Market research is all about predicting the future... or attempting to at least. But, as human habits and patterns become more irrational, as some suggest, predicting the future based on the past is becoming increasingly difficult, yet ever-more important.
It's simply no longer logical to take the historical data found in market research and assume that it will predict the future. Yet, many businesses use it as such, and, maybe in the past, that was okay. Now, human behavior must be considered right alongside market research in an entirely new way.
Predicting human behavior, however, can seem near impossible, and, to a large extent, it probably is. But, through a comprehensive combination of thick data and market research, we are closer than ever.
Even as business intelligence becomes more critical, the "human frailties" that make us prone to irrationality fight the practicality of research altogether. In a blog post written for GreenBook Blog, author Neal Cole, a 20-year veteran in the market research industry, describes how increased irrationality in human behavior and a reliance on historical data are affecting businesses' ability to make sound decisions:
Behavioral science suggests that as people gain experience and knowledge in their area of expertise they have a tendency to become overconfident and complacent about their ability to understand the past and predict the future. Our brains assume that we are living in a simpler, more predictable world than is really the case.
So, if knowledge and expertise can flaw our judgment by making us overconfident, why do we need market research and insights at all?
Although knowledge can cloud our judgment, without it our perceptions may never change. Market research, as Cole suggests, is all about broadening our horizons by allowing us to see things in a new light, revealing new opportunities that our "expert," often narrow, perception might otherwise overlook.
So, maybe, the key to market research predicting the future becomes less about assuming the past will become the future and more about changing how we view the past to better predict the possibilities of the future. Because, the fact of the matter is market research brings about innovation and helps support well-founded decisions. It may not hand you the secrets of the future like a crystal ball, but, it certainly goes a long way in helping you take past patterns to see new opportunities and avoid potential risks. As the great Mark Twain said, "History doesn't repeat itself, but it does rhyme."
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Thanks for reading!