The 2006 Confirmit Annual MR Software Survey … · Longdene House, Hedgehog Lane, Haslemere, Surrey GU27 2PH, UK Tel. +44 (0)20 3291 2931 Fax +44 (0)20 3291 2935 Web research & inquiry

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Tel. +44 (0)20 3291 2931Fax +44 (0)20 3291 2935

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research & inquiry

The 2006 ConfirmitAnnual MR SoftwareSurvey

Key Findings

Sponsored by FIRM

Research by meaning ltd

Researchers: Sheila Wilson and Tim Macer

Fieldwork: July 2006

2006 Confirmit MR Software Survey | 2 of 19

© 2006 FIRM a/s & meaning ltd

Contents

The headlines 3

1 Current and predicted activity 4

1.1 Quantitative v. qualitative......................................................................................4

1.2 Research modes cited ............................................................................................4

1.3 Research mode by volume ....................................................................................5

1.4 Fieldwork outsourced ............................................................................................6

1.5 Predicted changes in interviewing mode............................................................7

2 Software usage and attitudes 8

2.1 Packaged software in use.......................................................................................8

2.2 Changing software in the next one to two years.............................................9

2.3 Reasons for considering a change in software ..................................................9

3 Mixed Mode Research 11

3.1 Level of mixed mode or multimode capabilities required........................... 11

3.2 Reasons for mixed mode research................................................................... 11

4 Sample Sources 12

4.1 Which sources of online sample do you use? ................................................ 12

4.2 Sample sources – by volume.............................................................................. 14

4.3 Sample source – predicted changes by volume ............................................. 14

5 Panel management 16

5.1 Software tools used for panel management ................................................... 16

5.2 Trends in the use of specialist panel software ............................................... 16

6 Tables and reports 17

6.1 Distribution methods .......................................................................................... 17

6.2 How important are printed cross tabs? .......................................................... 17

7 Analysis of sample 18

7.1 Key demographics................................................................................................ 18

7.2 Seniority and area of responsibility .................................................................. 18

The results of this survey are Copyright © by FIRM a/s and meaning ltd. They may not be reproducedwithout permission. Any citations must refer to the title of the survey in full and the name of theresearchers. Applications for citations and publication must be made in writing to meaning ltd at the

address shown on the cover.



The headlines

Web is KingNearly all market research agencies offering quantitative research include onlineresearch as part of their offering. It seems that the number of organisations offeringthis service is only likely to increase very slowly in future years. However, the totalvolume of Web research has room for further growth.

Opportunities in mixed mode?A substantial minority of companies offer mixed mode research as part of theiroffering, but it is currently only a very small part of revenues.By far the most common combination for mixed mode is Web and CATI. Contrary tocommon opinion, the main reasons for conducting mixed mode are not to cutfieldwork costs (although this is also important) but to increase response rates andimprove respondent satisfaction – both factors closely aligned with combating theacknowledged decline in response rates.Though volumes remain small, the opportunities that mixed mode offers, and the factthat many companies are interested enough to have added it to their portfoliossuggests that this is going to become a far larger revenue stream in the future.

An unclear future for other data collection methodsWhat is to become of the other data collection methods is less certain. Smallcompanies see a growth in CATI, CAPI and Web, whereas medium and largecompanies only see a growth in the Web.Revenues for CAPI are very small compared to the number of companies offering theservice – which suggests a problem or that this mode has reached a plateau.

Opportunities in panel managementNearly half of the companies in the study have developed their own software forpanel management and a sizeable minority are using Microsoft Access or Excel.However, this is less than in previous years, showing there is a trend towards buyingpackaged panel management solutions rather than creating custom tools.

Major changes on the horizonAround a quarter of the industry is planning to change their software over the nexttwo years and another quarter is undecided. The big companies appear to be morelikely to switch software – 39% plan to change and a further 18% are undecided. Thatis, less than a half of the big companies are planning not to change their software.There are sharp differences between the reasons cited by larger and smaller researchcompanies.

Desperately seeking panel dataIn our previous two studies, respondents expected to make less use of client suppliedsample, but this has not been the case. The utilization of client sample has actuallyincreased, this year, showing a widening gulf between hopes and experience.Previously, it also seemed that access panels were gaining in popularity and theresults this year confirm the ascendancy of the rented panel.

