involves both B2C and B2B environments—with qualitative and quantitative insight solutions spanning market segmentation, customer experience and journeys (including digital user experiences), brand equity, product innovation, shopper insights, marketing optimization, social research platforms and research technology. Bellomy works with clients across a broad range of categories and industries including consumer packaged goods, financial services, automotive, retail, restaurant and hospitality, telecommunications and technology, apparel and textiles, utilities, healthcare, insurance and home improvement.

Bellomy serves as an extension of its clients’ marketing research and customer experience departments by integrating a broad set of capabilities and areas of expertise, including segmentation, customer (and digital experience), shopper insights, social research platforms, brand equity, product innovation and marketing optimization. In addition, Bellomy clients leverage SmartIDEAS, the firm’s enterprise consumer knowledge and insight platform. 

47. Edelman Intelligence

Founded: 1999 2019 U.S. revenue: $21 million Percent change from 2018: 12.9% 2019 non-U.S. revenue: $11.5 million Percent from outside U.S.: 35.4% 2019 worldwide revenue: $32.5 million U.S. employees: 131

Edelman Intelligence (EI) is the global research and analytics consultancy of Edelman, the world’s largest global communications firm. Based in New York, with employees in 18 offices internationally, EI houses more than 200 consultants, strategists, researchers, data scientists, data visualization specialists and analysts worldwide. Its specialists are method-agnostic and leverage the best of primary and secondary research, advanced analytics and business science to solve business and communications issues for its clients. EI’s offering spans the full spectrum of client needs, from mapping the current environment and targeting key audiences, to optimizing content and measuring business impact. 

EI partners with early-stage start-ups and Fortune 100 companies alike, providing strategic research, analytics, and insights-based marketing and communications counsel for a broad range of stakeholders and scopes, including government and public affairs, corporate reputation and risk strategy, crisis and issues management, employee experience and talent advisory, executive positioning, strategic communications and public relations, marketing and branding strategy, customer experience and insights, mergers, acquisitions and market entry strategy and more.

Key accomplishments in 2019 included advancement of its Edelman Trust Management (ETM) capabilities, including an evolution of its offering focused specifically on providing guidance for measuring and building trust in brands. Developed building from its 20-plus years studying trust through the Edelman Trust Barometer and the initial iteration of ETM (which explores corporate trust), this proprietary model for brand trust measurement was created in partnership with renowned academics from Harvard Business School and INSEAD, Edelman Brand experts and external marketing thought leaders. In recent months, this model has been engineered to consider fundamental transformations to consumer/brand relationship dynamics that the COVID-19 pandemic has accelerated.

46. KS&R

Founded: 1983 2019 U.S. revenue: $21.7 million Percent change from 2018: -1.4% 2019 non-U.S. revenue: $3.6 million Percent from outside U.S.: 14.2% 2019 worldwide revenue: $25.3 million U.S. employees: 100

KS&R is a privately held strategic consultancy and full-service marketing research company. For nine consecutive years, KS&R has received the highest Gold Index composite score of any provider in the Prevision/Inside Research survey of marketing research buyers. This is a testament to the company’s passion for excellence and client-first business philosophy—wherein KS&R empowers its clients with timely, fact-based insights so they can make smarter decisions and be confident in their actions.

KS&R creates and executes global custom market research solutions for some of the best-known corporations in the world in more than 100 countries and 50 languages. It has extensive and diverse industry experience with particular strength in healthcare (pharma and device), technology, entercom, transportation, professional services, and retail and e-commerce. Team members often include business strategists with client-side experience and deep industry knowledge.

In 2019, KS&R leveraged its expansive network of pharmacy panels to build world-class capabilities for pharma inventory measurement and healthcare insights. Its marketing scientists have driven marked advances in pricing decision support, which have now been validated by positive in-market results. KS&R expanded its portfolio to include insights fusion across multiple channels of content (primary research, social media, web-based information, etc.). And finally, it introduced its KS&R Win-Loss program that provides actionable insights for how organizations can improve their value proposition and sales performance to close more deals.

Founded: 1911 2019 U.S. revenue: $22.7 million Percent change from 2018: 12.9% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $22.7 million U.S. employees: 78

NAXION guides strategic business decisions globally in healthcare, information technology, financial services, energy, heavy equipment and other B2B markets, drawing on depth of marketing experience in key verticals and skilled application of sophisticated and inventive methodologies. The firm’s NAscence Group helps life science innovators develop commercialization strategy through clinical trials design and selection of target indications, forecasting, brand planning and other research-based consulting services.

Engagements routinely include market segmentation, opportunity assessment and innovation, demand forecasting and pricing, positioning, brand health, market monitoring and lifecycle management. The firm deploys multiple data streams including primary research (qualitative and quantitative), secondary data, customer databases and other complex datasets to develop an integrative perspective on business problems. The firm also builds custom panels for B2B markets.

Project leaders with sector experience and research proficiency are supported by in-house methodologists and a wide portfolio of advanced analytic tools, including proprietary modeling services and software, all of them highly customized. The firm continues to invest significant resources in intellectual capital to enhance enterprise decision support with cutting-edge methods, including specialized “small data” choice models, new predictive techniques using big data and brand-customized text analytics. Its Farsight suite supports the building of highly dynamic models capable of producing forecasts for complex market scenarios, including paradigm-shift technologies, and gives market monitoring programs a forward-looking perspective that guides timely market interventions. Other services include litigation and regulatory support, often involving expert testimony in cases involving trademark confusion, deceptive advertising and brand equity. NAXION’s strong commitment to operational excellence is reflected in ISO certification and in-house operations capabilities to deliver exceptional levels of quality control. 

Founded: 1991 2019 U.S. revenue: $24.2 million Percent change from 2018: -3.6% 2019 non-U.S. revenue: $1.2 million Percent from outside U.S.: 4.7% 2019 worldwide revenue: $25.4 million U.S. employees: 144

Gongos is a consultative agency that places customers at the heart of business strategy. Partnering with insights, analytics, marketing, strategy and customer experience groups, Gongos operationalizes customer centricity by helping companies both understand their customer needs and deliver on them better than anyone else.

From product innovation to portfolio management, customer experience to consumer journeys, pricing strategies to marketing optimization, and trend analysis to predictive modeling, Gongos provides both outside-in and inside-out approaches across organizations to drive greater customer attraction, retention and lifetime value.

Gongos further serves as a translator to help cross-functional teams fuel the competency to gain and apply consumer wisdom, transform decisions into action and navigate organizational change. Coalescing enterprise data with primary research and curating insights for multiple audiences further empowers stakeholders to achieve greater ROI by ensuring information is designed to influence actions and behaviors from executives to the frontline. 

Gongos’ consultative tools stem from change management principles that help organizations navigate the transformation often necessary to create a more outside-in perspective as they reorient around the customer. Gongos’ approaches to engage multiple audiences include communication strategies and tactics grounded in frameworks such as its adoption-to-advocacy model and human-centered design.

43. Maru/Matchbox **

Founded: 2016 2019 U.S. revenue: $28 million Percent change from 2018: 3.7% 2019 non-U.S. revenue: $14 million Percent from outside U.S.: 33.3% 2019 worldwide revenue: $42 million U.S. employees: 150

Maru/Matchbox began disrupting the market research industry in 2000. Powered by proprietary technology, its expert teams are deeply invested in key sectors of the economy, including consumer goods and services, financial services, retail, technology, healthcare, public services, and media and entertainment. Maru/Marchbox provides organizations with the tools and insights to connect with the people that matter most, so they can build and maintain a competitive advantage. 

In 2019, Maru/Matchbox released a series of innovative research solutions. 

• Digital Media Measurement is a campaign evaluation approach that enables clients to better understand how content, channels and brands interact to deliver effective communication. 
• Creative Insight measures people’s implicit and explicit responses to advertising, giving clients a complete picture of how their ad is working. It is designed to evaluate any type of ad or brand communication, across all channels, with best-in-class benchmarks.
• Lissted analyzes how members of communities relevant to clients react to content, tweets and even websites. 
• Brand Emotion utilizes visual semiotics to identify and leverage the emotional profile of a brand. 

Maru/Matchbox continues to demonstrate innovation and thought leadership through relentless publication of articles and whitepapers.

42. Chadwick Martin Bailey (CMB)

Founded: 1984 2019 U.S. revenue: $28.7 million Percent change from 2018: 20.6% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $28.7 million U.S. employees: 90

CMB is a research and strategy firm, helping the world’s leading brands engage, innovate and grow amid deep disruption. The company leverages the best of advanced analytics, consumer psychology and market strategy to tackle critical business initiatives, including market identification, segmentation, brand health, loyalty and advocacy, and product and service development.

For more than 35 years, CMB has helped the most successful brands and their executives give voice to their market through a relentless business decision focus, creative problem-solving and storytelling, deeply consultative approach and flawless execution. With dedicated financial services, media and entertainment, tech and telecom, retail and healthcare practices, CMB’s expert teams understand the complex and evolving technological, social, cultural and economic forces that drive disruption and create opportunity.

In 2020, CMB continued its growth trajectory, including building expertise in gaming and digital platforms and expanding its qualitative and advanced analytics teams. A thought leader in the application of consumer psychology to real world business issues, CMB conducted self-funded research among tens of thousands of consumers to capture the four core benefits that motivate decision-making—identity, emotion, social and functional—providing an in-depth look at more than 80 global brands. Further self-funded research explored the accelerating journey and path to purchase of today’s gamers.

41. Screen Engine/ASI

Founded: 2010 2019 U.S. revenue: $33 million Percent change from 2018: 10% 2019 non-U.S. revenue: $1.9 million Percent from outside U.S.: 5.4% 2019 worldwide revenue: $34.9 million U.S. employees: 132

Screen Engine/ASI is a research-based consumer insights firm that stands for delivering its entertainment and media clients actionable insights and recommendations, not simply data. SE/ASI strives to help clients mitigate risk and maximize the potential for success. Through its Motion Picture and TV Groups, SE/ASI works across all distribution platforms for both domestic and internationally produced content. 

The company is centered on assessing the “abilities” of content as it migrates from the earliest stages of development through multi-channel distribution. The Motion Picture Group is the leader in traditional and digital in theater and online recruited audience screenings. Offerings also include PostTrak, a syndicated domestic and international in-theater exit poll, and ScreenExperts, an early assessment of critical response, creative ad testing, positioning and brand studies, custom work, and location-based and online focus group research. A cross-platform team within this group works with home entertainment, over-the-top and gaming clients. 

The TV group is the leader in location-based ViewTrac dial testing of pilots, programs and ongoing series and conducts online dial testing as well. Other offerings include location-based and online focus groups, promo testing, positioning and brand studies, and a variety of custom studies including custom trackers. SE/ASI syndicates Tracktion trackers including a TV tracker, a theatrical movie tracker, a home entertainment tracker and a premium video-on-demand tracker. All groups work in the company’s media lab equipped for biometric and new technology research. When appropriate, SE/ASI engages in advanced analytics techniques including, but not limited to, segmentation, conjoint, maxdiff and TURF analysis. 

40. MarketVision Research

Founded: 1983 2019 U.S. revenue: $33.2 million Percent change from 2018: 2.5% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $33.2 million U.S. employees: 140

MarketVision Research is a full-service marketing research firm, providing clients with actionable insights about their markets, customers, brands and products. Research areas of focus include product and portfolio development, pricing, branding, segmentation and customer experience. The company offers a full suite of quantitative and qualitative research capabilities and works across industry groups. These include:

• Optimization and discrete choice modeling as it applies to product and service development, branding, packaging and pricing.
• Online communities that are managed and developed entirely in-house with a focus on improving participant engagement and with additional support for mobile participation.
• Hybrid research, which uses 20 in-house moderators, along with marketing science professionals and global project managers, to facilitate qualitative and quantitative research seamlessly.

39. The Link Group

Founded: 1994 2019 U.S. revenue: $34.2 million Percent change from 2018: 23.9% 2019 non-U.S. revenue: $0.3 million Percent from outside U.S.: 0.9% 2019 worldwide revenue: $34.5 million U.S. employees: 85

The Link Group executes research for Fortune 500 firms in the healthcare, retail, CPG and finance industries across both qualitative and quantitative methodologies and around the globe. TLG attributes its success to its core business philosophy: smarter research and better service. Its commitment to smarter research has allowed the company to take a creative, custom approach to its clients’ business needs that results in actionable and insightful reports. TLG delivers better service by maintaining a consistent research team across projects, allowing the team to anticipate and respond to client needs. This business philosophy has resulted in 99% of revenue coming from repeat clients.

This past year, TLG has continued to hone its research approaches to help elevate traditional research methods. For its messaging and positioning work, TLG developed a framework that triangulates quantitative survey data to determine how well messaging concepts will activate, communicate and engage the customer. In its segmentation studies, TLG blends science and art to create models that align with the client’s brand strategic vision by creating differences that are meaningful and actionable from a marketing perspective. TLG has leveraged its knowledge of behavioral economics to develop a validated, proprietary quantitative methodology—LinkEQ—that allows the company to reveal latent emotional associations.

Founded: 1983 2019 U.S. revenue: $34.3 million Percent change from 2018: -1.2% 2019 non-U.S. revenue: $1.2 million Percent from outside U.S.: 3.4% 2019 worldwide revenue: $35.5 million U.S. employees: 233

SSRS is a full-service market and survey research firm led by a core of dedicated professionals with advanced degrees in the social sciences. 

SSRS surveys support numerous media and academic partners looking to report on public attitudes and beliefs about a wide range of salient issues such as elections and public policy. SSRS is the polling partner for CNN, and conducts public opinion polling for ABC News, The Washington Post, Politico and CBS News. 

Beyond national polls, SSRS regularly conducts research at a state level, and among subpopulations such as Latinos and political partisans, and specializes in reaching hard-to-reach and low-incidence populations. SSRS has extensive experience in public policy, public affairs and health policy research. Since the Affordable Care Act was signed into law, SSRS has completed numerous studies surrounding its implementation and assessing Americans’ attitudes and experiences with the law. 

Since 2016, SSRS conducts the monthly Kaiser Family Foundation Health Tracking Poll. SSRS is well-known for its weekly telephone Omnibus poll. The firm also offers the SSRS Opinion Panel, which allows clients to conduct probabilistic surveys quickly at low cost. The SSRS/Luker on Trends Sports Poll is the first and longest-running tracking study focusing on sports in the U.S. 

37. BVA Group **

Founded: 1970 2019 U.S. revenue: $36 million Percent change from 2018: 2.6% 2019 non-U.S. revenue: $147 million Percent from outside U.S.: 80.3% 2019 worldwide revenue: $183 million U.S. employees: 120

BVA Group is a fast-growing research and consulting firm, an expert in behavioral science, ranked in the top 20 worldwide agencies. BVA brings data to life and converts deep understanding of customers and citizens into behavior change strategies. BVA operates both for public and private clients with methodologies fueled by data science and behavioral science. 

Its FMCG specialist—PRS IN VIVO—is a global leader in packaging and shopper research. PRS IN VIVO helps consumer marketers to succeed through: 

• In-store and online studies to better understand shopper behavior, in both physical and e-commerce shopping contexts.
• Qualitative studies to develop, screen and refine new product, packaging and merchandising concepts.
• Quantitative studies to pre-test and quantify new packaging, merchandising and display systems (for physical stores and e-commerce).
• Volume forecasting and product testing for both innovations and brand restages.
• “Nudge” initiatives to facilitate behavioral change, create new consumer habits and drive category growth. 

BVA Group is a European leader in customer experience research. More than 100 leading brands use BVA’s behavioral insights to provide seamless shopper journeys and design successful new products and services, including solutions from its multi-awarded Global Nudge-Unit.

36. radius | illumination

Founded: 1960 2019 U.S. revenue: $42 million Percent change from 2018: — 2019 non-U.S. revenue: $1 million Percent from outside U.S.: 2.3% 2019 worldwide revenue: $43 million U.S. employees: 127

Radius│illumination is the product of a merger between Radius Global Market Research and Illumination Research in 2018. Together, it’s one of the largest independent custom insights providers in the world. Its focus is on guiding brands at critical points along their growth journey, tackling issues such as identifying compelling innovations, creating relevant customer segmentations and developing strategies for deeper loyalty and engagement.

Radius | illumination partners with Fortune 500 leaders as well as challenger, disruptor and emerging brands in the U.S., Europe, Asia and the Middle East. Its top sectors include financial services, personal care, healthcare and pharmaceuticals, technology, home improvement and durables, media and entertainment, packaged foods, beverage, retail and transportation.

Its 2020 initiatives to fuel brand growth for its clients include:

• Provide agile and robust solutions such as InnovationSprint to accelerate new product and service development.
• Increase its information design capabilities so clients can easily take action on the results.
• Focus on driving deeper insights by combining its advanced analytics strength with immersive customer understanding in its designs.
• Expand solutions through the integration of new technologies and behavioral approaches.

35. Market Force **

Founded: 2005 2019 U.S. revenue: $50 million Percent change from 2018: 2% 2019 non-U.S. revenue: $7 million Percent from outside U.S.: 12.3% 2019 worldwide revenue: $57 million U.S. employees: 375

Market Force Information provides location-level customer experience management solutions to protect clients’ brand reputation, delight their customers and make them more money. 

Market Force operates at scale across the globe. Each month, the company:

• Completes more than 100,000 mystery shops.
• Collects, processes and analyzes millions of employee and customer experience surveys.
• Manages more than 100,000 inbound calls to its contact center.
• Hosts more than 1 million user logins on its KnowledgeForce reporting platform.

Market Force’s multi-location solutions provide a robust framework for measuring and improving operational excellence, customer experience and financial KPIs. Measurement channels include mystery shopping, customer experience surveys, contact center calls, social media and employee engagement surveys via the KnowledgeForce technology platform and Eyes:On mobile app. Market Force employs predictive analytics to determine what matters most and the ROI for investing in improvements. The firm takes a dual-headed approach to market research services (e.g., customer segmentation, attitude trial and usage studies and custom research projects) and strategic advisory services to design and implement effective measurement systems and improve performance.

Founded: 1991 2019 U.S. revenue: $52 million Percent change from 2018: 4% 2019 non-U.S. revenue: $6 million Percent from outside U.S.: 10.3% 2019 worldwide revenue: $58 million U.S. employees: 400

As a leading customer experience management firm, SMG helps clients get smarter about their customers and employees to drive changes that boost customer loyalty and improve business performance. SMG combines technology and services to collect, analyze and share feedback and behavioral data, so it’s easier for clients to deliver and activate customer insights across their enterprise.

SMG partners with more than 350 brands around the globe to create better customer and employee experiences, which drive loyalty and performance. SMG uniquely combines technology and insights to help clients listen better, act faster and outperform competitors. SMG is a technology-enabled research firm with a global footprint—evaluating more than 150 million surveys annually, in 50 languages across 125 countries. 

Strategic solutions include omniCXTM, Brand Research and Employee Engagement. SMG’s omniCX solution uses multiple research methodologies in capturing solicited and unsolicited consumer feedback across in-store, online, contact center and social channels. Results are aggregated and reported via smg360TM—a real-time, role-based reporting platform providing access to all customer and related data. 

SMG’s research professionals partner with clients to derive business-changing insights. Within Brand Research, SMG offers traditional brand tracking as well as access to dynamic customer and competitor data through market intelligence tool BrandGeek. Fueled by SurveyMini—SMG’s location-based mobile research app—BrandGeek contains consumer feedback and behavioral data relating to more than 4,500 brands across more than 500,000 locations.

33. Hanover Research

Founded: 2003 2019 U.S. revenue: $52.7 million Percent change from 2018: 14.1% 2019 non-U.S. revenue: $2.6 million Percent from outside U.S.: 4.7% 2019 worldwide revenue: $55.3 million U.S. employees: 358

Hanover Research is a brain trust designed to level the information playing field. Hanover is made up of hundreds of researchers who support thousands of organizational decisions every year. One of the industry’s fastest-growing companies, Hanover attributes this market success to its unique positioning as the only firm that provides tailored research through an annual, fixed-fee model. 

Hanover serves more than 1,000 organizations and companies worldwide from established global organizations, to emerging companies to educational institutions. Hanover’s research informs decisions at any level and across any department capitalizing on the exposure to myriad industries and challenges. 

Founded in 2003, Hanover operates on an annual fixed-fee model, and partnership provides its clients with access to a team of high-caliber researchers, survey experts, analysts and statisticians with diverse skills in market research, information services and analytics. There is no limit on the type of challenge that can be asked for on the quantitative and qualitative approaches Hanover uses to deliver solutions—most of which are very difficult to replicate internally.

Hanover’s custom research services include:

• Secondary research: market segmentation and evaluation; labor and demographic trends and forecasts; vendor and product reviews; best practices reports. 
• Survey: survey design, administration and analysis; open-ended response coding. 
• Qualitative primary research: focus group design and administration; in-depth interview design, outreach, administration and analysis. 
• Data analysis: data segmentation and mining; conjoint analysis; linear regression; descriptive and predictive analytics; data forecasting and modeling. 

32. Directions Research

Founded: 1988 2019 U.S. revenue: $54.2 million Percent change from 2018: 17.8% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $54.2 million U.S. employees: 181

Independently recognized as one of the leading business decision insight firms in the nation, Directions Research combines a highly experienced staff with a unique mix of innovative and proven approaches to answer pressing business issues. Directions and SEEK routinely combine primary and connected data from multiple sources to create holistic and actionable analytic stories for their clients. Through digital dashboards, infographics, written reports and other unique visualizations, the firm communicates its knowledge in a manner that is right for today’s leaders. 

Directions and SEEK excel in innovation, optimization, customer and brand experience, brand strategy, strategic business intelligence and visualization across a wide range of industries. The firm offers B2C and B2B services globally, surveying audiences using a broad selection of data collection techniques and combining those insights with existing client knowledge. Directions’ and SEEK’s staff have an excellent mix of client- and supplier-side experience. The organization allows senior researchers to work with clients on a day-to-day basis.

SEEK (acquired in 2018) is a qualitative insight and innovation consultancy, operating as an independent but connected division of Directions. SEEK empathically connects brands with the humans they serve, transforming the brand-to-consumer relationship into a human-to-human one. The SEEK approach builds brand advocacy for clients with the human-centric approach to innovation, activating empathy as an innate problem-solving capability.

31. Fors Marsh Group (FMG) *

Founded: 2002 2019 U.S. revenue: $57.5 million Percent change from 2018: 22.1% 2019 non-U.S. revenue: — Percent from outside U.S.: — 2019 worldwide revenue: $57.5 million U.S. employees: 263

FMG applies behavioral and data science to improve organizational processes, business solutions and customer experiences. This work is conducted within seven core U.S. markets: health, defense, technology, finance, homeland security, policy and consumer. 

FMG’s work for its clients wins industry and federal awards. FMG has been named as a top market research company by GreenBook and the American Advertising Federation and has been named to the American Marketing Association’s list of top market research companies in the U.S. for five consecutive years. FMG was also a finalist for the American Council for Technology and Industry Advisory Council’s Igniting Innovation 2018 award for creating an innovative e-learning program that improved program awareness and usability for the General Services Administration’s Center for Acquisition Professional Excellence. 

For 2019 and beyond, FMG is focused on continuing this momentum and expanding in important areas. In its human capital practice, FMG is furthering its work in the cybersecurity industry to help the Department of Defense attract top cyber talent and to protect the nation’s infrastructure. FMG is also expanding its efforts in public service recruiting through new partnerships with the U.S. Army, U.S. National Guard and AmeriCorps. The company is proud that its partnership with these institutions will help shape the future of the U.S. For its health division, FMG is leveraging its deep experience in health communications to fight the opioid crisis by reducing stigma and removing barriers that victims face in receiving help—potentially one of the biggest challenges facing America today. 

30. National Research Group (NRG) **

Founded: 1978 2019 U.S. revenue: $59 million Percent change from 2018: 1.7% 2019 non-U.S. revenue: $4 million Percent from outside U.S.: 6.3% 2019 worldwide revenue: $63 million U.S. employees: 200

National Research Group, acquired by Stagwell Media from Nielsen in 2015, is a leading global insights and strategy firm at the intersection of entertainment and technology. Rooted in four decades of industry expertise, the world’s leading marketers turn to NRG for insights into growth and strategy for any content, anywhere, on any device. Working at the confluence of content, culture and technology, NRG offers bold insights for storytellers everywhere. 

Some agencies specialize in qual, others focus on quant—but NRG connects the two disciplines with hybrid teams expert in both modalities. The company is a one-stop, custom consultancy that tailors its approach to solve clients’ biggest challenges. 

The foundation of NRG’s qualitative work is a team of passionate, subject matter experts who connect deeply with consumers in any environment. NRG uses qual to discover the subconscious drivers that fuel our quantitative truths. Its quantitative work is anchored in sophisticated techniques with a focus on agility, creativity and rigor. NRG is method-agnostic and works collaboratively with its clients to solve complex problems in a simple way.

29. Cello Health * **

Founded: 2004 2019 U.S. revenue: $64.5 million Percent change from 2018: 23.3% 2019 non-U.S. revenue: $58.5 million Percent from outside U.S.: 47.6% 2019 worldwide revenue: $123 million U.S. employees: 260

Cello Health consists of four global capabilities that enable the company to offer best-in-class services and an integrated partnership approach to its clients. This unique mix of capabilities, combined with its collaborative approach, results in a unique fusion of expertise, providing powerful advisory and implementation solutions.

• Cello Health Insight is a global marketing research company, providing business intelligence to the healthcare and pharmaceutical sectors. Cello Health Insight specializes in getting to the heart of its clients’ questions, using a large pool of creative and academic resources and providing design of materials and deliverables through a hand-picked project team—selected to best meet the needs of each individual project.
• Cello Health Consulting is the strategic consulting arm of Cello Health, focused on delivering business results by unlocking the potential within organizations, people, assets and brands. Cello Health Consulting works alongside clients to create practical solutions that ensure buy-in and build relationships. 
• Cello Health Communications combines science, strategy and creativity to unlock the potential of brands and assets. Its services underpin differentiated positioning and deliver brand optimization, focusing on multiple areas of development and launch, through commercial maturity.
• Cello Signal is a full-service digital capability bringing impactful messages alive in communications campaigns, content and film.

