Or, what do you do with market research, anyway?

I'm starting with a qualified "No!" For the majority of companies the market forecasts, guesses at market share, and prognostications are not anything you should be using to create your business plans. If you are only using data from GartnerGroup, IDS, Forrester, Keypoint Intelligence / InfoTrends, IT Strategies, 451 Group, Aspire, or the army of independent market researchers as the basis for your plans, stop! 

That screenshot of a slide at a conference or off your screen during a webinar isn't going to help you. And, if you have a contract with one of these companies and you are in the regular distribution group for the complete reports and PowerPoint decks, this would be a good time to rethink your expectations and your understanding of how to use the data you receive. 

I want to be clear - these companies have very smart people, many with years of industry experience. They can be a valuable resource for bespoke projects and targeted research. This is what they do well. But if you are relying on them to guide your strategic plan with their forecasts, the time for that has passed (if it ever existed). There is a new army of independent, smaller providers with targeted knowledge that could be a better investment. Let's talk about why this is true. 

The data in those charts that come in the forecasts from the usual companies in our industry may purport to represent the total number of machines installed, the total market share of various software products, the total value of print revenues for a region, or a host of other data cuts. Most of the companies have a bespoke approach to gathering data and they add their own secret sauce to develop their talk track. Some run surveys to a house list, others use services that do phone calls on their behalf. In some cases, the approach is to do deep dives into economic data to determine the revenue flowing through parts of the industry. Some do all of this. But they all have historical data, they have all had staff changes over the years, and they all struggle to develop forecasts that are both accurate and acceptable to their clients. Remember that when you use the data you pick up in the wild at conferences and out of articles. Remember that, too, if you are a subscriber to these services. 

Building forecasts is hard work. And it's all risky. Let me give you an example. If you are looking at the printing industry in the United States and you look at NAICS Code 32311 - Commercial Printing except for Screen and Books, you can find some economic data. You can look at 323117 for Printing Books and pamphlets. Printing on grey goods is 313310, which is a part of Textile and fabric finishing mills. Publishers are in subsector 511, while manufacturing of printed stationery and labels is in subsector 322. Dig into these and you will find a lot of data. 

To make it more confusing, NAICS 323111 includes printers like RR Donnelley & Sons, the University of Massachusetts, Harland Clark, and EFI. It covers everything from printing atlases to business forms and also includes quick printing.

If you are trying to understand the transaction and regulatory printing markets it gets more interesting. Many of the worlds largest printers who have significant market share do not identify themselves as printers. They often identify themselves as payment processors or under another category associated with business processes. 

Market researchers dig into that data, their own data, and data they acquire from friendly clients to try to map the numbers to the companies they know and to develop models. The final result is that every market research company has their own numbers, their own models, and their own methodology for how they build their lists of segment leaders. We need to be very clear, there is an element in here that we don't like to talk about. If you are paying one of these companies for advice, guidance, projects, and market research, you are likely to appear in their list of leaders. Years ago when I owned a software company I was guaranteed by one of these companies that I would appear in their leader list as long as I paid them a four-figure amount every month to subscribe to their service. That might sound good, but it may not reflect the true positioning of every company as they would appear if the market was reviewed dispassionately. 

The point of laying out how these market forecasts are developed is to show why you may not need any of them. I'd suggest that no vendor and no printer requires market research that focuses on market share and similar numbers on a regular basis. You would do better to mine your own data, plot trends, talk to your sales teams and use that information to build your understanding. If you aren't confident in your numbers, hire a facilitator to help you develop a good baseline. It will be your most reliable indicator of where you are. 

I understand that there is comfort in data. If you can point to a chart from a reputable company and you can base projections for your projects on what someone else says the market configuration and opportunity might be, that takes some of the burden off of your shoulders. But the odds are just as good that those numbers are not accurate and might be giving you a false sense of security. That brings us back to the question - has the time has passed for relying on the numbers in the forecasts from large market research companies? Especially in a post-COVID-19 world? 

I believe it is. I believe that there is more value to be derived from the data already locked in customer databases, analysis of customer problem reports and requirements lists, and intimate interaction with industry experts who can help to identify gaps that will inform the next generation of products.