Brains against brawn – Market research company BrainJuicer

In an industry dominated by massive international agencies, successful medium-sized market research company BrainJuicer is a rarity.

Founder John Kearon is determined to use the advantages of being smaller – creativity and fast footwork plus exploiting his own patented internet-based technology – to change the face of market research.

Despite his remarkable success so far, his next great challenge is still ahead – taking BrainJuicer into the international marketplace where he can challenge the big agency players head to head.

The quiet, conservative, almost academic world of the market research industry is slowly becoming aware of a disruptive force at work. The foundations aren’t being shaken – at least not yet – but someone is banging uncomfortably loudly on the doors of the handful of major agencies that dominate international market research.

Innovative internet-based research techniques

That someone is John Kearon, the ‘Chief Juicer’ of BrainJuicer – a young UK-based online research company. And Kearon is passionate about his mission to challenge the ‘pencil and clipboard’ conservatism of the established agencies. He has armed BrainJuicer with a suite of patented, innovative internet-based research techniques which Kearon claims produce better quality results than traditional research, in a third of the time and at significantly lower cost.

BrainJuicer was set up to break the rules. “The market research industry is dominated by $1bn plus turnover companies, and there are no intermediate sized players. My ambition is to change all of that,” Kearon says. It is no coincidence that BrainJuicer’s innovative research methodology is founded on use of the internet – a research medium that is still significantly under-used in Europe. Apart from making research faster and more cost-effective, the internet makes it possible for a relatively small, predominantly UK-based agency like BrainJuicer to offer research with a global reach.

What the internet cannot do, however, is replace overseas sales offices. Both winning new contracts and servicing major clients requires a presence in the territory where they are based, and in an industry dominated by large international agencies, winning overseas-based clients was always going to be critical to BrainJuicer’s future.

In the past year, Kearon has started to focus on taking the company’s client-facing activities into the international marketplace. With offices already established in Amsterdam and New York to supplement its London headquarters and Brighton operations base, BrainJuicer is gearing up to move into Shanghai later this year. The pace is rapid: “We set up our first international office in Holland in January 2005, followed by the New York office in September 2005, and we hope to open in China at the end of 2006 or early in 2007,” Kearon says. “The general model of business for our overseas offices seems to be that it takes about half a year for them to break even, and another six months before the business starts to really take off.“

Our office in Holland has just won a contract from Philips to act as its global agency for concept testing. It’s our first global contract from a blue-chip company, and it’s a massive step forward for us. We hope the pattern will be repeated in the US. We have now been there for six months and we are ready for the break-even point – our clients include some major corporations such as Proctor & Gamble, Wrigleys, Unilever, Sprint and Publicis.”

This restless, rapid pace of expansion has marked BrainJuicer’s progress from the start.


Kearon founded the company as a start-up just six years ago. Three years ago, he was still battling for his company’s existence – in his own words, “dodging the meteorites that threaten the very existence of start-up companies on a weekly basis”. For BrainJuicer, a kill or cure injection of private equity (one which, ironically, carried the potential to bankrupt the business within four months), was followed almost immediately by winning a breakthrough contract from Nike. These two events marked the start of a dizzyingly rapid rise in the company’s profile and success.

Kearon came up with the underlying concept for BrainJuicer while he was running Brand Genetics, an ‘innovation agency’ that created ideas for companies that own major international brands. He started to become interested in the potential of the internet and web-based software to improve and speed up market research. He couldn’t understand why existing agencies had not started to use the internet. “Market research is the most conservative industry I have ever come across,” says Kearon. “I am fascinated with why large companies have so much problem innovating. Large companies just can’t create products like Innocent with its ‘little tasty drinks’ – but why not? The resources are all there, but they seem unable to create what people would want to buy. The answer seems to be in the nature of the beast – they are ‘King of the Jungle’, they represent the status quo. As a start-up, you want to upset the status quo and break the rules.”

In 1999 Kearon set up BrainJuicer – originally called – to develop his concept. “I started with the naïve assumption that the software as defined would take four months to develop and need about £40,000. In reality it took two years, and some £400,000 over the course of turning the concept into a commercial product. I funded everything through my savings and by taking on consultancy work on innovation for large companies – essentially I did the consultancy to be able to pay the development team.”

The second year of simultaneously working on the developing company and working as a consultant to pay for the development were taking their toll on Kearon’s personal life. “Nine months through the second year of development Sarah, my wife, eventually said: ‘I know you’re a genius, but don’t you think it’s time you got a proper job?’ We agreed that we would give it three months.

“And just then the breakthrough came. We won a contract to work for Nike, measuring feedback on the Run London event. It was not a big project, and didn’t bring a lot of money in. But it was a case of a non-traditional market research buyer recognising a fresh, modern, human way of engaging research subjects, talking to them using open questions. What Nike did above all was give us confidence: if Nike would buy it, we could sell it,” says Kearon.

Year three was a question of taking that confidence and selling the concept to other blue chips. “We only had revenues of £150,000 – but we made a profit,” says Kearon. At the end of year three, in January 2003, private equity investors Unilever Ventures provided backing for BrainJuicer’s development.

BrainJuicer is now six and a half years old. “They have been like dog years,” says Kearon. “In terms of the events packed into them, they were each worth several normal years. The reality of a start-up is more complex and more messy than it’s often painted in magazine articles. This is an area where it’s true that failure is a necessary part of success.”

By 2005 BrainJuicer could list a ‘Who’s Who’ of blue chip clients including the BBC, Cadbury, Boots, Kellogg, Kraft, McDonald’s, Motorola, Nestle, Diageo, Adidas, Shell, Vodafone, GSK, Renault and Pfizer among many others – and Kearon won the ‘Emerging Entrepreneur’ category in the Ernst &Young Entrepreneur Of The Year awards.

