Market research is the backbone of strategic business planning. It informs you about customers, the market, and your competition’s strategies and plans. They bring together the business and consumer and provide a direction on how to function and transform into better entities. Whether you are launching a new product into a market or are modifying an existing product, marketing research gives you the what for.
If you want to learn how and why it is crucial, and what strategies and techniques you can apply to be ahead of competitors in your segment, then scroll till the end.
What is Market Research?
Market research is the process of employing information on customers, rivals, and the market for decision-making in business. Carrying out research with the specific intention of identifying potential opportunities in the target markets and potential threats which is inherent in the consumer.
Definition of Market Research
According to the American Marketing Association, the meaning of market research is:
“A process of purposefully capturing, documenting and analyzing data concerning various issues connected with the marketing of goods and services.”
How to Do Market Research
If you’re wondering how to do market research, follow these steps:
1. Identify Your Goals
Finding out your objectives means you have a clear perspective of why you are working towards something. Common goals of market research include:
- Getting insight into customer needs and consumer behaviour.
- Analyzing competitor’s opportunities and threats and how they operate.
- Testing certain sorts of theories, such as the feasibility of market extension or product development.
For example, if you’re a startup that developed an environmentally friendly product, your objective could be to establish the need for sustainable products in the desired market.
2. Define Your Target Audience
Your research will be more effective if you know who will use the information so that you make your research more personalized. This involves the research of:
- Demographics: Sex, age, education, income, occupation, and place.
- Psychographics: Interests, attitudes, beliefs and purchase inclinations.
- Pain Points: Challenges your audience encounters your product or service can address.
For example, if your product is a fitness app, then your target group is mobile-working individuals in health.
3. Choose the Right Method
There are two main types of market research methodologies: primary and secondary.
Primary Research:
This refers to the process of compiling information directly from your target market yourself.
Examples:
- Surveying through Google Forms or Survey Monkey.
- Organizing focus group discussions to get qualitative data.
- Conducting interviews with participants one-on-one to get more detailed information.
When to use: When you require information on precisely what is not known in the other modes of information dissemination.
Secondary Research:
This involves researching information that has been collected from other sources by other researchers.
Examples:
- The information is generated from current magazines, newspapers, and journals, websites like Statista and Nielsen.
- Articles and white papers.
- Through official records and records of government Agencies of statistics.
When to use: When you are searching for more general trends or are tied by time, money, and other resources.
4. Collect Data
This is the research stage where you gather the information you need to answer your research questions in the market research process. Below are methods to effectively collect data:
- Online Surveys: These are cheap and can help spread information to so many people. For instance, instead of using a boring SurveyMonkey, use a more visually appealing Typeform to create a survey.
- Social Media Polls: Such as Instagram, LinkedIn, or even Twitter gives you the perfect chance to talk directly with your audience and to get instant responses.
- Interviews: Interpersonal interviews enable capturing the details of the concept that is held by consumers.
- Website Analytics: Some of the information about the visitors that can easily be obtained with the help of tools such as Google Analytics includes the behavior of visitors on the website.
In other words, an increase in data quality and validity improves the quality of your findings depending on the sort of data you collected or conducted from a given source.
5. Analyze Results
Data analysis makes the raw data useful for decision-making since it helps in identifying useful information from large data. Follow these steps:
- Organize the Data: Organize your data in tables or charts or if you have a large amount of data, use software such as Tableau.
- Identify Patterns: This is about trends, correlations, and anomalies. For example, it is possible to observe that some groups of customers are more inclined to use some aspect of your product.
- Segment Your Audience: It is beneficial to divide your audience into subgroups depending on some similarity in hopes of providing a better approach.
- Compare with Competitors: Determine the location where the performance of your data objectively compares to your competitors.
For example, if you find that the majority of your audience shops online, you can create more content about that aspect of your e-commerce store.
Market Research Tools
To correctly execute research it is important to have appropriate tools of market research. Here are some popular tools for market research:
- Google Trends: It tracks the popularity of things to know what is trending.
- SurveyMonkey: This makes the process of creating and analyzing surveys a lot easier.
- SEMrush: Good for competitive analysis and to do some keyword research.
- BuzzSumo: Enables one to determine which of the many contents circulating in your area of operation are trending.
- Tableau: Takes straightforward data into acknowledged graphics.
These market research tools ensure you gain actionable insights without spending excessive time or money.
Benefits of Market Research
- Customer Understanding: If you want to get your audience engaged, you need to know what they need and what they want.
- Risk Reduction: Introducing new ideas to a market testing ground to assess how they will be received is proper.
- Competitor Insights: Never underestimate your competitors’ tactics, and know your enemy as you fight them.
- Trend Identification: It is important to keep abreast of market changes.
- Informed Decisions: Ensure that business decisions are made based on profound data analysis.
Conclusion
For integration of market research as an element of business strategy, it is not a matter of options but compulsions. It helps you to decide with confidence knowing your customers better than your competitors. Not only tends but also goal setting, useful tools, such as Google Trends and Tableau, to find important information encouraging innovations and business perspectives. With the help of market research benefits, businesses can minimize threats and capture opportunities as well as choose an appropriate path in their markets.
FAQs
What is market research?
Market research it refers to the collection of information from customers, competitors, and others alike with the view to assist businesses make appropriate decisions based on dependable data.
Why is market research important?
The market research gives information on consumers’ needs, industry trends, and competitors. It also cuts down on threats and supports choice while making sure that products and services meet the customer’s needs.
How to do market research effectively?
Describe your goals, determine who you are looking for, and how you are going to search for them. Collect data and review the conclusions for developing practical business strategies.
What are some popular market research tools?
For tracking there are Google Trends, for surveying purposes SurveyMonkey can be used and for the visualization of data for making strategic decisions, there are SEMrush, BuzzSumo and Tableau.
What are the types of market research?
Market research involves Primary Research (gathering data personally through surveys and interviews), and Secondary Research (looking into data from books, reports, surveys, etc.).