28. Macromill Group **

Founded: 2000 2019 U.S. revenue: $68.5 million Percent change from 2018: 2.2% 2019 non-U.S. revenue: $260 million Percent from outside U.S.: 79.1% 2019 worldwide revenue: $328.5 million U.S. employees: 275

Macromill Group is a rapidly growing global market research and digital marketing solutions provider bringing together the collective power of its specialist companies to provide innovative data and insights that drive clients’ smarter decisions. Macromill’s industry-leading digital research solutions deliver rapid and cost-effective solutions to the challenges businesses face today. 

The group’s leading business units are Macromill and MetrixLab. Macromill stands at the forefront of innovation, delivering unique marketing solutions. It offers exclusive access to the highest-quality online panels with more than 2 million members. Using its self-developed platform AIRs, Macromill provides full-service online research including automated survey creation and completion, data tabulation and analysis. Today, its business portfolio includes services such as offline quantitative research, mobile research, point-of-service database research (QPR), digital marketing (Accessmill), a DIY survey platform (Questant) and more. 

Metrixlab turns data from online surveys, social media, mobile devices and enterprise systems into valuable business information and actionable consumer insights. This helps leading companies drive product innovation, brand engagement and customer value. Owned and group panels provide expansive access to global respondents in mature and emerging markets. Its teams deliver strategic and tactical decision support by pushing the boundaries of data analysis innovation, combining cutting-edge technology with data science and proven marketing research methodologies. Clients across the globe rely on the company’s hyper-efficient data and insights ecosystem to deliver fast and affordable results.

27. C Space **

Founded: 1999 2019 U.S. revenue: $70 million Percent change from 2018: 2.9% 2019 non-U.S. revenue: $18 million Percent from outside U.S.: 20.5% 2019 worldwide revenue: $88 million U.S. employees: 354

C Space, part of the Interbrand Group, is a global customer agency that marries art and science to create rapid customer insight and business change. 

C Space works with some of the world’s best-known brands—such as Walmart, Samsung, IKEA and more—to build customers into the ways companies work and deliver on customer-inspired growth. By building real, ongoing relationships with customers—online and in-person—brands can stay relevant, deliver superior experiences, launch successful products and build loyalty. Through its “customer as a service” approach of research, consulting and communications, C Space helps businesses minimize risk and maximize growth.

The company integrates customers into the ways its clients work. By bringing stakeholders together around the customer, C Space’s clients create greater clarity and alignment in the actions that will most effectively drive customer growth.

C Space’s customized programs are tailored based on specific business needs and include private online communities, immersive storytelling, data and analytics, activation events, innovation projects and business consulting. C Space continues to invest in its people, existing capabilities like data and analytics, as well as new initiatives.

26. Engine Insights**

Founded: 2004 2019 U.S. revenue: $71 million Percent change from 2018: 4.4% 2019 non-U.S. revenue: $44 million Percent from outside U.S.: 38.3% 2019 worldwide revenue: $115 million U.S. employees: 240

Engine is a new kind of data-driven marketing solutions company. Powered by data, driven by results and guided by people, Engine helps its clients make connections that count—leading to bottom-line growth, an inspired workplace and business transformation. 

Engine Insights (formerly ORC International) connects traditional market research with cutting-edge products to deliver clients a 360-degree view of their customers, employees and markets. Engine’s extended suite of solutions and products are designed to support business growth, from helping clients understand and outperform the competition to operationalizing both survey and behavioral data to identify, attract, engage and retain their audiences.

Engine Insights’ client services and products include custom research and omnibus surveys; customer experience, customer retention and brand engagement studies; and data management and data analytics. 

These services help clients:

• Think beyond products and services to drive business revenue.
• Use insights to inform more relevant messaging and creative.
• Get a complete 360-degree view of their customers.
• Segment audiences for better targeting.
• Develop the perfect product and take it to market.
• Create unique experiences that engage their customers and keep them loyal for a lifetime.
• Build an internal culture that attracts, retains and engages the best talent.

Founded: 1931 2019 U.S. revenue: $71.1 million Percent change from 2018: 9% 2019 non-U.S. revenue: $6.9 million Percent from outside U.S.: 8.8% 2019 worldwide revenue: $78 million U.S. employees: 253

Since 1931, Burke has consistently redefined expectations in the marketing research industry. From segmentation to customer engagement programs, product innovation and brand tracking, Burke prides itself on designing and executing objectives-driven quantitative and qualitative research. Working across a variety of industries, Burke helps its clients gain actionable perspective on their most critical business challenges, providing a range of solutions from agile to integrated strategic decision support.

Today, Burke continues to push the boundaries of what marketing research can be, seamlessly uniting research, strategy and education. Backed by Seed Strategy—its strategic consulting subsidiary—Burke has the capabilities to support its clients throughout every phase of the product or service life cycle, with expertise in strategy, innovation, branding and marketing. In addition, Burke provides comprehensive training on research fundamentals and best practices through the Burke Institute—its dedicated education division and the industry’s leader in research and insights training. Wherever its clients find themselves on the path to success, Burke is uniquely equipped to help them move forward with clarity, confidence and purpose.

Continuing its long tradition of research innovation, Burke recently unveiled two new offerings: Geode|AI, an integrated insights system that analyzes multiple data sources to uncover patterns, relationships and critical insights that are often hidden; and Quantiment, a robust machine-learning solution that jointly extracts richer insights from structured and unstructured data.

24. YouGov *

Founded: 2000 2019 U.S. revenue: $76.8 million Percent change from 2018: 11.8% 2019 non-U.S. revenue: $107.5 million Percent from outside U.S.: 58.3% 2019 worldwide revenue: $184.3 million U.S. employees: 212

YouGov is a global provider of analysis and data generated by consumer panels in 42 markets. Its core offering of opinion data is derived from the proprietary YouGov Global Panel of more than 9 million people. The YouGov Global Panel provides the company with thousands of data points on consumer attitudes, opinions and behavior. YouGov captures these streams of data in the YouGov Cube, its unique connected data library that holds more than 10 years of historic single-source data. In 2019, YouGov panelists completed more than 25 million surveys.

YouGov’s data-led offering supports and improves a wide spectrum of marketing activities of a customer base, including media owners, brands and media agencies. YouGov works with some of the world’s most recognized brands.

Its syndicated data products include the daily brand perception tracker, YouGov BrandIndex and the media planning and segmentation tool YouGov Profiles. Its market-leading YouGov RealTime service provides a fast and cost-effective solution for reaching nationally representative and specialist samples. YouGov’s Custom Research division offers a wide range of quantitative and qualitative research, tailored by sector specialist teams to meet users’ specific requirements. YouGov data is delivered through Crunch, the most advanced analytics tool for research data, combining fast processing with drag-and-drop simplicity. YouGov has a strong record for data accuracy and innovation. 

23. Phoenix Marketing International

Founded: 1999 2019 U.S. revenue: $77 million Percent change from 2018: -3.8% 2019 non-U.S. revenue: $4.5 million Percent from outside U.S.: 5.5% 2019 worldwide revenue: $81.5 million U.S. employees: 343

Global advertising and brand specialist Phoenix Marketing International operates in all major industries, utilizing modern technology, innovative research techniques and customized approaches to help clients elevate their brand, refine their communications and optimize their customer experience. 

With the launch of Phoenix’s AdPi Brand Effect Platform, clients now have access to continuous advertising measurement and performance improvement insights through a single platform, providing the ability to analyze their campaigns at any stage in the advertising life cycle, and the flexibility to draw upon each piece as needed. Through more than 20 years of experience and testing thousands of ads per month, Phoenix developed 19 category-specific ad measurement models that uncover the drivers and creative attributes that explain the “whys” behind an ad’s creative performance, with forward-looking estimates for ad memorability and brand linkage.

Phoenix continues to evolve its CX solution, launching Competitive Customer Experience, a measurement of how consumers perceive their overall experience with a brand, including key touchpoints along the journey. Grounding recent experiences with a client’s brand, competitor brands and non-categorical benchmarking, Phoenix is able to evaluate brand opinion, understand what drives great CX outside of the category, focus on emotional drivers of brand CX, and provide an external view of culture, consistency and brand promises.

22. Concentrix **

Founded: 1983 2019 U.S. revenue: $95 million Percent change from 2018: 11.8% 2019 non-U.S. revenue: $130 million Percent from outside U.S.: 57.8% 2019 worldwide revenue: $225 million U.S. employees: 253

Concentrix is a wholly owned subsidiary of SYNNEX Corp., specializing in technology-enabled customer engagement and improving business performance for clients around the world. With more than 225,000 staff in more than 40 countries, Concentrix provides services to clients in 10 industry verticals: automotive, banking and financial services, insurance, healthcare, technology, consumer electronics, media and communications, retail and e-commerce, travel and transportation, energy and the public sector. 

The Concentrix Voice of the Customer solution combines technology with experience management services provided by its in-house team of hundreds of CX professionals. 

Powered by analytic tools and artificial intelligence, its customer feedback platform ConcentrixCX helps companies listen, analyze and act on omnichannel customer feedback at any point in the customer journey, at scale. Features include data capture and integration, real-time reporting and analytics, and coaching and employee engagement tools. Concentrix continues to invest in enhanced platform functionality—for example, multi-source data expansion of its proprietary text analytics engine, including structured and unstructured customer feedback sources such as surveys, social, messaging, complaints and email. New digital data collection capabilities include a conversational feedback bot and embedded micro-journey surveys. 

Concentrix experience management services range from program management to strategic advisory services and are custom tailored to free clients’ internal teams to focus on transformational impact. Its CX experts specialize in quantitative and qualitative techniques, delivering data-driven insights through solutions such as survey design, relational loyalty research, CX journey analytics, digital channel optimization, customer segmentation, customer effort assessment and integrated CX analytics.

21. Escalent

Founded: 1975 2019 U.S. revenue: $97.1 million Percent change from 2018: -3.4% 2019 non-U.S. revenue: $5.5 million Percent from outside U.S.: 5.4% 2019 worldwide revenue: $102.6 million U.S. employees: 352

Escalent is a human behavior and analytics firm specializing in industries facing disruption. The company transforms data and insights into an understanding of what drives human behavior, and it helps businesses turn those drivers into actions that build brands, enhance customer experiences and inspire product innovation. 

Escalent specializes in automotive and mobility, consumer and retail, energy, financial services, health, technology and telecommunications. Focusing on select industries allows Escalent to function as a trusted business partner who knows the challenges its clients face and understands how to engage their most valuable audiences. 

Escalent has three centers of excellence: Qualitative Research combines emerging technologies, anthropology and ethnography to tap into human insights that reveal real needs and potential; Marketing & Data Sciences combine survey, behavioral, transactional and third-party data to solve tough research challenges; and Insight Communities provides private, online platforms for brands to engage with groups of stakeholders to quickly and easily draw insights.

20. dunnhumby **

Founded: 2001 2019 U.S. revenue: $100 million Percent change from 2018: -3.8% 2019 non-U.S. revenue: $335 million Percent from outside U.S.: 77% 2019 worldwide revenue: $435 million U.S. employees: 230

Dunnhumby is a customer science company that analyzes data and applies insights for almost 1 billion shoppers across the globe to create personalized customer experiences in digital, mobile and retail environments. Its strategic process, proprietary insights and multichannel media capabilities build loyalty with customers to drive competitive advantage and sustained growth for clients. Dunnhumby uses data and science to understand customers, then applies that insight to create personalized experiences that build lasting emotional connections with retailers and brands. It’s a strategy that demonstrates when companies know and treat their customers better than the competition, they earn more than their loyalty—they earn a competitive advantage.

Dunnhumby was established in the U.S. to help retailers and manufacturers put the customer at the heart of their business decisions. Analyzing data from millions of customers across the country, dunnhumby enables clients to use this insight to deliver a better shopping experiences and more relevant marketing to their customers.

By putting best customers at the center of every decision, dunnhumby’s approach delivers measurable value, competitive edge and even more customer data to fuel ongoing optimization, setting clients up for long-term success.

Dunnhumby serves a prestigious list of retailers and manufacturers in grocery, consumer goods, health, beauty, personal care, food service, apparel and advertising, among others. Clients include Tesco, Procter & Gamble, Coca-Cola, Macy’s and PepsiCo.

19. Informa Financial Intelligence**

Founded: 2016 2019 U.S. revenue: $107 million Percent change from 2018: 1.9% 2019 non-U.S. revenue: $36 million Percent from outside U.S.: 25.2% 2019 worldwide revenue: $143 million U.S. employees: 500

Informa Financial Intelligence is a leading provider of business intelligence, market research and expert analysis to the financial industry. The world’s top global financial institutions and banks look to Informa Financial Intelligence for its authority, precision and forward-focused analysis. 

Informa Financial Intelligence consists of key research, analysis and industry experts, such as Informa Research Services, EPFR Global, Informa Global Markets, iMoneyNet, Informa Investment Solutions, eBenchmarkers and Mapa Research.

Informa Financial Intelligence provides fund and wealth managers, traders, insurers, analysts, and investment and retail bankers with the intelligent advantage to make informed decisions, understand past trends, forecast future performance, drive profitability and increase returns.

Because of their strong background in the financial industry, the research teams of Informa Financial Intelligence are highly qualified to help financial institutions with their market research needs. Informa’s researchers are experts in benchmarking studies, competitive intelligence, new product development and usability testing, customer and member satisfaction and loyalty research, brand and advertising awareness research, and mystery shopping services for sales and service quality evaluation, legal and match pair testing, compliance, discrimination and misleading sales practices testing. Informa is considered a leader in the use of market research to limit the risk associated with allegations of discrimination, UDAAP (unfair, deceptive, or abusive acts or practices), predatory lending and misleading sales practices.

18. NRC Health

Founded: 1991 2019 U.S. revenue: $113 million Percent change from 2018: 10.8% 2019 non-U.S. revenue: $3.6 million Percent from outside U.S.: 3.1% 2019 worldwide revenue: $128 million U.S. employees: 448

NRC Health (formerly National Research Corp.) has helped healthcare organizations illuminate and improve the moments that matter to patients, residents, physicians, nurses and staff for more than 38 years. The company offers performance measurement and improvement services to hospitals, healthcare systems, physicians, health plans, senior care organizations, home health agencies and other healthcare organizations. 

NRC Health solutions help organizations stay at the forefront of healthcare by understanding the totality of healthcare consumer and staff experiences. Primary solutions include: 

• Experience solutions capture personal experiences, while delivering insights to power a new benchmark: n=1. Developing a longitudinal profile of customers’ healthcare wants and needs allows for organizational improvement, increased provider and staff engagement, loyal relationships and personal well-being. 
• The Loyalty Index, composed of seven aspects that combine to provide a 360-degree view of healthcare consumer loyalty—a single, trackable metric to identify emerging trends in consumer behavior and benchmark against peers. 
• Market Insights is a large U.S. consumer database that gives partners access to the opinions of 310,000 healthcare consumers in 300 markets, and access to resources to better understand target audiences and gauge consumer response to communications.
• The Transparency solution calculates star ratings from existing patient, resident and family survey data, and publishes those ratings to organizations’ websites. 
• The Governance Institute supports the efforts of healthcare boards across the nation—to lead stronger organizations and build healthier communities. NRC Health partners with organizations to improve governance efficiency and effective decision-making by providing trusted, independent information, tools and resources to board members, executives and physician leaders. 

17. MaritzCX **

Founded: 1973 2019 U.S. revenue: $118 million Percent change from 2018: — 2019 non-U.S. revenue: $44 million Percent from outside U.S.: 27.2% 2019 worldwide revenue: $162 million U.S. employees: 600

MaritzCX is a software and research company that focuses on customer experience management for big business. The company offers a unique combination of award-winning CX software, industry-leading data and research science, deep vertical market expertise and managed program services. MaritzCX provides a full-service professional CX approach designed to continuously improve the customer experience across an enterprise’s customers, employees, prospects and partners. 

MaritzCX’s research insights include its leading CXStandards competitive benchmarking research that delivers quarterly benchmarks for 55 CX categories across 16 industries. Its CXEvolution study of more than 10,000 practitioners’ feedback informed large enterprises of their CX gaps. 

The company’s focus is to leverage the MaritzCX platform, its industry-leading studies and research services to drive more meaningful experiences between its clients and their customers by adding product and research services and continued thought leadership in the CX market. In addition, MaritzCX has received CMS-certification for HCAHPS surveys, becoming the industry’s first CX platform company to offer an inclusive CX-based patient experience platform.

MaritzCX specializes in solutions for key industries, including automotive, financial services, retail, technology, B2B and more. Its global reach includes more than 900 full-time employees and 800-plus part-time or contract employees in 19 offices around the world. MaritzCX provides solutions to more than 500 clients and 1.6 million users who speak 72 languages in 100 countries. MaritzCX is committed to being its clients’ customer experience research partners.

In March 2020, InMoment acquired MaritzCX.

16. DRG (Decision Resources Group) **

Founded: 1990 2019 U.S. revenue: $140 million Percent change from 2018: 2.2% 2019 non-U.S. revenue: $53 million Percent from outside U.S.: 27.5% 2019 worldwide revenue: $193 million U.S. employees: 399

DRG, the Health Science & Analytics Division of Piramal Enterprises, is a global information and technology services company that provides proprietary data and solutions to the healthcare industry. DRG has brought together best-in-class companies to provide end-to-end solutions to complex challenges in healthcare. DRG reframes these challenges, enabling its customers to see the opportunities. Pharmaceutical, biotechnology, medical technology and managed care companies rely on this analysis and data to make informed decisions critical to their success.

Framing the current status and future trends in target healthcare markets using data, primary research and secondary research is a core competency of DRG. Product offerings include high‐value analytics, syndicated research, proprietary databases, decision support tools and advisory services.

DRG has a number of key specialties, including syndicated research focused on new therapeutic opportunities; portfolio planning, changing industry dynamics and global treatment patterns; insights and data on physician and consumer healthcare e‐marketing; and proprietary databases and analytics covering more than 90% of the U.S. managed care markets. 

15. Wood Mackenzie **

Founded: 1973 2019 U.S. revenue: $150 million Percent change from 2018: 3.4% 2019 non-U.S. revenue: $335 million Percent from outside U.S.: 69.1% 2019 worldwide revenue: $485 million U.S. employees: 337

Wood Mackenzie, a Verisk business, is a leading research and consultancy business for the global energy, chemicals, metals and mining industries. Wood Mackenzie launched in 1923 as a small, relatively unknown, Edinburgh, Scotland-based stockbroker. By the 1970s, it had become one of the top three stockbrokers in the UK, renowned for the quality of its equity research. 

Its success has always been underpinned by the clear and simple principle of providing trusted research and advice that would make a difference to clients. This was true when the first oil report was published by its equity analysts in 1973 and remains just as relevant to it today. So much so that, over the past four decades, Wood Mackenzie has drawn upon its heritage to create a global research and consultancy business that has grown alongside the needs of its clients. 

Having cultivated deep expertise in upstream oil and gas, Wood Mackenzie has carefully broadened its focus to deliver the same level of detailed insight for every interconnected sector of the energy, chemicals, metals and mining industries it now serves around the world. But heritage is more than just history. Its expert analysts and consultants have connected the company to some of the most significant events of our time—creating insight for governments, boards and CEOs who have helped shape the future direction of the world’s natural resources industries and their impact on society. 

14. Material *

Founded: 1973 2019 U.S. revenue: $166.7 million Percent change from 2018: 0.3% 2019 non-U.S. revenue: $57.9 million Percent from outside U.S.: 25.8% 2019 worldwide revenue: $224.6 million U.S. employees: 1,038

In 2019, Material (under the name LRW Group) acquired five companies: Killer Visual Strategies, an award-winning visual communication agency based in Seattle; Greenberg Strategy, a Bay Area research and strategy consultancy with a strong presence in the tech community; Karma Agency, a strategic communications firm based in Philadelphia; Salt Branding, a Bay Area consultancy; and T3, an Austin, Texas-based digital marketing agency. This year, Material is taking steps to unify these companies under one brand, integrating their services and building a collaboration that will provide seamless, end-to-end marketing solutions for clients. This year, LRW Group rebranded as Material, formally integrating 10 companies into one modern, unified offering.

Material is a radical collaboration of the top research and analytics firms seamlessly paired with the most creative and strategic marketing agencies, all with the shared mission of igniting growth for the world’s top B2B and B2C brands, from Fortune 500 companies to disruptive start-ups. Material offers a full range of marketing services—from data analytics and insights, to consulting and strategy development, to customer experience programs and creative executions. Material employs a roster of 1,200 strategists, creators, technologists, designers, researchers and storytellers that work side-by-side with clients to solve modern-day problems, build customer loyalty and make an impact on the world around us.

Founded: 1969 2019 U.S. revenue: $173.7 million Percent change from 2018: 0.5% 2019 non-U.S. revenue: $52.6 million Percent from outside U.S.: 23.2% 2019 worldwide revenue: $226.3 million U.S. employees: 5,311

ICF is a global consulting services provider with more than 7,000 professionals focused on making big things possible for its commercial and government clients in the U.S., Europe and Asia. 

Clients work with ICF on issues that matter profoundly to their success, whether it’s a product or program that matters to the business or a social issue or policy that matters to the world. ICF offers comprehensive survey research services that empower clients to gain valuable and actionable insights on issues that matter. 

For more than 40 years, ICF has demonstrated design, methodological and statistical knowledge through the implementation of large and complex survey research projects. Its clients consist of U.S. federal, state and local agencies, universities, nonprofits and commercial organizations. 

Its survey research services include: 

• Analyzing, reporting and presenting findings.
• Conducting surveys through a variety of data collection methods. 
• Designing samples, data collection protocols and instruments.
• Protecting all processes and data through quality assurance and system security.

ICF recently completed the installation of a state-of-the-art, fully integrated and security-enhanced data collection system, allowing the company to securely and most efficiently collect survey research data across all modes. ICF continues to be dedicated to solving the world’s most complex challenges and tackle problems with ingenuity on issues that matter profoundly to its clients.

12. J.D. Power **

Founded: 1968 2019 U.S. revenue: $217 million Percent change from 2018: 3.3% 2019 non-U.S. revenue: $113 million Percent from outside U.S.: 34.2% 2019 worldwide revenue: $330 million U.S. employees: 744

J.D. Power is a global leader in consumer insights, advisory services and data and analytics. Those capabilities enable J.D. Power to help its clients drive customer satisfaction, growth and profitability. J.D. Power offers market research, forecasting, consulting, training and consumer surveys of product and service quality, customer satisfaction and buyer behavior. The company’s independent industry benchmark studies, innovative data and analytics products, and customized advisory services provide insights and help companies improve quality, engagement and business performance.

Annual syndicated studies are based on survey responses from millions of consumers and business customers worldwide. The firm does not review, judge or test products and services for its syndicated studies. It relies on the opinions and perspectives of consumers who have used the products and services being rated. 

J.D. Power is most often recognized for its work in the automotive industry, where its metrics have become the industry standard for measuring product quality and customer satisfaction. A team of associates worldwide conducts quality and customer satisfaction research across industries including automotive, financial services, insurance, telecommunications, travel, healthcare utilities and consumer electronics. 

11. Forrester Research Services **

Founded: 1983 2019 U.S. revenue: $233.7 million Percent change from 2018: 32.9% 2019 non-U.S. revenue: $65 million Percent from outside U.S.: 21.8% 2019 worldwide revenue: $298.7 million U.S. employees: 525

Forrester Research Services is the research component of Forrester, one of the most influential research and advisory firms in the world. Forrester works with business and technology leaders to develop customer-obsessed strategies that drive growth. Its unique insights are grounded in annual surveys of more than 675,000 consumers and business leaders worldwide, rigorous and objective methodologies, and the shared wisdom of its most innovative clients. 

Forrester’s research offerings consist of a library of cross-linked documents that interconnect its playbooks, reports, data, product rankings, best practices, evaluation tools and research archives. Research access is provided through role-based websites that facilitate client access to research and tools that are most relevant to their professional roles, including community tools that allow interaction between and among clients and analysts.

Forrester’s research and decision tools enable clients to better anticipate and capitalize on the disruptive forces affecting their businesses and organizations, providing insights and frameworks to drive growth in a complex and dynamic market. 

Founded: 1934 2019 U.S. revenue: $320 million Percent change from 2018: 3.2% 2019 non-U.S. revenue: $1,280 million Percent from outside U.S.: 80% 2019 worldwide revenue: $1,600 million U.S. employees: 860

GfK connects data and science. Innovative research solutions provide answers for key business questions around consumers, markets, brands and media—now and in the future. As a research and analytics partner, GfK promises its clients all over the world “Growth from knowledge.” 

The increasing speed of product innovation, the rise of new channels and emerging customer needs are all part of business today. GfK’s clients are businesses around the globe. To make the best possible business decisions every day, they need more than purely descriptive data—they require actionable recommendations based on advanced analytics and powered by leading-edge technology. GfK is in the unique position to leverage proprietary and third-party data to create indispensable predictive market and consumer insights and recommendations.

GfK’s industry focus provides its market researchers with a thorough understanding of business issues and questions specific to their concerns. Industries covered include automotive, consumer goods, fashion and lifestyle, media and entertainment, retail, technology, and travel and hospitality.

9. comScore * **

Founded: 1999 2019 U.S. revenue: $336.1 million Percent change from 2018: -6.5% 2019 non-U.S. revenue: $52.5 million Percent from outside U.S.: 13.5% 2019 worldwide revenue: $388.6 million U.S. employees: 870

ComScore is a global information and analytics company that measures advertising, content and the consumer audiences of each across media platforms. ComScore creates its products using a global data platform that combines information on digital platforms (smartphones, tablets and computers), television and movie screens with demographics and other descriptive information. 

ComScore has developed proprietary data science that enables measurement of person-level and household-level audiences, removing duplicated viewing across devices and over time. This combination of data and methods enables a common standard for buyers and sellers to transact on advertising. This helps companies across the media ecosystem better understand and monetize their audiences and develop marketing plans and products to more efficiently and effectively reach those audiences. ComScore’s ability to unify behavioral and other descriptive data enables it to provide audience ratings, advertising verification and granular consumer segments that describe hundreds of millions of consumers. 

ComScore offers several solutions to help advertisers maximize cross-platform marketing effectiveness—be it measuring brand impact, viewability or ad and audience delivery validation—as well as power cross-platform advertising for better targeting and stronger advertising ROI. ComScore Advanced Audience segments go beyond age and gender to help advertisers better target consumers based on lifestyles, behaviors, demographics and interests. ComScore pioneered this concept in digital, local and national TV. 