Company expansion

Once sheer survival was no longer the order of the day, Kearon could concentrate on BrainJuicer’s expansion. The challenge was, and remains, double-edged: to win the all important new business, Kearon has to change attitudes and accepted practice among the buyers of market research, especially in Europe; and he also needs to drive the company’s expansion into overseas markets – some of which, like the US, are far more receptive to the company’s new techniques than European markets.

Kearon is under no illusions about the size of the task ahead. “The more traditional market research buyers find BrainJuicer challenging, and to some extent our clients are self-selecting – they tend to be pioneering, open-minded and able to take on new concepts. Traditional buyers don’t believe that online research is representative, and don’t like our name because it doesn’t sound like an insurance policy. It depends whether they want market research to solve problems, or to provide insurance,” Kearon says.

Kearon continues: “We know the industry has to change – everybody does. It needs someone to be a catalyst, to be prepared to put their head above the parapet. But then they have to be smart enough to survive and grow. For example, it was Freddy Laker who started the cheap airline revolution, but he ended up going bust. We need to be more like easyJet – brave, yes, but then commercially smart enough to ride the wave, and adapt as the industry changes.

Expanding abroad

The recently won contract from Philips in Holland has given a boost to the process of overseas expansion. “This is almost as significant for us as Nike,” Kearon says. “It gives us enormous confidence in the same way. We beat off four of the leading international market research consultancies – Millward Brown, TNS, Ipsos and Research International – the ‘usual suspects’. Philips has taken a leap of faith, stepping back from accepted practice – it’s a big step for them, too, and we really didn’t expect to win. You live for those moments – just when you are wondering if you’ll ever get there.”

The next target is to achieve the same results in the US, initially through the New York office. “The US is crucially important to us. We have to succeed there to be a credible global player,” Kearon says. “My only worry about going into the US was whether we would be seen as novel enough – the US is much further ahead than Europe as a market for online research. But our innovativeness is understood and well regarded in the US market, and the fact that online research as a concept is completely accepted there gives us the opportunity to grow very quickly.”

Kearon had considered both India and China for the next step. “Both countries are important emerging markets and both have very low internet penetration. But India has an old, well established research industry using traditional pen and paper techniques. China, almost by definition, has none since it has only just emerged from a communist past with no history of consumerism. We feel there is enormous opportunity there for us to introduce our research methodology from day one. It’s analogous to telecommunications in recently developed countries with no historic infrastructure of landlines – they are going straight to the new technology, using satellite and mobile communications.”

Kearon explains: “The blue-chip companies which will be our target clients in China are primarily interested in the urban, young and affluent ‘new consumers’. Those consumers are going to be part of the five per cent of Chinese citizens who have internet access. It’s important to bear in mind, though, that those five per cent are numerically greater than the total number of people with internet access across the whole of the US, and China also has the largest online research panel in the world – some four million people.

“We don’t expect great profits from China, at least early on, but we feel we really should be there. To be a global research company you have to have an international background, and we are intent on building one ourselves. For the next stage we are going to be back in Europe, the fairly obvious markets such as Germany, Spain, Italy and France; after that Latin America. We are really following the natural order of countries where market research demand is located,” Kearon says.

“There are many new issues you need to take account of when expanding overseas, of course, including taxation and legal structures. We have set up as a ‘BV’ in Holland and as a Delaware corporation in the US. In China we will need to apply for a specific licence in order to be authorised to conduct market research. But it hasn’t been an inhibiting factor. We have gone for specialist advice when planning our overseas growth – it really pays to get the right advice early on, and it helps to get a partner that understands your ambition and works with you.

“The main limitation on our international growth isn’t cash – it’s management time,” says Kearon. “Because our ‘factory’, the Brighton operations base, is already built, we only need to open sales offices, and the infrastructure is incredibly cheap. A 30-person office can do tens of millions of pounds worth of billings. But finding the talented people to manage the overseas business and working with them to build the client base is the issue for us. The people are key. We need to find entrepreneurs and it’s incredibly difficult. If someone brilliant came along, we’d consider opening an office specifically to back them, even if the location wasn’t one we’d planned to cover yet – they are as rare as that.”

Hand in hand with international expansion is the need to ensure BrainJuicer maintains its lead. “Our competitive advantage using our online research tools will eventually be eroded. So we are looking to go beyond the established boundaries,” agrees Kearon. “We have recently set up experimental web-cams in families across the world, and we have started conducting ‘juicers’ (the BrainJuicer term for an opportunity to participate in product research) using mobile phones. It’s a first – there are twice as many mobiles in the world as there are internet PCs.”


Kearon concludes: “I have always felt that at some point in the future my talents and my entrepreneurship will run out; at a certain size BrainJuicer will need a different leader. I hope I will spot it when the time comes. I am watching to see what happens with James Dyson, whom I find an inspiration as an entrepreneur. My primary motivation, personally, is innovation itself. I’m an inventor who has commercialised my invention. Financial success is important as a way to measure success – to prove that it was a good idea, a worthwhile invention. I believe I have found a better way to do something, and now I want to battle to get it accepted.

“It will require a huge amount of patience to see the results we are aiming for – another ten years at least. But I think we can wait that long. It seems as if every small market research agency here at the moment just wants to be bought up by one of the major marketing conglomerates. But I’m not interested in seeing an agency’s cheque book. I want to change the status quo, not become a part of the establishment.”

This article was originally published in Masterclass magazine.

Marc Barber

Marc Barber

Marc was editor of GrowthBusiness from 2006 to 2010. He specialised in writing about entrepreneurs, private equity and venture capital, mid-market M&A, small caps and high-growth businesses.

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