Reporting and analysis – more of the sameAs before, PowerPoint is easily the most favoured distribution tool, but our analysisshows that bulk cross-tab reporting, though now only used in a minority of projects,is far from the brink of becoming obsolete.



1 Current and predicted activity

1.1 Quantitative v. qualitative

Research activities

73%

21%

7%

Quantitative research

Qualitative research

Other research

About three quarters of research revenues are quantitative The other quarter is divided into qualitative research and other research. The

former is three times the size of the latter

1.2 Research modes citedResearch modes cited

70%65% 65%

90%

30%23%

29%

54%

87%82%

92%95%

62%65%

53%

64%

41%38%

45%49%

0 %

20 %

40 %

60 %

80 %

100 %

Total Small co's Medium Co's Large co's

CATI CAPI Web Paper Miixed mode

The Web is by far the most widespread mode of research, with nearly allrespondents (87%) saying that their companies use this type of software. Sincethis figure is approximately the same as last year, this seems to indicate that themarket has reached maturity – although the volume of Web research is predictedto grow (see section 1.6), the number of organisations conducting online researchhas reached a plateau.

The number of companies using CATI has grown slightly since 2005, with 70% ofcompanies using it this year, as opposed to 65% last year.

Paper research is conducted by almost two thirds of all companies who took partin the survey.



Mixed mode research is now conducted by a very sizeable minority of companies(41%). Nearly all of this a combination of Web and CATI.

Company size has a strong effect on the likelihood of CAPI and CATI softwareusage – the larger the company, the more likely it is that it will use these types ofsoftware. Over half the large companies conduct CAPI surveys, whereas less thana quarter of small companies do so; nearly all (90%) of large companies offerCATI, whereas just two-thirds of small companies do this.

SMS does not seem to have taken off, with a reduction in the proportion ofcompanies offering this service – 6% in 2005, down to 3% in 2006.

Total Small co's Medium Large co's

2006

CATI 70% 65% 65% 90%

CAPI 30% 23% 29% 54%

Web 87% 82% 92% 95%

Paper 62% 65% 53% 64%

Mixed mode 41% 38% 45% 49%

CATI and web 36% 32% 37% 46%

Any other mixed 13% 14% 12% 10%

SMS 3% 1% 6% 5%

2005

CATI 65 % 45 % 70 % 77 %

CAPI 25 % 11 % 24 % 41 %

Web surveys 85 % 75 % 85 % 95 %

SMS surveys 6 % 4 % 5 % 9 %

Note: the categories in this question were changed in 2006. Only comparable categories from 2005are shown.

1.3 Research mode by volumeResearch modes by volume

27% 27%

19%

36%

5% 4% 4%

12%

40%36%

55%

35%

21%

27%

14%11%

7% 6% 6% 7%

0 %

20 %

40 %

60 %

Total Small co's Medium Co's Large co's

CATI CAPI Web Paper Miixed mode

Looking at all companies in this survey as a whole, two-fifths of revenue fromquantitative research is from Web studies. This is by far the biggest source ofrevenue.



Web, CATI and paper together are the source of most (88%) of the revenues fromquantitative work.

Looking at the entire sample, mixed mode research represents 7% of revenues.This figure is fairly consistent for all company sizes. It seems a lower thanexpected proportion of revenues given that over two-fifths of companies areconducting mixed mode research. (see section 1.2).

Similarly CAPI provides a low proportion of the income (5%) compared with thenumber of companies who use it (30%).

Large companies earn just over a third of their revenue from Web, and about thesame amount for CATI. Paper and CAPI are of roughly equal importance andtogether produce nearly a quarter of revenues.

Small companies obtain just over a third of their revenues from the Web and justover a quarter from CATI and another quarter from paper. Paper gives a greaterproportion of the revenue in smaller companies than larger companies.

Medium-sized companies are particularly dependent on online research, as overhalf of their revenue comes from this source. CATI and paper together make justover a third.

For clarity, the following table shows this data and extra information on mixed mode, inpercentage format:

Total Small co's Medium Large co's

CATI 27% 27% 19% 36%CAPI 5% 4% 4% 12%Web 40% 36% 55% 35%Paper 21% 27% 14% 11%Mixed mode 7% 6% 6% 7%

CATI & web 4% 4% 3% 6%All others 2% 3% 3% 2%

SMS 0.5% 0.1% 1.8% 0.2%

1.4 Fieldwork outsourcedThe question asked was:“Fieldwork/consultancy - Looking at yourrevenues, approximately what percentage ofthem are from end-users of market research,and what percentage are from work done forother research companies?” Market research companies, in this study

derive approximately a third to a quarter oftheir revenues from fieldwork outsourcedto other companies. This is particularly thecase for large companies.

