Is that market study worth paying for?
A consultant quotes you $10,000 for a market study before a big inventory commitment. Whether that price is a bargain or a ripoff is not a matter of opinion: a decision tree puts an exact dollar ceiling on what the information can be worth. This one also shows why a cheap, mediocre survey can be worth nothing at all.
Marketing Advanced Decision Tree Pro engine
After you install, this is the model to open.
Is That Market Study Worth It?
- In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
- Click Start from a template and put that name in the search box.
- Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.
This one runs on a Pro engine, and every free install includes five full-quality runs on your own numbers, shared across all five Pro engines rather than five for each. After that, Pro is $199/year.
The answer
Click Run and rollback compares all four opening moves at once, from the leaves back to the root.
- Best move
- Buy the study net expected profit $85,000
- Perfect info is worth
- $20,000 the ceiling price for any research
- Decide-now EV
- $75,000 large order, no research
- 60% survey is worth
- $0 it never changes the order
Buy the study: it lifts expected profit from $75,000 to a net $85,000, paying its $10,000 fee back twice over. Perfect information is worth at most $20,000, so any quote above that is too expensive no matter how good the research is. The surprise is the cheap option: the $2,000 survey is worth exactly $0, because at 60% accuracy the large order wins whether the reading comes back positive or negative. Information only has value when it can change your decision, and below roughly 69% accuracy this survey never does.
The model
A specialty beverage brand must commit to a large or small seasonal order before knowing whether the market lands strong or weak. Two research options can shift the odds first, each at a price.
| Market odds before research | 50% strong / 50% weak |
| Large order payoff | $150,000 strong / $0 weak |
| Small order payoff | $60,000 strong / $40,000 weak |
| Deep-dive study | $10,000, assumed to call the market correctly |
| Quick survey | $2,000, right 60% of the time |
Once it is in your sheet
- The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
- Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
- Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.
Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.
Next question
- If you raise your bid, what does it actually buy?Ad Auction Simulator
- Is that jump in your conversion rate real, or just luck?Is That Rate Real, or Just Luck?
- How big is your serviceable market, really?Serviceable Market Size (SAM) Range
- What are your customer segments, actually?Find Your Real Customer Segments
- The remodel looks better. Would you bet the chain on it?Which Store Layout Sells More?
- Which step of your funnel moves least reliably?Spend, Visits, Sales: What Moves Together?
Every model like this one, and the method behind them: Decision trees.