Market research may seem tedious and complex especially when you recall all the statistics you did in school. However, just like other fields, market research and practically any organisation can do cutting-edge research without much sweat. This is due to all the tools and solutions available for executing the activities surrounding market research. Consider this quote…
Doing business without advertising is like winking at a girl in the dark. You know what you are doing but nobody else does.
– Steuart Henderson Britt
Does this quote remotely ring any bell? It doesn’t have to be related to marketing. Maybe you’ve winked at your crush (okay, someone else could qualify too) before or did something crazy in the past involving winking. Did you achieve your aim or you were met with disappointment? The quote has two sentences thus 2 parts. The first emphasizes the importance of advertising. But I’d like to focus on the second part.
“You know what you are doing but nobody else does” – Steuart Henderson Britt
Sometimes, entrepreneurs and businesses get caught up in a sandbox doing stuff that no one cares about but yet this is unknown to them because they have taken any step to ensure that they are doing the right thing or at least on the right path.
Sadly, most businesses are operating in this manner.
They know what they’re doing but nobody else knows. Their products and services are developed in a vacuum and offered in a vacuum. But the market doesn’t operate in a vacuum; It is made up of markets.
The markets determine what’s valuable and worth paying for So why would you spend months and maybe even years developing something without seeking the views of the people you are making it for?
How do you determine the language to use in your advertising? How do you decide on a pricing structure or strategy? How do you even tell if the millions you are investing in a new product will sell? Market research helps you answer all these questions and even more.
What is market research?
According to HubSpot, “Market research is the process of gathering information about your business’s buyers personas, target audience, and customers to determine how viable and successful your product or service would be among these people.”
The entire rationale behind is to ask your ideal customer or target group, what makes them happy so you can design the perfect solution, product or service for them.
Market research can be used for several purposes based on the objectives of the research.
Market research can be as complex as you need spanning months or even years or simply spanning a few weeks depending on several variables and budget involved. It could be expensive or not. My point is, you don’t need to spend lots of money to gain information from your customers. You could simply ask for feedback after service and that constitutes market research.
Importance/Benefits of Market Research
What makes any business want to learn more about their customers and audience through some form of market research? There are several benefits to doing market research. A few of them are highlighted here.
1. Determine Your Marketing Plan or Strategy
Your primary marketing plan and strategy is dependent on a good understanding of who your customers are, their preferences, where to find them and how best to add value to their lives.
Without this crude understanding of your customers, your marketing plan would at best be a work of guesses. And guessing is risky business. What you want to do is to do research into the industry, competition, customers, etc.
This will give you a good idea of what to do and how to do it in order to meet your marketing goals.
2. Spot New Opportunities
Have you ever got an idea from a mere interaction with someone? Market research works in a similar way. Doing market research is a great way to be informed of new ways to solve your target’s needs, penetrate the market, or simply a strategy to sell more.
Learning more about your business and its various aspects will also set you as an industry leader and thought leader. Does it surprise you that most companies that are on top of their game are always researching different aspects of their industry?
3. Make your customers feel listened to
Taking time to ask and inquire out of genuine curiosity as to how to help your customers will make them feel they are truly the centre of your work. It is commonplace for customers to feel not listened to.
Market research is a great way to restore that feeling and to incorporate customer viewpoints into how your business runs and develops products. This is the hallmark of the truly, customer-driven company.
4. Beat Competition and Build Brand Loyalty
Beating the competition sounds fun, right? But it isn’t that fun, in actually doing the work to get there. Achieving the milestone of beating competitors is one of the key motivators of businesses. But how best should this be done?
Not market research alone but it definitely is a part of it. How do you determine the dominant territories of your competition? How do you know how well you will have to do to overcome your competition? Start with market research.
5. Lower the Risks Involved In Business
Business is risky business. It doesn’t matter your niche. There is some form of risk associated with each and every business and business model. Having a good understanding of your market and its key players such as competitors, customers, suppliers, and any others which may relate to your specific venture is a sure good way to insure your business against a lot of risks.
You would be able to spot changes and adjust. You will be able to predict to some level competitor behaviour and act accordingly. You will be able to know what satisfies your customers so you can continue to deliver that to them.
6. Advertise Where and How the Customer Wants
How do you know where your customers are hanging out? Are they in a certain location, a certain internet platform, social media or community? What makes them thick? How best can you appeal to them using your adverts? It all seems like a deep maze until you start asking the right questions through your research. It goes deeper.
You can use information gained from customers to design marketing campaigns, determine the messaging, tone and voice for your campaigns and lastly which platforms to advertise or to look out for your audience.