Conducting fieldwork or tabulations forother companies is a far less importantrevenue source – 5% overall.

Outsourcing

27%

5%

68%

Fieldwork outsourced to other agenciesField &/or tab for other agenciesWork commissioned and handled internally



1.5 Predicted changes in interviewing mode

We asked respondents to predict changes over the next three years using a 4-pointscale, where 2 represents major growth; 1 modest growth; 0 no change and 1 any decline.Here, we present the difference between the predicted volumes and the currentestimated volumes, to emphasise the extent of the change anticipated. Web stands out, as the major growth area over the next three years. Small companies see growth in CATI, CAPI and Web, whereas medium and large

companies only see growth in the Web.



2 Software usage and attitudes

2.1 Packaged software in usePackaged or in house software: all

91%88% 86%

94%

14%

22% 21%16%

10%16% 16%

10%

0 %

20 %

40 %

60 %

80 %

100 %

CATI CAPI Web Analysis

Any packaged in use Any own developed in use Own-developed only

Although most companies use only packaged software, a notable minority usetheir own bespoke software. Some who use customised software, also usepackaged software, but the majority use one type or the other. Given the highcost of software development, this suggests that a proportion of the industry isdissatisfied with the software tools in the marketplace.

Over one fifth of all CAPI and Web users have in-house tools, and most of theseuse only the customised software.

A slightly lower proportion deploy in-house CATI and analysis technology. Tenper cent of the respondents reported that their companies use only their bespokeCATI and analysis software.

Looking at the Web users, medium-sized companies are particularly likely todevelop their own software, with well over a quarter (29%) of medium-sizedcompanies creating their own software.

For analysis and reporting, large companies stand out, with over a quarter developingtheir own tools, but only half of them making exclusive use of the in-house software.



2.2 Changing software in the next one to two years

We asked companies whether they had plans to change the software they were usingfor MR in the next one to two years. About a quarter of companies do plan to change their software and another

quarter is not sure. The proportions are much the same all company sizes, with one notable

exception: A higher proportion of large companies plan to change their software in the next

one to two years. About half of all companies do not plan to change their software over the next one

to two years.

2.3 Reasons for considering a change in softwareThose with plans to change were asked to state the reason from a list of pre-definedoptions.



The most often cited reason for changing software is to seek ‘more flexibility,more capabilities or better functionality.’ Nearly two thirds of respondents chosethis.

Over half cite achieving efficiency improvements and a more modern platform asreasons.

Nearly half of the respondents who are considering a change are planning tochange in order to consolidate all activities on a single integrated platform.

As shown in the chart, there are a diverse range of other reasons for changingsoftware, all of which are important factors.

2.3.1 Reasons for change by company size

The company size split is as follows:

Total Small Medium Large

Sample size 55 26 14 15

Seeking more flexibility, more capabilities or better functionality 62% 54% 79% 60%Move to a more modern platform 53% 42% 43% 80%To achieve efficiency improvements through increased automation 53% 27% 79% 73%Consolidate all activities on a single integrated platform 47% 35% 36% 80%Dissatisfaction or concerns with the existing software 40% 35% 36% 53%Seeking something that is easier to use 33% 15% 50% 47%To reduce software or IT costs 33% 27% 29% 47%Concerns with the existing supplier 20% 12% 21% 33%Company policy reasons 16% 4% 0% 53%

Note: Sample sizes generally are small for this question so the results should be considered indicative ratherthan definitive.

For small companies, the most important reasons were Seeking more flexibility,more capabilities or better functionality (54%) and Move to a more modernplatform (42%)

For medium sized companies, the most important reasons were Seeking moreflexibility, more capabilities or better functionality (79%) and Efficiencyimprovements through increased automation (79%)

For large companies, the most important reasons were Move to a more modernplatform and Consolidate all activities on a single integrated platform (both 80%)and efficiency improvements through increased automation (73%)



3 Mixed Mode Research

3.1 Level of mixed mode or multimode capabilities required

2006 Americas Europe Asia/PacSmallco's Medium

Largeco's 2005

Commonauthoring 38% 32% 44% 36% 42% 38% 26% 35%

Mixed modes inparallel 40% 52% 24% 50% 37% 50% 36% 40%

Multi-mode withswitching 23% 16% 32% 14% 21% 13% 39% 25%

The results were similar to those of 2005 – just under a quarter of respondentsworldwide require multimode with switching; the rest of the sample is splitalmost exactly in half, with their requirements for either mixed modes in parallelor common authoring.

