The Importance of Market Research for Business Owners

If you are not familiar with the market research, here is a brief explanation: Market research is the process of pulling and analyzing information from customer/consumer groups, competitors, industry and the business environment in general. Therefore, it plays a huge role in any of the steps involved in the business process.

As a business owner, there are important questions that you will answer throughout the process of market research:

1. Whether or not your product is good enough for the market
2. To identify your customers’ sentiments and opinions about your marketing campaign
3. Where and when your customers buy certain products or services

Market research is essential for companies of any size. As a business owner, it is crucial for you to gather market information continuously. Market research will provide you a better decision, better off, a data-driven decision. The following sections will explain how market research will help your business.

Feasibility Study for Your Company

Before you launch your new business, it is essential for you to identify the following:

1. Whether you offer the right product or service to the right market and if they really need your product or service
2. Whether there are enough customers to allow your business to scale up and be profitable

Gathering statistics such as demographic data and asking prospective customers will give you predictions about the market needs and the future growth of your business. This information is critical for you, the business owner, as you can predict the market before you even start. Allowing you to decide whether or not you want to take the risk to launch the company.

Assisting You in Setting Strategic Direction

Market research can be used to identify and validate your business ideas when you are about to offer new products or services. For example, you are selling organic toothpaste in Malaysia and you’d like to expand your business to Thailand. In order to do so, you have to first calculate the number of potential customers in Thailand, and whether or not the market is big enough. Also, as an organic toothpaste company, you have to assess to your competitors, whom you are competing against.

Identifying Your Customer’s Wants

Significant test marketing can be used when trying to sell the a new product or service. Significant test marketing is when you select potential consumers to try your product, whilst enlightening them on your product and explaining the benefits to them. This is useful as it can clarify whether your potential customers are aware and interested in your product and its benefits.

If you are not familiar with significant test marketing yet are thinking of trying it, you are able to do so in a less formal way by asking your potential customers directly through online surveys. On your survey, you can get insights on whether your product will satisfy your customer’s needs.

Monitoring Your Competitors

Another thing that you could do with market research is to monitor your competitors, which can be done through competitor analysis. With competitor analysis, you will be able to identify strategies used by your competitors to capture customers. As you are sharing the same cake with your competitors, your competitors’ customers are your customers too. Among other things that you can capture through competitor’s analysis are: competitor’s activity, marketing strategies, marketing campaigns and business offerings. Through competitor analysis can it gain you a competitive edge.

Identify Available Opportunities

As a business owner, you are continuously seeking to grow your business and looking for opportunities that can elevate your growth. How market research plays into this role is that it makes you pay closer attention to the world around you, helping you structure pieces of information that will eventually lead to potential opportunities.

Spotting Potential & Trouble Ahead

Every business is affected by local and national economy performance and directions. Through market research can you monitor the business environment to identify signs of a potential economic slowdown or growth. Signs of an economic slowdown or growth could be identified through surveying those in the markets: customers, suppliers and business practitioners, whether they are satisfied with the economy directions and performance. Thus, allowing you to adjust your company strategies accordingly.

What are the reasons why research is important in business?

1. To Better Understand Your Customers
2. Identifies Problem Areas
3. Beneficial in Comparative Studies
4. Helps Design New Business Opportunities
5. Minimizes Loss

 

The utilization of research through a WordPress survey tool is greatly beneficial to the evolution and the further development of a business. By exerting efforts in gathering data through research, a business can observe what parts of their current processes are working well and what needs to be changed. The collection of data can also be used to formulate new types of business opportunities and marketing campaigns, creating a bigger and better business for you.

To Better Understand Your Customers

Marketing research with the use of online surveys can help you quickly and efficiently collect data from a vast group of people. In order to understand who exactly is benefiting from your products and services, you can choose to send out a survey that would ask questions regarding their demographic. Take note of the similarities in the replies in order to find out the consumers that benefit from your services. Doing so can help change up your business to better cater to the right consumers, effectively increasing your customer satisfaction.

These can help turn your business into a more aware one. It can even be a stepping stone to searching for a new consumer market to explore. Another reason as to why research is important is it can help you identify problem areas.

 

Identifies Problem Areas

By customizing online survey tools, your business can better observe the points of improvement in each of your departments. If you opt to release a survey meant for the consumers, you can better see what factors of your products and services need to be improved upon. If you release a survey meant for your employees, then you can better see the point of improvement that you can do within your current business processes.