8. The NPD Group

Founded: 1966 2019 U.S. revenue: $339.5 million Percent change from 2018: 8.6% 2019 non-U.S. revenue: $104.5 million Percent from outside U.S.: 23.5% 2019 worldwide revenue: $444 million U.S. employees: 1,185

NPD’s global information and advisory services help the world’s leading brands achieve data-driven growth. NPD combines data, industry expertise and prescriptive analytics across more than 20 industries to help its clients measure markets, predict trends and improve performance.

NPD syndicated services include retail tracking, distributor tracking and consumer tracking. NPD offers weekly data, store-level enabled data for looking at geographies or custom store groupings and account-level information for participating retailers. Point-of-sale data is collected from more than 600,000 doors worldwide, plus e-commerce and mobile platforms. Consumer information is collected via online surveys and NPD’s Checkout service, which uses receipt harvesting to track and analyze purchasing and behavior. Prescriptive analytics include market forecasting, new product forecasting, pricing and promotion evaluation and segmentation. 

With deep expertise in more than 20 industries, NPD provides thought leadership to the C-suites of many of the world’s leading brands. Senior industry advisors are available for strategy sessions to guide long-range planning or address specific needs, such as preparing for earnings calls. Topics include industry and category performance, the state of retail and winning strategies of best-in-class companies.

7. Westat **

Founded: 1963 2019 U.S. revenue: $590 million Percent change from 2018: 3.5% 2019 non-U.S. revenue: $7 million Percent from outside U.S.: 1.2% 2019 worldwide revenue: $597 million U.S. employees: 1,900

Westat is a 100% employee-owned research and professional services company. Westat provides extensive survey design and operations capabilities in support of modern data collection from households, institutions, businesses and individuals. Westat applies multiple modes of data collection and survey management to achieve maximum response rates.

The company’s focus areas and capabilities include: 

• Statistical analysis and methodological research in survey design, experiments and testing, data science and analytics, statistical disclosure control and qualitative research.
• Program, process and outcome evaluation using diverse methodologies from design to implementation to guide each program to success.
• Health research, including behavioral and mental health, clinical studies and clinical trials, public and international health, healthcare delivery, patient safety and health communications campaigns.
• Social policy research and technical assistance for implementing innovative evaluation, quality improvement and service delivery systems.
• Education programs for supporting teachers, conducting evaluations and providing technical assistance.
• Transportation studies of travel behaviors, safety and human factors using advanced technologies such as instrumented vehicles and simulators, field observational studies, and online and mobile device-based surveys.

To support its research projects, Westat designs tailor-made approaches for clients as well as invests in many general and specialized IT technologies and products. Westat also provides licensing, training and support for Blaise, a major data collection software system produced by Statistics Netherlands and used internationally. 

Founded: 1975 2019 U.S. revenue: $682 million Percent change from 2018: 16.2% 2019 non-U.S. revenue: $1,685 million Percent from outside U.S.: 71.2% 2019 worldwide revenue: $2,367 million U.S. employees: 2,025

Ipsos, through its subsidiaries, engages in collecting, processing and delivering survey data for brands, companies and institutions primarily in Europe, the Middle East, Africa, the Americas and Asia Pacific. It explores market potential and market trends, tests products and advertising, helps clients build long-term relationships with customers, studies audiences and their perceptions of various media and measures public opinion trends. Ipsos offers advertising research services, including advertising tracking and brand equity evaluation services that help advertisers in the development, evaluation and improvement of their advertising efforts.

It also provides marketing research services that help clients to identify business opportunities and innovation platforms, develop strategies at point of sale, generate insights and ideas, develop and optimize their mix, and model and forecast sales volumes, as well as offers custom innovative products and solutions to address stakeholder experience and brand-building business goals.

In this unique year, Ipsos has remained strong and reaffirmed its ambition and sense of purpose to deliver reliable information for a true understanding of society, markets and people. Ipsos activates this vision for more than 5,000 customers through its presence in 90 markets both globally and locally. Ipsos covers the whole information production and analysis chain, from the collection of raw data to the activation of the insights. It has a solid tradition of innovation expressed by new methodological developments and continuously renewed product range.

5. Information Resources, Inc. (IRI) **

Founded: 1979 2019 U.S. revenue: $815 million Percent change from 2018: 1.9% 2019 non-U.S. revenue: $510 million Percent from outside U.S.: 38.5% 2019 worldwide revenue: $1,325 million U.S. employees: 3,639

IRI is a leading provider of big data, predictive analytics and forward-looking insights that help consumer packaged goods, over-the-counter healthcare organizations, retailers, financial services and media companies grow their businesses. A confluence of major external events—a change in consumer buying habits, big data coming into its own, advanced analytics and personalized consumer activation—is leading to a seismic shift in drivers of success in all industries. With the largest repository of purchase, media, social, causal and loyalty data, all integrated on an on-demand, cloud-based technology platform, IRI is empowering the personalization revolution, helping to guide its more than 5,000 clients around the world in their quest to remain relentlessly relevant, capture market share, connect with consumers, collaborate with key constituents and deliver market-leading growth.

In 2019, IRI announced the integration of artificial intelligence and machine learning into its leading suite of analytics solutions, retained 100% of its major CPG clients and welcomed new strategic partnerships with top retailers in the U.S. IRI added several innovators to its leadership team while continuing to invest in its employees by providing ongoing training. 

4. Kantar **

Founded: 1993 2019 U.S. revenue: $950 million Percent change from 2018: 2.7% 2019 non-U.S. revenue: $2,900 million Percent from outside U.S.: 75.3% 2019 worldwide revenue: $3,850 million U.S. employees: 3,585

Kantar is one of the world’s largest data, insights and consulting companies, bringing together some of the world’s leading research, data and insights expertise. Kantar’s offer covers the breadth of techniques and technologies, from purchase and media data to predicting long-term trends; from neuroscience to exit polls; from large-scale quantitative studies to qualitative research, incorporating ethnography and semiotics. 

In April 2019, all services and offerings of the various Kantar companies were combined under the Kantar brand name. This operational change enables Kantar to build platforms and offers on a global scale and to remove barriers to collaboration and co-creation within the organization to better meet clients’ needs. 

As part of this branding strategy, Kantar launched several initiatives:

• Kantar Marketplace, a global on-demand research and insights store.
• Kantar’s new Brand Guidance System that intelligently integrates validated survey measures with social, search, sales media and behavioral data to provide actionable insights to optimize brand or campaign performance.
• Integration of big data, artificial intelligence and analytical capabilities from across the company into one resource that unlocks deeper insights to fuel growth.

3. Gartner Research **

Founded: 1972 2019 U.S. revenue: $1,800 million Percent change from 2018: 4.7% 2019 non-U.S. revenue: $1,474.5 million Percent from outside U.S.: 45% 2019 worldwide revenue: $3,274.5 million U.S. employees: 4,500

Gartner Research delivers independent, objective advice to leaders across an enterprise through subscription services that include on-demand access to published research content, data and benchmarks, and direct access to a network of approximately 2,300 research experts located around the globe. Gartner Research is the fundamental building block for all Gartner products and services. It combines its proprietary research methodologies with extensive industry and academic relationships to create Gartner products and services that address each role across an enterprise. Gartner’s research agenda is defined by clients’ needs, focusing on the critical issues, opportunities and challenges they face every day. Its proprietary research content, presented in the form of reports, briefings, updates and related tools, is delivered directly to the client’s desktop via its website or product-specific portals.

Within the research segment, Global Technology Sales sells products and services to users and providers of technology, while Global Business Sales sells products and services to all other functional leaders, such as supply chain, marketing, human resources, finance, legal and sales. 

2. IQVIA * **

Founded: 2016 2019 U.S. revenue: $2,220 million Percent change from 2018: 8.6% 2019 non-U.S. revenue: $2,166 million Percent from outside U.S.: 49.4% 2019 worldwide revenue: $4,386 million U.S. employees: 6,000

IQVIA is a global provider of information, innovative technology solutions and contract research services focused on helping healthcare clients find better solutions for patients. Formed through the 2016 merger of Quintiles and IMS Health, IQVIA applies human data science—leveraging the analytic rigor and clarity of data science to the ever-expanding scope of human science—to enable companies to reimagine and develop new approaches to clinical development and commercialization, speed innovation and accelerate improvements in healthcare outcomes. 

IQVIA has three operating segments: Technology & Analytics Solutions, Research & Development Solutions and Contract Sales & Medical Solutions. Powered by the IQVIA CORE, IQVIA delivers unique and actionable insights at the intersection of large-scale analytics, transformative technology and extensive domain expertise, as well as execution capabilities to help biotech, medical device and pharmaceutical companies, medical researchers, government agencies, payers and other healthcare stakeholders tap into a deeper understanding of diseases, human behaviors and scientific advances, in an effort to advance their path toward cures.

IQVIA has one of the largest and most comprehensive collections of healthcare information in the world, which includes more than 800 million comprehensive, longitudinal, non-identified patient records spanning sales, prescription and promotional data, medical claims, electronic medical records, genomics and social media. Its scaled and growing information set contains more than 35 petabytes of proprietary data sourced from more than 150,000 data suppliers and covering more than 1 million data feeds globally. Based on this data, IQVIA delivers information and insights on more than 85% of the world’s pharmaceuticals, helping its clients run their organizations more efficiently and make better decisions to improve their clinical, commercial and financial performance. 

1. Nielsen **

Founded: 1923 2019 U.S. revenue: $3,875 million Percent change from 2018: 1.6% 2019 non-U.S. revenue: $2,623 million Percent from outside U.S.: 40.4% 2019 worldwide revenue: $6,498 million U.S. employees: 10,300

Nielsen is a global measurement and data analytics company that provides a complete and trusted view of consumers and markets worldwide. Nielsen is divided into two business units: Nielsen Global Media and Nielsen Global Connect. 

Nielsen Global Media provides media and advertising clients with unbiased and reliable metrics that create the shared understanding of the industry required for markets to function, enabling its clients to grow and succeed across the $600 billion global advertising market. Nielsen Global Media helps clients define exactly who they want to reach and optimize the outcomes they can achieve. The company’s cross-platform measurement strategy brings together the best of TV and digital measurement to ensure a more functional marketplace for the industry.

Nielsen Global Connect provides consumer packaged goods manufacturers and retailers with accurate, actionable information and a complete picture of the complex and changing marketplace that brands need to innovate and grow their businesses. Nielsen Global Connect provides data and builds tools that use predictive models to turn observations in the marketplace into business decisions and winning solutions. The business’ data and insights, combined with its open, cloud-native measurement and analytics platform that democratizes the power of data, continue to provide an essential foundation that makes markets possible in the rapidly evolving world of commerce. With Nielsen Global Connect’s set of guiding truths, businesses have the tools to create new opportunities.

* ‘% change’ calculation reflects adjustment of previously reported 2018 U.S. research revenue due to acquisition or divestiture activity or other business change during 2019.

** Some or all figures are not made available by this company so instead are based on research and estimation by the report author.

Diane Bowers is a consultant to research and data analytics businesses and industry associations in the U.S. and internationally. She previously served as the president of CASRO, board chair of the Global Research Business Network, a board member of the Americas Research Industry Alliance and a board member of The Roper Center for Public Opinion Research at Cornell University. She is also a past president of the Market Research Council and the Research Industry Coalition, and a long-time member of American Association for Public Opinion Research, AMA and ESOMAR.

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13 Top Market Research Companies in 2024

Related topics:.

Market research companies play a pivotal role in simplifying the complexities of today’s business environment, blending traditional and innovative methodologies for exhaustive market insights.

Traditional market intelligence companies have evolved, while non-traditional entities are transforming the sector through the early identification of startups, scaleups, emerging companies, future trends, and technologies to provide a 360° view of opportunities.

13 Top Market Research Companies:

• Frost & Sullivan
• StartUs Insights
• Zion Market Research
• MarketsandMarkets
• Forrester Research
• Kantar Group
• Kline & Company
• MarketResearch

Credit: Ipsos

Ipsos connects businesses with online communities, offering insights across multiple industries including retail, healthcare, transportation, politics, and automotive. With Ipsos, companies can:

• Assemble custom panels of consumers
• Conduct brand, packaging, and product testing
• Develop studies on healthcare quality and patient satisfaction
• Engage in public opinion polling

Ipsos’ customizable services and global reach provide businesses with the insights required to make informed decisions.

2. Frost & Sullivan

Credit: Frost & Sullivan

Frost & Sullivan is renowned for its extensive industry research and strategy solutions, focusing on innovation opportunities, market trends, and disruptive technologies. Collaborating with Frost & Sullivan offers businesses:

• Detailed market research and analysis
• Growth strategy consulting

Frost & Sullivan’s strategic insights enable companies to identify growth opportunities and navigate market challenges.

3. StartUs Insights

Credit: StartUs Insights

StartUs Insights is a non-traditional market research company that specializes in identifying startups, scaleups, and emerging technologies early on. With access to data on over 4.7 million startups, scaleups, and tech companies, as well as 20 000 trends & technologies, we leverage both AI and human expertise to deliver tailored market reports and custom research services. This unique approach enables businesses to proactively engage with the latest innovations and market shifts across more than 20 industries, including automotive, pharmaceuticals, logistics, mobility, biotechnology, manufacturing, and energy. Services offered by StartUs Insights include:

• Customized market research reports plus competitive intelligence
• Tailored startup and technology scouting
• Innovation scouting and technology tracking
• Detailed analysis of industry trends

Collaborating with StartUs Insights allows you to make informed, confident decisions that not only future-proof your business but also foster strategic growth. To explore how StartUs Insights can transform your market research approach, get in touch for a free consultation.

4. Zion Market Research

Credit: Zion Market Research

Zion Market Research provides comprehensive market research reports, offering insights into global and regional markets across various industry sectors such as healthcare, technology, chemicals, and consumer goods. Working with Zion Market Research, businesses benefit from:

• Extensive market analysis and forecasting
• Sector-specific research reports
• In-depth studies on consumer behavior and market trends
• Custom research services tailored to specific business needs

Zion Market Research’s deep industry knowledge enables companies to navigate market dynamics effectively, ensuring strategic decision-making.

5. MarketsandMarkets

Credit: MarketsandMarkets

MarketsandMarkets is known for its focus on identifying high-growth emerging markets and the technologies driving these sectors. Its market research reports and custom research services are designed to provide:

• Comprehensive market analysis and forecasts
• Insights into technological advancements and innovations
• Custom research tailored to client-specific requirements

By partnering with MarketsandMarkets, organizations gain access to actionable insights that support strategic planning.

6. TrendFeedr

Credit: TrendFeedr

TrendFeedr is an innovative market research platform designed to keep businesses ahead of the curve by identifying and analyzing over 20 000 trends in real-time. TrendFeedr.com specializes in sifting through data from industry reports, company websites, news outlets, social media, and more to deliver actionable insights directly relevant to your market. Services provided by TrendFeedr.com include:

• Real-time trend tracking and analysis
• Competitive intelligence gathering
• Customizable alerts for emerging trends and technologies

With TrendFeedr.com, companies can rapidly adapt to market changes, identify new opportunities, and stay competitive in their respective industries. Moreover, the platform’s focus on emerging trends makes it an invaluable tool for businesses looking to innovate and grow.

7. Forrester Research

Credit: Forrester Research

Forrester Research offers detailed market analysis with a focus on the impact of technology on businesses and consumers. Companies working with Forrester can access:

• Strategic market research reports
• Consumer and business technology insights
• Custom advisory services

Forrester’s forward-looking research assists businesses in anticipating customer needs and technological shifts, enabling them to stay ahead in a rapidly evolving market.

Credit: Mintel

Mintel provides comprehensive market analysis, insights, and forecasts across a range of sectors, including consumer goods, finance, and automotive. Mintel’s services allow businesses to:

• Understand market trends and consumer behavior
• Test and develop new products
• Conduct brand and packaging research

Mintel’s global presence and in-depth industry knowledge empower companies to make strategic decisions.

9. Kantar Group

Credit: Kantar Group

Kantar Group delivers services that cover brand guidance, media effectiveness, creative excellence, and retail & shopper insights. Kantar enables businesses to:

• Understand and leverage brand equity
• Optimize media planning and effectiveness
• Enhance creative development and execution
• Gain insights into shopper behavior and retail strategies

Kantar’s comprehensive approach to market research enables companies to achieve brand and business growth.

10. Gartner

Credit: Gartner

Gartner provides technology-related insights through its research and advisory services that inform business decisions in IT, marketing, and supply chain management. Gartner allows organizations to:

• Navigate IT investments and strategies
• Develop marketing plans and customer engagement
• Optimize supply chain operations and management

Gartner’s expert analysis and advice support businesses in leveraging technology for strategic advantage.

Credit: IQVIA

Specializing in health information technology and clinical research, IQVIA offers:

• Data analytics and research services to the healthcare industry
• Insights into patient care, drug development, and market dynamics
• Custom solutions for healthcare organizations

IQVIA’s expertise in healthcare data and analytics enables businesses to improve patient outcomes and operational efficiency.

12. Kline & Company

Credit: Kline & Company

Kline & Company provides market research and management consulting services focusing on the chemicals, materials, energy, life sciences, and consumer products sectors. Kline offers:

• Market analysis and strategic planning
• Competitive intelligence and benchmarking
• Custom research and consulting services

Kline’s industry knowledge and strategic insights assist companies in navigating market complexities and identifying growth opportunities.

13. MarketResearch.com

Credit: MarketResearch.com

MarketResearch.com is a comprehensive source for market research reports and services, offering data from hundreds of research firms across a range of industries. Services include:

• Access to an extensive collection of market research reports
• Insights into industry trends, forecasts, and market analysis

MarketResearch.com’s vast resources and expertise allow businesses to make data-driven decisions.

Which Company’s Best Suited for Your Needs?

For tailored research insights that align closely with your specific business needs, consider partnering with specialized companies such as StartUs Insights , Zion Market Research, or MarketsandMarkets. These firms offer the expertise and depth of data necessary to dive deeper into emerging technologies and market trends.

If you’re leaning towards more autonomous or flexible market exploration, platforms like TrendFeedr.com may serve your needs more effectively, offering real-time trend analysis.

Ultimately, the selection of a market research partner should be informed by the relevance of their industry focus and the richness of their data sources. This ensures that the insights you receive are both precise and actionable, driving forward your strategy, product development, and broader business objectives.

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11.5 Market Segmentation

• What are the five basic forms of consumer and business market segmentation?

Most organizations cannot target the total market for a specific product. For each separate part of the market that an organization wants to target, a marketing mix (a set of 5Ps) must be created. It would be very expensive to try to create a marketing mix for every part of the target market. Instead, companies cut up those targets into specific “segments” of the market that the organization is more strategically positioned to be successful in targeting. Segmentation also varies based on the target market being a consumer market or a business market.

The study of buyer behavior helps marketing managers better understand why people make purchases. To identify the target markets that may be most profitable for the firm, marketers use market segmentation , which is the process of separating, identifying, and evaluating the layers of a market to identify a target market. For instance, a target market might be segmented into two groups: families with children and families without children. Families with young children are likely to buy hot cereals and presweetened cereals. Families with no children are more likely to buy health-oriented cereals. Cereal companies plan their marketing mixes with this difference in mind. A business market may be segmented by large customers and small customers or by geographic area.

The five basic forms of consumer market segmentation are demographic, geographic, psychographic, benefit, and volume. Their characteristics are summarized in Table 11.2 and discussed in the following sections.

Demographic Segmentation

Demographic segmentation uses categories such as age, education, gender, income, and household size to differentiate among markets. This form of market segmentation is the most common because demographic information is easy to obtain. The U.S. Census Bureau provides a great deal of demographic data, especially about metropolitan areas. For example, marketing researchers can use census data to find areas within cities that contain high concentrations of high-income consumers, singles, blue-collar workers, and so forth. However, even though demographic information is easier to obtain than other types of information, it may not always be the best approach to segmentation because it is limited on what it can reveal about consumers.

Many products are targeted to various age groups. Most music CDs, Pepsi , Coke , many movies, the Honda Fit, and thousands of other products are targeted toward teenagers and persons under 25 years old. In contrast, most cruises, medical products, fine jewelry, vacation homes, Tesla s, and denture products are targeted toward people 50 years old and up. An example of how Frito Lay targets various age groups for three of its most popular products is shown in Table 11.3 .

Income is another popular way to segment markets. Income level influences consumers’ wants and determines their buying power. Housing, clothing, automobiles, and alcoholic beverages are among the many markets segmented by income. Budget Gourmet frozen dinners are targeted to lower-income groups, whereas the Stouffer’s line and California Pizza Kitchen frozen pizzas are aimed at higher-income consumers.

Geographic Segmentation

Geographic segmentation means segmenting markets by region of the country, city or county size, market density, or climate. Market density is the number of people or businesses within a certain area. Many companies segment their markets geographically to meet regional preferences and buying habits. Pizza Hut , for instance, gives easterners extra cheese, westerners more ingredients, and midwesterners both. Both Ford and Chevrolet sell more pickup trucks and truck parts in the middle of the country than on either coast. The well-defined “pickup truck belt” runs from the upper Midwest south through Texas and the Gulf states. Ford “owns” the northern half of this truck belt and Chevrolet the southern half.

Psychographic Segmentation

Race, income, occupation, and other demographic variables help in developing strategies but often do not paint the entire picture of consumer needs. Demographics provide basic data that can be observed about individuals, but psychographics provide vital information that is often much more useful in crafting the marketing message. Demographics provide the skeleton, but psychographics add meat to the bones. Psychographic segmentation is market segmentation by personality or lifestyle. People with common activities, interests, and opinions are grouped together and given a “lifestyle name.” For example, Harley-Davidson divides its customers into seven lifestyle segments, from “cocky misfits” who are most likely to be arrogant troublemakers, to “laid-back camper types” committed to cycling and nature, to “classy capitalists” who have wealth and privilege. Two different managers could be described by demographics as male, managers, 35 years old, with $80,000 per year income. A marketer who just saw the demographics might create one advertisement to reach both of them. However, if the marketer knew that one of the managers was president of his homeowner’s association and captain of a rugby league team and the other manager was a holder of opera season tickets and president of the Friends of the Public Library, the messages might be designed very differently in order to be more successful.

Benefit Segmentation

Benefit segmentation is based on what a product will do rather than on consumer characteristics. For years Crest toothpaste was targeted toward consumers concerned with preventing cavities. Recently, Crest subdivided its market. It now offers regular Crest, Crest Tartar Control for people who want to prevent cavities and tartar buildup, Crest for kids with sparkles that taste like bubble gum, and another Crest that prevents gum disease. Another toothpaste, Topol, targets people who want whiter teeth—teeth without coffee, tea, or tobacco stains. Sensodyne toothpaste is aimed at people with highly sensitive teeth.

Volume Segmentation

The fifth main type of segmentation is volume segmentation , which is based on the amount of the product purchased. Just about every product has heavy, moderate, and light users, as well as nonusers. Heavy users often account for a very large portion of a product’s sales. Thus, a firm might want to target its marketing mix to the heavy-user segment. For example, in the fast-food industry, the heavy user (a young, single male) accounts for only one in five fast-food patrons. Yet this heavy user makes over 60 percent of all visits to fast-food restaurants.

Retailers are aware that heavy shoppers not only spend more, but also visit each outlet more frequently than other shoppers. Heavy shoppers visit the grocery store 122 times per year, compared with 93 annual visits for the medium shopper. They visit discount stores more than twice as often as medium shoppers, and they visit convenience/gas stores more than five times as often. On each trip, they consistently spend more than their medium-shopping counterparts.

Business Market Segmentation

Business markets are segmented differently than consumer markets. Business markets may segment based on geography, volume, and benefits, just as consumer markets are. However, organizations might also segment based on use of the product (such as a petrochemical company having one market segment for purchasers who use polyethylene for instrumentation panels and one for purchasers who use polyethylene for car seats), characteristics of purchasing function (such as purchasing committees, purchasing managers, or purchasing departments), size of the client (one segment for large customers who have different needs than smaller customers), or industry (such as segmenting food systems into restaurants or government agencies such as schools or military bases), as well as other considerations related to characteristics of business customers.

Using Marketing Research to Serve Existing Customers and Find New Customers

How do successful companies learn what their customers value? Through marketing research, companies can be sure they are listening to the voice of the customer. Marketing research is the process of planning, collecting, and analyzing data relevant to a marketing decision. The results of this analysis are then communicated to management. The information collected through marketing research includes the preferences of customers, the perceived benefits of products, and consumer lifestyles. Research helps companies make better use of their marketing budgets. Marketing research has a range of uses, from fine-tuning existing products to discovering whole new marketing concepts.

For example, everything at the Olive Garden restaurant chain, from the décor to the wine list, is based on marketing research. Each new menu item is put through a series of consumer taste tests before being added to the menu. Hallmark Cards uses marketing research to test messages, cover designs, and even the size of the cards. Hallmark ’s experts know which kinds of cards will sell best in which places. Engagement cards, for instance, sell best in the Northeast, where engagement parties are popular. Birthday cards for “Daddy” sell best in the South because even adult southerners tend to call their fathers Daddy.

Marketing research can use either primary data (where the organization actually gets the data and analyzes it) or secondary data (where the organization uses data that has already been developed and published by another entity and the organization is able to utilize the data for its own purposes). There are three basic research methods used for gathering primary data: survey, observation, and experiment.

With survey research , data is gathered from respondents—in person, through the internet, by telephone, or by mail—to obtain facts, opinions, and attitudes. A questionnaire is used to provide an orderly and structured approach to data-gathering. Face-to-face interviews may take place at the respondent’s home, in a shopping mall, or at a place of business.

Observation research is research that monitors respondents’ actions without direct interaction. In the fastest-growing form of observation research, researchers use cash registers with scanners that read tags with bar codes to identify the item being purchased. Technological advances are rapidly expanding the future of observation research. Arbitron research has developed a portable people meter (PPM) about the size of a cell phone that research participants clip to their belts or any article of clothing. They agree to wear it during all waking hours. Before the study participants go to sleep, they put the PPM in a cradle that automatically sends data back to Arbitron (now Nielsen Audio). The PPM will tell the marketing research company exactly which television programs the person watched and for how long. It also records radio programs listened to, any web streaming, supermarket piped-in music, or any other electronic media that the research participant encountered during the day. 5

In the third research method, experiment , the investigator changes one or more variables—price, package, design, shelf space, advertising theme, or advertising expenditures—while observing the effects of those changes on another variable (usually sales). The objective of experiments is to measure causality. For example, an experiment may reveal the impact that a change in package design has on sales.

Concept Check

• Define market segmentation.
• List and discuss the five basic forms of consumer market segmentation.
• What are some additional forms of business segmentation?
• How does marketing research help companies make better use of their marketing budgets?