Europe has a far greater need for common authoring and switching than the restof the world.

There is a substantial amount of variation by company size, but with no obviouspattern.

3.2 Reasons for mixed mode research

The reasons for mixed mode research are many, the main ones being to improveresponse rates, be more respondent friendly, to meet the client’s requirement for amixed mode and to reduce fieldwork costs.

Sample sizes are too small to allow detailed analysis by the Pacific Rim region. The results were, in any case, broadly similar across the regions and company

sizes.



4 Sample Sources

4.1 Which sources of online sample do you use?

4.1.1 Current yearSample source trends – utilization, 2006

33%

53%56%

82%

60%66%

48%44%

50%

88%

78% 75%

0 %

20 %

40 %

60 %

80 %

100 %

Americas Europe Asia/Pac

Own panels 3rd party/Access panelsSpecialist sample providers Sample provided by client

The most frequently used sources of panel data are access panels and thoseprovided by the client – this is particularly the case in North America where thevast majority of companies use these types of panels.

Specialist sample providers are used by nearly half of all companies in all regions. A third of companies in North America, but about half in Europe and Asia Pacific

have their own panels.



4.1.2 Online sample sources – utilization trends 2004-2006

In our previous two studies, respondents expected to make less use of clientsupplied sample, but this has not been the case. The utilization of client samplehas actually increased – it was 75% and 73% in 2004 and 2005 respectively, and82% in 2006.

In our last two studies, it also appeared that access panels were gaining inpopularity and that definitely seems to be the case. In 2005, 57% used accesspanels, whereas 70% use access panels in 2006.

In 2005, our respondents predicted a modest growth in the use of own panels, butthis has not been the case – it was just under 45% then and still is now.

There is particular growth in the use of access panels, although there has also beenan increase in sample provided by clients.

Own panels and specialist sample providers have remained static.



4.2 Sample sources – by volumeFor the first time, in 2006, we asked respondents not just to tell us which sources theyused, but also what the actual volumes were for each mode (in terms of revenue).

Having already discovered that research agencies make most frequent use ofaccess panels or their clients’ sample, it is not too surprising to find that these twosources provide the greatest volume of sample – nearly one third each.

Research companies’ own panels account for nearly a quarter of all sample. Specialist sample providers supply only a minority (11%) of the total sample

volume. The situation varies significantly around the world. In Europe a third of the total sample volume is provided by research agencies’

own panels, and this is more than double the figure for North America. In Europeagencies’ own panels and client sample are equal in importance, each providing athird of the sample volume.

In North America and Asia Pacific, access panels are clearly playing a far moreimportant role than in Europe – in North America they provide over two fifths ofthe sample and in Asia Pacific, nearly a third.

In Asia Pacific access panels, client sample and agencies’ own sample are all aboutequal in the volume they provide.

4.3 Sample source – predicted changes by volumeWe asked companies “What would you predict the proportions of your onlinesamples coming from each of these sources will be in two years' time?” as apercentage: the exact counterpart of the previous question on current use.In presenting the data, below, we have subtracted current use from future use toemphasise the anticipated shifts in volume.



Sample source predicted changes - by volume

5%5%

8%

0%-1%

-4%

-1%

6%

1%

3%

2% -

2%

-4%

-2%

-3%

-7%

1% - 1% -2% -

0%

-10 %

-5 %

0 %

5 %

10 %

Total Americas Europe Asia/Pac

Own panels Third party/access panels Specialist sample providers

Sample ptovided by client Others

In general, the respondents to the survey predicted that research agencies’ ownpanels would grow their volume the most over the next two years. They alsoexpected there to be a small growth in the sample provided by specialists.

Companies continue to estimate that utilisation of client sample will fall, eventhough this prediction has been repeated in all prior surveys, and found not to behappening.

The general picture conceals considerable variation in the regional predictions:there is no global consensus on the future trends in sample sourcing.