You could create necessary improvements, by identifying problem areas. You may also opt to release surveys every couple of months in order to track the progress of your changes. Besides your own data, you can also compare it to the data from other competitor companies.

Beneficial in Comparative Studies

In order for you to be a step above your competitors, you need to offer something unique to your consumers. If you observe that their sales are increasing at a relatively faster rate than yours, it may be due to a number of factors. In order to discover what exactly makes their company run more smoothly than yours, you could compare the data that you received from your market research with the growth of your competitors.

Compare your products & services and see what makes theirs more appealing to consumers. Then, adapt to this knowledge by making the necessary changes to your current business practices. These changes can be in the form of designing marketing campaigns or by exploring new business opportunities.

 

Helps Design New Business Opportunities

Research can not just help design new business opportunities, but it can help design successful ones. With the help of online surveys, you can easily ask your consumers for other things that they may need help in. If you notice a trend in the desires of your consumers, you can turn this into a good advantage for your company in terms of business opportunities. The release of this product will prove to your consumers that you care for their needs, which will ultimately boost loyalty.

Besides new products, with the help of research, you can even look into tapping new consumer markets. By releasing surveys to new and unexplored target markets for your company, you can discover what works and does not work for them. This way can help you effectively reduce your losses as online surveys are free to create.

Minimizes Loss

By first sending out surveys to consumers, you are saving your company a lot of money. This is because you can already pinpoint the potential issues that could arise before you even launch a new product or service. After making the necessary changes, you can confidently release products that you know consumers will enjoy. In the case of a pre-existing product, you could send out surveys to help you find points of improvement in each one. By catering to the concerns of the consumers, it increases the chance of a product’s success.

Take note of these key reasons as to why research can be extremely beneficial to your business. This can better optimize your business processes as well as your services.

Marketing is built on the opinion of the masses. Without the public’s approval and buy-in, getting a concept or product off the ground is nearly impossible. Today, there are many options to choose from with gathering these opinions. Marketers can set up complex systems to examine behavioral data or work with a research company and conduct surveys.

Surveys are important for various research efforts. The collection of survey data online is very popular and can be the difference in the success or failure of a brand.

How Can Surveys Help Small Businesses?

Surveys and data collection can help small businesses in myriad ways.

1. Build Your Brand Identity

With surveys, you can collect valuable consumer feedback and utilize it to give your brand authenticity. Knowing what consumers think of your business can help guide important branding decisions and give you ideas on how to appeal to your target market in the most effective way.

When using a survey to gauge perceptions about your brand, you can also learn what your business is doing well and what you can work on. The data gleaned from surveys can help you improve your customer experience, as well as influence your marketing decisions.

2. Use Surveys to Further Engage Your Customers

Every business wants to engage their customers and followers. A great engagement tool is sending surveys directly to customers to learn more about their experience with your business. Not only does this give customers the chance to share their thoughts, but it also shows that your business values their opinions.

Use your website, marketing emails, end of blog posts and email signature to advertise your survey. If you create your survey efficiently with fewer questions, your customers will be more willing to spend a greater amount of time per question.

3. Get Market Insights with Social Media Surveys

For small and large businesses alike, social media can drive a lot of website traffic. When crafted carefully, a social media survey can be a cost-effective marketing tool, generating more vital information than other data collection methods. Conducting surveys regularly can help small businesses gain valuable market insights.

Through social media, you can captivate prospects and reach a multi-generational audience, allowing you to devise marketing strategies for the future. When you interact with your customers and prospects through an online survey, you’ll learn what your audience prefers and collect a wealth of information about how your customers view your brand and what changes, if any, they want to see from you.

For multivariate audiences, survey your audience across all your social media platforms and use the same survey, as this provides consistency in your results.

4. Enhance Your Customer Profiles

With surveys, audiences may also choose to share first-party data like age, demographics and contact information by offering an incentive in exchange. With an incentive attached, customers are more likely to complete a survey and provide these important details.

By gathering and analyzing insights from your customers, you can think of ways to improve your business to better serve these groups or appeal to their specific needs and interests. Surveys are also an excellent tool for creating customer personas for marketing purposes.

5. Use Surveys to Generate Leads

Quizzes are popular among people of all ages, especially when the quiz is relevant to their shopping experience. When you make your survey a fun quiz, you can keep your customers engaged and answering questions until the end.

