How to do Effective Market Research for Your Business

Market research is a way of finding out what your potential customers think, feel, and want from your product or service. It is a process of evaluating a product or service according to the market. It involves asking specific questions, opinions and collecting feedback from potential customers. Market research allows companies to get the necessary information before creating their product or optimizing their product/service.

It is also helpful in iterating the existing product/service or getting an idea of the brand perception of the company to ensure that the company’s values are being communicated properly. In this blog, you will understand the importance and advantages of market research and learn how to do market research.

What’s the Importance of Market Research?

In today’s highly competitive market, if a company comes with a new product or service, without proper knowledge and information about the target audience, market size, pain points of the customers, preferences, and demographics of the consumers then there are high chances of failure of the product/service. The market and newspapers are full of such startups that enter the market without extensive market research and soon lead to shut down of the organization.

Market research is a critical component of the Research & Development (R&D) phase of a new product/service creation. Market research doesn’t only hold significance in the creation stage of a product/service, it is a necessary component throughout the lifecycle of the product as the market is changing rapidly. New tools, technologies, and evolutions are taking place making market research indispensable for organizations. Apart from providing optimization strategies to make the product a better market fit and giving an idea of how consumers and non-consumers perceive the brand, market research provides insights into a wide variety of things including;

1. Where your customers and target audience is looking for the product/service
2. Which of your competitors does your target audience look to, for seeking information or making buying decisions
3. What’s trending in your industry and attracting the eyes of your customers
4. Which market segment constitutes more of your target market and what are their challenges
5. Who are the people/influencers that influence buying decisions of your target audience
6. Whether there is demand for your product/service and what’s the market size
7. Unserved or underserved needs of your target customers
8. Whether your target market is price-sensitive or value sensitive

Ultimately, market research allows you to get the required information from a larger size ideal market, avoiding any bias or assumptions in the data. Conclusively you can make better-informed business decisions.

Types of Market Research

There are two types of market research. The first one is called primary market research and the other one is called secondary market research. Primary market research is based on discussions, questions, and interviews asked directly by the target audience while secondary market research mainly depends on facts, data, and reports presented by other researchers or organizations. Let’s explore primary and secondary market research deeply.

Primary Research

Primary research refers to conducting the research firsthand. It is conducted by the company or by a company that it hires. Unlike secondary market research, it does not depend on existing external sources of data such as census reports, or any other research data.

Primary research helps you to get the ground reality of the market conditions. Unlike secondary market research, it is direct and based on the surveys, reviews, and feedback of the target audience in real time. It is not dependent on any secondary sources of data which makes it a more authentic and trustworthy type of market research. Primary market research can further be classified into two types; exploratory and specific research.

Exploratory Primary Research
Exploratory primary research consists of open-ended questions and is intended to get an idea of potential problems that are worth solving. It is used to gather data in the initial stage and is generally less structured and conveyed over a large number of people to get insights.

Specific Primary Research
It is generally conducted after exploratory primary research to dig deep into the collected data. In the specific primary research, the researchers pay more attention to the problems and opportunities identified in the exploratory research. In specific research, researchers can take a smaller group of target audience and can ask more specific questions.

Secondary Market Research

Secondary research refers to the conclusion drawn from existing data and the available public data such as census reports, trend reports, statistics, polls, and previous sales data of the company. It mainly depends on the findings of other researchers and their descriptions.

Secondary Market Research is beneficial when there are limited resources for market research and the research needs to be conducted urgently. You get access to the required data and statistics in a short amount of time in secondary market research.

How to do Market Research

After reading about the importance & benefits of market research, you would be thinking, “How to do market research” Conducting market research isn’t an easy task. It takes the company’s valuable resources to conduct thorough market research. For your ease we are providing you with the steps you can follow, to conduct proper market research:

1. Define Your Buyer Persona
2. Identify a group persona
3. Prepare Research Questions for Your Market Research
4. Summarize Your Findings

Define Your Buyer Persona

The very first step in conducting market research is to define your buyer persona. The buyer persona is an imaginary character who is most likely to buy your product/service. Below are the common characteristics you should define while creating an avatar of your ideal customer:

1. Age
2. Gender
3. Location
4. Income
5. Family size
6. Job title
7. Challenges
8. Interests

Create the buyer persona very carefully as it is the primary piece of information your business requires. Further, this buyer persona will be used for marketing and research purposes to target the right audience. If your business has more than one buyer persona, it’s completely fine but then you will need to be mindful while planning your content and marketing campaigns.

Identify a group persona

Create the buyer persona very carefully as it is the primary piece of information your business requires. Further, this buyer persona will be used for marketing and research purposes to target the right audience. If your business has more than one buyer persona, it’s completely fine but then you will need to be mindful while planning your content and marketing campaigns.

Prepare Research Questions for Your Market Research

You should keep all the questions ready that you have to ask in the research process. Whether it's a phone call interview, face-to-face discussion, online survey, or focus group discussion, you should be clear with what information you have to get from the research participants to make the best use of your time and get the most out of the research. Open-ended questions are always a good choice for market research as they provide deep insights into the topic.

Summarize Your Findings

Finally, you will have a lot of information that you have to dive deep in. Don’t feel overwhelmed, just take a deep breath and relax. Now take out your tools for the analysis of the information. After getting fruitful insights from your research, you are finally ready to make informed business decisions.

You can use the extracted data to make necessary changes in your product/service or come up with a product/solution which is more demanding. You will also get to know about the behavioral patterns of your target audience, you can use this information to make better marketing campaigns.

Conclusion

Market research can be very beneficial for businesses as it provides the important information you need to create/customize your product according to the market’s needs. It can be done in various ways including surveys, getting questionnaires filled out, personal interviews, or group discussions. It helps provide the business with customers' behavioral and transactional information such as interests, challenges, desires, and purchasing patterns. Businesses can make better-informed decisions based on market research data.

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Found this blog helpful? You can subscribe to our newsletter to keep getting such informative blogs about digital marketing in your mail regularly.Market research is a way of finding out what your potential customers think, feel, and want from your product or service. It is a process of evaluating a product or service according to the market. It involves asking specific questions, opinions and collecting feedback from potential customers. Market research allows companies to get the necessary information before creating their product or optimizing their product/service.

It is also helpful in iterating the existing product/service or getting an idea of the brand perception of the company to ensure that the company’s values are being communicated properly. In this blog, you will understand the importance and advantages of market research and learn how to do market research.