This book may not be used in the training of large language models or otherwise be ingested into large language models or generative AI offerings without OpenStax's permission.

Want to cite, share, or modify this book? This book uses the Creative Commons Attribution License and you must attribute OpenStax.

Access for free at https://openstax.org/books/introduction-business/pages/1-introduction

• Authors: Lawrence J. Gitman, Carl McDaniel, Amit Shah, Monique Reece, Linda Koffel, Bethann Talsma, James C. Hyatt
• Publisher/website: OpenStax
• Book title: Introduction to Business
• Publication date: Sep 19, 2018
• Location: Houston, Texas
• Book URL: https://openstax.org/books/introduction-business/pages/1-introduction
• Section URL: https://openstax.org/books/introduction-business/pages/11-5-market-segmentation

© Apr 5, 2023 OpenStax. Textbook content produced by OpenStax is licensed under a Creative Commons Attribution License . The OpenStax name, OpenStax logo, OpenStax book covers, OpenStax CNX name, and OpenStax CNX logo are not subject to the Creative Commons license and may not be reproduced without the prior and express written consent of Rice University.

How to Research a Company: The Ultimate Guide

Free Website Traffic Checker

Discover your competitors' strengths and leverage them to achieve your own success

Good company research can take many forms. Depending on your research goals, you might want to look at the strengths, weaknesses, opportunities, and threats of a market, or drill down into key industry leaders and emerging players to unpack their successes.

If you want to beat the competition, you need to know their business as well (if not better) than your own. The more intel you have, the quicker you’ll be able to spot and leverage opportunities, respond to market changes, and grow.

Read on to discover how to research a company online, tear down its strategies, and take over its market share.

What is company research?

Company research gathers and analyzes information about a business and its customers. This means understanding its performance data and target audience so you can optimize your own strategy.

In today’s fiercely competitive markets, doing good company research is a game-changer. In fact, a 2022 report on competitive intelligence found that 98% of businesses believe researching their competitors is vital for success.

If you have the right tools to collect accurate competitive intelligence , you’ll be able to anticipate your competitors’ moves and emerging threats to stay ahead and succeed.

How to do company research in 8 steps

Researching a company is a bit like doing detective work. The deeper you go, the more questions you ask, and the more curious you are, the better the outcome will be.

Here are eight steps to steer you through the process of doing company research.

1. Track top competitors

You want to know exactly what your rivals are doing, where they’re going, and how the competitive landscape is changing. With this data, you can carefully plan your next move and take action when and where it’s needed most. Competitive tracking tools like Similarweb give you the ability to track what your rivals are up to. You can measure each competitor’s digital footprint, and identify any changes or growth over time.

Did someone experience a sudden uptick in website visits? Would you like to know why and how? Perhaps they launched a new feature or ad campaign, or maybe its social channel is driving growth.

With Similarweb Research Intelligence, you get alerts about changes so you can be sure you’ll never miss a beat.

Analyzing the top performers in your industry will give you new ideas and provide targets for what is achievable for you.

Similarweb’s Analyze Industry Leaders tool will tell you who is winning in your industry based on their website performance. A Market Quadrant Analysis graph, or competitive matrix , provides a visual snapshot of the websites in your industry and how they compare based on different metrics. The industry leaders may inspire you to try new things, while the weaker competitors in your industry can provide you with swift opportunities to chip into their market share.

Pro tip: Similarweb’s Similar Sites tool helps you uncover up to 40 domains that are similar to yours. Finding these domains can be infinitely useful when conducting a competitive content analysis . You can audit these domains to learn more about their content strategy and upgrade your own.

2. Benchmark

Now that you have a good view of the market, you need to drill down into your competitors’ performance. You want to understand their metrics and KPIs so you can benchmark them against your own.

A company research and analysis tool can help you understand your competitors’ digital reach and performance. You can look at multiple websites or domains owned by a single company to analyze their aggregated data or look at a specific market. This will give you a good idea of the business’ size and market share .

You’ll also want to look at their engagement metrics and any changes over time. If you see their metrics improving, they are probably investing in a digital strategy . You should look into this to see what has been working for them. We’ll show you how in the next section.

Pro Tip: Don’t forget to look at mobile app intelligence too. There are five key metrics you’ll want to track when benchmarking an app:

• Demographics

3. Compare traffic and engagement

These days, it’s no longer enough to consider website traffic and engagement metrics on their own. The complete digital perspective of any company includes mobile app intelligence, alongside traditional desktop and mobile web metrics. You need to see the full picture before you make any judgments or decisions.

Using Similarweb digital intelligence, I wanted to view the key players in the travel industry – specifically travel booking sites, like booking.com, Expedia, and Airbnb. First, I want my company research to focus on mobile web and desktop traffic alone.

Using Similarweb Digital Research Intelligence, I can see the overall benchmarks for traffic and engagement. This shows metrics like monthly visits, unique visitors, pages per visit, bounce rate, and visit duration. 

The top websites include booking.com , Airbnb , Expedia , Agoda , and Hotels.com . So, in essence, these are my industry leaders .

However, knowing how important apps are these days to consumers, I want to consider app intelligence in my company research too. When I add this data into the mix, things look a little different.

On both Android and iOS: Expedia, Airbnb, VRBO, booking.com, and Hopper are my top five.

Now, my view of industry leaders has changed . We’ve got three key players who are leading desktop, mobile web, and app platforms; and four others, who respectively dominate different channels.

Here, you can see a range of engagement metrics that apply to mobile apps on Android. Including active users, number of sessions, and session times; which shows engagement, upturns, downturns, and opportunities at a glance.

So, when you view traffic and engagement metrics, make sure you explore desktop, mobile web, and app intelligence to get an accurate picture of what’s really going on.

4. View audience interests

Understanding cross-browsing behavior tells you what other sites your users are interested in. Maybe they are looking at other products and solutions like yours!

This audience interests tool allows you to evaluate the browsing behavior of your target audience, helping you understand user intent and their purchasing process. You might even discover new markets or a specific niche audience , and come up with new audience acquisition strategies.

5. Pinpoint audience overlap

Who else holds your potential customer’s attention? With Similarweb’s Audience Overlap feature, you can analyze metrics and insights on the overlap of visitors across up to five websites for a selected time period and geographical region. You’ll be able to determine the size of your total addressable audience , evaluate what part of the audience is shared, and pinpoint your unreached audience potential.

This is also a good way to gauge audience loyalty . You’ll see the proportion of monthly active users who look at multiple sites in the same category or just one site.

6. Analyze specific pages

While a company may be your competitor, you may not be competing on every front. You might only want to look at a particular segment of a business when doing your company research. This ensures that your insights are specific and useful, and leave out less relevant information.

Similarweb’s Segment Analysis tool lets you slice the URL of a website to analyze just the parts that are relevant to you. You can deconstruct their website to look at a specific category, topic, brand, or whatever else interests you. This can help you benchmark a specific line of business or individual products.

This analysis is extremely powerful for marketing and sales managers, data analysts, and BI specialists who want to optimize their strategies for specific business segments. For example, if you are a clothing retailer looking to launch a line of kids’ clothes, you can use this tool to analyze your competitors’ kids’ clothing lines.

7. Reveal successful conversion strategies

What makes customers convert? The only way to know for sure is to analyze conversion data across your industry. You need to understand the conversion funnel, which keywords and marketing channels drive traffic, and which trends your potential customers are interested in.

You can get a unique view of your industry’s conversion data with Similarweb’s Conversion Analysis tool . Check out each company’s conversion efficiency and how they scale over time. You can identify efficient marketing channels , go-to-market strategies, and their ROI for marketing spending. You can also benchmark your metrics across the industry average.

Understanding conversion strategies also reveals opportunities for your own growth. You can examine category performance at top retailers such as Amazon, Walmart, and Target, and identify what consumers are searching for at the different retailers and what converts. When you understand the customer journey, you can better position yourself to guide them toward purchasing from you.

8. Research mobile app performance

When you research a business, you need to look at all customer touchpoints. Today, that means analyzing apps alongside web and mobile web traffic. You want to know how well your competitors’ apps rank so you can focus on your own app strategy. With rapid consumer adoption of mobile-first spending ( 46% of people now complete a full purchase via mobile ), app intelligence is a key consideration for any type of company research. In almost every industry, the digital landscape changes when you add app intelligence metrics.

If you’re looking at apps competitively, you want to consider:

• Monthly/ Daily Active Users
• No. of sessions/session time
• Sessions per user
• Overall rank
• Category rank
• User retention
• App demographics

Similarweb App Intelligence Premium now provides a few ways to help you view app rankings , downloads, engagement, and usage metrics across both Android and iOS. From benchmarking an app to unpacking the successes of those with apps in your market; good company research should include app analysis. By unifying digital insights, you see a truer picture of a company’s successes online.

How to research a company like an expert

Follow these eight steps and you’ll quickly be able to research any company in any niche like a pro. Uncover key insights that tell you more about a market, target audience, or competitors to shape your own strategy for success.

Ready to get growing? Grab a free trial of Similarweb today.

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Why do company research?

Your business doesn’t exist in a vacuum. You’re competing with other companies and operating in an industry that has its own norms and expectations. If you want to succeed, you need to research other companies in your industry to ensure your strategy is aligned, but also positioned to give you a competitive advantage . You won’t be able to do this without researching other companies.

What to look for when researching a company?

You want to review all their company metrics, including traffic and engagement metrics, and look at their strategy, focus, processes, and content. You should search for any interesting ideas and identify where the company excels. All the data you collect will be valuable for you to compete.

What can company research tell you?

Good company research shows you how a market, company, and its target audience’s interests change over time. It can help you develop your own strategy for growth, and shows trends and emerging threats to watch out for.

by Liz March

Digital Research Specialist

Liz March has 15 years of experience in content creation. She enjoys the outdoors, F1, and reading, and is pursuing a BSc in Environmental Science.

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18 US market research companies for leading consumer insights

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When it comes to understanding modern American consumers, guesswork just won’t cut it. With transformative changes affecting the way we shop, behave, and consume media, it’s no secret that in-depth consumer research should be at the heart of every strategic marketing, product, or business decision you make. 

There are a myriad of US market research companies out there armed with customer insight platforms, smart research tools, and AI-powered features that give you the answers you need. But which is best for reaching your US target audiences? Whose data can you trust? With so much choice, it can be tough to figure out which market research company is the right fit for your business needs. 

To help you make that decision (‘cause we’re nice like that), we’ve put together a no-nonsense rundown of the best market research companies for US consumer insights right now, outlining the specialist areas and key use cases you might consider them for. Grab a hot drink and settle in. 

Oh – and if you’re interested in the best market research companies in the UK , we’ve got a shortlist of those worth skimming through too. 

How to choose the right US market research company

It sounds obvious, but every US market research company is different. The type of consumer data they collect, and how they deliver it to you really varies. So before you commit to a research partner, think carefully about the kind of support you need – and crucially, how quickly you need it. Start by asking these six questions:

• Do they know about your audience? 
• Do they have expertise in your industry/category, with a proven track record of success?
• Do they conduct the right kind of research to answer your questions, with a sound and trusted methodology? 
• Are they transparent about how they collect and analyze data to ensure quality?
• Do they have the capacity to provide fast results, with regular client communication?
• Most importantly, will they understand your long-term goals and add value to your business?

If you can answer “yes” to each of these questions, you’re on the right track to finding the perfect partner. But if you want more guidance on how to drive research forward, here’s our list of the leading US market research companies worth considering, in no particular order. Well, except for us – obviously.

Top 18 US market research companies worth considering

It would be crazy if we put together a comparison piece on US market research companies and didn’t mention our very own AI-enhanced, on-demand consumer research platform . So let’s start there.

GWI is modernized consumer research, with an intuitive platform that instantly puts high-impact US consumer research at your fingertips.

Location: New York, USA (with additional offices in the UK, Greece, Czech Republic, and Singapore)

Specialisms: Every business has questions about its audiences; GWI has the answers. Get a window into your target audience’s world, on demand, with our easy-to-use consumer research platform. Our GWI USA data set covers an 80K+ annual sample, representing the views, behaviors, and interests of 250 million US consumers in all 50 States. Need to go beyond the US? Delve into our global flagship survey representing nearly 3 billion consumers in 50+ markets worldwide.

Understand today’s diverse Americans in seconds, with deep psychographic consumer insight spanning key topics like social media, mental health, DE&I, and attitudes toward brands. And if you need fast answers on something really specific? Ask your US audiences any question you like with our custom research solutions.

Use cases include: 

• Marketing strategy ( ad targeting , brand health tracking, content marketing, and media planning)
• Revenue growth (media ad sales, winning pitches and retaining key clients)
• Product development (product expansion, improvements, and partnership and collaboration opportunities)
• Competitive advantage (market differentiation, market sizing/expansion, and sponsorship opportunities)

2. MRI-Simmons

A long-standing provider of US consumer insights, collected through address-based probabilistic sampling, and online and in-person interviews.

Location: New York, USA

Specialisms: MRI-Simmons offers a complete view of the American consumer – providing consumer research via a national study, print studies into magazine ad readership, and focus studies for deeper insight into emerging tech and cultural trends. Data is based on a representative sample of over 50K+ US consumers in 48 states (excluding Alaska and Hawaii), with surveys conducted twice a year. 

Use cases include:

• Audience profiling
• Market sizing
• Media planning

An integrated, AI-driven enterprise platform combining “quant, qual, and high quality audiences” into a connected research cloud.

Specialisms: Using AI to drive research, Suzy has three main product offerings – Suzy Insights, Suzy Live, and Suzy Audiences – and offers real-time customer insights delivered with “agency-quality rigor”. Pulling data from an active, engaged community (via surveys, interviews, and focus groups), its platform helps teams understand US consumers, explore purchase journeys, validate ideas, optimize marketing assets, and more.

Use cases include:  

• Concept testing
• Product development

AI-powered market intelligence that solves critical questions in the decision-making process, and helps drive sustainable growth.

Location: Nuremberg, Germany (with additional global offices)

Specialisms : GfK “drives growth from knowledge” by providing a holistic view of US consumers’ buying behavior and the dynamics impacting markets, brands, and media trends. With particular expertise in consumer and shopper intelligence, Gfk’s research methods include surveys, point-of-sale data analysis, and wider market monitoring. It also offers strategic consultancy to help businesses make great decisions.

• Competitive advantage
• Market segmentation

A global media leader specializing in TV, video, and radio audience and data analytics.

Location: New York, USA (with additional global offices)

Specialisms: Nielsen is a powerhouse of market intelligence, “connecting clients to audiences, growth and new opportunities”. It explores nuanced consumer behavior, preferences, and market dynamics to give media brands an edge. You may be familiar with Nielsen ratings – its renowned audience measurement system for TV viewership – which have been a deciding factor in many shows being renewed or canceled over the years.

And in case you didn’t know – GWI has an ongoing Fusion partnership with Nielsen that delivers advanced media insights and analytics to our customers. A pretty solid choice of market research partner, if you ask us.

• Ad targeting
• Media planning 

A business intelligence and market research company that helps clients “drive data-backed business decisions that enhance customers’ lives.”

Location: Virginia, USA

Specialisms: Bixa gives businesses a springboard to sustainable growth by helping them “build meaningful connections” with customers. It shares targeted business intelligence for a deeper understanding of US audiences, market dynamics, and emerging trends. Ultimately, it helps businesses with strategic decision-making. Data derives from diverse sources including surveys, consumer feedback, and in-depth industry analysis. 

• Brand health tracking
• Market expansion

7. Morning Consult

A real-time “decision intelligence” and custom research tool, powered by consumer opinion polling.

Location: Washington, D.C., USA

Specialisms: Morning Consult provides timely consumer opinions and market insights, alongside current economic data and political trends.  Daily surveys and insights give businesses the agility they need to pivot strategies quickly and effectively. Analyzing niche audiences and underserved buyers in 100+ countries (including the US), it’s also useful for identifying new market opportunities.

• Political risk analysis

Equipping clients with market intelligence tools to help them make “smarter decisions, faster and more consistently across markets”.

Specialisms: Ipsos is a global market research company that sources consumer data from surveys, behavioral analysis, and social listening. With specialist insight into the lifestyles, media habits, and purchase behavior of financially-successful Americans (via its Affluent Survey), it also pays particular attention to public opinion. This helps brands tune in to changing market trends and benchmark how well they’re received by consumers.

• Digital marketing strategy
• Sentiment tracking

An AI-driven “knowledge management” tool that helps enterprises keep pace and make fast decisions through predictive analytics.

Location: Minnesota, USA

Specialisms: Putting AI at the heart of market research, Lucy “exists to amaze, delight, and empower people with knowledge”. Generating US insights via machine learning algorithms, it rapidly analyzes a blend of large data sets, social media interactions, and consumer behaviors. Lucy is trusted by 18+ Fortune 1000 companies to deliver advanced analysis at speed – saving time while boosting organizational productivity. 

• Trend forecasting

10. Comscore

Leading digital audience insights and media performance analysis, that helps businesses generate more ROI from their advertising.

Location: Virginia, USA (with additional global offices)

Specialisms: Sharing real-time US consumer insights on media consumption, Comscore provides effective digital marketing and advertising solutions across several veins (including TV and advertising). Using its robust, reliable suite of tools, clients can explore demographics to understand American audiences, then optimize ad targeting and wider marketing strategies for better engagement and return on investment.

11. Kantar Marketplace

A market research company offering relevant, robust data about global and local audiences in an increasingly connected world.

Locations: New York, USA (with additional global offices)

Specialisms: Kantar serves industry-leading consumer insights across TV, radio, print, and digital – all unpacked in its Target Group Index (TGI) survey. Based on a representative 700K+ sample across 50 markets, data is collected online and through offline consumer panels. Analyzing attitudes, behaviors, media consumption, and brand/product use, Kantar promises “decision-quality insights in as little as a few hours.” 

12. 1+1 Research

A full-service fieldwork company supplying tailored market research solutions to companies across the globe.

Specialisms:   1+1 Research provides bespoke market research services for its clients, such as consumer opinion mining and sentiment analysis. Depending on a company’s needs, US consumer data can be collected through focus groups, online surveys, industry analysis, and CATI (computer-assisted phone interviews) among other methodologies – ideal for those with unique industry requirements who need a bit more flexibility.

• Brand strategy
• Custom research

13. Gartner

Expert market research company that delivers practical solutions for fast, informed decision-making and measurable impact.

Location: Connecticut, USA (with additional global offices)

Specialisms : Gartner is a global name in market research for good reason. Its on-demand diagnostics, insights, frameworks, rankings, and benchmarking tools help businesses work smarter, not harder to get ahead of modern Americans in the digital world. Valuable insights are sourced from a mix of market analysis, surveys, and expert consultations, and outline the impact of new technology on US businesses and consumers alike. 

Use cases: 

• Customer experience

A real-time consumer intelligence platform that helps clients figure out what matters to their online audiences, fast.

Specialisms: Subscription-based Toluna Start offers automated solutions that put market research into its clients’ hands. Collating US survey data from a global community of engaged consumers, its platform users get a dynamic view of digital preferences and behaviors to help them validate their strategies and implement feedback in a real-world environment.

• Marketing strategy

15. Statista

A global data and business intelligence platform aggregating statistics, market research reports, and key insights on over 80,000 topics.

Specialisms: Statista is a household name for timely US market and consumer insights, designed to “empower people with data” on key topics such as the economy, military, and population. Solutions include analysis of behavior and media usage (via Consumer Insights) and trend forecasting (via Market Insights). Data coverage also extends globally, with a representative 1.7M+ sample across 56 countries.

• Content marketing
• Winning pitches and retaining clients

16. SIS International Research

A full-service consulting firm supplying market intelligence and consumer research solutions to businesses worldwide.

Specialisms: SIS is a US market research company with specialist experience across various industries, including B2B, supply chain, and healthcare market research. It sources data and strategic insights from a global network of field researchers, alongside consumer surveys and interviews. SIS helps businesses benchmark against competitors and create tailored strategies for success – even as market dynamics change.

17.  Forrester Research

A US market research company that helps global organizations excel with technology and deliver on consumers’ changing demands.

Location: Massachusetts, USA

Specialisms: Combining traditional, in-house market research with a modern, tech-driven mindset, Forrester Research offers deep consumer insights along with recommendations for tech adoption strategies. It takes data from consumer surveys and expert market assessments, with findings analyzed by its team of experts. Clients benefit from clear results and a deeper understanding of nuanced consumer behavior in their industry.

• Market differentiation

18. Resonate

US market research and consumer intelligence experts, offering AI-powered consumer data and predictive insights. 

Specialisms: Resonate operates through “rAI”, its unique AI consumer intelligence model that gives clients a holistic view of their US audiences. Blending online behavioral data with surveys, psychographics, and real-time consumer interactions, it takes an in-depth look at what makes Americans unique, and the “why” behind what they do. Ideal for crafting highly targeted, effective marketing strategies backed by granular insight.

[H2] Those are our top market research recommendations, now it’s over to you

Nineteen US market research companies, with nineteen different ways to tackle US consumer research. Hopefully you’ve come away from this blog with a clearer idea of exactly what you need from a research partner, and who you can trust to get the job done. We’ll leave you to digest.

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What is Organizational Marketing? Strategies, Activities, and Essentials

In today’s competitive business landscape, understanding “what is organizational marketing” is more crucial than ever. This essential framework can help companies achieve their objectives by understanding and targeting specific markets, creating strategies, and implementing activities that cater to customer needs.

Let’s dive into the world of organizational marketing and explore its various aspects, from understanding organizational markets to enhancing customer satisfaction through personalized marketing efforts.

Short Summary

• Organizational marketing is the process of analyzing customer behavior to create value and achieve success.
• It requires understanding customer needs, setting objectives, targeting specific groups, and aligning with business goals.
• Digital initiatives offer cost-effective ways to reach target audiences, while post-sale support helps foster satisfaction & loyalty.

Understanding Organizational Marketing

Organizational marketing is all about comprehending and identifying target markets, devising strategies, and executing activities to accomplish marketing objectives. This vital function plays an integral role in creating knowledge value by representing the “voice of the customer,” utilizing data science to facilitate data creation and management, leveraging market and customer intelligence, and advancing marketing analytics. These marketing functions contribute significantly to the success of organizational marketing.

Marketers use sophisticated analytics and machine learning tools to analyze large volumes of data on consumer behavior, optimizing exchange value while taking into account the organizational structure. For example, a company might use marketing analytics to understand customer preferences for a particular product, enabling them to develop targeted marketing campaigns that resonate with their target audience.

By gauging their current performance against the 72 capabilities, marketing teams can evaluate their ability to deliver. In essence, organizational marketing helps companies create value and achieve success in their respective industries.

Types of Organizational Markets

When it comes to organizational markets, there are primarily three types: business-to-business (B2B), government, and institutional markets. Business-to-business markets, also known as the industrial market, refer to markets where businesses acquire goods and services from other businesses. For example, a company that manufactures office supplies might sell its products to other businesses that need them for their operations.

The government market involves governments procuring goods and services from businesses. For instance, government agencies might purchase goods such as office supplies or services like consulting from various companies.

In the institutional market, which comprises institutions like schools, hospitals, and other organizations, businesses provide goods and services tailored to their specific needs and preferences. This market is essential in the world of organizational marketing, as it represents unique customer groups.

Key Elements of Organizational Marketing Strategy

An effective organizational marketing strategy begins with understanding customer needs and preferences, conducting market research, and setting clear, quantifiable, and achievable marketing objectives. These objectives may include increasing sales, attracting new customers, and ensuring customer satisfaction. By aligning marketing objectives with overall business goals, organizations can create a cohesive framework that guides their marketing team and drives results.

Targeting specific customer groups is also a crucial component of an organizational marketing strategy. By understanding customer demographics and selecting appropriate advertising platforms, businesses can ensure that their marketing efforts reach the right audience. In turn, this can lead to higher-quality leads, increased brand recognition, and deeper customer loyalty.

Market Research and Analysis

Market research and analysis are essential for understanding customer needs, preferences, and trends and applying these insights to develop effective marketing strategies. By conducting market research, organizations can gain a better understanding of their target audience, identify opportunities for growth, and make informed decisions about their marketing initiatives.

Determining customer needs is a critical aspect of organizational marketing, as it ensures that customers receive a quality product and remain loyal to the organization. Through market research, businesses can identify opportunities for improvement, tailor their marketing efforts accordingly, and ultimately drive better results.

Defining Marketing Objectives

Defining marketing objectives is vital, as they help facilitate the achievement of business goals, provide a clear direction for the marketing team, enable the evaluation of performance, and guarantee that the marketing strategy is in line with the company’s mission and vision. Examples of marketing objectives include increasing brand recognition, fostering customer loyalty, optimizing sales, expanding market share, and enhancing customer satisfaction.

Metrics such as website visits, customer feedback, sales figures, and customer retention rates can be used to evaluate the success of marketing objectives. By regularly monitoring these metrics, organizations can make data-driven decisions, adjust their marketing strategies as needed, and ensure the ongoing effectiveness of their marketing efforts.

Targeting Customer Groups

Familiarity with customer demographics is essential for targeting customer groups. By understanding the preferences and needs of their target audience, businesses can ensure that their marketing efforts resonate with the right customers.

Additionally, selecting a target market allows organizations to ascertain the appropriate price point for products and services, as well as the appropriate advertising platforms.

Targeting customer groups, including the reseller market, is essential, as it facilitates businesses to establish a direct connection with a particular audience, draw in high-quality leads, make their brand distinctive, and foster deeper customer loyalty. In essence, businesses that effectively target a specific customer group can drive better results and achieve greater success in their respective markets.

Implementing Organizational Marketing Activities

Once a business has developed its marketing strategy , it’s time to implement organizational marketing activities. This involves taking a comprehensive approach to marketing, encompassing digital marketing initiatives, marketing operations management, and collaboration with other departments.

By coordinating these various aspects of marketing, organizations can ensure that their marketing efforts are aligned with their overall business objectives and drive better results.

As organizations embark on their marketing journey, evaluating their business focus, corporate values, and the direction their business is taking is the initial step in commencing organizational marketing activities. By understanding their unique strengths and opportunities, businesses can create a solid foundation for implementing their marketing strategies and achieving success.

Digital Marketing Initiatives

Digital marketing initiatives such as social media , email marketing, and content marketing can be used to reach target audiences. These digital channels enable businesses to engage with their customers digitally, focus on particular demographics, access a worldwide audience, promote sales, and boost revenue.