Once you know who your target audience is and you’ve created customer profiles, you can use the available data to create knowledge or personality quizzes, depending on what you’re planning for your future marketing strategies. You can also use quiz-like surveys to educate your audience about your services and products.

6. Create a Product Based on Consumer Feedback

Surveys let you know what customers are thinking about your business and products or services. Your brand’s quality and reputation are essential, especially if you’re an entrepreneur, so you want to focus on developing and marketing products that appeal to your customers. Online surveys can help you determine what your customers need and prefer.

Asking open-ended questions about what your customers think about a service or what features they would like to see in a product can help you analyze whether you’re meeting all of your customers’ needs and what you can do to improve your offerings.

When you survey your customers, you’re no longer developing products in a vacuum or offering services people might not want. Instead, you’re using customer feedback as a guide throughout the product development process and establishing an interactive communication loop. You can also use this feedback to generate ideas for marketing campaigns early, such as for a holiday marketing campaign.

7. Improve Customer Service by Monitoring Customer Satisfaction

Every business needs to know how customers perceive their brand. As such, your business should focus on improving your customer service by gathering feedback following a successful sale. One of the best ways to improve your sales is by sending out a post-sale survey after a purchase or including a survey link on your customer receipt.

With this approach, your survey link will be sent out automatically, so no added effort is required on your part. Include questions about customer satisfaction that can help you identify the problem areas in your customer service. These questions allow you to examine your customer service and improve your customer handling and products.

Benefits of Online Surveys for Small Businesses

Everyone benefits from knowledge-driven by data, especially small businesses. The following are the advantages of surveys for small businesses:

• Test products
• Track sentiments
• Increase brand loyalty
• Get customer feedback
• Predict intent to purchase
• Inform product development
• Conduct demographic research
• Understand consumer behaviors
• Gauge the opinions of the audience
• Improve employee satisfaction and retention

Types of Surveys Small Businesses Can Use

You can use several types of surveys in your small business:

Online: The best available option for small businesses is the online survey, which customers can complete from home in just minutes.

Paper: Another option is a paper survey that you can give your customers, especially if the questions are related to personal topics. Paper surveys are a bit outdated and inconvenient, however, especially in comparison to online surveys.

Mobile: You can also administer a survey via your customers’ smartphones. Customers can conveniently answer questions through a mobile app.

Phone: If you have an older audience, you may want to target your customers with phone surveys. Older generations tend to be more likely to have landlines than mobile devices, so the best way to reach them may be with a phone call rather than texting or an app.

Wondering if market research is important for your small scale business? Stuck between choosing qualitative, quantitative or statistical sampling methods? You have stumbled upon the correct blog to answer all your questions.

People dealing in small business have to manage a lot of day-to-day operations. Thus making time for market research is difficult, especially when you have to learn about the whole process of market research. But it becomes necessary to keep a check on the audience periodically; otherwise, revenue could be lost. For a business venture to be successful, accurate information is required. Information about the existing customer base and the competition prevailing around the industry, in general, is an important aspect. It helps the business owners to determine the feasibility of the business before they make any commitments relating to substantial resources being used in the venture.

Effective market research helps to get inside the customer’s head. What kind of marketing research is to be used depends upon the availability of budget. It is tricky to find out which kind of market research would be suitable for the available time and cost investment.

What is Market Research?

Market research is an important tool to assist in business planning. It is the process of collecting information which provides an insight into the customer’s way of thinking, buying patterns and location. Market research helps to monitor the market trends and keep an open eye towards what your competition is doing.

It is the process by which information about the market is gathered, analyzed and interpreted. It helps in solving the marketing challenges that a business is most likely to encounter. The process of market segmentation and product differentiation is impossible to be conducted without a properly developed market research strategy.

Types of Data in Market Research

Primary information

Primary research helps in gathering two types of basic information which are either explanatory or specific. Explanatory research is an open ended research. It helps to define a specific problem and involves detailed and unstructured interviews in which lengthy answers are asked for from a small group of respondents. Whereas specific research is precise in scope and is used to solve a problem that exploratory research has identified. Comparatively, specific research is more expensive than exploratory research. Primary research is targeted to the group by using resources such as direct mail, telephone and personal interviews.

