Market research challenges 1

MARKET RESEARCH CHALLENGES

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Market research challenges

The constant economic growth of Vietnam is attracting many businesses to invest in the

country. However, it is important to conduct a market research to identify the factors that

influence production patterns and the necessary micro and macroeconomic variables that would

determine an organization’s profitability. Companies should expect to undergo challenges that

may keep them from conducting effective market research and collecting the necessary data.

Some of the challenges include the cost of market research, communication, and technological

differences, and cultural differences. The latest World Bank records ranked Vietnam at 99 th

place in terms of the ease to do business; thus it is necessary for an organization to consider the

above challenges (Alon and Jones, 2013). This paper assesses some market research challenges

that organizations might experience while conducting a research in Vietnam, the possible risks

that they might pose on the decision-making process and provide possible solutions.

Pitfalls

Research cost variations

The cost of conducting market research in a developing country such as Vietnam is much

higher than in a developed country. The high cost is caused by the fact that these markets are

unpredictable; thus the researchers cannot just rely on the previous data. There is a high

possibility that the cost would be higher than the budget because of the new factors that the

organization might discover during the research process. Other factors that might lead to

increased cost include currency fluctuations, and cost of traveling (Alon and Jones, 2013). Since

the potential customers are scattered across the country, it is costly to identify the ideal location

to conduct face-to-face research. The main risk that research market cost holds is the probability

of getting false information from primary sources. This might make the organization to end up
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making the wrong decisions and loose on a chance to gain maximum returns from its investment

(Alon and Jones, 2013). Wrong decisions might also affect the quality of tools that the

organization selects when exploiting the new market.

To overcome the risks, an organization must ensure that it identifies the best market entry

strategy that it should use to ensure that it does not spend a lot of time and resources trying to

adjust to the new environment. The organization needs to develop market action plans to respond

to unexpected changes that might occur in the market. Some of the action plans include setting

aside backup funds for emerging challenges. The organization should also outsource a market

researcher with some level of experience in conducting successful market researches in Vietnam.

This is meant to reduce the risk of having incomplete market research that might reduce the

organization’s profitability. It is also important for the organization to avoid taking maker

decisions under uncertainty (Taylor, 2017). If there is no clear information about an issue, the

organization should explore the ideal sources of the necessary information before making any

decision. There is also a probability that the organization might fail to put into consideration all

the necessary requirements for a successful investment in Vietnam. Therefore, the organization

should conduct continuous market researches to observe the changes in the market and put into

consideration some factors that it might have failed to consider before.

Communication and technological differences

Market researchers may encounter difficulties when collecting data due to language

barriers and technological differences. They might not be able to conduct online research

because the majority of people in Vietnam are not used to participating in online researches.

Researching without technology would reduce the level of accuracy when analyzing the data and

a wrong conclusion might be drawn. Markets rely on technology to identify potential customers
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(Engelen, Engelen, and Samuel Craig, 2016). Therefore, without technology, an organization

would be required to do extra work in identifying potential customers physically. The major risk

posed by technological and language barriers is the high probability of making the wrong

assumptions. Inaccurate information leads to wrong assumptions about a market thus making the

organization to lose a significant amount of resources. The risk of the increased cost of research

might prevent an organization from doing comprehensive research in Vietnam; which would

prevent an organization from exploring all necessary options for increased probability of success

(Engelen, Engelen, and Samuel Craig, 2016). An organization that might be ready to invest in

the country despite the fact that it lacks the necessary information might face the risk of investing

in an unfamiliar market, which increases the probability of failure.

Market researchers need to utilize the traditional methodologies of collecting data while

still identifying the ideal ways to deploy the modern methodologies in Vietnam. For example,

market researchers can interact physically with the participants but use technology to record and

analyze the findings. For example, questionnaires can be administered using tablets instead of

physical papers. This method would increase accuracy and also save on time since data analysis

would be conducted while still collecting the information. The language barrier can be overcome

by hiring local individuals, who can speak in both Vietnamese and English, to interact with the

participants on their behalf. Market researchers should train the local individuals about the

information that they should collect from the participants and how to record it using different

technological tools. Vietnamese form of a questionnaire is notably longer, and this would impact

the time taken to conduct the research (Armstrong, 2015). This can be solved by involving locals

in the research since they would ensure that the participants have understood the questions before

responding. Communication barriers might prevent responders from providing correct and
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adequate responses; thus making the whole research process a waste of time. However, prior

research about how communication barriers can be overcome might increase the probability of

success during the research process.

