Market research describes the process businesses employ to understand their customer base, competitors and trends within their market.
The information collected during market research undertakings help businesses understand the direction they need to take regarding their strategic planning. The insights provided by market research are used to supplement key decision making and focus efforts on expanding the customer base and offering more meaningful services.
While larger organizations offer in-house teams, it is not uncommon to find businesses outsource the market research services. Hunting for the best market research company can be time consuming but offers a multitude of long term benefits.
Here are five ways market research helps with critical decision making within an organization;
1) Build Your Branding
Most companies pride themselves on their product but do not consider the other factors that draw customers into a purchase. These organizations need to take a step back and ask how customers look at the them and how their company weights in comparison to competitors.
This is where you introduce market research. Questions that should be asked include;
- Are customers aware of the branding?
- Do customers associate your product or service to your brand?
- If not, who do they compare the product to?
- How do customers look at competitors?
- What are the characteristics customers associate with your brand?
When market research is conducted, it offers a pretty wide understanding of the conditions of the market and points of improvement. If your brand is not working as well as competitors’ brands, this is your opportunity to understand what is making you lose your prospective customers.
Understand where competitor brands are able to develop a leg up and introduce the best possible counter-actions or adaptations to your own organization.
Keeping an eye on what people are saying about your brand also offers strong insight into the direction of your brand. Should the words being associated with your organization differ from what you’e envisioned . Relevant market research offers a solid jumping off point to remedy the same.
2) Customer Analysis
Oftentimes a company fails to meet their sales quotas or grow their business because they are too concerned with putting out a product and less concerned with the people creating demand.
Any organization looking to secure market share and consistent purchasing must understand who their customer base is. This could take the form of asking questions including;
- How old are my customers?
- What is their marital status?
- Do they live with their families?
- What areas see more products moving?
- Are they on social media? If so, what platforms are they using?
The answers to these questions help zero in on who your target market is. In turn adjustments can be made to the product or service provided to help further appeal to the target audience.
Additionally if the people purchasing your product are not your intended audience, this would be an ideal time to understand where they are looking and how to pivot them towards your offerings.
Identifying your target audience helps the business concentrate their efforts into better performing marketing campaigns, packaging and in turn sales and revenue.
3) Stay Relevant
Today’s marketplace is flooded with options, and consumers are genuinely spoilt for choice. Market research is a great way to understand what has your customers and prospects’ attention, be it another company or an idea gaining traction.
Researching allows the business to understand how the needs of customers have evolved and the results other companies have had around innovation and staying successful. The trends can then be understood and analysed internally to build a solid course of action.
Companies that choose to neglect market research have a hard time pinpointing directions to pivot. The global pandemic was a great example of the same. Businesses were forced to realign their supply strategies based on demand for necessities including medical masks and hand sanitizers.
One ear to the ground can come in handy at times of crisis, reinvention or even just baseline pivoting.
4) Understand the effectiveness of your Marketing
Marketing is a critical component of successful sales. A number of entrepreneurs have no problem building new, innovative and disruptive marketing strategies that they feel would work best with their product and their target audience.
It is important to measure the degree of success faced by these campaigns to understand what should be on further display and what should be wrapped up. Asking organizations to conduct market research around the success of virtual and physical marketing campaigns opens the doors to other successful marketing opportunities and helps minimize wasting time and resources on ideas that are less likely to work.
Keep customer awareness and engagement at a forefront when making business decisions.
5) Paving the way for new Opportunities and Business Growth
Growth and expansion is a core goal of all organizations. Though the execution around the same is likely to be shrouded in uncertainty and a lack of direction.
At moments like this, market research can help pave the direction forward. Metrics including;
- Watching for future trends and markets
- Identification of areas for expansion
- Effective campaign strategy drafts
- Realistic business targets
- Ways to address competition
- Ideas around further optimizing results
All of the above can be be addressed through thorough market research. Understanding adjacent markets and how to tap into them can be sourced from company specific or market specific reports.
With enough clarity in place, businesses can look at investing into expansion opportunities and introducing better strategies to build and grow their business as intended.
It is also important to keep track of the sources market research is obtained from. Introducing a reputed organization to conduct this research for you is critical. Occasionally attempting to do the same without an experienced professional can lead to undesirable or unclear results.
As a business owner, it is of utmost importance to do research around the outsourcing firm and to ensure both the organization and the business conducting market research are on the same page and looking for answers to the same question. This maximizes the return on investment.