Secondary information

This type of research uses information gathered by government agencies, trade associations, labour unions, media sources, industry associations and chambers of commerce. This information is usually printed on pamphlets, newsletters, magazines and trade publications.

Advantages of Conducting Market Research

• Helps in identifying potential new customers
• Learn more about the existing customers
• Have a better understanding of the competition
• Test new markets
• Identify new opportunities regarding performance, pricing and promotion
• Communicate their decisions regarding existing and new products or services

Why is Market Research Important for Small Businesses?

Helps in spotting business opportunities

Once the market research has been conducted, it becomes crystal clear as to which section of the society the business wants to target and what kind of goods or service they are reaching out for. Sometimes approaching other small businesses becomes mutually beneficial when the joint promotion is carried out. Knowing about the other products and services which the customers can buy helps in coming up with additions to the existing one.

Business risk is reduced

According to the Bureau of Labor Statistics, half of the businesses around the world don’t make it past the fifth year. Thus, to ensure that the business survives longer in the market, proper research about the customers and sales has to be done, which can be done only through market research. Regular market research needs to be conducted so that they can keep a check on the current and the upcoming potential customers.

Decision making becomes easier

Market research becomes an important part when tough business decisions are being made. The market research report can be used while making decisions. Decisions – such as where to spend advertising and marketing budget, opening a storefront in a new location, the price to be charged, and which products are to be discontinued – can be made with market research.

Create relevant promotional materials

Proper promotional materials need to be designed so that it would attract the eyes of the customers. To choose what type of text and images to add on the fliers, website, and social media accounts, thorough market research needs to be done to know exactly how to proceed. Since target customers have been identified and their needs properly recorded, it will become easier to know what to address and how to address when the marketing materials are being created.

Outsell competitors

A business which knows its customers more tends to capture the market. They can easily beat their competitors by fulfilling the demands of the customers in a better way and standing out in the market. To outsell competitors, market research can be used to target the dissatisfied customers and fulfil their unsatisfied needs.

Set better goals for the business

When targets are set out for the business, they are based upon the sales and customers. Without carrying out market research, it would become difficult to determine whether the goal is achievable or not. With the help of market research, it becomes simpler to determine the directions which the company has to follow to reach its goal.

Know where to advertise

Small business owners have budget constraints. Hence, it becomes very important for them to decide where to spend to optimise the maximum returns. Market research can help in identifying the intended audience and on which platform they would likely to see the passage being advertised.

Marketing research is an important task for a small business to be successful. It is very easy to begin with by gathering information about two things – the target customer and the competitors. One doesn’t have to get all the information at one go. The sentiments of the target customers keep changing over time. Thus, market research is an ongoing process that must keep a record of these. But a business must not forget about the proper execution while doing the research.

Successful entrepreneurs use market research to keep up with trends, make better business decisions and maintain their company’s competitive edge. Regardless of whether you’re starting or expanding your business, research is vital to understanding your target markets and increasing sales.

Here are some specific areas where market research can help you build a stronger business.

1. Improve your branding

Many companies don’t have a good handle on their brand. They ask themselves: How do customers perceive us? How does our brand stack up against our competition?

You can use market research to improve your branding by exploring such subject as:

• Brand awareness—Are customers aware and familiar with your brand?
• Competitive comparisons—How do customers view your company compared to the competition?
• Personification—What characteristics and traits do customers associate with your brand?

You can also survey customers to gather feedback on marketing content such as logos, brochures, websites, etc. Brand research is typically conducted by interviewing customers or organizing focus groups. In this way, you can explore different topics in-depth and get feedback from the participants. The results will help you develop brand positioning and improve your marketing assets.

2. Understand your customers better

Sometimes entrepreneurs need better information on the size of their market, their target customers and how best to reach them. We recently completed a study for a client who had developed a new kitchen product and wanted insights on her target market. Here are some of thing we wanted to find out about typical customers for this new product.

• How old are they?
• Are they male or female?
• What is their marital status?
• Do they have children?
• Where do they live?
• What is their level of education?
• What kind of social media do they use?

We designed a questionnaire to be answered online by 1,000 consumers across Canada. This type of consumer study helps us to understand the profile of the target audience so that we can develop focused brand positioning. By focusing your efforts on the right target market, you can see faster results, improved efficiency and greater overall performance from your marketing campaigns.