Moreover, digital marketing is an economical, scalable, and trackable way to market products and services. By leveraging digital marketing initiatives, businesses can create targeted campaigns, measure their effectiveness, and make data-driven decisions to adjust their marketing efforts as needed. In turn, this can lead to improved customer satisfaction, increased brand recognition, and a stronger competitive position in the market.

Marketing Operations Management

Marketing operations management entails coordinating marketing initiatives, overseeing budgets, and evaluating performance. It is essential for optimizing the marketing process, improving efficiency, and driving results. By providing a framework for the marketing team to adhere to, marketing operations management helps to streamline processes, reduce costs, and increase efficiency.

Additionally, marketing operations management serves as the bridge between marketing and sales teams, enabling the marketing organization to deliver measurable value to the business. By fostering customer loyalty, boosting sales, and acquiring new customers, marketing operations management contributes to the overall success of the organization.

Collaborating with Other Departments

Collaborating with the marketing department and other departments is essential in order to ensure alignment of marketing strategies with overall business goals and objectives. By working closely with departments such as sales, product development, and customer service, marketing teams can gain valuable insights into customer preferences, market trends, and opportunities for growth.

Moreover, cross-departmental collaboration facilitates the sharing of resources, knowledge, and expertise, leading to more effective marketing strategies and stronger organizational performance. By fostering a culture of collaboration and communication, businesses can ensure that their marketing efforts are aligned with their overall objectives, driving better results and achieving greater success.

Organizational Markets vs. Consumer Markets

Organizational markets diverge from consumer markets with respect to their purchasing processes, decision-making, and relationship management. Organizational markets generally involve more intricate purchasing processes, which may include multiple decision-makers, multiple stakeholders, and a longer decision-making timeline.

Relationship management in organizational markets also requires a more complex approach than in consumer markets, as it involves building relationships with multiple stakeholders, understanding customer requirements, and providing continual customer support.

By recognizing these differences and tailoring their marketing efforts accordingly, businesses can effectively cater to the unique needs of their target audience and drive better results in both organizational and consumer markets.

Enhancing Customer Satisfaction through Organizational Marketing

Customer satisfaction is a critical success factor in organizational marketing, and companies can enhance it through various strategies, such as personalization, customization, and post-sales support. By understanding customer preferences and tailoring marketing efforts to meet their unique needs, businesses can create a positive experience that encourages customers to return and remain loyal to the brand.

Implementing these strategies not only fosters deeper customer loyalty but also helps to create positive sentiment in the market and among customers, contributing to the overall success of the organization.

Let’s explore how personalization, customization, and post-sale support can enhance customer satisfaction and drive better results.

Personalization and Customization

Personalization and customization involve analyzing customer needs and preferences to create targeted marketing efforts and product offerings. Organizations can identify customer needs and preferences by performing market research, analyzing customer data, and conducting customer feedback surveys. By leveraging customer data, businesses can create targeted campaigns and personalized product offerings that resonate with their target audience.

Monitoring customer engagement, sales, and customer satisfaction metrics can help organizations gauge the effectiveness of their personalization and customization initiatives. By continuously refining their marketing efforts based on these insights, businesses can create a more personalized and customized experience for their customers, ultimately driving better results and increased customer satisfaction.

Post-Sale Support and Services

Organizations in marketing offer post-sale support and services such as customer service, technical support, and warranty management to ensure customer satisfaction and loyalty. By addressing customer needs and providing support after the sale, businesses can generate loyal customers who trust the brand and are more likely to advocate for it.

After-sales service also helps to create positive sentiment in the market and among customers, contributing to the organization’s overall success. By offering comprehensive post-sale support and services, businesses can enhance customer satisfaction, foster brand loyalty, and encourage customer retention.

Organizational marketing is a critical component of business success in today’s competitive landscape. By understanding and targeting specific markets, creating effective marketing strategies , and implementing activities that cater to customer needs, organizations can drive better results and achieve their objectives. By embracing digital marketing initiatives, collaborating with other departments, and providing personalized experiences through personalization, customization, and post-sale support, businesses can enhance customer satisfaction and loyalty, ultimately contributing to their long-term success. It’s time to take action and implement organizational marketing strategies that will propel your business to new heights.

Frequently Asked Questions

What is organization marketing, for example.

Organization marketing is a discipline that works to maintain or change public opinion of an organization. A prime example is the Salvation Army in South Africa, who were behind a viral photo of a dress.

The photo was shared widely on social media and was seen by millions of people. It was a powerful example of how organization marketing can be used to create a positive image for an organization.

What are the four types of organizational markets?

Organizational markets consist of industrial or producers, resellers, institutions, and governments.

What is the purpose of the organizational market?

Organizational marketing focuses on return on investment, corporate goals, and technical suitability to help businesses and other organizations purchase goods and services for production and operations, while the consumer market purchases goods and services for personal use.

How can market research and analysis help improve marketing strategies?

Market research and analysis can give vital insights into customer preferences, trends, and needs, which can be used to inform and improve marketing strategies .

By understanding customer behavior, businesses can create more effective campaigns and target their audience more accurately. This can help to increase sales and build customer loyalty.

Data-driven marketing can also help identify new opportunities.

How can personalization and customization enhance customer satisfaction?

By understanding customer needs and preferences to tailor marketing efforts and product offerings, personalization and customization can lead to improved customer satisfaction.

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Segmenting Organizational Markets

It is also important for the marketing manager to understand how business or organization customers can be segmented. Many firms sell not to ultimate consumers but to other businesses. Although there are many similarities between how consumers and businesses behave, there are also several differences, as mentioned earlier. Recall that business buyers differ as follows: (a) most business buyers view their function as a rational (problem-solving) approach; (b) the development of formal procedures, or routines, typifies most business buying; (c) there tend to be multiple purchase influences; (d) in industrial buying it is necessary to maintain the correct assortment of goods in inventory; and (e) it is often the responsibility of the purchasing executive to dispose of waste and scrap.

A number of basic approaches to segmenting organizational markets exist. An industrial marketing firm must be able to distinguish between the industries it sells to and the different market segments that exist in each of those industries. There are several basic approaches to segmenting organizational markets: (a) types of customers; (b) the Standard Industrial Classification; (c) end use; (d) common buying factors; and (e) buyer size and geography. 2,16

Type of customer. Industrial customers, both present and potential, can be classified into one of three groups,

• Original Equipment Manufacturers (OEMs), such as Caterpillar in the road equipment industry
• end users, such as farmers who use farm machinery produced by John Deere and OEMs
• after market customers, such as those who purchase spare parts for a piece of machinery

Similarly, industrial products can be classified into one of three categories, each of which is typically sold to only certain types of customers:

• Machinery and equipment (e.g. computers, trucks, bulldozers): these are end products sold only to OEM and end user segments.
• Components or subassemblies (e.g. switches, pistons, machine tool parts): these are sold to build and repair machinery and equipment and are sold in all three customer segments.
• Materials (e.g. chemicals, metals, herbicides): these are consumed in the end-user products and are sold only to OEMs and end users.

The Standard Industrial Classification (SIC). A second industrial segmentation approach employs the Standard Industrial Classification (SIC) codes published by the US Government. The SIC classifies business firms by the main product or service provided. Firms are classified into one of ten basic STC industries. Within each classification, the major groups of industries can be identified by the first two numbers of the SIC code. For example, SIC number 22 are textile mills, SIC number 34 are manufacturers of fabricated metals, and so on. An industrial producer would attempt to identify the manufacturing groups that represent potential users of the products it produces and sells. Figure 2.6 takes the two-digit classification and converts it to three-, four-, five-, and seven-digit codes. As you can see in Figure 2.6 , use of the SIC code allows the industrial manufacturer to identify the organizations whose principal request is, in this case, pliers. Based upon this list of construction machinery and equipment products, it is possible to determine what products are produced by what manufacturers by consulting one of the following sources:

• Dun's Market Identifiers—computer-based records of three million United States and Canadian business establishments by four-digit SIC.
• Metalworking Directory—a comprehensive list of metalworking plants with 20 or more employees, as well as metal distributors, by four-digit SIC.
• Thomas Register of American Manufacturers—a directory of manufacturers, classified by products, enabling the researcher to identify most or all of the manufacturers of any given product.
• Survey of Industrial Purchasing Power—an annual survey of manufacturing activity in the United States by geographic areas and four-digit SIC industry groups; reports the number of plants with 20 or more and 100 or more employees, as well as total shipment value.

End uses. Sometimes industrial marketers segment markets by looking at how a product is used in different situations. When employing end-use segmentation, the industrial marketer typically conducts a cost/benefit analysis for each end-use application. The manufacturer must ask: What benefits does the customer want from this product? For example, an electric motor manufacturer learned that customers operated motors at different speeds. After making field visits to gain insight into the situation, he divided the market into slow speed and high speed segments. In the slow-speed segment, the manufacturer emphasized a competitively priced product with a maintenance advantage, while in the high-speed market product, superiority was stressed.

Common buying factors. Some industrial marketers segment markets by identifying groups of customers who consider the same buying factors important. Five buying factors are important in most industrial buying situations: (1) product performance, (2) product quality, (3) service, (4) delivery, and (5) price. 2 Identifying a group of customers who value the same buying factors as important is difficult, as industrial organizations' and resellers' priorities often change.

Buyer size and geography. If organizations' markets cannot be easily segmented by one of the previous approaches, market advantages may still be realized by segmenting based on account size or geographic boundaries. Sales managers have done this for years, but only recently have organizations learned to develop several pricing strategies for customers that are both close and far away geographically. Similarly, different strategies can be developed for large, medium, and small customers.

• Single-base and Multi-base Segmentation
• Qualifying Customers in Market Segments
• 11911 reads
• ABOUT THE AUTHOR
• BALANCED COVERAGE
• INTERNATIONAL AND TECHNOLOGY COVERAGE
• CURRENT EXAMPLES FROM ALL TYPES AND SIZES OF BUSINESS
• A CLEAR, EFFECTIVE ORGANIZATION
• HELPFUL PEDAGOGY
• ACKNOWLEDGMENTS
• ELVIS-ALIVE AND WELL
• INTRODUCTION
• Defining Marketing Newsline: Picture your mission
• Justification for Study Review
• Consumer Content
• Company Capabilities
• Communication
• Competition Integrated marketing
• Cross-Functional Contact
• Community Contact
• Macromarketing Versus Micromarketing
• Service Marketing Versus Goods Marketing
• For-profit Marketing Versus Nonprofit Marketing
• Mass Marketing, Direct Marketing, and Internet Marketing
• Local, Regional, National, International, and Global Marketers
• Consumer Goods Marketing and Business-to-Business (Industrial) Marketing Review
• Functional-Level Considerations
• The Marketing Plan
• The Marketing Mix
• Evaluating Results
• KEYS TO MARKETING SUCCESS Review The Wall Street Journal (wsj.com) Questions
• THE HOG IS ALIVE AND WELL
• THE WEB SEGMENT
• The Market Is People
• The Market Is a Place
• The Market Is an Economic Entity
• Consumer Markets
• Industrial Markets
• Institutional Markets
• Reseller Markets
• The Undifferentiated Market (Market Aggregation)
• Product Differentiation
• Segmentation Strategies Review
• Bases of Segmentation
• Segmenting Ultimate Consumers Integrated marketing
• The Concept of Positioning
• The Future of the Marketplace Review The Wall Street Journal (wsj.com) Questions
• ROLLING ROCK FINDS ITS NICHE
• DISCOVERING WHY THEY CHEW
• THE NATURE AND IMPORTANCE OF MARKETING RESEARCH
• WHAT NEEDS RESEARCHING IN MARKETING? Newsline: How execs use research Review
• Determining the Purpose and Scope of the Research
• The Informal Assessment
• Choosing the Approach
• Determining the Types of Data Needed
• Locating the Sources of Data
• Choosing the Method of Collecting Data Newsline: Where's the beef?
• Selecting the Sample
• Anticipating the Results/Making the Report
• CONDUCTING THE RESEARCH
• PROCESSING THE DATA
• THE VALUE OF MARKETING RESEARCH Integrated marketing The Wall Street Journal (wsj.com) Questions Review
• RESEARCH SAVES THE DAY AT CASE
• TILL DEATH DO US PART
• BUYER BEHAVIOR AND EXCHANGE
• Need Identification
• Information Search and Processing Integrated marketing
• Information Processing
• Identification and Evaluation of Alternatives
• Product/Service/Outlet Selection
• The Purchase Decision Newsline: Follow the consumer and see what happens
• Postpurchase Behavior Review
• Buying Task
• Market Offerings
• Demographic Influences
• Social Class
• Reference Groups
• Learning and Socialization
• Lifestyle Review
• Characteristics of Organizational Buying
• Stages in Organizational Buying Newsline: The future of the consumer Review The Wall Street Journal (wsj.com) Questions
• CUSTOMER SATISFACTION STILL MATTERS
• THE CAR INDUSTRY AND TECHNOLOGY
• External Surprises
• Competitors
• Product Liability
• Deregulation
• Consumer Protection
• Consumer Buying Power Newsline: Everyone seems to have money
• Technology Integrated marketing
• Demographic Changes
• The Baby Boom
• Generation X
• The Baby Boomlet
• Cultures and Subcultures Review
• Understanding Other Cultures Around the World
• Forecasts of the Future The Wall Street Journal (wsj.com) Questions
• CASE APPLICATION
• GOOD LUCK GETTING INTO CHINA
• DEFINING INTERNATIONAL MARKETING
• STANDARDIZATION AND CUSTOMIZATION
• REASONS FOR ENTERING INTERNATIONAL MARKETS
• REASONS TO AVOID INTERNATIONAL MARKETS
• Joint Ventures
• Direct Investment
• US Commercial Centers Review
• Trade Intermediaries
• The Corporate Level
• The Business Level
• The Functional Level
• Product/Promotion
• Distribution and Logistics Review
• Customs and Taboos
• Business Norms Integrated marketing
• Religious Beliefs
• Political Stability
• Monetary Circumstances
• Trading Blocs and Agreements
• Expropriation
• The Technological Environment
• The Economic Environment
• Marketing Objectives The Wall Street Journal (wsj.com) Questions
• UNILEVER'S GLOBAL BRAND
• JAPANESE CARS ON THE DECLINE
• DEFINING THE PRODUCT
• Classification of Consumer Goods
• Classification of Industrial Goods
• Simultaneous Production and Consumption
• Little Standardization
• High Buyer Involvement
• The Determination of Product Objectives
• The Product Lifecycle
• Approaches to the Market
• Product Features
• Related Services
• Product Mix Strategies
• Product Line Decisions
• Product Deletion Integrated marketing
• The Consumer's Viewpoint
• The Firm's Viewpoint
• Internal Sources
• External Sources
• Step 1: Generating New Product Ideas Newsline: New ideas are rare
• Step 2: Screening Product Development Ideas
• Step 3: Business Analysis
• Step 4: Technical and Marketing Development
• Step 5: Manufacturing Planning
• Step 6: Marketing Planning
• Step 7: Test Marketing Integrated marketing
• Step 8: Commercialization Review The Wall Street Journal (wsj.com) Questions
• HERSHEY CHOCOLATE MILK
• AMERICAN EXPRESS: COMMUNICATING BIG IDEAS
• Primary Tasks Integrated marketing
• Integrated Marketing Communication
• THE MEANING OF MARKETING COMMUNICATION
• THE OBJECTIVES OF MARKETING COMMUNICATION
• Interpersonal Communication Systems
• Organizational Communication Systems
• Public Communication Systems
• Mass Communication Systems
• Marketing Communications
• The Promotion Mix
• The Campaign Review
• The Advertising Department
• The Advertising Agency
• Developing the Creative Strategy
• Stating Media Objectives
• Evaluating Media
• Selection and Implementation
• Determining the Media Budget
• Banner Advertisements
• Types of Sales Promotion
• Public Relation's Publics
• Public Relations Techniques Review
• Inside Versus Outside Selling
• Company Salespeople Versus Manufacturer Representatives
• Direct Versus Indirect Selling
• The Selling Process Review
• Strengths and Weaknesses of Personal Selling
• The Sales Force of the Future Newsline: New toys for sales success? The Wall Street Journal (wsj.com) Questions
• THE MICRORECORDER
• THE MCDONALD'S EFFECT
• The Customer's View of Price
• Rational Man Pricing: An Economic Perspective
• Irrational Man Pricing: Freedom Rules
• The Marketer's View of Price
• PRICING OBJECTIVES Review
• Nonprice Competition
• Pricing to Meet Competition
• Pricing Above Competitors
• Pricing Below Competitors
• New Product Pricing Newsline: The risk of free PCs
• PRICE LINES
• Discounts and Allowances Integrated marketing
• PRICE BUNDLING
• PSYCHOLOGICAL ASPECTS OF PRICING Review
• Cost-Oriented Pricing: Cost-Plus and Mark-Ups
• Break-Even Analysis
• Target Rates of Return
• Demand-Oriented Pricing
• Value-Based Pricing Review
• The Future of Pricing The Wall Street Journal (wsj.com) Questions
• UNITED TECHTRONICS
• SAM SIGHTINGS ARE EVERYWHERE
• THE DUAL FUNCTIONS OF CHANNELS
• THE EVOLUTION OF THE MARKETING CHANNEL
• FLOWS IN MARKETING CHANNELS
• FUNCTIONS OF THE CHANNEL
• Producer and Manufacturer
• Department Stores
• Chain Stores
• Supermarkets
• Discount Houses
• Warehouse Retailing
• Planned Shopping Centers/Malls Newsline: The mall: a thing of the past?
• Nonstore Retailing Integrated marketing
• Functions of the Wholesaler
• Types of Wholesalers
• Physical Distribution Review
• Conventional Channels
• Administered VMS
• Contractual VMS
• Corporate VMS
• Horizontal Channel Systems
• Analyze the Consumer
• Establish the Channel Objectives
• Specify Distribution Tasks
• Number of Levels
• Intensity at Each Level
• Types of Intermediaries
• Who Should Lead
• Correcting or Modifying the Channel
• Power Review The Wall Street Journal (wsj.com) Questions
• CONNECTING CHANNEL MEMBERS
• Photo Credits

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Market orientation research: a qualitative synthesis and future research agenda

• Review Paper
• Published: 20 November 2017
• Volume 13 , pages 649–670, ( 2019 )

Cite this article

• Vishal K. Gupta 1 ,
• Gizem Atav 2 &
• Dev K. Dutta 3  

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The prominence of market orientation as a core organizational concept, as well as recent discussions about its contributions and shortcomings, suggest that it is time to assess the large and expanding body of research surrounding the construct. Our research takes a systematic qualitative approach to assessing extant research on market orientation, identifying problems, patterns, and paradoxes in the literature. Specifically, we provide an integration of the burgeoning empirical research on market orientation, based on a thorough synthesis of articles published over more than 25 years of inquiry. Bringing together the different strands of inquiry that have guided knowledge accumulation on market orientation, we are able to identify major theoretical gaps and omissions in the literature. We also find that while market orientation research has made considerable strides over the years, much work still needs to be done as voids remain that need to be addressed in future investigations.

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Acknowledgements

We thank Editor Wolfgang Kursten and two anonymous reviewers for very constructive suggestions and ideas during the review process. Erik Markin provided assistance on previous drafts of this manuscript, for which we are grateful. We appreciate insightful comments from Alka Gupta on previous versions of this manuscript. Of course, all errors and omissions remain our own.

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Culverhouse College of Commerce, The University of Alabama, Tuscaloosa, AL, 35487, USA

Vishal K. Gupta

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University of New Hampshire, Durham, NH, 03824, USA

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Gupta, V.K., Atav, G. & Dutta, D.K. Market orientation research: a qualitative synthesis and future research agenda. Rev Manag Sci 13 , 649–670 (2019). https://doi.org/10.1007/s11846-017-0262-z

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Received : 01 February 2016

Accepted : 15 November 2017

Published : 20 November 2017

Issue Date : 01 August 2019

DOI : https://doi.org/10.1007/s11846-017-0262-z

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Table of Contents

Everything you want to know about market research.

Nearly 80% of businesses conduct market research to gather targeted insights into their performance, customers, industry, and competition.

While market research offers a variety of benefits, it can be challenging to identify what research to conduct, and when to ensure you get accurate and actionable data for your business decisions.

To cut through information overload and discover how market research can help you, we are breaking down the basics of market research, including what it is, what you can learn, potential benefits, and how to get started.

What is market research?

Market research is the process of collecting, analyzing, and interpreting data about your target market, competitors, and industry. Market research spans a wide range of topics, uncovering insights on various elements that can impact a business. 

Some common subjects of market research include:

• Customer needs, preferences, and behaviors
• Market trends, competitors, and growth opportunities
• Brand awareness, perception, and evaluation amongst competitors
• Product performance, strengths and weaknesses, and customer evaluations

Why do companies conduct market research?

There is a wealth of insights   and benefits  provided by market research, but at its core, the purpose and value of market research is that it helps you make informed decisions by:

Understanding the Market

Market research provides in-depth insights, allowing companies to better understand the market, identify customers’ needs and preferences, discover how their brand is perceived in the market, and measure the impact of investments and strategies.

Identifying Opportunities

Market research spots untapped opportunities for companies to focus on, including how to improve their brand status, identify new customer bases and markets to sell to, and provide insights to help senior leadership prioritize investment opportunities.

Uncovering Risks

Market research also reveals potential risks that, if ignored, can cause considerable damage. This includes insight into competitors, the impact of major challenges or economic influences (i.e., COVID-19, heightened regulatory concerns), and negative perceptions of the company and its brands.

What types of companies use market research?

All types of businesses use market research, Including B2B ( 77% of companies ), B2C (82%), and B2B2C (83%). 

While they conduct research at similar rates, the types of questions they ask are driven by the unique challenges each type of business faces. For example, over half of B2B companies conducted a market share analysis last year, while B2C and B2B2C companies’ top project was evaluating customer satisfaction.

Find out how Hanover can help collect and analyze the data you need for better business decisions.

• Hanover Research Corporate Solutions

What can you learn from market research?

Anything. One of the biggest values of market research is how you can customize your research to gather the insights you need most. Below are some common examples of insights you can learn through market research.

Understand the Market

• Identify and prioritize markets for exploration and entry.
• Identify and build in-depth comparative profiles for your biggest competitors in the market.
• Understand market dynamics and identify potential factors, innovations, and trends that might impact your company.

Optimize Products and Services

• Generate new product ideas or optimize existing products.
• Develop an optimized pricing strategy.
• Evaluate how customers perceive and use your products and services.
• Identify any sales and service gaps or unmet customer needs.

Strengthen Brand Strategy

• Measure and track the strength of your brand and competing brands.
• Measure and improve brand health.
• Evaluate marketing and sales approaches to align with customer needs and preferences.

Understand Customers

• Understand the needs and preferences of your target customers.
• Identify crucial components of the customer experience. including unmet needs, pain points and levels of satisfaction.
• Differentiate customers into targetable segments based on behavioral, attitudinal, demographic, and psychographic data.

What are the most common market research projects?

The most popular market research projects can vary slightly over time, often reflecting market, economic, and societal shifts that impact company performance. Last year, with a focus on expanding to new markets and obtaining new customers, leading projects were analyzing customer satisfaction and needs , evaluating the market and identifying current and upcoming market trends , and measuring the strength of their brand equity .

This year, with inflation affecting customers’ buying power and increased production and resource costs, companies have expressed increased interest in price sensitivity research , making it the fifth-most common market research project. Increased uncertainty has also prompted companies to evaluate sales and renewal performance with win loss analysis projects increasing by 19%. 

Most Common Research Projects

How do you know you need market research?

With endless possibilities for insights, it can be hard to figure out where to start. To identify the type of market research you need, examine your top business priorities and determine if they could benefit from new data and insights. 

Ask yourself these two questions.

• Do you have the information you need to accomplish your goals?
• Is that data comprehensive and recent?

If the answer to either is no, your strategies will benefit from updated research insights.

Need help convincing your executive team to invest in market research?

You can find more stats on the use and impact of market research in our recent study.

• The State of Market Research

When should you conduct market research?

Companies usually conduct market research for one of three reasons: In response to a triggering event, to evaluate past performance, or to measure changes over time and quickly respond to declined performance.

Market Research Triggers

There are a variety of triggering events that prompt businesses to conduct research. Some common situations include:

• Evaluating the impact of external influences (economic factors, political shifts, etc.,)
• Understanding and adjusting to shifting customer needs
• Entering new markets
• New or increased competition
• Developing new products or features
• Merging or acquiring a new company

Evaluating Past Performance

In addition to conducting research to inform upcoming strategies or overcome pressing challenges, companies also conduct market research to evaluate the success of recent strategies or determine the reason for recent declines in performance. Market research allows companies to measure performance and identify areas of improvement. This can include anything from evaluating the performance of recent product launches, assessing the impact of recent sales and marketing strategies, or measuring the impact of recent pricing or service changes.

Recurring Assessments

The final instance of market research is recurring research. Companies conduct recurring research to ensure data is relevant, to evaluate performance over time, and to quickly identify and respond to changes in performance. For example, some companies periodically measure their brand health including brand awareness, perception, and evaluation against their competitors. By consistently assessing their brand health, these companies have updated insights into their presence in the industry, how customers evaluate them, and potential threats from competitors.

How often should you conduct market research?

How much research you should conduct depends on your unique business needs and strategies. Often, the amount you conduct is determined by the market research triggers we mention above. If you are launching a new product, breaking into a new market or customer base, or have noticed a decline in performance, you should conduct market research to address these needs as they arise.

Most businesses conduct multiple market research projects a year depending on their needs and resources. Over 80% of companies conduct market research frequently, and 79% conduct at least five market research projects a year.

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Value of market research

What roi can you expect from market research.

In addition to successful key initiatives, companies that conduct market research say it provides an ROI of over four times the cost.

What challenges does market research address?

The insights market research provides are directly related to businesses’ biggest challenges. In our State of Market Research report , we asked respondents what their company’s biggest challenges were. In addition, we also asked respondents how their companies have benefited from market research findings. 

We found that the benefits they attributed to market research directly addressed their biggest reported challenges. Even those who did not report having a specific challenge reported market research insights helped them accomplish their goals.

What are the benefits of effective market research?

There are a variety of benefits of market research depending on the specific research you conduct.

Market research can benefit your company by helping you:

Companies that leverage market research insights into their strategies are also able to accomplish their goals at a higher rate than those without market research insights.

Companies that conduct market research are:

Discover how Rheem leveraged customer insights to build its sustainability strategy.

