Far too many businesses go through all the work of creating incredible products or services, setting up striking websites, and compiling collateral to communicate what they do, yet still have a hard time with conversion. This can be due to a number of reasons, but more often we notice it’s because the business didn’t do enough research to make sure they understand their audience. Market research is critical to your business reaching new heights!
In this blog we will discuss the following:
- What is Market Research?
- Develop Your Market Research Plan
- Market Research Methods
- Visualize and Communicate Results
What is Market Research?
Market research is the process of gathering information about your target audience’s needs and preferences. It can also be used to determine the potential of a new product or service in the market. The data collected should help you understand your audience’s desires, challenges, and what they look for in a product/service. Ultimately, the collected data helps make your brand connect to your audience on a deeper level whether it be through product, content or support.
Market research is made up of two major types: primary research and secondary research.
- Primary research: information that is gathered directly. This type of research can be conducted in-house or by a third-party company that specializes in market research. Typically this type of research is conducted with a specific goal in mind as it is more expensive and takes a longer time to execute. Primary research tends to gather more specific data that will directly answer your research questions.
- Secondary research: research that’s been previously compiled for another purpose by an outside entity. It is less expensive and less time consuming to collect and ensures that researchers do not waste time conducting the same research again. Nevertheless, it has its own weaknesses, for example since this data was collected for a different purpose than the goal you have in mind the data may not provide you with the detailed answers you’re looking for or the additional insights that primary research would.
Once you’ve weighed the pros and cons of each research type and know which you want to move forward with you can move onto the next step: developing your market research plan.
Develop Your Market Research Plan
Your market research plan will be the key in identifying the problems you want to try to resolve. It will also be a framework to rely on throughout the execution of research. To start your plan, reflect on your business to see what is already performing well and areas that need improvement. This will help establish what the focus of the current leg of research should be.
Five steps for developing and executing a Market Research plan are as follows:
- Define the objective and problem
- Design and prepare research plan
- Field work, sampling, and data collection
- Analyze data
- Visualize and communicate results
Using this system will help you understand new trends, learn more about core customers, and tackle new projects.
Now you need to determine which type of research method you’d like to conduct. Determining which method to use depends how much time, cost and detail you have available.
In this blog, we will cover the five most common forms of market research methods: Surveys, Focus Groups, Field Trials, Interviews, and Observations.
Surveys are a list of questions aimed at extracting specific data. This type of market research can be conducted over the phone, digitally (through email or online), or in person. Surveys are a great tool for acquiring data because they are an opportunity to quantify data that is oftentimes more qualitative.
- Less expensive
- Less time consuming
- Higher response rate
- No way to ensure that respondents will provide accurate and honest answers
Focus Groups are an in-depth deep dive interview of a group of 10 or fewer volunteers who represent a segment of the target market. Typically this type of research is led by a moderator who ensures that the conversation doesn’t go off the rails and answers the questions you’ve set.
- Great way to measure customer reactions
- Gain immediate responses
- More expensive
- Can lead to moderator bias as they have a significant impact on the focus group discussions
- Group bias may come into play as others may not want to speak out against group thoughts
Field trials is a qualitative method of data collection that aims to observe, interact and understand people while they are in a natural environment.
- Conducted in real-world and natural environments
- Researcher is able to gain deep understanding into research subjects due to proximity
- Difficult to distance from research bias
- Impossible to control external variables
Interviews are a common method of research that provide valuable insights – more intimate opportunities to obtain information by asking questions outside of focus groups or surveys.
- Great opportunity for strong qualitative feedback
- Allows you to pick up on non-verbal cues
- Creates a more personal interaction
- Interviewer has complete control of the direction of the interview
- Doesn’t provide numerical data
- Limited sample size
- Dependent on interviewer skills and predisposed biases
Observation is the easiest research method as it requires minimal technical knowledge. This method is great as subjects behave in a natural manner which keeps the data from being skewed. Typically, researchers watch and take notes on actual behavior of consumers in the field.
- Consumers are unaware that they are being studied
- Requires minimal technical knowledge
- Time consuming
- Can involve large amounts of inactivity
- Observations may lack depth and qualitative richness
Visualize And Communicate Results
The ability to present the information you’ve collected is arguably the most important part of market research, aside from collecting accurate data. Properly visualizing the data helps you present the information in a way that can be easily understood and help you make informed decisions to improve your business. Data visualization includes a large variety of methods including but not limited to:
- Line chart
- Pie chart
- Bar chart
- Scatter chart
- Bubble chart
- Scatter map
- Pivot table
The data visualization you’d use depends on the data and story you’re trying to showcase. But that’s a whole other blog!
Some helpful tools for organizing and visualizing data include: Microsoft Suite, JMP Statistical Software, or Tableau.
Performing market research will only benefit the company, and the more data pulled will lead to more room for improvement. Then soon the business will be booming like never before!