3. Measure the effectiveness of your marketing

Lots of entrepreneurs want to do a better job promoting their companies and generating sales. Market research can help by providing information on the effectiveness of your marketing efforts. We can design studies to gather feedback from customers on the look and feel of your marketing messages. We can also measure customer awareness and reaction to specific marketing campaigns and activities.

Gathering this type of data can really help maximize your marketing budget by helping you design marketing that reaches and resonates with your audience.

4. Identify new opportunities

Market research can help you identify new market opportunities that might be available to your company. It can help identify geographic regions for expansion and/or test the market’s readiness for your new products or services.

For example, you could be looking to open a new retail store and need to find the right location. Or you may be planning to change your distribution channel and need to determine how the decision will affect your customer base.

To answer these questions, we could analyze existing data from government publications, Statistics Canada data and/or industry specific reports. These sources provide insights in such areas as:

• Market size
• Demographics
• Market share statistics
• Industry dynamics
• Major industry suppliers
• Key competitors
• General industry data such as number of firms and their geographic distribution

Obtaining this type of market data is a necessary first step to help firmly “size up a new market” to determine the optimal business strategy and operations.

5. Get insights into product features

If you’ve come up with a new product or are improving an existing one, you will want to know whether you have the right features and packaging. Research will provide insights your company can use to refine your products before you commit to expensive production costs.

When we design new product research, we gather consumer feedback on a concept and/or a prototype. We also collect data on consumer reaction to the product and its features, including its look, design, usability, colours, packaging and other variables.

We might also ask how consumers would shop for this product to gather insights for a distribution plan. We can also ask for reactions to the marketing messages, creative content and promotional ideas that are planned for the product launch.

Typically, we’d start with qualitative research (interviews or focus groups) because this conversational format allows us to gather rich, in-depth feedback from consumers. If possible, we would provide a prototype or sample of the product for customers to touch and use.

After that, we would validate the research insights with comprehensive survey with a similar audience but a larger sample set (i.e. more than 100 consumers). By doing this, we will have rich data to make informed decisions on finalizing the product concept and/or design.

Market research is an essential tool for businesses of any size or industry to understand their target audience, identify customer needs and preferences, and gather information about their competitors. In a nutshell, market research helps businesses grow and succeed. This is a primary goal for small businesses, making market research integral to small businesses making data-driven decisions that will help them to grow and succeed in their industry.

According to the U.S. Bureau of Labor Statistics (BLS), almost 45% of new businesses fail during the first five years, and the biggest reasons for this are almost obvious: poor market fit, lack of funds, competition, lousy location, drastic market changes, and many others. Most of these challenges can be stymied by understanding customer needs and the market environment – which is what market research does.

Market research may look like an unnecessary step  that costs some money, time and effort yet looks dispensible for smaller businesses.  However, it is a basic step that may determine the business’s life. Conducting market research can be expensive and time-consuming, but not having proper data can lead to even costlier mistakes and a lack of understanding in the market, so it is critical to be able to invest in market research.

And market research doesn’t have to be complicated or expensive. In this article, we look at simple steps to conducting market research for small businesses and the important data that they can collect.

Steps to conducting market research

One of the first steps in conducting market research is to define the research objectives. This will help the business to focus on the specific information that they need to gather. The research objectives should be specific, measurable, achievable, relevant, and time-bound (SMART), and once the objectives have been defined, the business can choose the appropriate research methods to collect the data.

There are two main types of market research methods: primary and secondary research. Primary research is conducted by the business itself and can include surveys, interviews, and focus groups. This method allows the business to collect firsthand information from its target audience and gather their opinions and feedback. Secondary research, on the other hand, is conducted by using existing sources such as published reports and studies, government statistics, and industry publications.

After the data has been collected, it should be analyzed and interpreted to extract valuable insights. This can be done through statistical analysis, customer segmentation, and competitive analysis among other methods. Once the insights have been identified, they can inform critical business decisions such as product development, pricing strategy, and marketing efforts.