7. Increase Sales
The chief aim of a business is to help solve problems. In return, it gets sales for a job well done. To be able to do a great job, every business needs a strong and perhaps intimate understanding of the problem they’re trying to solve and for whom. These kinds of insights can only be gained through research. Consequently, sales go up if the customers see the value in what the company or business does.
Disadvantages of Market Research
1. Time Consuming
Market Research takes time, from deciding you need to conduct research, to planning, laying out specific objectives, budgeting and all the other aspects of doing full-blown market research. It can actually get overwhelming and take years.
However, the time it takes to get research done depends on your goals and other things. Availability of volunteers or participants is also another issue.
If you have a website or you are present online, it may be better to constantly collect data on your marketing activities and your product. In case you need to use the data, it comes in handy. It also reduces the time you need to collect data since you have already been collecting a good amount.
This strategy also helps you spot opportunities even before crisis drives you to look for opportunities. In recent times, time could be reduced by using online tools, running ads, collecting data in the background of your website, app or other online assets.
3. Costs Money
Traditional ways of doing research particularly cost lots of money. From planning, doing tests, hiring analysts, data collectors, compensating participants and other things that involve costs, implicit or explicit. This doesn’t mean startups and SMEs can’t do their own research.
In this age, it is more of finding out how to do it. Is it through google forms or survey monkey? Are we subscribing to Hotjar to monitor our online store visitor activity or we are settling with another option? Are we doing a twitter poll? Should we seek for recommendations on Facebook?
These are small social media tools that can help you collect information and get to know your customers intimately concerning what they need.
3. Lack of willing volunteers
Another problem common with research involves the lack of volunteers, qualified volunteers for that matter. For certain market research projects, you can’t simply take anyone who is available. You need qualified persons based on a criterion set out by the research team.
This narrows down the people who can fill in as a participant making it difficult. Even though you do not need the entire population, you need a sample which is representative of the population you are trying to study else your findings may be skewed toward a certain select group and not the entire population.
5. Inaccurate Information and Fluctuating Consumer Needs
A good saying, I often remind myself of when trying to change my mind is that which says only a fool doesn’t change his mind. Consumers aren’t fools hence they are prone to changing their minds. Preferences change. Sometimes, they’re simply not sure of what exactly what they can’t.
Henry Ford is quoted as saying if he had asked what people wanted, they would simply ask for a faster horse. Does this mean sometimes you don’t need market research because it is unreliable? Not really. It just means that you can entertain a completely new idea from what consumers have always known.
You can develop a business model from it but make sure you test the idea to be sure it’ll work.
For a few people, going against this has worked. But who wants to be acting in the dark? No wants to be winking at their crush in the dark.
Types Of Market Research
1. Primary Research
Primary research is the market research you carry out on your own. It could be internal, within your company or external.
2. Secondary Research
Secondary research is information from other sources other than from your company or organisation. It involves reading through other research findings, data from independent bodies, internet research such as from websites and articles, etc.
3. Qualitative Research
Qualitative research could be secondary or primary. The main point of difference is that qualitative research is based on finding information which cannot be measured in the form of numbers, etc. It is finding how customers feel about your product. And other information that will be difficult to measure. Stuff you can’t quantify in values and numbers. It is best done through interviews so you can ask all relevant questions on the spot to deeply understand the customer’s point of view. Qualitative research is also called exploratory research where the research has no particular theories but simply on the look for information that could be relevant in different areas of marketing and making the company better.
4. Quantitative Research
Quantitative research is just as like qualitative – It could be secondary or primary. It is used to collect, measure and analyse information. Such as how long (time) it takes a customer on average to make an order after adding products to the cart. This will help the company to understand further if it has to do something to improve the ordering process or rather add incentives for customers to move through the decision process faster.
Armed with such information, designing a campaign can be made easier and faster since a lot of the information would already be known. It is even better when after realising it takes longer on average for the order to be completed, a simple 2 or 3 question survey could be added to the cart page to understand further the nature of what would qualify as a good motivator.
Common Market Research Methods
Market research could be done in several methods. Here are the top ones. These could be done on a physical level or virtual platform based on where you can find your target sample. In certain research situations, budget and conditions, some of them may be more appropriate.
This is the most used method or form of market research. Using questionnaires to gain insights from your target sample or customers is one of the best and straight forward ways.
Next to surveys, you will find interviews. Interviews physically or through another platform to communicate live with a customer or a person who has agreed to participate in your research. Special questions are usually set for interviews but further questions could be asked based on the direction of the conversation and the Responses given by the respondent.