• Rheem Measures Homeowner and Contractor Demand for Sustainability

Market research KPIs

Some common KPIs based on the focus of the research can include:

Brand-focused

• Brand recall and recognition
• Brand perception
• Brand preference
• Net promoter score (NPS)

Customer-focused

• Customer retention and churn
• Customer satisfaction (CSAT)
• Cost per acquisition

Product-focused

• Product appeal
• Willingness to pay
• Future purchase consideration
• Post-purchase satisfaction

Market-focused

• Share of market
• Competitive benchmarks
• Total addressable market
• Market demand

How do you evaluate the success of market research?

Market research is successful if the resulting data is accurate, representative, and informative. Accurate data means the data has been cleaned and is a valid response to the study questions. Representative means that the data reflects the target market and is comprehensive. Finally, informative means the data provides insight and is actionable.

See how market research can help you with these key market research stats.

• Market Research Stats You Need to Know

How to perform market research

What are the common market research methods .

There are four main types of market research.

Quantitative Data Analysis

Data analytics involves collecting and analyzing large sets of existing data to uncover patterns and predict future outcomes. These data sets can include information like customer behavior data or historical sales data that allows companies to analyze their current performance and model potential scenarios and outcomes. 

By leveraging existing data, data analytics provides companies with an objective view of the situation, allowing them to identify gaps and discern trends.

Quantitative Survey Research

Surveys pose a set of questions to a targeted group of people. The survey measures the opinions, preferences, perceptions, and experiences of a desired audience and can collect self-reported demographic and geographic data. 

With surveys, companies get an aggregate but statistically valid picture that they can leverage to make decisions. Surveys also offer the ability to segment and further analyze the answers to determine key drivers of behaviors.

Qualitative Primary Research

Qualitative research focuses on targeted insights around concepts, opinions, and preferences. Unlike quantitative methods, these market research methodologies leverage a smaller set of data and respondents but allow for more in-depth answers.

There are two common types of qualitative primary research: in-depth Interviews and focus groups.

• In-depth Interviews In-depth interviews involve one-on-one conversations between interviewers and those from the target audience. The interview follows a pre-determined set of questions, or guide, to reveal sentiment, decision-making processes, and unmet needs.
• Focus Groups Focus groups are facilitator-led group discussions reveal perceptions of or reception to a concept or idea. While the facilitator guides the meeting, the direction of the conversation is determined by the participants creating organic responses that stem from participant perception and reactions.

Secondary Research

Secondary research, also known as desk research, is leveraging data that already exists to answer questions. It can be used to understand what others in the market are doing, identify potential markets for growth or expansion, or allow companies to compare their organization to others on key performance indicators.

What is the market research process?

There are five stages to the market research process.

• Determine your Area of Focus To determine the focus of your market research, look at your goals objectively and determine if you have accurate and effective data to accomplish these goals.  Once you have identified your goal, the next thing is to determine what you need to learn to support it. This could be anything from external information like market trends and competitors or internal information like customer satisfaction with your brand and offerings.

• Gather Your Data With your focus and methodology determined, the next step is to start collecting data. Each methodology has its own methods of data collection. Methods like surveys and interviews require researchers to gather feedback data from a select sample of their intended audience. Data analysis and secondary research entail gathering existing internal or external data related to the primary research focus.
• Analyze the Results Once the data is collected, the next step is to clean and analyze the results. It is essential that data is verified and accessed to ensure the data is valid and is sufficient to provide accurate results. Once the data has been cleaned it should be reviewed for general findings, evaluated against your initial questions, and benchmarked against past performance or competitors.
• Leverage Findings to Inform Your Business Strategies After conducting your initial research, it’s time to reassess your strategies. Look at the strengths, weaknesses, opportunities, and threats that your research has uncovered to see how it might impact your business and existing strategies. Is there a way to enhance your current strategies with the new data? Do you need to alter your strategies and resources to address an uncovered threat? 

Leverage your findings to inform your strategy and determine your next steps, whether they indicate you should stay the course, pivot to tackle a more pressing challenge, or even conduct new research to further understand your recent findings.

Why use both quantitative and qualitative research?

Leveraging both quantitative and qualitative research can provide a more holistic view of a situation. For example, quantitative data analysis offers relevant findings but can sometimes lack context. If it is followed up by qualitative in-depth interviews, companies can gather feedback to understand the factors that lead to the data analysis findings and identify potential solutions or untapped opportunities.

Interviews can help businesses identify customers’ thoughts and opinions and then that feedback can inform a survey that is sent to a wider audience for measurable insights. Companies can also use secondary desktop research to identify market trends and industry benchmarks and combine it with data analysis or surveys to evaluate the company’s performance in the market.

What is a sample in market research?

A sample in research refers to a small but representative group of people whose answers are extrapolated to a larger population.

For example, if a company wants to identify their brand awareness, they will survey a sample of people that have similar characteristics to their target audience. The survey’s findings will then provide a general understanding of how well known the brand is and directions on how to improve their brand’s presence in the market.

Start conducting your own research with this step-by-step guide.

• The Ultimate Guide to Market Research

How companies conduct market research

How can you get market research.

There are three main ways companies can get market research insights.

• Internal non-dedicated research Some companies conduct research with no real dedicated resource, requiring members in the marketing, product, strategy, and business intelligence departments to conduct research themselves. While initially low-cost, this option consumes internal resources and time, can produce incomplete, inaccurate, and biased results, and is often not shared company wide.
• Dedicated internal research team Some companies are big enough or require extensive market research and have therefore invested in building an internal research department. This option produces more accurate and strategic results than the first option. However, it requires a long-term investment and the amount of research and insights you can collect will be limited depending on the amount and expertise of the analysts employed.
• External market research company Many companies partner with an external research company to gain access to research experts, technology, and advice for actionable insights. The price for this option depends on the type and amount of research you do, but it can be less of a burden than maintaining an internal department while still providing the value of research expertise.

What are the types of market research firms?

A market research company is a firm that specializes in conducting research. There are a few different types of market research firms based on the services they provide.

• Custom research providers Custom research companies (like Hanover) design and conduct research centered around client’s unique needs. They often specialize in all four research methodologies to develop research that answers clients’ focus questions and provide findings that connect the data back to the intent of the research.
• Syndicated research providers Syndicated research companies do not conduct client-specific research. Instead, these companies conduct widespread research to offer data such as industry statistics, current best practices, or recent trends. Businesses can then buy this research to gather perspectives on their performance and identify areas where custom research can help provide more insight.
• Self-service platforms Self-service companies provide research technology for companies to conduct their own research. It allows companies to design and administer their own research and analyze and assess the results.

Should you use a market research firm?

Market research companies provide valuable benefits, making them an effective partner for your research needs. In addition to the research they provide, they have added benefits like:

• Removing the influence of preconceived opinions and personal or company bias
• Access to sophisticated analysis software and research methods
• Offering expert insights to help design research that results in accurate and relevant findings
• Offloading time-intensive research and analysis enabling companies to focus internal resources on strategic work
• Access to expert researchers without having to hire a full-time employees

How much does market research cost?

The cost of market research varies based on how you conduct your research. Conducting research in-house vs hiring a research company might be cheaper (but less effective). The type of methodology you use can affect the cost, for example, in-depth interviews can become quite expensive depending on the incentives you offer to participate. Price can also vary depending on the level of service you need, for example some companies will work with you to identify your focus and mythology, conduct the research, and present findings and recommendations while others will only conduct research and deliver the results.

Don’t make the mistake of focusing on costs by itself. Opting for cheaper or quick research can provide you with skewed data that can do more harm than good.

Good research is worth the investment. Over 85% of companies say market research ROI is over four times the investment. The insights and impact market research provides has also led 69% of businesses to increase their investment in market research this year.

Find out how Baltimore Aircoil successfully entered an international market with targeted insights

• Baltimore Aircoil Company Develops HVAC Purchasing Strategy for New International Market

What are some tips for making market research effective?

Market research is instrumental in building effective data-driven strategies. But only if done right. As you begin to plan out your market research and business strategies, keep the following tips in mind.

• Refresh your data to ensure it is accurate and relevant
• Tailor research to your unique needs and challenges
• Use the correct methodology to accurately answer your questions
• Incorporate research findings into your strategies
• Share insights across the company to ensure everyone is operating off the same data
• Leverage outside expertise when you need it

By implementing these tips, you can enhance the quality and effectiveness of your market research efforts, enabling data-driven decision-making and strategic planning that aligns with your business objectives.

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The Top 20 Business Transformations of the Last Decade

by Scott D. Anthony , Alasdair Trotter and Evan I. Schwartz

Summary .   

In 2012, Denmark’s biggest energy company, Danish Oil and Natural Gas, slid into financial crisis as the price of natural gas was plunging by 90% and S&P downgraded its credit rating to negative. The board hired a former executive at LEGO, Henrik Poulsen, as the new CEO. Whereas some leaders might have gone into crisis-management mode, laying off workers until prices recovered, Poulsen recognized the moment as an opportunity for fundamental change.

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Types of Market Segmentation

• Nondemographic Segmentation
• Avoiding Faulty Segmentation
• Industries Using Segmentation
• Success Stories

The Bottom Line

• Marketing Essentials

How to Get Market Segmentation Right

Amilcar has 10 years of FinTech, blockchain, and crypto startup experience and advises financial institutions, governments, regulators, and startups.

The goal of market segmentation—the process of dividing a target market into smaller, defined subgroups of customers with shared characteristics—is to identify the subgroups with the highest potential for profit or growth. Segmentation is a crucial part of any effective marketing campaign, but insights from segment analysis are also widely used to identify niche opportunities and to inform decisions about pricing, distribution, and new product development.

Key Takeaways

• In addition to personalizing marketing campaigns, market segmentation is used to get solid intelligence on which products to develop, which distribution channels to sell them in, and how much to charge for them.
• Prominent market researchers have argued that segmentation based on consumer buying patterns is far more accurate at predicting future purchasing behavior than demographics like age, gender, and income.
• Multiple historical studies by Bain and Harvard Business Review revealed that management believes proper market segmentation is critical to driving revenue growth.
• Almost all industries can benefit from proper market segmentation, though consumer goods, retailing, e-commerce, and media are the most obvious sectors to leverage the opportunity.

There are five primary sets of characteristics that researchers use to divide target markets into subgroups likely to make similar choices about products and services:

Demographic Segmentation: Sorting a market by factors like age, income, education, gender, race, and occupation is the earliest type of market segmentation.

Geographic Segmentation: Previously a subset of demographics, geographic segmentation (including climate and regional factors) is relevant for businesses trying to determine where to sell certain products and how to advertise them.

Firmographic Segmentation: Firmographic is the business counterpart of demographic segmentation. Instead of race, gender, and income, firmographic segmentation sorts companies by factors like size and number of employees to inform strategies for prospective business clients ranging from small local firms to large international corporations.

Behavioral Segmentation: Behavioral segmentation is based—not on the behavior of individual consumers—but on trackable behavior in the marketplace: purchase history, spending habits, browsing history, brand loyalty, and consumption patterns.

Psychographic Segmentation: Closely related to behavioral segmentation, psychographic segmentation identifies customer subgroups based on personality, interests, beliefs, and lifestyle, including factors like hobbies, life goals, values, and priorities.

A slightly older (2018) but still relevant study by Accenture found that 91% of consumers are more likely to shop with brands and recognize, remember, and provide them with relevant offers.

Yankelovich and Nondemographic Segmentation

In 1964, Daniel Yankelovich , an influential U.S. market researcher and social scientist, introduced the concept of nondemographic segmentation, i.e., the classification of consumers by criteria other than age, gender, and income—which he argued were far less accurate predictors of future purchases than data on actual consumer buying patterns.

Psychographics Replace Demographics: Since then, market segmentation has been widely used, with psychographics replacing demographics as the most common criteria. In a 2006 Harvard Business Review (HBR) article, Yankelovich revisited the subject to make the case that over-reliance on psychographics was no more effective than demographic segmentation. "Despite disappointing performance,” commercials were populated with characters designed to reflect the lifestyles, attitudes, and self-image of viewers: “High-Tech Harry” and “Joe Six-Pack."

Famous Advertising Flops: Although Yankelovich agreed that psychographics are effective at brand reinforcement and positioning, he argued that the emotions these ads evoke do not drive commercial results, which explains the disappointing results of certain famous advertising campaigns. For example, consider the classic example of New Coke. In 1985, Coca-Cola faced the challenge of potentially losing customers to blind taste tests. The company decided to launch a marketing campaign promoting "New Coke" which failed to grab the public's support. The line was eventually discontinued.

Hard Data on Consumer Buying Patterns: In the 2006 article, Yankelovich repeated his original argument that the most effective segmentations are based on criteria that are directly linked—not only to emotional triggers—but also to the attitudes and values that drive how each consumer will view a certain product—which in turn drives the factor with the greatest predictive power: actual purchase behavior. The attitudes that drive purchase behavior do not have to be guesstimated—they are revealed in hard data on consumer buying patterns, including product loyalty and brand loyalty as well as purchase history and channel selection. (Yankelovich also discusses the “gravity of the decision” as a factor in predicting purchase behavior, e.g., the decision about which car to buy has more gravity than which shampoo to buy, etc.)

Segmentation Ground Rules

Instead of segmentation based solely on psychographics, Yankelovich proposed a broader view of nondemographic classification so that the segments identified could inform not only advertising campaigns but also strategy outside the marketing department, including new product development, pricing, and distribution. To get solid intelligence on the urgent business questions the segmentation was commissioned to answer—which products to develop, which distribution channels to sell them in, how much to charge for them, and how to advertise them—Yankelovich cautioned marketers not to forget certain ground rules, including:

The Predictive Power of Purchase History: Predominantly psychographic approaches ignore Yankelovich’s precept that past buying patterns are much better predictors of future purchase behavior than any superficial identity—and the hard data can be used to predict long-term business outcomes as well.

Overly Technical Segmentation Alienates Senior Management: As marketing gets more scientific and more specialized, Yankelovich also cautioned marketers to remember that—as they are “flaunt(ing) their technical virtuosity”—remember that the market segments identified must “make intuitive sense” to the senior managers who are the final decision makers. If the marketers fail to clarify how the segments were defined or the segments are somehow inconsistent with a senior executive’s deep experience in the sector, the research will likely never be applied.

Product Features Matter More Than Consumer Identities: Don’t let an over-reliance on consumer identities distract marketing strategy from communicating the product features that are most important to existing and potential customers.

Different Segmentations for Different Purposes: One common mistake that Yankelovich called out was applying a segmentation designed for an advertising campaign to strategies it was never intended to inform, such as market entry, product development, and pricing decisions. Draw one segmentation to strengthen brand identity and very different segmentations to determine which markets to enter and which products to develop. For example, an advertising segmentation for an HVAC company came up with clever psychographic characters (“traditional male” and “woman doing yoga”) but failed to inform executives which segment would be most likely to want to upgrade their HVAC systems. Most importantly, that segmentation failed to identify the segment that the client’s own experience had already correctly identified as the most likely purchasers of an HVAC system: people buying older homes in affluent neighborhoods.

Segmentation Must Be Dynamic: No segmentation is a one-time, complete portrait of customers that “can inform all subsequent marketing decisions.” Segmentations must be part of an ongoing strategy to address urgent business questions as they come up. Not only can consumer needs, attitudes, and behaviors change quickly, they are also constantly being revamped by external factors like evolving market conditions, emerging trends, and new technology. The best segmentations focus on only one or two issues and then are “redrawn as soon as they have lost their relevance.”

How to Avoid Faulty Market Segmentation

A frequently cited statistic from a 2006 survey by Bain & Company is that 81% of CEOs considered customer segmentation “a critical tool for growing profits.” A less frequently cited statistic from that survey is even more interesting: fewer than 25% of CEOs believed that their companies “used segmentation effectively.”

A Harvard Business Review (HBR) article about that survey argued that, all too often, companies hire market research firms to conduct expensive segmentation analysis that identifies what looks like white-space segments—and these customers turn out to be a mirage. For companies who fail to get good value from heavy investments in market segmentation, the authors propose adding two preliminary steps before acting on the research: “finding the sweet spot” (to avoid overly ambitious targeting) and “rigorous self-examination” (to avoid chasing potential customers the company lacks the capacity to serve).

2021 data from McKinsey revealed 71% of consumers expect companies to deliver personalized interactions, with more than two-thirds of consumers stating they get frustrated when this doesn't happen.

Which Industries Use Market Segmentation?

Consumer goods, retailing, e-commerce, and media are the most obvious sectors to leverage market segmentation, but all industries benefit from the customer insights that this analysis provides. For example, Grand View Research, a U.S. market research company, provides both syndicated and customized market segmentation reports on every industry: pharma/biotech; financial services; telecommunications; computer software/hardware; materials/chemicals; manufacturing/construction; transportation/shipping; energy/resources; and agriculture.

In addition to industry players, market segmentation research is conducted on behalf of government agencies, educational institutions, and law firms—and even advertising and marketing firms. For example, Bloomberg reported the results of a segmentation study on the customer experience (CX) management market, which is expected to hit $38.98 billion by 2030, with compound annual growth rate (CAGR) of 18.1% from 2022 to 2030, across their mobile touchpoint, cloud-based, end-use, and BFSI (banking, financial services and insurance) segments.

Success Stories on Market Segmentation

The HBR article on the Bain study gave two case studies of companies who got market segmentation right. By grounding their strategies in “hard data” and “flesh-and-blood” customer behavior, these companies used insights from both A-list customers and dispassionate self-assessments to attract new customer segments and to develop new products aligned to organizational capacity.

American Express: Finding the Sweet Spot of Market Segmentation

The first necessary step—before acting on insights from customer segmentation research—is to identify a very important subset of customers that you already have: existing, brand-loyal customers who “really, really like you.” That segment (of course) is not your target—you already have them. Instead, the characteristics of your happiest existing customers are used to find an overlapping subset within the new customer segments that your research generated.

That overlap—which the Bain study called “the design target”—will be your sweet spot: the “bull’s-eye” of prospective customers who were not only identified by the new research but who are also very similar to your happiest existing customers. Marketing spend tailored to that refined segment—sometimes a very narrow slice—will likely be highly effective and highly profitable.

American Express (AmEx) warded off intense competition in the 1990s by ramping up the product line based on the right kind of segmentation analysis. They targeted their sweet spot: prospective customers who shared many of the characteristics of their current best customers, a profitable segment of high spenders. AmEx also used the updated analysis to identify more products to offer to their current happy customers. 

For example, AmEx created credit cards linked to rewards programs that allowed business executives to rack up frequent flyer miles and hotel points. Although this segment was quite narrow, it turned out to be highly profitable over the long term, in part because marketing costs were minimal. All that AmEx had to do to reach this lucrative executive segment was to offer upgrades to their existing customer base and then let word-of-mouth marketing bring in new customers.

Global Investment Bank: Self-Assessment to Maximize Market Segmentation

The Bain study noted that identifying the sweet spot of customer segmentation is “only half of the growth equation.” The next essential step for every company planning to act on market segmentation is to take an “unflinching inventory” of internal capabilities—both strengths and weaknesses.

Marketers and product developers who conduct this kind of rigorous self-assessment can evaluate the prospective customer segments against their current operational strengths and weaknesses—and avoid the costly mistake of pursuing customer segments that the company is not set up to serve and will never be able to turn into happy customers.

As an example of a successful self-assessment, the Bain study used a global investment bank’s resolution of an unaccountable discrepancy: some of the bank’s most profitable existing clients were very happy and some were vocally unhappy. With senior management unsure which segments merited further investment, they made the shrewd decision to survey the happiest segment of existing, profitable clients to find out what the bank was doing so well—and the unhappy profitable customers to find out what the bank was doing so wrong.

What the investment bank discovered was invaluable: many of their happiest profitable clients were large, complex companies with complex financing needs, operating in multiple countries, often in heavily regulated industries. This segment of profitable clients appreciated the bank’s technical and regulatory expertise and rated the bankers’ ability to ask probing questions as a strong positive. The bank also learned that many of their unhappy clients were much less complex and had simpler financing needs—and the same expertise that the complex companies considered a strong positive was seen as arrogance and condescension by the unhappy clients with simpler structures.

This enlightening self-assessment allowed the bank to focus resources on their sweet spot: the segment of existing and prospective clients that were most likely to have extensive advisory needs.

What Are the 5 Types of Market Segmentation?

The five types of market segmentation are demographic, geographic, firmographic, behavioral, and psychographic.

What Is Psychographic Segmentation?

Psychographic segmentation divides customers into subgroups based on personality, interests, beliefs, and lifestyle, including factors like hobbies, life goals, values, and priorities.

What Is the Difference Between Behavioral and Psychographic Segmentation?

Behavioral segmentation sorts customers by purchase history and how they interact with brands; psychographic segmentation is based on personality and interests.

Market segmentation involves dividing a target market into distinct groups with shared characteristics and needs. To get it right, businesses should conduct thorough market research, analyze consumer behavior, and identify segments with substantial potential. Companies must tailor marketing strategies to each segment, addressing their specific needs and preferences for better customer engagement and increased profitability.

Accenture. " Widening Gap between Consumer Expectations and Reality in Personalization Signals Warning for Brands, Accenture Interactive Research Finds ." 

Harvard Business Review. “ Rediscovering Market Segmentation .”

Encyclopedia Britannica. " New Coke ."

Harvard Business Review. “ Find Your Sweet Spot .”

McKinsey & Company. " The Value of Getting Personalization Right—or Wrong—is Multiplying ."

Grand View Research. “ Market Research Reports .”

Bloomberg. “ Customer Experience Management Market Size Worth $38.98 Billion By 2030 ."

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Aligning the Organization with the Market

As managers revamp their organizations for closer alignment with customers, one of the biggest challenges is determining how far and fast to go..

• Developing Strategy

Companies are being pulled by their strategies and pushed by increasingly assertive customers to restructure their organizations around customer groups rather than functions or products. 1 Responding to competitive pressures and looking to improve operating profit margins, a growing number of corporate managers are dismantling organizations and cultures that were built on selling particular products and replacing them with new structures designed to be more responsive to customer needs. Intel Corp., which in 2005 announced plans to create five new market units, became one of the more high-profile companies to move in this direction. Rather than designing discrete chips and then assuming customers would adopt them, new units were expected to bundle whatever combinations of processes, chips and software made sense for their own customers. 2

The push to restructure around customers is more than the latest management fad. It is supported by success stories at companies including IBM, Cummins India, Fidelity Investments and Imation, and applauded by organizational specialists who have studied the performance of smaller, market-responsive units. 3

Companies transitioning from being product-oriented organizations to ones centered on customers progress along a continuum. The first stage involves informal coordination within the company to overcome the familiar deficiencies of product or functional silos. If that is not sufficient, companies often add integrating functions such as key account managers and customer segment task forces. Companies achieve greater levels of structural alignment by reinforcing the customer dimension of the organization matrix with segment managers or customer-based front-end units. 4 (See “The Stages of Organizational Alignment.”)

The Stages of Organizational Alignment

Companies move through a series of stages of evolution depending on a variety of strategic and operational considerations.

Stage One: Product or Functional Silos

This structure usually suffices for smaller and/or highly focused companies. The limitations are exposed when markets become more complex and customers’ needs become more diverse. Common indicators of problems are growing conflicts within the organization over product and market priorities and a lack of accountability to customers.

Stage Two: Informal Coordination

The addition of product managers and a few key account managers improves coordination of customer-connecting activities, since these roles require creating networks and bridging functional silos. A customer relationship management system helps by providing an integrated view of previously balkanized and dispersed customer data.

Stage Three: Formal Coordination via Integrating Functions

This stage involves more alignment with market segment managers, “heavyweight” customer teams and key account managers. i Their jobs are to use deep understanding of the customers within segments, to identify unmet or emerging needs and to better coordinate assorted customer-connecting activities. Internal customer advocates derive influence from their knowledge and persuasive ability, since they seldom have direct control over resources.

Stage Four: Fuller Structural Alignment

This can be achieved by: (1) strengthening the customer dimension of the organization matrix with empowered segment managers or (2) adopting a hybrid design with strong customer-focused front-end units that offer integrated solutions supported by back-end business units that supply modular components needed for solutions. Companies use this hybrid design when customers want solutions customized to their individual needs and delivered through a single customer contact point. ii Complete alignment is achieved with a family of autonomous business units, each with full accountability for performance within a distinct market segment. This stand-alone design requires stable segments that overlap minimally and limited sharing of resources among businesses. iii

i . These shifts were identified and documented in C. Homburg, J.P. Workman Jr. and O. Jensen, “Fundamental Changes in Marketing Organization: The Movement Toward a Customer-Focused Organizational Structure,” Journal of the Academy of Marketing Science 28, no. 4 (fall 2000): 459–478. ii. This description draws from J.R. Galbraith, “Designing Organizations: An Executive Guide to Strategy, Structure and Process” (San Francisco: Jossey-Bass, 2002), 116–134; and from N.W. Foote, J. Galbraith, Q. Hope and D. Miller, “Making Solutions the Answer,” McKinsey Quarterly 3 (2001): 84–93. The stream of research described in this chapter also confirms the evolution toward customer-focused organizations. iii. M. Goold and A. Campbell, “Designing Effective Organizations: How to Create Structured Networks” (San Francisco: Jossey-Bass, 2002).

The market logic for adopting a customer-oriented strategy is often compelling. In my survey of 347 companies, those that embraced this approach found that accountability for customer relationships was greatly improved and information about customers was shared more readily. These companies were also easier to do business with, according to customers, and better at dealing with customer problems and queries. Overall, however, the findings from my study were mixed. (See “About the Research.”) The challenges of transforming product-centered cultures can be considerable. Each stage can be disruptive in the short run and add coordination costs in the long run. As a result, potential benefits did not necessarily translate into superior performance.

About the Research

This article is based on research drawn from both a mail survey and extensive company interviews. In the survey stage, a combination of an initial mailing and follow-up telephone calls yielded a 17% response rate from the most senior person in the company involved with strategy. The resulting sample of 347 was representative of midsize to large companies in the United States with more than 500 employees.

The main survey findings were:

• Although some 32% of companies were organized around customer groups, this figure would increase to 52% in three years.
• Companies organized by customer groups reported much higher accountability for the overall quality of relationships and employees’ freedom to take actions to satisfy individual customers, and moderately more openness to sharing information about customers.
• When company demographics and strategic choices were held constant, there was no signification correlation between organization by customer groups and relative performance. The lack of effect is perhaps because many companies were in the midst of their reorganization, their competitors were also reorganizing around customers and blunting any advantage, or the reorganization was poorly implemented.

