Market research. You’ve likely heard that you should do market research, but have you ever explored why?
Defining Market Research
My favorite definition of market research is the one you’ll get if you simply look up “define market research” on a Google search: “the action or activity of gathering information about consumers’ needs and preferences.” So, if you’ve been with a friend while they’re shopping and asked, “What exactly are you looking for?” – well, that’s a bit of market research.
Market research professionals take it a bit further, though. Market research experts don’t just want to know the needs and preferences, we want to know why you’re making the purchasing decision you’re making in the first place. What brought you to that particular store at that particular time to look for that particular thing? Once you’ve made a purchase, we want to know why you made that purchase, and how likely you would be to make a similar purchase in the near or distant future. Did you start looking for one thing and end up purchasing something completely different?
Why Do Market Research
You might be asking why bother with market research? There are a wide variety of reasons to do market research. From knowing if your product has a market, to knowing where and how to market that product, to knowing if your business is doing well, to knowing if your website has the information your visitors need…there are many reasons to do market research. Let’s look at some why’s based on how it could apply for various roles and organizations.
Small Business Owners
Small business owners likely have done market research before opening their store to decide a few things such as: what would work better – a physical storefront or an online store? If I have a physical storefront, where are my target customers more likely to visit my store? How should I price my products? How much variety should I have? How much stock should I carry? What should my marketing plan look like; where should I advertise? And once their business has started, then come the customer satisfaction questions to determine if anything needs to be tweaked to make the customer experience better from the time the customer walks in the door to the time they (hopefully) make a purchase.
Medium and Large Business Owners
Just because your business has outgrown that “small business” title doesn’t mean you stop doing market research. You still do market research to determine how to attract potential customers and how to retain current customers. Market research can also answer what products or services your customer base might be interested in, from new features for existing products to entirely brand new products. These organizations might expand research to include information on brand identity and brand reputation. This could also include competitive analysis (looking at the competition and seeing why your current or potential customers are visiting the competition), as well as looking for better ways to connect with those potential and current customers.
Non-profits use market research to determine how effective they are at connecting with their target base, knowing how to message their organization’s cause (and where to spread that message), as well as how to connect with possible donors to keep their organizations funded. If they’re looking at expanding their reach, they’re likely doing market research to determine how far to expand that reach.
Understanding customer needs, preferences, and why customers are making the decisions they’re making will greatly affect the message being delivered, as well as how, where, and how often that message is being delivered. Marketing professionals also want to know where customers are seeing advertisements and how those ads are affecting the purchase process.
Product managers want to know what features current and potential customers are looking for – and how soon! Product managers also benefit from what is known as “disruptive innovation” which looks at creating products that the consumer didn’t even realize they wanted, as the phrase goes. There are entire organizations dedicated to the field of disruptive innovation research that help companies find that next thing that nobody seems to have thought of yet, but that consumers really love.
Market research can be especially pertinent to executive managers who use the results to feed strategic decisions about the companies they lead. Should the company invest in a new social media presence? What about launching a new product? Have they landed on the right features, and do they have the right timing for releasing those features?
Making Informed Decisions
Why do market research? Market research helps you make better decisions, regardless your role or your organization. Over the past few years, the ability for anyone to conduct market research has become more accessible than ever, thanks to online survey tools. Anyone in any organization can create and field a survey to help feed their decision-making process. And QuestionPro has a robust reporting module that makes it easy to analyze and share data with those who need it.
Every organization has questions. Market research can help you find the answers.