A Tale of Two (Sample) Cities: Paradigm Shifts in the Sample Industry

May 7, 2019 Author: Mario X. Carrasco

The novel, A Tale of Two Cities, has one of the most recognizable opening sentences of all time: “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness…”

It depicts the drama of the French Revolution within two cities, London and Paris. And of course, as a market researcher, it made me think of what is happening in the sample industry. Thankfully the revolution happening in sample isn’t a bloody one (although for some businesses it may feel like it). But, the dichotomy in thought and innovation happening within the sample industry is polarizing, and we’re starting to see two distinct paradigms unfold (I won’t comment on which represents wisdom or foolishness).

Paradigm One: Democratization of Sample

On the one end, we have the rapid democratization of sample buying via programmatic sample driven by companies such as Lucid, Cint, and PureSpectrum. This paradigm is driven by innovation in technology to make the purchase and distribution of sample and ultimately, insights, easily accessible. APIs are an integral part of this as companies’ marketing technologies can now integrate seamlessly with these tools. The vision of this paradigm is insights on demand without a middle man.

Paradigm Two: Consolidation of Panel Companies

On the other end, we have further consolidation of panel companies exemplified by Dynata, Ipsos, and GfK. Through the acquisition of smaller panels, these companies have focused on sample quality and panel size, consolidating many smaller panels into a one-stop shop for all your sample needs. These companies also have programmatic features and the ability to set up and deploy sample without the hassle of emails, but the main difference between this model and the other model is that it is a closed loop system. You cannot tap into multiple panels at one time. Instead, you are tapping into multiple panels that are part of one entity. This theoretically increases the sample quality due to the overarching company implementing stricter criteria and cohesiveness to the sample composition thus improving sample quality.

Why the shift?

So why is the sample industry going in two such different, competing directions? The answer may be found in looking at other industries. In the hospitality industry, for example, we see Airbnb continue to grow in popularity and at times even partnering with traditional hotels. On the other end, we see traditional hotels continue to consolidate and invest more in creating differentiating experiences (such as wellness) for their guests.

In the media and entertainment industry, streaming giants Netflix and Hulu continue to crank out high volume content to attract subscribers. In response, the major studios are investing bigger budgets for their blockbusters, and it seems to be paying off if Avengers is any indication.

The trend of disruptive companies in a market being met with resistance by the incumbents is no different in the sample industry. There is still a tendency to double down on the business model that used to work, even though it's clear that the model has term limits. However, while traditional panel companies are doubling down on their closed loop systems, they are also integrating pieces of the innovative technologies such as DIY and programmatic into their product offerings, just as hotels are integrating aspects of home sharing services and studios are integrating streaming offerings into their offerings.

The ends of the sample spectrum are benefiting each other, holding each other accountable through competitive forces on things important to our industry such as innovation, data quality, and customer service. While the prevailing narrative in the industry may point to a winner or loser, the fact is that both will likely continue to innovate in their respective paradigms, continuing to push us all into an “age of wisdom” rather than an “age of foolishness.”