To understand the differences in companies’ abilities to realize better performance, I undertook extensive interviews with senior managers (including senior marketing, sales, management information services managers and executives) of 12 companies that had previously announced major realignments around customers. I asked why they undertook the change, what implementation challenges they encountered and how the change impacted performance. The information from these companies was supplemented with comparable data for three additional companies (Cisco, Sony, and Thermo Electron) drawn from other sources.

In the course of examining 15 companies that had attempted to reorganize themselves around customers, the reasons for the mixed results became clearer. Four companies had sufficient track records with their reorganizations to be called unqualified successes. Two had achieved regional success with their efforts, but the corporate parent had not yet adopted the customer-focused strategies in other markets. Several companies could best be described as works in progress. And two had recently decided to scale back their efforts to align themselves with customers because of competitive and cost pressures. In fact, one of Mark Hurd’s first initiatives as the successor to Hewlett-Packard Co.’s chief executive officer Carly Fiorina was to undo her efforts to create an integrated sales force to sell bundles of products and to return to a more product-oriented focus. 5 Finally, one company’s reorganization was an unqualified failure. I classified the companies by their degree of success, using the judgments of those who were familiar with the history of the realignment process. (See “Classification of Companies Interviewed.”)

Classification of Companies Interviewed

View Exhibit

The definition of success in the categorization below is based on management judgment plus objective measures of performance improvement.

The Limits to Organizational Alignment

The extent to which managers should attempt to transform their organizations toward customers depends on the thrust of the strategy and on the facilitating and countervailing pressures they need to balance. (See “The Pressures Organizations Need to Balance.”) Many organizations cannot and should not aim for complete organizational alignment with their markets. For one thing, complex change efforts can take many years to execute and require substantial leadership commitment. Moreover, some companies, including Samsung, Toyota and Unilever, are resolutely product focused and not inclined to move beyond modest coordinating mechanisms. Without a strong commitment from the top, any attempts to alter established cultures are bound to fail.

The Pressures Organizations Need to Balance

Companies are constrained in how far they can evolve by a variety of factors.

One of the main facilitators toward a more customer-focused organization is the strategic need to have a close relationship with customers. Strategies that are highly dependent on relational value tend to be best suited for settings where customers have diverse and complex requirements and where some of the most attractive customers see value in buying an integrated bundle of products and services from one source. Companies pursuing this approach — for example, IBM Corp.’s Global Services and General Electric Co.’s Power Systems — need to interact closely with their customers in ways that go well beyond a traditional transactional relationship. Conversely, companies with more homogeneous markets and more standardized offerings, and whose strategies are based on leveraging economies of scale, do not need to be as close to their customers. The most they need to do is adopt informal coordination mechanisms.

Even in organizations where it is desirable to become highly customer focused, major impedients may stand in the way. For example, companies may not have enough detailed information about their customers or market segments; they may not want to get involved with the complexities of transfer pricing or activity-based costing; or there may be established legacy systems that will be difficult to change. These countervailing pressures are a warning that although moving toward closer alignment with customers may be directionally correct, the appropriate structure needs to be shaped as much by the implementation constraints as by the strategic imperative to get closer to customers.

Getting Closer to Customers

Although the potential for gain certainly exists, creating customer-oriented organizations involves significant risks. As Louis Gerstner, Jr., former CEO of IBM, put it: “…(The) integration of “front office” functions that touch the marketplace … can produce significant benefits, but the integration must be executed superbly or the benefits will be decimated by the parochial interests of individual units.” 6

To identify the main benefits and pitfalls, I asked senior managers of 15 companies that had undertaken such large-scale redesigns to reflect on their experiences. Most respondents hesitated to quantify the role organizational change played in their company’s profit or revenue improvements, noting that it could not be separated from the effects of concurrent changes in their strategy, systems and capabilities. In addition, six companies were still in the midst of their realignment and deemed it too early to label it a success or failure. Still, managers at these companies were able to identify promising signs of progress, using metrics about customer satisfaction, customer perceptions of responsiveness and data showing better utilization of marketing resources.

Rationales for Reorganization

Different companies are pushed to reorganize for different reasons. At Motorola Inc., newly appointed CEO Edward J. Zander was eager to dismantle the company’s debilitating bureaucracy and to end a culture of rivalry among product divisions, which behaved like “warring tribes.” 7 A new culture was necessary to support the company’s strategy of “seamless mobility” and to enable consumers to transport any digital information — music, video, e-mail or phone calls — from the home to the car to the workplace. Zander wanted to abandon the divisional structure based on products (for example, mobile phones or broadband gear) and reorganize the company around customer groups (such as digital products for home users or for large enterprises). To soften resistance within the company, Zander made internal cooperation a key factor in determining pay raises and bonuses.

Strategic Rationales for Alignment

Companies had several different rationales for embarking on their restructuring programs.

There was broad agreement among respondents that there needed to be a compelling strategic rationale for a realignment around markets before an organization could summon the energy necessary to carry it out. The path to competitive advantage had to be clear, the reasons (or triggers) had to be obvious and implementers needed to be able to see how and where they could contribute.

Managers cited a number of primary and secondary reasons to explain the strategic rationales for their realignment efforts. (See “Strategic Rationales for Alignment.”)

Implementing a solutions strategy.

The desire to implement a solutions strategy was the most frequently cited strategic rationale. Many managers wanted the opportunity to work closely with customers to design tailored solutions that integrated both products and services and entailed some degree of risk sharing. 8

Cummins India Ltd., which manufactures and sells a variety of engines and generators in East Asia, offers a good example. It began as a diverse group of separate joint ventures for making and selling engines, generator sets and related equipment, and had a separate service entity. The motivation to change was driven by two main factors: fear of losing its dominant market share and deteriorating profit margins as the Indian economy opened to foreign competition. Cummins India was lucky to have a service business. The service business taught the company about ongoing customer needs and showed managers that the margins on custom service bundles were better than those on products.

The new head of Cummins India took the lead in advancing the company’s solutions strategy. The strategy was adopted by three subsidiaries that were “product agnostic” (meaning they could offer products from competitors when those were better suited to the solution). Initially, that was highly controversial, but it soon won broad support. After all, power system customers were buying more than engines — they needed uninterrupted power and reliable end-to-end solutions. Since the realignment, Cummins India’s market share and revenue have risen, even though its sales of engines and generators have declined by 30%.

Solutions strategies are best suited to financial service companies or system manufacturers that can add a valuable service “wrapper” to their products or to companies that are operating in markets that are converging.

Fidelity Investments has adopted customer-based front-end units to meet the competitive challenges of discount brokers on one side and independent financial advisers on the other. Fidelity’s organizational transformation from a product-focused company started with a strategy that emphasized credible advice and investment solutions tailored to the individual investor’s situation. That involved selecting the customer segments to nurture and creating dedicated groups to serve each segment with personalized guidance and service appropriate to its profit potential. The product groups continued to develop and manage a broadened array of funds and financial services that could be readily bundled. (See “Realignment at Fidelity Investments.”)

Realignment at Fidelity Investments

After identifying the customer segments to nurture, Fidelity created dedicated teams to serve each segment with personalized guidance and service levels tied to the profit potential of segment members.

Getting closer to the market.

While few managers cited getting closer to the market as the main reason for realigning, the advantages of “getting closer to customers,” gaining “deeper insights into segments” and “breaking away from product orientation” were often mentioned as strong supporting reasons. Further impetus sometimes came from customers who said they were tired of having to deal with multiple salespeople from the same company.

One company that moved closer to its customers was Imation Corp., which had been spun out from 3M Co. in the mid-1990s as a collection of seven product-focused businesses in rapidly com-moditizing markets. After divesting five of the businesses, management decided to concentrate on two: data storage media and devices. Even though the company did not sell directly, management realigned the organization around four end-user segments: personal storage, entry level, midrange and enterprise.

Imation created a business team for each end-user segment, led by product managers whose task was to assess customer requirements and design the offering. Key account managers, who were members of the teams, called on large retailers, such as Best Buy Co. Inc., and large original equipment manufacturer accounts. The managers were not selling solutions but deep customer knowledge, which they used to reinforce their ties with distributors and retailers.

Pursuing segment growth opportunities.

Both Sony Corp. of America and Nokia Corp. were concerned that their uncoordinated and product-centered organizations were missing growth opportunities and their marketing efforts were being diluted across too many categories. By bundling products to expand their positions within targeted segments, they wanted to follow the maxim, “If you have dominant share in the market, make the sandbox bigger.”

Sony North America had chosen to mirror its parent company’s organization of five autonomous product divisions, each with its own product focus and profit-and-loss statement. Because each product line was aimed at its own target customers — for example, the Walkman was primarily aimed at the youth market — other customer segments were underserved or overlooked. The company’s product orientation meant that customers had to fend for themselves in bundling or linking Sony products. In an era of convergence, that lack of coordination meant lost opportunities to sell related products.

Managing the Implementation Pitfalls

Managers attempting to reorganize around customers need to understand the potential risks. Some of the problems are built into the contradictions and compromises in the original designs. For example, a company’s eagerness to contain overhead costs may conflict with its desire to improve coordination and information sharing across the organization. 9 Each new job function adds to the bureaucracy and cost and disperses market knowledge more widely. 10 Also, it is difficult to nurture deep functional expertise while subordinating these functions within process teams. People who are fearful of change or who think they have something to lose often will latch on to these concerns. Another common source of delay and frustration is inadequate information systems.

To overcome resistance, managers need to communicate actively and effectively. 11 Beyond that, the opportunities for success will be greatly enhanced when there is a clear and compelling strategic rationale for the changes and when managers pay close attention to the following three implementation lessons: Keep everyone focused on the customer’s total experience; adjust the pace of the alignment process to the anticipated obstacles; and keep realigning to stay ahead of market changes.

Lesson One: Keep Everyone Focused on the Customer’s Total Experience

The first lesson for creating successful customer-focused organizations is to establish clear accountability for the relationships with the best customers. Functional and product-dominant structures are notably weak at comprehending the total customer experience and solving cross-functional problems. No one looks at the company through the customer’s eyes and asks how processes can be improved, how products can be integrated across units or what other requirements might be met with an augmented offering. Without clear accountability, no one is responsible for tracking customer defections or trying to win customers back.

Likewise, systems and controls designed for measuring product profitability cannot measure the profitability of individual customers or segments. Yet the ability to treat different customers differently based on their lifetime value is at the heart of customer relationship management. Improving accountability requires a combination of system changes, customer-focused metrics and employee incentives tied to customer-segment performance.

To implement these changes, companies must have unified customer information that can be filtered through linked customer activity and cost databases. Companies with fragmented information systems have great difficulty coordinating their offerings. 12 Consolidating information at the point of customer contact makes it easier to separate the front-end customer solution units from the back-end product infrastructure.

An important factor in getting people to pay attention to the customer experience is properly selecting performance metrics. The choice of metrics needs to be guided by both strategy and objectives. Most of the companies I talked with held their customer-facing units accountable for segment revenue and profitability. But this information provides little in terms of diagnostic value, and it is not usually part of what individual contributors or teams relate to easily. Team members’ general information needs to be augmented by metrics that illuminate the company’s specific strategy and have a clear connection to financial performance. In addition to supporting strategy, the best metrics are meaningful to employees and are grounded in a deep understanding of customer needs and priorities. For example, GE Plastics found that on-time delivery was of paramount importance to its customers and that variability — being either late or early — was a major source of dissatisfaction. To fulfill customer needs, the company began to measure and manage the delivery “span” (the time variation from the promised date) by tying incentives to meeting designated dates. By linking incentives to particular metrics, companies can send clear messages about what matters. In an effort to encourage internal collaboration, Thermo Electron Corp., for example, rewards salespeople for sharing customer leads with other market segment groups.

Management needs to keep in mind that employees will be reluctant to get on board unless they can trust the metrics and their ability to affect the results. Unfortunately, many managers violate this principle. Some are forced to use proxies for segment revenue numbers when the real data are not available. Others use accounting methods (for example, to calculate the cost of products) that raise more questions than they answer. Of course, employees have their own methods of introducing distortions (such as auto dealership employees asking customers to give them high scores). 13 That kind of gaming compromises the potential value of the metric and shifts the focus from the needs of the customer.

Lesson Two: Adjust the Pace of the Alignment Process to Address the Obstacles

Reorganizations invariably take longer than expected. Sometimes changes in corporate leadership interfere with the sense of urgency. Many people have unrealistic expectations about how quickly plans can be carried out. At Fidelity Investments, for example, managers estimate that it took them at least three years to accomplish 60% of their reorganization goals. The main constraint was the time it took to make information system changes and upgrades.

In general, the biggest impediment to a timely reorganization was an inability to anticipate and overcome obstacles. Few companies have had more difficulty in this area in recent years than Xerox Corp., even though there was a clear strategic rationale for a proposed front-end alignment around customers. Former CEO Paul Allaire recognized as early as 1992 that Xerox’s new strategic focus on “the document” would have a far-reaching impact on its customer relationships. Xerox wouldn’t just sell copiers; it would sell, as Allaire put it, “innovative approaches for performing work and enhancing productivity.… But that means our salespeople need to understand the customer’s business, what the customer’s real needs are and how the customer is going to use our products.” 14

To overcome the rigidity of an extremely function-based organization, Xerox initially moved salespeople and service people into geographic customer teams. That served the company well through the late 1990s. But when Rick Thoman arrived from IBM Corp. in April 1999 as the new CEO, he saw the need for a different configuration. In his view, the sales force needed to be less geographically organized and more oriented toward selling document solutions.

Due to implementation problems, none of the benefits of reorganization were realized. According to my interviews and other accounts, Xerox suffered from a mixture of problems. In some market segments, employees were not committed to selling “document solutions,” and not all customers wanted solutions. The company also had unrealistic expectations about the abilities of the sales force, which was not properly trained in their new roles and lost long-standing relationships. Effective as they were at selling boxes to office administrators and purchasing agents with large contracts, their knowledge of networking or specific industries was lacking. Gradually, longer sales cycles, customer defections, sagging morale and finger-pointing crippled the reorganization effort. Within a year, one-third of the sales force left the company.

A company’s culture can either make it easier for the organization to realign around markets — or make it harder. Nokia Corp., for example, benefited from a flexible culture that encouraged informal networking and task forces composed of people from different business units. That made it easier for the company to accept the idea of separate businesses serving distinct markets. Obstacles arise when the culture is mature and absorbs dysfunctional beliefs. Among them: that “the sales force owns the customers” or that “customers don’t know what they want.”

Many managers are aware of the more obvious obstacles — mismatched capabilities, fragmented information systems and poor execution — and take steps to deal with them. But they frequently overlook two others: customer resistance and internal tension.

Even though one of the strongest arguments in favor of realignment is that it helps managers differentiate product and service levels based on customer value, long-standing customers who are costly to serve usually resent being relegated to a lower status, and they often work hard to circumvent the rules. Companies need to design strategies for dealing with these issues early to avoid jeopardizing the whole program.

Managers should also brace themselves for new flare-ups of long-simmering internal conflicts, particularly between marketing and sales. When many different parts of the company — for example, field sales, inside sales and customer service — all interact on the same account, close coordination between marketing and sales is critical. But too often, there is infighting and duplication. In addition to being costly, it leads to a poor customer experience.

Lesson Three: Keep Realigning to Stay Ahead of Market Changes

Because markets are always changing, organizations continually slip out of alignment. Management’s ability to stay abreast of change is by no means certain in light of the inherent drag of system legacies, culture and other obstacles.

Organizations that focus on the customer dimension need to think about which customer to serve. Logic dictates that you cannot serve all segments equally well. Do you want a high share of a few accounts, or a smaller share of a large number of accounts? Assuming that the roster of high-value accounts keeps changing, companies must be prepared to form and re-form their account teams as new segment opportunities emerge.

There is also the pendulum phenomenon: An organization in transition pauses briefly at the top of the pendulum swing and then accelerates through the bottom, which was the intended destination. As a result, the risk of overshooting and over-alignment is high, which is why many savvy managers expect to adjust their course quickly in response to market feedback. For example, when Philips Semiconductors Co. established global account teams to handle its biggest accounts, the company encountered a number of problems. Some were the consequence of having to manage teams across multiple time zones; others were related to the cultural complexities of having people located in one country reporting to managers elsewhere. Management also found that some customers didn’t really want a closely linked collaborative relationship that functioned like a joint venture. In response to this feedback, Philips is evolving to a more hybrid organization, with global teams involved with the biggest customers. The rest will be served on a more regional basis.

Companies looking to stay aligned with the market need to be responsive to both customer opportunities and competitive cost pressures. In tough economic times, cost considerations may need to take the upper hand. During most of the 1990s, Square D Co., for example, part of Schneider Electric SA and a maker of industrial control and distribution systems, was organized around its main markets, which included industrial, residential and construction, to serve global customers that wanted integrated solutions. The customer-focused structure, supported by centralized manufacturing, worked well for several years, but it ran into trouble when the economy slowed and customers started moving production overseas for lower costs. Square D’s reaction was to strengthen the product side of the matrix; product managers were assigned responsibility for profit and loss and made accountable for costs savings. In that way, Square D shifted to a hybrid structure, with the front end of the organization aligned around markets and the rest structured around products.

Market difficulties were the catalyst for organizational changes at Cisco Systems Inc. as well. Until the technology slump of 2001, Cisco had done well with a highly integrated structure with three separate semiautonomous lines of business. 15 Each line of business developed, manufactured and sold its own customized networking solutions to distinct customer segments: Internet service providers, large companies and small to midsize businesses. But the market slump exposed the fault lines of that approach — in particular, the high costs of redundancy in engineering and innovation. 16 Meanwhile, the previously distinct customer segments were converging with regard to their technological sophistication and requirements, and companies such as Huawei Technologies Co. Ltd. of China were offering competitive products at lower prices.

To reduce costly redundancies, Cisco centralized all related technologies into 11 technology groups. Solutions engineering teams, which were assigned to the central marketing function, mixed and matched from the various technologies. That allowed Cisco to share technology across multiple customer segments. The realignment was implemented within three months without layoffs or physical relocation of most engineers. Within two years, the benefits of the cost efficiencies were visible. Customer satisfaction remained high, and in 2003, net income rose to $3.6 billion.

ORGANIZATIONAL STRUCTURES WILL CONTINUE to be in flux because they are a means to an end: the realization of a competitive strategy. When companies rethink or redirect their strategies, they are also redesigning their enabling structures and supporting mechanisms to achieve better results. Both Square D and Cisco rode their customer-focused organizations to rapid growth during the 1990s and then found (when market growth slowed and competitors appeared) that they were no longer aligned with the market. In each case, the ability to regroup was enhanced by the fact that the company had existing market-driven cultures. Indeed, many Cisco observers believe that customer advocacy is so much a part of its cultural DNA that it was impervious to changes in the formal structure.

In the end, organizations are made up of more than boxes, arrows and lines, but structure does signal strategic intent. Although the balance of accountability and power of each dimension will shift, some form of alignment with markets will continue to offer value, even in the most cost-constrained and demanding markets.

About the Author

George S. Day is the Geoffrey T. Boisi Professor of Marketing at the University of Pennsylvania’s Wharton School, where he is codirector of the Mack Center for Technological Innovation. He can be reached at [email protected].

1. See J.R. Galbraith, “Designing Organizations: An Executive Guide to Strategy, Structure and Process” (San Francisco: Jossey-Bass, 2002), 91–115; N.W. Foote, J. Galbraith, Q. Hope and D. Miller, “Making Solutions the Answer,” McKinsey Quarterly 3 (2001): 84–93; D.K. Rigby, F.F. Reichheld and P. Schefter, “Avoid the Four Perils of CRM,” Harvard Business Review 80 (February 2002): 101–109; and G.S. Day, “Creating a Superior Customer Relating Capability,” MIT Sloan Management Review 44 (spring 2003): 77–83.

2. For background on Intel’s reorganization, see C. Edwards, “Shaking up Intel’s Insides,” Business Week, Jan. 21, 2005, 35; “Intel’s Right-Hand Turn,” Economist, May 14, 2005, 65–66; and A. Lashinsky, “Is This the Right Man for Intel?” Fortune, April 18, 2005, 110–120.

3. H.E. Aldrich, “Organizations Evolving” (Thousand Oaks, California: Sage, 1999); and J. Child and R.G. McGrath, “Organizations Unfettered: Organizational Form in an Information-Intensive Economy,” Academy of Management Journal 44, no. 6 (2001): 1135–1148.

4. D. Miller, R. Eisenstat and N. Foote, “Strategy from the Inside Out: Building Capability-Creating Organizations,” California Management Review 44 (spring 2002): 37–54; and R. Eisenstat, N. Foote, J. Galbraith and D. Miller, “Beyond the Business Unit,” McKinsey Quarterly 1 (2001): 54–63.

5. P. Burrows, “The Un-Carly Unveils His Game Plan,” Business Week, June 27, 2005, 36.

6. L.V. Gerstner Jr., “Who Says Elephants Can’t Dance? Inside IBM’s Historic Turnaround” (New York: Harper Business, 2002), 248.

7. R.O. Crockett, “Reinventing Motorola,” Business Week, Aug. 2, 2004, 82–83.

8. D. Sharma, C. Lucier and R. Molloy, “From Solutions to Symbiosis: Blending with Your Customers,” Strategy + Business 27 (2002): 39–48.

9. The trade-off between specialization and coordination was first identified by P. Lawrence and J. Lorsch, “Organization and Environment” (Cambridge, Massachusetts: Harvard University Press, 1967).

10. S. Ghoshal and N. Nohria, “Horses for Courses: Organizational Forms for Multinational Corporations,” Sloan Management Review 34, no. 2 (winter 1993): 23–35.

11. J.P. Kotter, “Leading Change” (Boston: Harvard Business School Press, 1996).

12. M. Sawhney presents a similar notion in “Don’t Homogenize, Synchronize,” Harvard Business Review 79 (July–August 2001): 101–108. He notes the most difficult challenge is getting the back-end product groups to view the internal customer-facing units as their primary customer, rather than the external end-users.

13. F. Reicheld, “The One Number You Need to Grow,” Harvard Business Review 81 (November–December 2003): 49.

14. R. Howard, “The CEO as Organizational Architect: An Interview with Xerox’s Paul Allaire,” Harvard Business Review 70 (September–October 1992): 107–120.

15. This description of the Cisco reorganization is based on R. Gulati and P. Puranam, “Organizational Inconsistencies After Reorganizations: Good for Performance?” working paper, London Business School, London, 2005.

16. Under the burden of high costs relative to new competitive entrants, and a slowing of global demand, net income collapsed from $2.7 billion in 2000 to a $1 billion loss in 2001.

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Organizing for the future: Nine keys to becoming a future-ready company

The prospect of successful vaccines for COVID-19 has given business leaders everywhere hope that the pandemic may be finally nearing a turning point. And not a second too soon: the organizational adrenaline that helped many companies get things done quickly and well during the pandemic’s early days has, in many cases, been replaced by fatigue.

Yet even as leaders take action to reenergize their people and organizations , the most forward looking see a larger opportunity—the chance to build on pandemic-related accomplishments and reexamine (or even reimagine) the organization’s identity, how it works, and how it grows.

The pressure to change had been building for years. Well before the COVID-19 pandemic, senior executives routinely worried their organizations were too slow, too siloed, too bogged down in complicated matrix structures, too bureaucratic. What many leaders feared, and the pandemic confirms, is that their companies were organized for a world that is disappearing—an era of standardization and predictability that’s being overwritten by four big trends: a combination of heightened connectivity, lower transaction costs, unprecedented automation, and shifting demographics (Exhibit 1). (For more about these forces, see “ Organizing for the future: Why now? ”) And if incumbents didn’t see the future in themselves they saw it clearly in the competition: digital upstarts that continue to innovate, and win, in bold new ways.

In this article, we’ll synthesize lessons from our experience and from new research on the organizational practices of 30 top companies to highlight how businesses can best organize for the future. While no organization has yet cracked the code, the experimentation underway suggests that future-ready companies share three characteristics: they know who they are and what they stand for; they operate with a fixation on speed and simplicity; and they grow by scaling up their ability to learn, innovate, and seek good ideas regardless of their origin. By embracing these fundamentals—through the nine organizational imperatives that underpin them—companies will improve their odds of thriving in the next normal.

The bad news? Companies have zero time to lose. In an increasingly winner-takes-all business environment in which McKinsey research  finds that up to 95 percent of economic profit is earned by the top 20 percent of companies, any organization that isn’t seeking new approaches is on borrowed time.

The good news? Not only do these same top performers offer hints at what a better organization could look like, but companies everywhere are recognizing that the pandemic offers a once-in-a-generation opportunity for change. Indeed, the much-anticipated—and yes, inevitable—transition from today’s COVID-19 crisis mode to the next normal offers senior executives a unique unfreezing opportunity. By seizing the initiative, companies can discover organizational “unlocks” and create new systems that are antifragile, 1 Author Nassim Taleb’s concept of antifragility is instructive. “The resilient,” Taleb writes, “resists shocks and stays the same; the antifragile gets better.” For more, see Nassim Nicholas Taleb, Antifragile: Things That Gain from Disorder , New York, NY: Random House Trade Paperbacks, 2012. more flexible, more organic, more interconnected, more purposeful—and simply more human. 2 These ideas have a long history. For example, consider the notion of open, dynamic organizational systems versus closed, static, mechanistic systems articulated by Daniel Katz and Robert L. Kahn in “Evaluating the application of theories of open systems thinking,” 1978.

Reinvention needed

Ask executives about their company and you can expect to be shown an organization chart. No wonder. The management concepts that the org chart visualizes—coordination, hierarchy, a matrixed organization—are the ones leaders grew up with and know best, as did generations before them. The original org chart  hails from 1854, and was introduced to help run the New York and Erie Railroad during the age of the steam locomotive.

Therein lies the challenge. Today’s organizations are set up as traditional hierarchies or matrix organizations with roots stretching back to the industrial revolutions of the 18th, 19th, and 20th centuries. In theory, these structures provide clear lines of authority from frontline employees up through layers of management. In reality, matrix structures have only grown more complex as business has—to the extent that in some companies they are so cumbersome they hardly function.

The takeaway? We shouldn’t expect these old models to be fit for purpose in today’s environment. They are mechanistic by design, built to solve for uniformity, bureaucracy, and control—goals that undercut what companies now prioritize: creativity, speed, and accountability.

The answer isn’t to modify the old models but to replace them with something radically better.

