Is the market research industry recession-proof?

2008 will, apparently, be a particularly good year for market research.

Whilst the financial industry is feeling the effects of the credit crunch, and technology vendors and marketing agencies are concerned about the impact of the economic downturn, market research will continue to blossom.

That's the optimistic view of fieldwork company Indiefield, which is convinced that market research represents a ‘recession-proof’ industry and will continue to be invested in.

“During a period of reduced spending and budgets being slashed, which industry experts are forecasting, knowing your market and customer is key to keeping your head above water,” says Tara Lyons, managing director at Indiefield. “It’s important to continue to allocate funds to researching the market, as this will allow companies to remain competitive.”

Certainly anecdotal evidence suggests that there is no slowdown in market research. Firms are gobbling up more data than ever before.

But I have one nagging doubt over the recession-proof qualities of market research.

I still question how much data collected by firms - often at no little expense - is actually going to good use. Are firms actually feeding this information into operations to improve processes? Is the data even reaching the departments that need it to take the requisite action?

And this is no longer going unnoticed.

Don Peppers recently stated his belief that little of the data being gathered by firms was being put to productive use. And Professor Robert Shaw has made no secret of his concerns.

"Directors, managing directors and marketing directors of most firms are stuck on a treadmill, fiddling with numbers, and they never have time to stand back and answer the question 'what do they all mean?'" he recently told me. "It is awful."

"Alongside that, companies are buying all of this customer data, but there has been a loud chorus of complaints from marketing people about how crap their market research departments are. Yet you have to ask the marketers - aren't you the ones that commissioned it? But the big complaint they come up with is that they don't get enough insight out of it."

He added: "We used to get a bucket load of data now it is like having a fire hose pointed at us. And they don’t know what to do with it."

If and when the recession really starts to bite, something may have to give. And it will be interesting to see whether firms decide to really get to grips with the data they have at their disposal and ensure that the collection of data is connected to processes that take advantage of the information gathered. Or whether they will wave the white flag, acknowledge that they're not getting enough value from the data and simply trim the market research budget.

And that will really put to the test just how recession-proof market research is...