I was intrigued by a recent article on this topic because I have been researching business success and failure patterns for over 25 years, and theories play an important role in my work. In my quest to identify “Winning Moves” for business success, I gather information about companies, I look for patterns in the moves companies make, and I develop theories that explain business success and failure. I gather additional information to confirm or disconfirm the theories, and I examine how research done by others validates my findings, which it often does. I write, speak and consult to help others apply my theories.
I am using the term theory to describe my work because I look for patterns associated with law-like generalizations that can explain and predict, and this is consistent with some definitions of theory. The theories I develop apply not only to strategy and management, but also to how business uses knowledge and research.
So when I read “From Information to Theory” by Terry H. Grapentine and R. Kenneth Teas in the Spring 2012 issue of Market Research: A Magazine of Management and Applications, I was in strong agreement with their view that market researchers need to place greater emphasis upon the use of theories. Developing and applying theories has many benefits, such as better understanding of subject matter, improved prediction and, as a result of not reinventing the wheel, reduced costs or faster answers. In their article, Grapentine and Teas present advantages of using theories in market research.
As I see it, both within marketing as well as within a broader business context, theories can explain what works, under what types of conditions it works, and why it works. In addition, theories can guide the process of defining research objectives. Theories can provide a starting point that reflects what presumably is already known. Sometimes, we will want research to verify what is known. But, in many cases, market research can be designed to obtain what is still needed, rather than collecting data that essentially duplicates what theories already tell us. Thus, market research would benefit from making greater use of theories.
Grapentine and Teas propose that the American Marketing Association change its official definition of market research to reflect the importance of theories. In their proposed new definition, the primary purpose of market research is to develop and test theories. Since theories offer numerous benefits, I agree that market research should make greater use of them. So, updating the definition of market research to reflect the importance of theories is a positive step, since it can help encourage their use.
Theories facilitate the accumulation of knowledge and understanding. My research into business success patterns finds that knowledge and understanding play a key role in business success. So, as I see it, adding the phrase “knowledge and understanding to improve business decision making” to the definition of market research, as Grapentine and Teas propose, strengthens the definition. In the future, as changing technology makes information more widely available, knowledge and understanding will become increasingly important. All that information will have to be transformed into meaningful knowledge and understanding. And, theories help accomplish this.
In an effort to emphasize the value of theories, however, we should not ignore the other beneficial uses of market research that are embodied in the current definition. So, it is good that the proposed new definition of market research leaves many pieces of the old one intact. After all, market research has a great deal to offer in addition to theory development.
For example, some marketers want and need information to guide immediate decisions about specific products, specific markets, or specific situations that they are working on right now. They may lack time for figuring out how what they are working on might fit into various theories. True, there would often be advantages if they did fit their work into theory, but it may not always be practical to do so. And, even though the best information often comes when theories are incorporated into market research, sometimes it is beneficial to do research that supports immediate decisions and is not necessarily oriented toward theories.
Sometimes, experienced marketers may have a really good, practical understanding of a market, yet want research to provide a bit of additional information without getting involved with how the research fits into broader theories. They may want market research that describes or monitors the immediate situation, but does not necessarily explain or predict, as theories do. They may already be able to explain and predict based upon their prior experience, but may still want a little more information. In these kinds of situations, market research that may not be tied to theories does have benefits. And, these benefits should not be overly de-emphasized by defining theory as the primary purpose of market research.
This raises the question of whether the revised definition of market research should make theory development and testing the primary purpose of market research. Might it be better if the definition were merely altered to emphasize the tremendous value of theory, as well as the importance of knowledge and understanding, without going so far as to declare theory the primary purpose of market research?
In summary, I see great advantages in revising the definition of market research to focus more heavily upon on theory. But, the reworked definition should incorporate an increased emphasis upon theory without downplaying all other uses of market research. Recognizing that market research can be conducted for a variety of purposes, the definition needs the right blend of theory and non-theory. Yet, regardless of its official definition, market research can benefit from making better and greater use of theories.
