History of Market Research I

history of market research, market research history

To gain a deeper understanding of the history of market research and foster an appreciation of where our theories and practices originate, it is important to understand its origins. I did not attend any history of market research courses while in university and many of the individuals I have come to know in market research did not come to the field with a business degree or a background in the subject. Perhaps you have a good understanding of the history of market research or maybe, like me, you are trying to gain more information. In either case, I hope this post can provide an overview of even a few fun facts.

Most sources cite the first “true instance” of market research as occurring in 1920’s America; however, the practice of taking the pulse of the market to inform selling decisions is far older and more widespread than one may think. There is evidence of branding and promotion among the early Mesopotamians, Greeks, Chinese, Indians, and Romans in the form of makers marks, trademarks, and brand slogans. In India as far back as 323BCE, vendors were sending interviewers out to read the markets. In the 15th century, merchant families communicated market trends through their trade networks hoping to beat competitors to the market. Their market research methods were not as formalized or structured as today, but they all contributed to the history of market research as we know it today.


The Start of Market Research:

The forebearers of what we recognize as modern market research in the US showed up as early as the 1824 election. During this election, researchers in Delaware and North Carolina canvased political meetings to gain a “sense of the people” and determine who might win. This “sense of the people” is one of the first examples of a straw poll.

In the 19th century, advertising as we know it was hitting its stride with an increasingly global presence and a focus on consumer goods. At the beginning of the 1900s, ad agencies became the focal point for ad planning and creating advertisements became a profession.

With the increased focus on advertising, academics and agencies alike began to discuss what drove people to be swayed by a particular ad. In 1900, an experimental psychologist at the University of Minnesota named Harlow Gale mailed questionnaires to identify attitudes toward ads, how unconscious attitudes were formed, and what visual or written cues persuaded people. His research resulted in methods and concepts which are still used in the study of advertising today.


Starch in the 1920s:

When asked about the beginning of market research, the person most think of is Daniel Starch, an American psychologist. Initially, Starch was an experimental psychologist focused on educational psychology, he later went on to teach at Harvard in the School of Business Administration. During this time, he developed a readership scoring method published in 1923 in the Principles of Advertising.

In the same year, he formed ‘Daniel Starch and Staff,’ a business research company that exists today under the name ‘Roper-Starch.’ Starch and his team would approach people on the street, show them publications, and ask if they recognized or remembered any of the ads in them. The results enabled companies to compare the effectiveness of their ads with that of their rivals. This became known as the Starch Test, based on the theory that advertising had to be seen, read, believed, remembered and, most importantly, acted upon to be considered effective. This theory caught on and is considered to be the basis of market research in its current form.


Gallup Brings Polls to the Forefront:

In the 1930’s, a contemporary of Starch named George Gallup (of Gallup poll fame), started making advancements in polling using techniques such as aided recall research and going through publications with respondents’ piece by piece to determine what respondents had read and what they attended to.

His research initially focused on the newspaper, recognizing that traditional methods to determine readers’ preferences were not as accurate as previously thought. He found that small samples of the population could often predict more general attitudes; continuing the research of the straw poll during the 1824 election, Gallup turned his statistical method to understanding attitudes around the 1932 presidential election. His later work predicting the 1936 election bolstered the public trust in survey research and his polls began to change how we look at information and predict outcomes.


The History of Market Research Continues…

There are many more twist and turns in the market research story. We invite you to continue reading about this fascinating topic as we post more information about the history of market research.

Read Part II of the History of Market Research series by clicking here.

Elissa Cannonwood is a Senior Associate at Vivisum Partners. She has experience with both quantitative and qualitative research methods. Email Elissa at elissa.cannonwood@vivisumpartners.com