In Asia Pacific, a swing towards access panels and away from client sample ispredicted.



5 Panel management

5.1 Software tools used for panel managementSoftware used for panel management

18%

45%

28%

9%Microsoft Access or Excel

Own-developed software

Tools built in to web surveysoftware

Specialist panel managementsoftware

Off-the-shelf panel management software is clearly still in its infancy, with lessthan 10% of respondents reporting that they use it.

Nearly half of respondents reporting using their own in-house software for panelmanagement.

Just over a quarter are using tools built into web survey software. A sizeable minority are using Microsoft Access or Excel.

5.2 Trends in the use of specialist panel software

2004

18%

82%

Packaged solutionDeveloped own

2005

28%

72%

2006

37%

63%

A clear trend has emerged away from using in-house solutions and towards using thepanel management capabilities in software provided by software developers. This isseen very clearly in the above pie charts, where the segment for packaged solutionshas doubled since 2004.



6 Tables and reports

6.1 Distribution methodsWhat percentage of projects currently involve the following deliverables ordistribution methods to the client?

Distribution modes, by number of projects

48%

30%27%

23%20%

11%

0 %

20 %

40 %

60 %

PowerPoint Word AcrobatPDF

Printed tabs Onlinestatic

reports

Interactiveanalysis

As in 2005, PowerPoint slides continue to be the outright most popular deliverable,Word and Acrobat PDF files, as well as printed tabulations are still very much indemand. By volume, printed tables are very much in the minority now, at 23%

6.2 How important are printed cross tabs?

2006

55%33%

10% 2%

Essential Moderately important

Relatively unimportant Not something future tools should provide

2004

59%27%

13% 1%

2005

55%27%

14%4%

It is clearly too soon to forecast the demise of the printed reports – with mostrespondents considering them essential or moderately important. This figure hasactually slightly increased since 2005.

Though cross-tabs are still considered important, the previous question hasshown that cross-tabs is now a minority delivery method.



7 Analysis of sample

7.1 Key demographicsThe two principal demographics which we are using to profile the results arecompany size and global region. We have used these to identify differencesthroughout this report, and we actively sampled using these demographics duringthe fieldwork in order to achieved balance.While North America and Europe are well represented in the sample in relation to thenumber of research companies operating in those markets, the Pacific Rim sample fellslightly short of our sample frame target. We therefore advise caution in interpretingsome of the less emphatic differences in this region.Company size is reasonably well distributed across the three global regions. Thisyear, we decided to raise the threshold for small companies from $1million to $1.5million to take account of increased revenues, and also to ensure that the group ofmedium companies was balanced with a range of companies of differing sizes.

Total Small Medium Large

Total 213 100% 125 100% 49 100% 39 100%N America 89 42% 45 36% 29 59% 15 39%Europe 90 42% 58 46% 13 27% 19 49%Pacific Rim 34 16% 22 18% 7 14% 5 13%

‘Small’ is intended to reveal the different needs of companies unlikely to havespecialist in-house technical staff. The smaller proportion of companies in the over$25m category is only a reflection of the ‘pyramid’ that exists of company size, with asmaller number of large companies globally.

7.2 Seniority and area of responsibilityThe objective was to conduct the survey among opinion formers, which wasadequately achieved, as can be seen below. 82% of the sample was either at boardlevel or were primary decision makers for software and technology issues.

Level of responsibility

33%

49%

18%BoardMember

PrimarydecisionmakerDecisioninfluencer

Area of responsibility

47%

8%9%

36%

Research

IT

Dataprocessing

Business orOperational

We were also concerned to ensure that the survey was biased by an overlytechnocentric sample. With 17% of the sample ‘technical’; 47% with researchresponsibilities and 36% business and operational responsibilities, we consider thesample to be balanced by both level and area of responsibility.Overall, we are confident that the sample, as completed, forms a representativecross–section of the professional market research community and is not undulyinfluenced by any particular subgroup.



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Q1. Have you found the results of this surveyinteresting or useful?

Q2. Do you fall within the categories of the peopleinterviewed for this survey?

Q3. Would you be willing to participate in similarresearch in the future?

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Documents

The 2006 Confirmit Annual MR Software Survey … · Longdene House, Hedgehog Lane, Haslemere, Surrey GU27 2PH, UK Tel. +44 (0)20 3291 2931 Fax +44 (0)20 3291 2935 Web research & inquiry