Cultural differences

Vietnam has a distinct culture that can affect market researchers from other countries as

they try to identify the characteristics of the country’s market. The society has not yet

empowered women to perform different roles like men. The level of literacy is also lower

compared to western countries; thus some participants may experience difficulties when

answering questions that require a certain level of educational knowledge (Armstrong, 2015).

Cultural differences might also make the participants be biased during face-to-face interviews

since they will be inclined towards giving less detailed information to the market researchers that

they feel uncomfortable to interact with. Inadequate responses from research participants reduce

the probability of getting comprehensive information thus increasing the risk of making the

wrong decisions. There is also an increased risk of the business failing to adapt to the Vietnam

market, and the management practices might fail to implement the business culture in the

communities with conflicting social cultures (Armstrong, 2015). Cultural differences also

increase the risk of a misunderstanding about Vietnam’s legal and ethical issues. The women’s

position in society can lower the investing organization’s ability to achieve employee diversity.

Face-to-face interviews using hired local researches is the most viable option of

collecting data in Vietnam to prevent the research participants from withholding any

information. During the interviews, the researchers should avoid personal questions that might

affect the participants emotionally. Diversifying the market research team increases the

reliability of the information collected because the participants feel more comfortable to share
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the necessary information with the researchers. Therefore, market researchers should use women

to interview female participants. The researchers collecting data should also belong to a similar

social class with the research participants (Taylor, 2017). The Vietnam culture also calls for a

variety of research methods to identify the characteristics of the market from different angles.

For example, using both qualitative and quantitative research methods can enable the market

research to identify both the advantages and shortcomings of investing in the country and the

resistance that an organization might face from the country’s residents. The questionnaires,

interviews, and other data collection tools should be designed in such a way that they are

understandable to people from different cultures. For example, people with less educational

background should be asked to describe their environment in terms of business marketability,

instead of asking them complex questions such as to provide a simple analysis of their area’s

business market.

Conclusion

There are many challenges related to conducting market research in Vietnam. The most

common challenges are cultural differences, technological differences, and increased market

research cost. Market researchers need to set aside funds for the unexpected increase in cost and

develop a market action plan to ensure that it settles in the new environment quickly. The

organization seeking information should avoid making decisions under uncertainty, and the

market research should be a continuous process even after deciding to invest in the country. The

challenges caused by technological and language differences can be solved by identifying the

ideal technological infrastructure to use during the data collection process, and individuals with

experience in the local research market. Prior research about communication barriers can

increase the efficiency of the information collected. The best solutions to the problems caused by
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cultural differences opting for face-to-face interviews and primary data collection methods,

diversifying the market research team and using a variety of research methods.
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References

Alon, I. and Jones, V. (2013). The emerging economy of Vietnam: Pitfalls, problems and the

relevance of business education. [Online] Stratfor. Available at:

https://worldview.stratfor.com/article/emerging-economy-vietnam-pitfalls-problems-and-

relevance-business-education [Accessed 25 Mar. 2019].

Armstrong, T. (2015). Chapter 12 Case Study: Vietnam's Emerging Market Potential. [online]

prezi.com. Available at: https://prezi.com/js70bic-u5qq/chapter-12-case-studyvietnams-

emerging-market-potential/ [Accessed 25 Mar. 2019].

Engelen, A., Engelen, M. and Samuel Craig, C. (2016). Challenges in Conducting International

Market Research. Handbook of Market Research, pp.1-25.

Taylor, B. (2017). Key challenges facing international market researchers. [online] Language

Connect. Available at: https://www.languageconnect.net/blog/market-research/key-

challenges-facing-international-market-researchers/ [Accessed 25 Mar. 2019].