The divestment of a large part of GfK Customer Research to Ipsos means a cut in sales of one-fifth, 1000 expert employees and a far-reaching departure from traditional ad-hoc research. Anyone looking for solutions tailored to their company’s individual needs will no longer find a partner in GfK. How does this fit in with the formulated goal of greater customer proximity? And what does this mean for the entire market?
After planung&analyse had already identified a number of planned changes at GfK in advance – deep cuts in media research in Germany due to the shutdown of GfK Media & Communication Research, the farewell to the “Supercrunch by GfK” brand, which was only launched a year ago, and the cessation of car clinics – the sale of four research units to competitor Ipsos has now been announced.
What is the plan?
“We have decided to focus on the products, industries and countries where we are already strong and what we do best,” Kai Hummel, Vice President, Communications & Public Affairs, told planung&analyse.
Hummel refers to durable goods and technology as GfK’s core market. However, the Consumer Panel – as the 5th division of Customer Research – will be kept in any case. Nevertheless, there are apparently players in the market who can claim a much larger market position for research in the field of FMCG. Therefore, the decision was made to no longer consider FMCG as a core market.
GfK wants to move from being a very data- and fact-driven company to becoming a consultant. Customers should be advised on the conclusions to be drawn for their own company from the study results. GfK has so far been too cautious in this area, according to the results of the analysis.
Everything is supposed to work digitally
The vision: Using technology, the head of marketing, the CEO or the sales manager of a company should have all relevant questions answered with just one look on his smartphone or with just a few clicks on the PC. This is what GfK CEO Peter Feld means when he speaks of a “true technology-based data analysis company” and a “clear client-centered focus”.
How can this work?
It sounds as if the market researcher wants to play in a league that is currently occupied by management consultants such as Accenture or PwC, and at the same time create digital solutions that are also offered by companies such as SAP, IBM or Salesforce. This is, of course, a completely different, very challenging playground. In order to provide the planned consulting services, GfK must not only invest in digitization, but also in know-how, in people with completely different qualifications than previously represented in the company.
It is right not to leave the field so easily to the players mentioned, who are increasingly offering expertise. With market research expertise at the heart, better recommendations could be made than by management consultants who conduct a few surveys on the side and focus above all on their models and their approval.
The question also remains whether there is still enough data available for the data-driven, digitally processed and always-accessible insights after having separated from numerous research units. Not everything can be learned through panels and scalable studies or third party data.
What does GfK’s approach mean for the industry?
Almost every market researcher in Germany has a relationship with GfK, whether as a client, former employee or competitor. The industry observes the “construction work” in Nuremberg (GfK’s headquarters) with skepticism and great discomfort. Nobody shows malice or schadenfreude, all the people planung&analyse had contact with are worried. Many customers now have to deal with a new service provider. Some are angry too.
And the process that can now be observed is being seen as a warning signal for the entire industry. After all, the business model is similar for all players: using direct or implicit procedures to discover insights about consumers, which ultimately promise companies a greater return on investment.
GfK is pursuing a path many industry representatives dream of — closer to the client means, in this case, being closer to the decision-maker at the highest level in the company. A provider who screens information online recently reported at a conference that he tells the CEOs he meets with that it’s not quite scientific but it’s fast. “Then they listen to me.” Will it be necessary to say goodbye to core areas of market research in order to be successful?