Six Market Research Budget Mistakes You’re Probably Making
Budgeting for market research is a challenge. From estimating how much you need to justifying the value of vastly different approaches and price points, it seems that everyone is struggling with this process.
But there’s struggling and then there’s struggling. There are six planning types that can sink budgeting for your organization. Take a look and see how many of these you recognize in your process.
Six Bad Budgets
The First Come First Served Budget – This approach is similar to the proverb that states “the loudest mouth gets fed first”. The teams most aware of the process benefit, and the teams that don’t, lose out. It’s not aligned with need or strategic importance, but with propensity to use.
The Process Driven Budget – This is a process-heavy approach with a lot of steps to get access to budget and finances for a particular project. Usually driven by procurement or finance, it enforces practices that don’t always make sense for research.
The Peter and Paul Budget – This approach entails a ton of shuffling around in terms of where the money is coming from and what department is paying for it. This style creates limited visibility around who is using research, which teams need it, and who pays for it.
The ‘Champagne Taste on a Beer Budget’ Budget – Here you have high expectations for output, but laughable resources to deliver against these expectations. One symptom: A lot of research projects get executed that aren’t adequately funded, so the organization begins to doubt the value of research.
The Lead Foot Budget – Early access and early use win. This rewards the team that burns through resources most quickly without any kind of discipline around where that budget is being used.
The Prehistoric Budget – The allocation has been the same for years and is used as the basis for planning future budgets. Here there’s no accounting for large initiatives, new product launches, or expansions, all of which come with research heavy needs.
Research Budgeting Best Practices
Don’t panic, there is a better way. Here are some tips to help you make sure that you have a budget aligned with your goals.
- Align research budgets and needs with organizational KPIs to ensure visibility and adequate funding
- Create categories for irregular but important needs like new product launches or customer experience issues
- Simplify the process of getting budget by proposing a unified standard across the organization
- Highlight groups using research that have accomplished great things as an example to everyone else, thereby promoting usage of research
- Position research as a revenue generator not a cost center. If it’s handled well and used appropriately, research can help your organization generate more revenue.
These are just a few tidbits. To learn more about how to solve your research budget problems, access our on-demand webinar.