Types of market research data that small businesses can collect

There are several types of market research data that small businesses can collect in order better to understand their customers, target market, and industry. Some common types of market research data that small businesses should consider collecting include:

• Demographic data: Information about the age, gender, income, education, and occupation of their customers and target market. This type of data can help a small business understand the needs and preferences of their target market and tailor their products or services accordingly.
• Behavioral data: Information about how customers use a small business’s products or services, as well as their opinions and attitudes towards the business. This type of data can help a small business understand customer satisfaction and identify areas for improvement.
• Competitive data: Information about the products, services, and marketing strategies of a small business’s competitors. This type of data can help a small business understand its competitive landscape and identify opportunities for differentiation.
• Sales data: Information about the sales of a small business’s products or services, including information about the number of customers, revenue, and profit. This type of data can help a small business understand its financial performance and identify areas for growth.
• Social and Online data: With the help of different tools one can collect data from various social media platforms, reviews websites, ratings, searches, and other online data, which can be helpful in understanding how customers view the business, how they find the business, and how they engage with the business.
• Surveys: One of the most potent tools of market research, surveys are a way to gather direct feedback from the customers, which can be used to improve products or services, customer satisfaction, and understanding of the target market.

The Bottomline

In conclusion, market research is a valuable tool that small businesses can use to gather important information about their target audience, competitors, and industry. By conducting market research, small businesses can make data-driven decisions that will help them to grow and succeed in their industry.

Market research is the process of gathering and analyzing information about customer groups, competitors, your industry and the general business environment. Whether a company is small or large, market research plays a vital role in decisions about what products or services to offer and how to sell them. A small business owner must make gathering market information an ongoing process and a high priority. He then can be more confident in the decisions he makes, knowing they were based on solid data rather than guesswork or hunches.

Assessing the Feasibility of a Venture

Before an entrepreneur launches a new venture, it is essential that he can state with confidence that the marketplace truly needs what he plans to offer — his products or services — and that there are enough potential customers to support the business and allow it to be profitable. Market research at the pre-launch stage involves the business owner talking to as many different experienced businesspeople as he can about his venture and soliciting their opinions about its feasibility. He also gathers statistics such as demographic data and predictions about the future growth of his proposed target markets. He talks to prospective customers as well. This information is critical in helping him decide whether to take the risk of launching the company.

Setting Strategic Direction

To grow his company, a small business owner may decide to offer new products and services, may expand the geographic scope of his marketing efforts and may change the marketing message he delivers to his market or the media he uses. The decisions whether to implement any of these changes are supported by market research. For example, if he wishes to begin selling his products internationally, he must have information on the number of potential customers and how many entrenched local companies he will have to compete against.

A simple definition of market research

Market research is the process of gathering and analysing data about one or more of the following:

• A specific industry – For example, trends and patterns affecting the industry as a whole.
• A product market – Research concerning the performance of a specific market. This research may look into things like the forecasted growth of the market and the number of competitors active in the market.
• Products or services – Research involving a specific product or service. This kind of research may involve estimating demand for a new product, or determining if sales would be improved by changing the appearance, branding or the cost of a product.
• Customers – Research that seeks to understand the behaviour of past, present and future customers.

The market research process can reveal information about product branding, product differentiation, pricing strategies, marketing campaigns and much more. It can be useful for established businesses who are looking to improve their sales, or for new businesses seeking to understand if their business model is viable.

Small-to-medium enterprises, freelancers, consultants and entrepreneurs can also gain a significant advantage by using market research strategies and services.

How can market research help a small business?

Some of the many ways market research can help your business include:

Finding out who your potential customers are

The more insight your business can gain into potential customers, the more easily you can craft your product or service to suit their requirements. Information including the potential customer’s gender, age, buying habits, intended use of the product or service, and level of education can all be very useful.

Your business can use the valuable information gained from the market research process to fine tune the marketing strategy of your product or service. It can also help test the feasibility of a new product or service before bringing it to market — potentially saving you thousands of pounds.

Obtaining more information about your current customers

Market research into your current customers can help your business improve sales figures, customer satisfaction and brand loyalty.  Some of the valuable information that market research strategies and services can provide include:

• Learning which aspects of your product or service customers like or dislike.
• Discovering how much customers would be willing to pay for your product or service.
• Understanding why customers choose your business instead of your competitors.
• Learning if customers believe your business offers good value for money.
• Understanding which things influence customer’s buying decisions.

This information can help you refine your products or services in ways that will make them more attractive to your target market.

Determining how effective a marketing campaign will be

The information you gather during the market research process will help you develop effective, evidence based marketing strategies.  You will understand how a price change may affect demand in the market, what kind of advertising appeals to potential customers, which media channels are the most effective, and much more.