Interviews are the most insightful if well done because they provide a rare opportunity to engage one-on-one with customers.
3. Focus Group Discussions
Focus group discussions are a great avenue to learn more about your customers. However, the opportunity comes with several dangers such as the influence of an influential and imposing participant whom everyone tends to agree with and several other problems.
At best, try to avoid this unless you are sure you can handle the research errors that could arise due to using focus groups.
One of the most natural ways to get insights. It doesn’t involve any direct communication but can be very insightful. An example of how observations can be used in research is observing how customers go about shopping in a physical shop.
Even though they do not directly communicate with the researcher, some good insights could still be gained to determine shopping habits and how best to enable a better shopping experience for the customer.
Pols are the last on this list but certainly not the least or not effective. Polls are a perfect way to get quantitative data. An example could be, did you enjoy our shopping experience? Yes/No.
The responses could trigger even more focused market research to discover the causes of the response and how best to keep doing it, if its good, and how to correct it if it’s not so good.
Forms of Market Research (When You Should Do Market Research)
A good research culture for any company is a good thing. I am yet to see a company that knows what the customer wants and proceeds to provide it do badly. They always thrive. Therefore, research should be a constant thing for every company. In another vein, qualitative and quantitative research can be done for more specific purposes. In another way, when should you do market research? Here are a few situations where market research is critical for success.
- Brand Research
- Product Development
- Competitor Research
- Campaign Effectiveness
- Consumer Research
- Customer Segmentation research
- Usability testing
Common Mistakes in Doing Market Research
- Relying On One Piece of Research All The Time (The Market Changes)
- Not Being Clear On Objectives (Lack Of Clarity)
- Setting Too Broad Goals and Objectives (Lack Of Clarity)
- Doing Wrong Analysis and Interpretation Of Findings
- Not Doing Market Research At All
Is Keyword Research a Better Option than Market Research?
Modern market research has grown to be much of keyword research but is a market research the same as keyword research? Depending on the type of marketing that your company does, the two may be very similar. However, market research and keyword research are not the same. Keyword research is actually a part of what is called marketing research, the umbrella term for all marketing research. Marketing research covers all aspects of marketing-related research such as supply chain, raw materials, keyword research and market research. Keyword research is mainly an online, internet or digital marketing activity where companies doing inbound marketing in the form of content marketing, Search Engine Optimisation (SEO), Search Engine Marketing (SEM), Pay-per-click (PPC) ads, etc.
6 Steps To Doing Market Research, The 21st Century Way
1. Define your ideal buyer persona (And personality).
Create a clear picture of who your buyer, customer or target is. Without a good understanding of your perfect or ideal customer, you may be researching the wrong bunch of people. Finding the right set of characteristics of your perfect customer could itself be an avenue for research in the form of consumer research.
2. Identify a sample of that persona work with.
In most cases, you cannot possibly work with everyone who is your ideal buyer type. Hence you need to decide the sample size which will be representative enough to accept the findings of the research. There are several sampling techniques you can work with based on your objectives and research methods.
3. Engage your market research participants.
Time to get into action and get asking questions. But before that, you need to get some questions ready.
4. Prepare your research questions.
It is a great strategy to go into research with questions carefully planned to gain more insights into a highly specific area you want to improve in your business. This kind of approach takes away some of the problems associated with market research such as lack of clarity and setting too many objectives. Having a few objectives reduces questions and help you narrow down on what really matters in the research.
5. List your primary competitors.
It helps to research into your main competitors. One mistakes companies are to solely focus their attention on consumers. There is a lot to learn from your competitors. They are your main competitors for a reason. They also have some good stuff worth understanding if you are to do better than them.
6. Summarize your findings.
This stage crowns the process. It could also be the most dangerous since wrong interpretations could be made rendering the entire research even harmful to the company. It pays to hire experts to analyse data and supervise your research. This is particularly helpful if it is big research involving lots of time and resources. It pays to publish some of your findings when it is appropriate to do so. It helps build a positive PR and establish your brand as an industry leader and thought leader.
PRO Market Tip: Map Your Market Research against the consumer decision journey (CDJ) so that you can understand each and every need at each stage of the CDJ.
Conclusion and Final Words.
You have been exposed to a lot about market research. Yet there is even more. I will be writing more articles on market research. However, the best way to learn market research is actually doing it. Do not hide under the carpet of learning. Get doing.
This Complete Introductory Guide Was Inspired By My Session With The Bilth Studio On A Similar Title.
Do leave any comments and or questions and I will do my best to respond. Cheers!