If you are a business owner, you have probably come across the term “market research” before. While many use this as an umbrella term for understanding what people want from a particular industry, market research is an important and specific tool that business owners can use to gain insights into the market, predict trends, find new ways to connect to consumers, and find a strong position for an individual business within current and emerging markets.
Today, we are here to break down exactly what market research is and how it can work for you.
Market Research is simply defined as: the process of examining an industry’s buyers, the products these buyers want, and where they are currently getting them.
In short, market research gives an overall view of consumer activity and opinions, and answers questions about the current state of an industry. This information can then be used to make intuitive decisions when it comes to your buyers, or even offer them something where your competitors are currently lacking.
When performing market research, it is all about engaging the right people and finding the right data. This can then be used by a business to find their position within the market, and predict where they might grow in the market in the future. What is your business’ place in the industry? Market research will help you to determine this.
While engaging in the research process, the information gained may be either qualitative in value, or quantitative in value. Let’s take a look at each of these types of information:
Qualitative: research concerned with public opinion, exploring how the public feels about products currently available on the market. This type of research is often largely formed through personal interviews, customer feedback, and buyer personas which can help identify what sort of people are purchasing your products and services, and the problems that they face that your business can solve.
Quantitative: research concerned with data and relevant trends that are gleaned from publicly collected data. This type of research is typically conducted through focus groups, surveys, census data, and other public information about your industry that can be found in market reports, trade magazines, social media business pages, or competitor websites.
What can then be gleaned from market research, are a number of different industry insights. These may include insights such as:
Consumers’ current attitudes towards a particular product, brand, or pain point, as well as attitudes towards the current pricing model of particular products and services
If there is a demand for the current business avenues that you are investing in or planning to roll out
Where the best places to advertise are and to whom
What customer needs are currently not being addressed that you may have a solution to
Now, it may be tempting to think that your current customer base and experience is all you need to know about the market and where you fit within it. But there are some things that market research can tell you that your current experience may be missing. This includes:
1) The Experiences and Findings of Your Competitors:
You may want to stand out from the crowd against your peers in the industry, but there is something to be said about learning from your competition. They too have first-hand experience that can be useful to your business in learning how to grow and thrive in the industry, as well as ways in which you may want to make changes or do things differently.
2) Larger Sample Sizes Are Closer to the Market as a Whole:
Your experience and customer base is valuable, but at the end of the day, it doesn’t represent the whole market. Increasing your sample size of data helps you to understand the overall scope of your market, and indicate areas and demographics that you may want to grow into that you aren’t currently hitting. Having a broader view of the market also helps to eliminate your personal biases about how you think things are for everyone, when really they may only apply to a small sector of consumers.
At the end of the day, market research is about getting real data from real consumers. This information can then help you to make decisions for your brand that minimizes risk, and gives you a high degree of knowledge to position yourself strongly within the industry.
Looking for more marketing insight and news? Sign up for the Fox & Forth newsletter.