Organizing for the (winner-takes-all) future

To define “radically better” for organizations, we—along with our colleagues in McKinsey’s Organization Practice—embarked on a research effort in 2018 to understand how companies could successfully organize for the future. This work identified nine imperatives, highlighted in Exhibit 2, that we believe separate future-ready organizations from the pack.

Exhibit 3 shows the degree to which 30 top US companies are already making or considering bold moves across the imperatives. These companies—all among the top three in their industry as measured by total economic profit captured between 2015 and 2019—represent the vanguard of an increasingly winner-takes-all world (see sidebar, “The winner takes it all”).

Top-performing companies are taking bold action across all nine imperatives.

1 To acknowledge that industries have different market fundamentals and face different headwinds and tailwinds, we selected the top 10 industries as measured by their average economic profit between 2015–19. We then selected the top 3 companies from each industry by the same metric.

2 Bold moves defined as: 1) Company among the first to adopt a given practice; 2) the practice is unique and not copied elsewhere; or 3) the practice has been scaled across >50% of the company.

3 Bold plans defined as: Company is actively planning or piloting a bold move as defined above.

Source: McKinsey Organization Practice; McKinsey Strategy & Corporate Finance Practice

McKinsey & Company

The winner takes it all

To learn the extent to which the nine imperatives were being studied and pursued by leading organizations, we turned to groundbreaking research conducted by our colleagues in McKinsey’s Strategy & Corporate Finance Practice for their book, Strategy Beyond the Hockey Stick . There, the authors observed that company performance (as measured by average economic profit) demonstrates a power law—the tails of the curve rise and fall at exponential rates with long “flatlands” in between. The implications of the power law are stark: companies in the top quintile capture no less than 90 percent of economic profit, and the gap appears to be widening .

As part of our own research, we looked to this top quintile, selecting the top three companies from each of the ten highest-scoring industries on average economic profit from 2015 to 2019. We then conducted expert interviews and outside-in analysis to determine the degree to which the companies were acting on—or exploring—the nine organizational imperatives that form the heart of this article.

Three of the imperatives proved notable pockets of bold action: taking a stance on purpose (83 percent of companies we studied), establishing ecosystems (83 percent), and creating data-rich tech platforms (73 percent).

Further, when we looked across the three categories (“who we are,” “how we operate,” “how we grow”) that together comprise the nine imperatives, we noted that top-performing companies didn’t concentrate their efforts on any single category but instead tended to act across all three. This could suggest that all three areas are viewed as important to future organizational performance.

Indeed, in an increasingly winner-takes-all economy in which even above-average performance won’t guarantee returns above the cost of capital, we would expect the bar on organizational innovation to only rise.

As our colleagues in McKinsey’s Strategy & Corporate Finance Practice demonstrated in their 2018 book, Strategy Beyond the Hockey Stick , companies in the top quintile for economic profit capture almost 90 percent of it. A more recent analysis  shows this share has increased to 95 percent—basically all excess returns over the cost of capital.

Clearly, the case for reimagining an organization and taking bold actions has never been clearer. To see how companies can do both, let’s turn to the organizational imperatives and examine the ways in which they help organizations answer three core questions: Who are we? How do we operate? How do we grow?

Who we are: Strengthen identity

In his seminal 1937 essay, “The nature of the firm,” 3 Coase’s essay, described by him as “little more than an undergraduate essay,” is nonetheless widely cited as contributing to his 1991 Nobel Prize for economics. For more about Coase’s life and career at the University of Chicago (where he taught until his death in 2013 at the age of 102), see Sarah Galer, “Ronald Coase still stirs debate at 101,” University of Chicago, April 23, 2012, uchicago.edu. the economist and eventual Nobel laureate Ronald Coase argued that corporations exist to avoid the transaction costs of the free market. Yet with transaction costs plummeting (spurred by rising connectivity) this rationale no longer holds up. Why, then, do companies exist?

The answer is identity. People long to belong, and they want to be part of something bigger than themselves. Companies that fixate only on profits will lose ground to organizations that create a strong identity that meets employees’ needs for affiliation, social cohesion, purpose, and meaning.

Future-ready organizations accomplish this in three ways: they get clear on their purpose; they know how they create value and why they’re unique; and they create strong and distinct cultures that help attract and retain the best people.

Imperative 1: Take a stance on purpose

Top-performing organizations know that purpose is both a differentiating factor and a must-have. A strongly held sense of corporate purpose is a company’s unique affirmation of its identity—the why of work 4 For more, see Simon Sinek, Start with Why: How Great Leaders Inspire Everyone to Take Action , New York, NY: Penguin Group, 2009. —and embodies everything the organization stands for from a historical, emotional, social, and practical point of view.

Future-ready companies recognize that purpose helps attract people to join an organization, remain there, and thrive. Investors understand why this is valuable, and factor purpose into their decision making: the rise of environmental, social, and governance (ESG)–related funds is just one of the ways they acknowledge that purpose links to value creation  in tangible ways.

Nonetheless, few companies harness purpose fully. In a McKinsey survey of employees at US companies, 82 percent said organizational purpose is important , but only half that number said their purpose drove impact. How to bridge the gap? Take action to set the company’s purpose in motion ; help make it real for people. This only happens when employees identify with and feel connected to their company’s purpose. While such connections can be encouraged and reinforced through meaningful, symbolic action—for example, Amazon leaves an empty chair at meetings to represent the customer’s role in decisions 5 For more, see George Anders, “Inside Amazon’s idea machine: How Bezos decodes customers,” Forbes , April 4, 2012, forbes.com. —purpose must also be forged in tangible choices and behaviors. Consider CVS Health’s choice to stop selling tobacco products to more fully achieve a purpose of “help[ing] people on their path to better health.” 6 For more, see Eileen Howard Boone, “An insider look at CVS’s decision to quit the cigarette business,” Guardian , June 18, 2014, theguardian.com.

It’s often said that “where your talents and the needs of the world cross, there lies your vocation.” Indeed, employees aspire further (and even live longer) when their energies are channeled to purpose. McKinsey research finds that people who say they are “living their purpose” at work are four times more likely  to report higher engagement levels than those who say they aren’t.

When centered at the heart of work, purpose helps people navigate uncertainty, inspires commitment, and even reveals untapped market potential. Future-ready organizations will clearly articulate what they stand for, why they exist, and will use purpose as the glue to connect employees and other stakeholders in ways that inform their business choices.

In a McKinsey survey of employees at US companies, 82 percent said organizational purpose is important, but only half that number said their purpose drove impact.

Imperative 2: Sharpen your value agenda

While all companies have a strategy for how they create value, 7 For more, see C.K. Prahalad and Gary Hamel, “The core competence of the corporation,” Harvard Business Review , May–June 1990, hbr.org. few can show precisely how the organization will achieve it. Future-ready companies, by contrast, avoid this dilemma by creating a value agenda—a map that disaggregates a company’s ambitions and targets into tangible organizational elements such as business units, regions, product lines, and even key capabilities. Armed with such a depiction, these companies can articulate where value is created in the organization, what sets the company apart from the pack, and even what might propel its success in the future.

The key is to use the value agenda to focus the organization’s efforts and instill a sense of what really matters in every employee. When organizations can leverage this clarity—knowing exactly what differentiates them from everyone else—the results are powerful and hard to replicate. Consider how Apple rallies itself behind creating the best user experience. The company’s obsessiveness when it comes to pleasing customers includes obvious things like product design but extends to how products are packaged: the company has a small team dedicated just to packaging to ensure that the experience of opening the box elicits just the right emotional response. 8 For more, see Jamie Condliffe, “Apple’s packaging is so good because it employs a dedicated box opener,” Gizmodo, January 25, 2012, gizmodo.com.  

The power of a clear value agenda isn’t only that it helps a company better achieve its strategic priorities today but also that it gives the organization a line of sight into how to shift resources as priorities change. Top-performing companies, after all, reallocate their people aggressively, dynamically, and continuously against their core priorities, recognizing that this activity is both an economic engine and long-term competitive strength. According to McKinsey research, companies that frequently reallocate talent to high-value initiatives  are more than twice as likely to outperform peers on total returns to shareholders.

While all companies have a strategy for how they create value, few can show precisely how the organization will achieve it.

Imperative 3: Use culture as your ‘secret sauce’

In addition to having a clear why (purpose) and what (a value agenda), companies that thrive in the next normal will distinguish themselves by their cultures—the how of any organization. Culture is that unique set of behaviors, rituals, symbols, and experiences that collectively describes “how we run things.” Among the most successful companies, culture forms the backbone of organizational health and fuels sustained outperformance over time: companies with strong cultures achieve up to three-times higher total returns to shareholders  than companies without them.

Telltale signs of a strong culture of performance include leaders who consistently carry out the behaviors the company aspires to, work practices that stand out and feel fresh to outsiders, and innovative approaches to important moments—everything from employee onboarding to how meetings are run. Amazon, for example, famously enforces its “two-pizza rule” mandating that no team should be larger than two pizzas can feed. The rule supports the company’s idiosyncratic approach to meetings: keep them small, no PowerPoint, and start with silence to give participants time to reread the required premeeting memo (time that CEO Jeff Bezos refers to as “study hall” ). These approaches might seem like quirks, but, in fact, they directly support a valuable business goal: helping the company reach faster, better decisions.

Leaders hoping to create a robust performance culture need to start by cooking up their organization’s own unique “secret sauce.” The main ingredient: specific, observable behaviors that employees at all levels of the company adhere to.

Broad themes won’t cut it. Instead, behaviors must be made an integral part of core business activities and specific work tasks, especially for the moments that matter. A global manufacturer, for example, wanted shop-floor workers to view operational discipline as everyone’s job. To promote this, the company encouraged frontline teams to briefly huddle at the start of every shift to review the company’s “golden rules of safety.” Ultimately, the manufacturer created tailored interventions for different groups  of employees based on their respective roles, goals, and even particular mindsets that might otherwise have held employees back.

Culture can’t just exist in slogans painted on the walls or in catchy email signature lines. Defined principles and ways of working are critical to creating a cohesive, long-lasting organization. And culture plagiarists be warned—culture is devilishly hard to copy and should ultimately be unique to each organization. When leaders choose—and build—the kind of culture they want the organization to embody, they create a virtuous cycle, attracting the right talent that will thrive in their culture, unlock their value agenda, and “turbocharge” performance.

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How we operate: Prioritize speed

Visit a future-ready organization and you’ll observe that speed is both a preoccupation and a cultural bias. You’ll even hear it in the company lexicon, in expressions such as “increasing the clock speed,” “metabolic rate,” or “a bias for action.” While the COVID-19 crisis has made speed a priority for many organizations , it has also reinforced how difficult speed is to harness. Once organizations galvanize identity, they need to optimize for speed. Operating models need to be fast, nimble, and frictionless to create ways of working that foster agility and simplicity. They need to enable a network of empowered, dynamic teams to find pockets of value, including at the company’s “edges” where employees are closest to customers.

Imperative 4: Radically flatten structure

As the business environment has become more complex and interconnected in recent years, many companies have mirrored these changes in their organizational structures, creating an ever-more convoluted matrix. Unwittingly, they are betting on organizational complexity to solve market complexity.

This is a losing bet. Future-ready organizations, by contrast, structure themselves in ways that make them fitter, flatter, faster, and far better at unlocking considerable value. Their goal isn’t to eradicate hierarchy so much as make it less important as an organizing mechanism. They flatten the organization and adopt the simplest P&L structure possible, reinforcing business objectives with clear, strong performance management and other mechanisms.

Consider Haier, the China-based multinational maker of appliances and consumer electronics that shifted away from traditional hierarchical structure and toward emergent, agile teams. Employing one of the more intriguing approaches we’ve come across, Haier is an organization with no layers, no traditional bosses, and no middle management; yet the company is anything but a free-for-all.

Future-ready organizations structure themselves in ways that make them fitter, flatter, faster, and far better at unlocking value.

Instead, thousands of independent “microenterprises”—small, flexible teams that form by mutual selection—collaborate over networks of platforms and people to accomplish the company’s goals. Microenterprises come in three forms : transforming units that aspire to reinvent existing products; incubating units that create entirely new products; and node units that support the others with component products and services. 9 For more, see Gary Hamel and Michele Zanini, “The end of bureaucracy,” Harvard Business Review , November–December 2018, hbr.org.

Another intriguing approach is the “ helix organization .” In this model, reporting is split into two separate, parallel lines of accountability—one focused on stability, the other on speed. To achieve the former, a function-oriented capabilities manager oversees an employee’s long-term career path and skills development. For the latter, a market-facing “value manager” sets priorities and provides day-to-day oversight, ensuring that people can be deployed as flexibly as needed to meet priorities. This model allows for nimble reallocation of people while avoiding the confusions of traditional dual reporting.

The vision of the future that these examples suggest is one in which organizational structure no longer focuses on boxes and lines. Instead, it centers on connectivity—on who works on what with whom. Future-ready organizations require models that are designed, nurtured, and grown around people and activities. Furthermore, advances in digital technology mean that bosses in the years ahead can become true coaches and enablers—not micromanagers—across larger spans of control (1:30 ratios of manager to employee are imaginable, versus much smaller ratios). When companies have a strong identity informing their priorities and ways of working, responsibilities and clear decision rights can empower frontline staff to make decisions in real time.

Finally, rethinking structure means rethinking teams. Many companies have established networks of teams that are empowered to operate outside current structures, take over some critical operations, and deal with rapidly evolving situations. Companies such as Google follow a “non-zero-sum” management approach in which the development of lines of communication running in all directions is more important than reporting relationships. 10 For more, see James L. Heskett, W. Earl Sasser, and Joe Wheeler, The Ownership Quotient: Putting the Service Profit Chain to Work for Unbeatable Competitive Advantage , Boston, MA: Harvard Business School Publishing, 2008. Such teams bring together cross-functional skills and a wide range of experience while avoiding the usual baggage that comes with more hierarchical mindsets. The teams can act fast because they are flexible. They form, disband, reshape, and experiment as they learn lessons, make and correct mistakes, and try new approaches.

Imperative 5: Turbocharge decision making

A recent McKinsey survey found that organizations that make decisions quickly are twice as likely as slow decision makers to make high-quality decisions. Organizations that consistently decide fast and well are, in turn, more likely to outperform their peers. However, only one in three survey respondents said their organizations consistently make fast, high-quality decisions .

Achieving quality and speed in tandem takes work. It requires a system that properly allocates decisions to the right executives, teams, individuals, or even algorithms. The top team needs to focus its time and energy on the core business decisions that only it can make, such as those initiatives central to the value agenda. Other leaders, meanwhile, should spend more time deciding on resource and talent allocation for those initiatives. Top of mind for everyone should be who is working on what. Through managing the backlog of resources from the top of the house, organizations will speed up and increase the quality of decisions.

Many decisions and processes require less than half the steps executives imagine are necessary.

To prepare for the future, many companies will need to reset their default mode by developing a bias for action and the ability to differentiate between crosscutting and delegable decisions. The great majority of decisions should be delegated to the lowest levels possible, giving employees at the company’s edges agency and accountability for decisions they are equipped, and best placed, to make. For example, most of Alibaba’s operating decisions are made by small teams informed by machine learning and creative applications of data. 11 For more, see Ming Zeng, “Alibaba and the future of business,” Harvard Business Review , September–October 2018, hbr.org. The company’s C-level executives focus on crosscutting decisions, including resource allocation for top initiatives. Many decisions and processes require less than half the steps executives imagine are necessary. This kind of streamlining is vital to increasing decision speed.

Leading organizations also rightsize the number of decision makers and critical voices involved in a decision. Each participant should be purposefully included, with a clear eye to removing decision “spectators” or others without a critical role in the process. Who has a vote? Who has a voice? Notably, clarity on this does not necessarily mean limiting the number of people involved or removing diverse perspectives. It just means ensuring that there is a strong reason for each participant to be present.

The COVID-19 crisis has forced companies to “turbocharge” decision making out of necessity. For example, Sysco, the largest US food distribution company, pivoted its core business in only a few weeks to provide services to the retail grocery sector by leveraging its supply-chain expertise. 12 For more, see “Sysco pivoting support to help US retail grocers keep shelves in stock,” Warehouse Automation, March 25, 2020, warehouseautomation.ca. As an executive at another company confided during the early days of the pandemic, “We are making a month’s worth of decisions every day at the moment.” Such examples suggest that companies do have the muscles to accelerate decision making. Now they must strengthen and flex those muscles, embedding what they’re learning from the crisis into redesigned decision-making processes for the future.

Imperative 6: Treat talent as scarcer than capital

The world of work is changing fast. Some jobs are being replaced by automation while others, facilitated by technology platforms, are becoming more globally dispersed. These changes are leading many companies to rethink their talent strategy. Top companies will anchor the effort to a bedrock principle: our talent is our scarcest resource. Then they’ll zero in on three core questions: What talent do we need? How can we attract it? And how can we manage talent most effectively to deliver on our value agenda?

Thirty-nine percent of survey respondents said they have turned down a job because of an organization’s perceived lack of inclusion.

Answering the first question (What talent do we need?) will be devilishly hard for companies that haven’t yet taken the time to create a value agenda. Our research finds that a substantial amount of value in organizations is linked to as few as 25 to 50 roles, many of which aren’t at senior levels of the company. Leaders must know what those roles are. If they don’t, they may be wasting top talent on roles that can’t deliver outsize value.

Creating an attractive destination for top talent means fostering an inclusive employee experience. This influences whether employees stay and thrive, which in turn affects the company’s bottom line. A recent McKinsey global survey  found that 39 percent of respondents said they have turned down a job or decided not to pursue one because of an organization’s perceived lack of inclusion. And other McKinsey research finds that companies in the top quartile for racial/ethnic diversity and gender diversity at the executive level are 36 and 25 percent more likely  to have above-average profitability, respectively, than companies in the bottom quartile.

When it comes to performance management, senior executives can learn from companies such as Netflix, which says it prioritizes having “stars” in every position and at every level. While this statement might sound like an empty motto at another company, for Netflix it serves a valuable need: the company’s highly autonomous culture would suffer with the wrong people in place. To decrease the odds of this happening, Netflix actively counsels out “adequate” performers .

Finally, future-ready companies see that talent ecosystems often allow for the best management and allocation of top talent. In some cases, companies rely on tech-enabled marketplaces to better match skills to projects. Such talent ecosystems can even reach beyond traditional corporate boundaries. For example, Cisco’s Networking Academy offers self-paced IT training and skills development to prepare students for a range of tech-related roles and then connects them to job opportunities, including with external partners. Participants benefit from greater opportunities for career advancement. But Cisco wins, as well, by tapping into a larger pool of talent empowered with specific skills the company prioritizes.

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How we grow: Build for scale

Organizations cannot simply hardwire decisions about their identity or operating models and declare victory. As connectivity and automation increase, and as the expectations of younger generations change, businesses must be prepared for nimble and constant adaptation if they hope to grow with any consistency.

Doing so entails constant interaction with stakeholders, technology, and employees. The best way to ensure this is by harnessing a vibrant ecosystem of partners outside the company’s traditional boundaries, building data-rich technology platforms that support growth and innovation, and accelerating learning to fuel the talent engine they’ll need to succeed.

Imperative 7: Adopt an ecosystem view

In 2014, Tesla made the seemingly radical decision to open source its patents and encourage other companies to use its intellectual property. In retrospect, that choice is a brilliant model of the ecosystem-oriented decisions that all future-ready companies must make. Tesla recognized that it couldn’t grow without partners that would build charging stations and offer services to create the infrastructure to support electric vehicles. By putting itself at the center of a burgeoning ecosystem of partners, Tesla laid the groundwork for its own explosive growth.

A substantial amount of value in organizations is linked to as few as 25 to 50 roles.

Future-proof organizations will take such examples to heart, recognizing that traditional understandings about what an organization is and where its boundaries lie are being upended. The old thinking was all about gaining leverage and controlling the supply chain. Increasingly, however, value is created through networks where partners share data, code, and skills; where communities of businesses create value and antifragility together.

The underlying recognition that top companies embrace (and that laggards struggle to accept) is that the sources of value will be constantly changing—in ways that can’t be tapped solely by a company’s traditional, core business. Successful companies need to excel at blurring boundaries, taking a systems view rather than a mechanistic one, and embracing fluidity over fixed plans.

Future-ready organizations view partners as extensions of themselves. These relationships feature porous boundaries and high levels of trust and mutual dependence to share value and let each partner focus on what it does best. For example, Amazon encouraged the formation of new delivery start-ups by launching a last-mile delivery program that offered top-performing employees seed money, leased vans, and training. While these delivery-system partners are self-employed, Amazon views them as both an extension of their logistics ecosystem and a new form of homegrown partnership. 13 For more, see Sarah Perez, “Amazon offers employees $10K and 3 months’ pay to start their own delivery businesses,” Tech Crunch, May 13, 2019, techcrunch.com.

Partnerships should be cultivated for the long term to better develop the antifragility that helps partners weather shocks. For example, Johnson & Johnson’s JLABS provides support and resources on compliance, markets, science, and other topics to promising start-ups. By doing so, the company supports and develops relationships with entrepreneurs on the “fragile front lines of innovation.” 14 For more, see Amirah Al Idrus, “J&J, BARDA pick 7 startups to back in fight against COVID-19—and beyond,” FierceBiotech, August 27, 2020, fiercebiotech.com. Instead of transactional, win–lose relationships, models such as this one embrace partnerships motivated by shared success.

Imperative 8: Build data-rich tech platforms

Future-proof companies take data seriously. For them, data isn’t simply about reporting what is happening in the business or answering a business question. Data is the business.

The rise of Netflix is a case in point, as demonstrated in its transformation from a small, mail-in provider of DVDs to a multifaceted global platform, streaming service, and content creator. Netflix achieved its growth by leveraging its user data in the powerful algorithms that created its recommendation engine. 15 For more, see N. Venkat Venkatraman “Netflix: A case of transformation for the digital future,” Medium, April 16, 2017, medium.com. The company’s recommender system now accounts for 80 percent of time customers spend streaming Netflix content. 16 For more, see David Chong, “Deep dive into Netflix’s recommender system,” Towards Data Science, April 30, 2020, towardsdatascience.com. Future-ready companies understand that data can continually empower decisions and the value agenda in unexpected, yet promising, ways.

To make the most of data, leading organizations must tackle a complex set of tasks. They must create compelling approaches to data governance , redesign processes as modular applications, tap the benefits of scalable cloud-based technology, and support all this through variable-cost technology budgets that are reallocated dynamically. By seizing upon data’s ability to connect and scale, these companies will be able to develop new products, services, and even businesses in fast release-and-upgrade cycles—much as Tesla updates its products over the air several times a year. 17 For more, see Marci Houghlen, “How often does the Tesla Model 3 update itself?” MotorBiscuit, May 4, 2020, motorbiscuit.com.

Imperative 9: Accelerate learning as an organization

Capitalizing on new approaches to data requires modern DevOps skills, as well as other capabilities that will be new to most leaders. This underscores the urgency of the final organizational imperative, the one that helps make the others go: accelerate learning. Companies need to get learning right to fuel their talent engine and create an empowered workforce that’s fluent in the art of “fail fast, learn, repeat.” 18 The world needs it too. The calls for massive workforce reskilling have never been this palpable—according to the OECD, almost one-third of all jobs worldwide will be transformed by technology in the next decade. For more, see Saadia Zahidi, “We need a global reskilling revolution—here’s why,” World Economic Forum, January 22, 2020, weforum.org. High-performing companies promote a mindset of continuous learning that encourages and supports people to adapt and reinvent themselves to meet shifting needs.

Experiment-and-learn environments encourage accelerated personal growth and improvement for employees.

Getting to this level requires instilling a growth mindset, curiosity , and an openness to experimentation and failure. Microsoft CEO Satya Nadella describes it as hypothesis testing. “Instead of saying ‘I have an idea,’” Nadella observes, “what if you said, ‘I have a new hypothesis, let’s go test it, see if it’s valid, ask how quickly can we validate it.’ And if it’s not valid, move on to the next one.” 19 Krzysztof Majdan and Michal Wasowski, “We sat down with Microsoft’s CEO to discuss the past, present and future of the company,” Business Insider, April 20, 2017, businessinsider.com. This approach, and the company’s underlying push to shift its collective mindset from “know it all” to “learn it all,” is emblematic of a learning organization.

Experiment-and-learn environments encourage accelerated personal growth and improvement for employees. They can fuel beneficial innovation, as evidenced by Google’s famous “20 percent time” policy that encourages employees to work on their own ideas for Google 20 percent of the time (this approach contributed to the creation of Gmail and Google Maps, among others). 20 For more, see Bryan Adams, “How Google’s 20 percent rule can make you more productive and energetic,” Inc., December 28, 2016, inc.com. The real value in such programs is that they signal to the organization that learning, experimentation, and innovation are part of everyone’s day job, not something that gets done in a “skunkworks” or other specialized group.

Since traditional educational institutions alone cannot deliver the skills companies will need, organizations need to look inward. Rather than create monolithic centralized programs that people attend before returning to their day job, forward-looking companies will develop learning journeys that have a mix of core and individualized content, delivered when people need it and at requisite scale. 21 For example, see Aaron Pressman, “Can AT&T retrain 100,000 people?,” Fortune , March 13, 2017, fortune.com. And in keeping with the lessons learned during the pandemic, these programs must work in today’s virtual working environments .

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Into the future

For most organizations, the COVID-19 pandemic and its aftermath have upended life as we knew it. The resulting pain, grief, and economic dislocation will be felt long into the future. The first priority for leaders, therefore, is to lead with empathy and compassion as they revitalize, and reenergize, their exhausted teams and organizations.

As companies face up to an uncertain, postcrisis landscape, we urge them to recall Albert Einstein’s encouragement that “in the midst of every crisis, lies great opportunity.” As organizations move from a mindset of coping to one of competing , the best companies will seize the unique unfreezing opportunity before them to imagine—and create—new systems and modes of organization that are more flexible, integrated, resilient, and ultimately, more human. These organizations will view themselves as interconnected systems that seek to constantly experiment, fail, learn, grow—and start the process anew when the world invariably changes again.

Aaron De Smet is a senior partner in McKinsey’s New Jersey office, Chris Gagnon is a senior partner in the Austin office, and Elizabeth Mygatt is an associate partner in the Boston office.

The authors wish to thank Selin Neseliler, Richard Steele, and Jessica Zehren for their contributions to this article.

This article was edited by Tom Fleming, deputy editor in chief in the Chicago office.

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