The ability to make informed decisions and create effective marketing strategies can save your business thousands of pounds.  You won’t be taking a “stab in the dark” when creating a new advertising campaign or product line — you will know precisely what will work, and what won’t.  Market research can also help you make informed decisions about other business activities, including when to expand, consolidate or diversify the business.

Defining appropriate production goals for your business

The information gathered by the market research process can be used to accurately predict sales for your business. You will also understand how well new products or services will be received, allowing you to properly prepare for their introduction.

Identifying obstacles that your business may face in the future

Market research strategies and services will help you identify any problems that exist — perhaps the product or service is priced poorly or the market is simply crowded with competitors. The information obtained will help you understand if your business should cut its losses or improve the product or service you are offering.

Develop your business

Increasing the size of your small business can be a daunting task, because unnecessary over-expansion can cause a business to collapse. Market research allows you to determine if an expansion of your business is the correct path to take, giving you the assurance that you need to invest wisely. It can help you develop new products or services, make changes to distribution channels, increase/decrease output and much more. Market research gives your business some certainty about the decisions being made.

Monitoring the activities of your competitors

Market research allows you to keep a close eye on the performance of your competitors and answers important questions like — Why do customers prefer a particular competitor? Are competitors selling more product than me? What do customers think of the competitor’s branding and marketing? This information can help you devise business strategies that keep you ahead of the game.

Research new products and services

Businesses can use market research to predict how successful a new product or service will be in the market. For example, you can determine if the branding and price of a product or service is appropriate before launch.

Discover new opportunities in the market

Having a deep understanding of prevailing market conditions helps a business to take advantage of new opportunities. Market research can help you identify if a market is under serviced and helps you to take advantage of that fact. It can also help you spot changes in the overall market like population increases, shifting demographics and other important trends.

Performing research doesn’t need to be difficult; however, it does need to be complete and inclusive of specific information.

1 – Create Buyer Personas

Learning how your customers make their buying decisions is important; however, it’s essential that you know who they are. Knowing who your buyer personas are is just the beginning during your research of the primary market.

Buyer personas are fictional representations of your perfect customer. Personas help you develop your strategy, streamline your communications, and visualize your ideal audience.

Some key characteristics that you should focus on including in your business persona are:

• Gender
• Age
• Job titles
• Family size
• Income

Basically, the idea is to help you use your persona as a guide when you experience real life customers. For all you know, your business may end up having multiple personas and that’s perfectly fine! Just be certain that you’re being thoughtful about the persona you’re planning to optimize. It’ll make things easier when you’re planning campaigns and content.

2 – Identify Market Segments

Now that you’ve learned about buyer personas, it’s time for you to find a sample of your ideal customers. Doing this is going to help you understand the customer’s buying habits, challenges, and characteristics.

Your customers should be people who recently bought something or who have decided not to make a purchase.

Here are some ways you can meet with them:

• Create an online survey
• Conduct phone interviews
• In-person through the means of a social group

An important factor to keep in mind when choosing who you wish to engage with is starting with characteristics that apply to your personas. Not to mention, it will help you conduct your marketing research.

3 – Increase Engagement

A lot of research firms in marketing have groups of people that they can pull from whenever they need to perform a study. The fact of the matter is a lot of individual marketers are unable to afford that kind of luxury. However, that’s not exactly a terrible thing. All the time you’re going to spend recruiting people for the study may lead to having better participants.

Below is a brief recruiting guide to make things a little easier:

• Bring up a list of people who have made a recent purchase
• Have a list of those who made an active evaluation of your product, but haven’t made a purchase
• Ask for participants via social media
• Try to leverage your network
• Make sure you have an incentive

4 – Ask Questions

One of the best ways to get everything out of your conversations is to prepare your questions in advance. Try creating a discussion guide for everything such as a social group, surveys, online and phone interviews. This will ensure that frequently asked questions are covered and you can use the extra time wisely.

It’s worth mentioning that this should not be a script. All your discussions are better when they’re conversational and natural.

5 – Know Your Competition

Figuring out your potential competitors starts off your research of the secondary market. With that said, there’s a lot more than just one company against the other. In some cases, a fraction of a company may compete with another company’s service or products, despite the fact that this company puts more effort in a different area.

Even if you think you know your target audience, conducting market research can be an eye-opening experience. Consumers of today are more powerful than ever. They know what they want and usually aren’t willing to settle for less. And why should they? With so many options out there, the world is their oyster.