Fraud will be the #1 concern across the research industry in 2024. As a foundational problem that brings the entire industry into question, it’s only right that the drive to tackle respondent fraud remains front and centre.
Respondent fraud rates are as high as 30-40% industry-wide, but it’s unlikely that we’ll see more companies put their names to exact numbers. And we expect to see more anecdotal examples like the one presented by P&G and PepsiCo in 2022, which brilliantly illustrated how fraudulent data could lead to serious commercial losses.
This year, we’ll see the impact of stricter verification measures that have been demanded – though it’s unlikely that they’ll have struck the optimum balance between research companies’ needs and respondents’ tolerance for hoop-jumping.
We'll also start to see the impact of firmer contractual obligations and greater financial penalties designed to stamp out the supply of fraudulent data. This could prove challenging for less well-funded research companies, and may result in some market consolidation.
Smart research companies will step back and consider anti-fraud measures at every stage of their processes, and will actively seek technology-driven solutions to support them.
CXOs and boards of client companies will be watching the research industry’s progress with interest. It’s a matter of integrity for us all to make significant strides, but failure to do so may also call the entire category into question.
In 2024 synthetic data quality will improve, which will lead to its increased acceptance amongst some research and client organisations. For some, synthetic data will become sufficient to inform their thinking for certain scenarios.
Even if the quality of synthetic data is unclear, the high levels of fraud in panels make it an ideal candidate for early adoption. Until fraud is solved for, the difference between fraudulent data and less-accurate synthetic data will become negligible, and the price and speed differential of synthetic data will enable it to steal a march on 'real' data.
One area where we expect to see early adoption is consumer insight tracking studies. With the recent growth of and investment in such studies, these teams have budget to make it work; and having been hit by respondent fraud issues, they’re actively looking for a solution. Add to this the connection between the study results, and brand teams’ KPIs and even remuneration, and there seems to be ample motivation to adopt synthetic data, even in with uncertain accuracy.
Wherever early adoption comes from, it will drive the rise of synthetic data vendors. Initially, speed and price will be key factors, as authenticity metrics will be devised, interrogated and revised in real time. We expect this to be a fiercely competitive space in 2024, particularly as a potential LLM data shortage could impact quality. Vendors who are quick out of the gate may burn out; those with a longer-term view will come to realise that the quality of what they provide will have a significant impact on the speed of mass adoption.
On the other end of the spectrum are research and client organisations who are firmly against synthetic data, and unlikely to adopt it until it’s almost ubiquitous. For this group, the current mindset is that there’s no substitute for real respondents; and they will double down on efforts to recruit, verify and retain authentic respondents.
Fraud rates and synthetic data's rise point to an uncomfortable truth: few people want to participate in research studies. And as an industry, we need to ask ourselves why.
Consumers will continue to be hit by economic uncertainties. Their fundamental motivation to participate in research studies will largely be fuelled by the promise of fast, easy money that can be spent anywhere, anytime.
But consumers’ experiences are generally poor: post-purchase surveys create feedback fatigue; and slow, clunky user experiences turn them off. Ultimately, consumers have zero loyalty to panels, and maintaining the status quo will make them leave in droves.
This year, some savvy researchers will finally apply the same rigor and principles that they use in their research to interrogate the respondent experience. They’ll unlock the key question: Why do so few people want to participate in research studies? They’ll invest in providing best-in-class digital experiences that match up with what consumers expect in their daily lives. They’ll create a new best practice that will see recruitment and retention rates soar.
Technology has always moved faster than the legislative machines, despite the latter's best efforts to keep up. This isn’t going to change in 2024, particularly because of the rise of AI. However, some of what is proposed will give the research industry a clear steer on necessary operational changes that can be planned well before enactment.
In the UK, the Data Protection and Digital Information Bill is still in preliminary stages, but we’ll be watching its development with interest. A white paper from the governance of AI enquiry is due early next year, addressing issues such as the possibility of biased algorithms, a lack of transparency, and unexplained decision-making; we expect this to inform industry decision-making.
In the US, since the CCCP of 2018, consumer privacy laws have been created in roughly one state per year. But in 2023 the floodgates opened, with the enactment of seven new consumer privacy laws in Delaware, Indiana, Iowa, Montana, Oregon, Tennessee and Texas. We don’t expect that pace to continue into 2024, but we do anticipate that more than one state will follow suit.
In 2024, Ayda will build on the successes of the previous year, continuing to champion optimised incentive payout experiences for both research companies and respondents.
In the past we worked to streamline a broader range of back-office processes for research companies. In 2024 we will narrow our focus to the interlinked challenges of respondent incentivisation and fraud. We believe that this will meet a significant growing demand in the market. It will also enable Ayda to expand into serving the quantitative research market, as well as continuing to grow both in Europe and North America.