Market research is one of the most important elements of every successful business and it is, more often than not, a starting point for developing proper marketing and sales strategies. It is definitely a must for every startup business, as it can provide information crucial for gaining insight into the customer’s needs and preferences. You need to know exactly how they would react to particular products or services.
As a business owner, you conduct market research almost all the time, whether you are aware of it or not. How is that exactly? When you are talking to your customers about your products or services, you are conducting market research. When you are checking out your competition in order to learn about their prices or the way they address their customers’ pain points, you are conducting market research yet again.
However, formalizing your market research can help you gather a lot more information about your customers and their opinion on your services or products, as well as information about the overall market.
Why Conduct Market Research?
The main reason for conducting market research is to gain a clear insight into your customers’ preferences and the overall marketplace, so that you can make all the right business decisions, whether those concern your startup, your innovation or your growth. It can help you avoid risks in your business decisions and figure out the best opportunities for increasing your profits and ensuring your business growth.
Market research can help you understand what it is that your customers actually want and need, so that you can adjust your products or services accordingly. It can also help you learn the best ways to set up and distribute your products, depending on different locations and different points of sale.
Market research can also help you set optimized prices for your products by gaining insight into your competitors’ prices and how much your customers are actually willing to pay for your products or services. It is also very useful for figuring out the best ways to reach particular market segments by promoting your services or products on social media, for instance.
Conducting market research is extremely useful in that it provides you with solid facts that can help you paint a clear picture of your market and learn exactly how to approach that market and showcase your business to your target customers. It is also great for monitoring your competitors and learning how they operate their business, so as to know exactly what to do in order to try and be better.
When Should You Conduct Market Research?
Market research is the key element for every successful startup, as the gathered data can greatly contribute to every business plan. If you are just starting out, market research should be one of the key components of your planning stage, as it can help you determine the sales potential of the services or products you offer.
It can also help you attract new customers and make them interested in your business, which can enable you to set optimized prices for your products or services, as you would learn about their preferences and their pain points.
However, market research can also be of immense help to businesses that have been around for a while, as it can show them whether or not their customers’ preferences have changed, so that they can implement certain changes to meet their needs. Moreover, it can show them if their products or services are performing well on the market or if they perhaps need some refinement.
If you are opening a new location for your business or are introducing a new line of products or services, market research is the best and most effective way to learn about the demands on the marketplace you operate your business in.
Every piece of information you gather through your market research, whether during the planning or growth stage of your business, can be extremely useful in your day-to-day operations, as it can help you maximize the potential of your business and create the perfect plan for future growth.
How to Conduct Market Research?
Prior to creating your market survey, you need to know how to approach your market research, so take a look at the following points that can help you on the way.
Establish your goals
You need to clearly establish your goals and determine exactly what you want to know and why. The most common mistake marketers make is trying to answer everything, as that kind of thing could backfire.
Therefore, you need to identify specific goals, so that you can get clear answers to each and every one of your questions. Do you want to identify your customers’ pain points in order to present them with a solution to their problems? Do you want to know which competitors your target audience is turning to?
Do you want to gain an insight into whether or not your new product is enticing and how much your customers are willing to pay for it? Do you want to learn how your target audience prefers to communicate and consume information?
You need to figure out exactly which questions you need answers to and craft your market survey accordingly. Only by setting clear goals will you be able to yield positive results through your market research activities.
Document your questions and hypothetical answers
This is a very important part of your research, since there’s literally nothing worse than conducting research and not realizing there was an entire set of follow-up questions you could have asked up until you analyzed your results, so you would need to do your research all over again.
Therefore, you need to make sure you prepare different follow-up questions for people who respond differently to your questions; namely, for each of those who respond positively, negatively or remain indifferent. It’s imperative that you document all of your questions, including your hypothetical questions, before you start conducting your market research, as only then will you receive meaningful and comprehensive data.
Identify the target audience for your market research
You need to find the right group of people that would qualify for your market research. If you are trying to learn whether or not your new product is performing well on the market, you need to target the people who are actually using that product.
Targeting your research towards the right type of audience is exactly what will help you get the useful and relevant information you need and it will mitigate the risk of making wrong business decisions. Therefore, identifying your target audience should be one of your top priorities.
Determine the best method for conducting your market research
This is exactly what will help you get the best possible results. For instance, if you happen to have a big Twitter following, it might be a much better option for you to use that following to conduct your own market research, instead of creating an online market survey.
Social media are ideal for conducting market research and gathering excellent qualitative data, since they are becoming better and better at targeting the right audience. You should definitely use them as tools in your market research.
Also, if you happen to have customers on your email list that are engaged in your brand and, what’s more, represent the target audience for your market research, try and use email as one of the tools for conducting your market research.
Create your market research survey
There are a lot of little things when it comes to market surveys that can make a big difference regarding the results you get after you have conducted your market research, so it is paramount that you take your time when crafting your market survey in order to make sure you do it properly.
When creating your survey, it is imperative that you ensure every question you ask actually needs to be asked. If your survey is way too long, the completion rate will greatly decrease. It’s important to let the respondents know upfront how much time it would take to complete the survey, as that will help you increase your survey completion rate and, more importantly, provide you with higher-quality results.
You should also include a progress bar, so that the respondents know when they are finishing up the survey. This will ensure that they will complete it entirely, instead of leaving when they are perhaps only one question away from completing it.
If you are looking to collect qualitative data in your survey, you need to phrase your questions very carefully, so as not to confuse the respondents or lead them towards the answer you expect to hear. Instead, encourage them to answer honestly.
Analyze the collected data
After you have conducted your research, you need to analyze the collected data and make your business decisions accordingly. If you happen to have collected quantitative data, the number of people who have responded positively, negatively or indifferently should show you whether or not you can pursue your planned project.
On the other hand, if you have collected qualitative data such as, for instance, some new ways people are using your products, you can use that data to adjust your products and improve them so that they fit your customers’ needs. More often than not, this kind of data can help you learn about the problems you didn’t even realize people had, so that you can present them with a perfect solution to their every issue.
Conducting market research should definitely be considered an ongoing process, instead of only being a one-time job you take part in. You should do it on a regular basis in order to always have a clear insight into the success of your business. Never stop communicating with your target audience, as that will enable you to understand what their needs and desires are and help you know what and how to do in order to meet those needs.