Why is the London MR market so had to crack?

Every so often I am asked by companies from outside the UK to advise them on the best way of entering the UK and of being sucessful. Unfortunately my response is normally to point out that it is very, very rare for a company entering the UK from outside to be sucessful.

In order to back-up my observation I decided to list the number of entrants into the UK who had been sucessfull. However, this led to a discussion about what we meant by sucessful. My feeling that there are probably two indicators of sucess, a) a turnover of £4million per year (enough to put you in the top 75 companies in the UK), and b) profitable. In terms of this criteria it is clear there are just a handful of sucessful entrants, and most of them have achieved it by acquiring large local businesses, for example Ipsos/Mori and GfK/NOP (Harris is a large company, largely through acquisitions, but may be failing the profitable test).

Perhaps the biggest surprise is how few North American companies have been sucessful in the UK, given the size and strength of the North American research industry.

Why is it so hard to enter the UK market? Well, I'd love to hear your views, but here are a few of ideas that have occured to me.

1. The UK market is quite incestious, it is mostly based in London and most of the key people know each other, buyers tend to buy from people they know.
2. The market is simply very hard to enter, most local start-ups also fail to get into the top 75, the ones that do are usually created by people who already have client networks in place (e.g. they may take clients from their previous employer).
3. UK buyers think that 'British' research is best - this may not be true, but seems to be driving behaviour.

So, does this mean that people should not try to enter the UK market? I think the answer to that is a loud maybe! I think that companies looking to enter Europe should seriously consider entering a multi-lingual country such as Netherlands. If you are looking to enter the UK, think about why somebody should prefer you to the top 75 companies doing more than £4million a year, you will need a good 'reason' and you will probably need a Brit to drive the brand image - because not only is it rare for a non-UK company to be sucessful in the UK, but it is rare for a non-Brit to be sucessful in the UK research industry.

Comments

[Andrewjeavons]

London is incestuous, and there are a lot of MR companies, so buyers I think tend to go with who they know. As Ray says, it is generally hard to enter even if you are from the UK, there is a lot of competition. There is little incentive to go with the new outsider in the UK. The UK, as a culture, is far less accepting of anyone or anything new, and so this is again an extra barrier to many companies. Most significantly for USA companies they wildly misunderstand how different the UK is from the USA. I always caution Americans that the UK is as foreign to them as Japan is, the common language is a hindrance ("two nations divided by a common language"). This works the other way with the USA and UK. The USA is just as complex culturally, but there is more of an acceptance of what is new. The USA has a plethora of social structures and traditions that are utterly invisible to outsiders, as does every country.