Alexis Larinda Carney
Aug 14, 20222 min
Updated: Aug 23, 2022
Market research is the process of determining the viability of a new service or product through research conducted directly with potential customers. Market research allows a company to discover the target market and get opinions and other feedback from consumers about their interest in the product or service.
Market research is an organized effort to gather information about target markets and customers: know about them, starting with who they are. It is an important component of business strategy and a major factor in maintaining competitiveness.
Market research allows you to meet your buyer where they are. As our world (both digital and analog) becomes louder and demands more and more of our attention, this proves invaluable. By understanding your buyer's problems, pain points, and desired solutions, you can aptly craft your product or service to naturally appeal to them.
Market research also provides insight into a wide variety of things that impact your bottom line, including:
Where your target audience and current customers conduct their product or service research
Which of your competitors your target audience looks to for information, options, or purchases
What's trending in your industry and in the eyes of your buyer
Who makes up your market and what their challenges are
What influences purchases and conversions among your target audience
Consumer attitudes about a particular topic, pain, product, or brand
Whether there's demand for the business initiatives you're investing in
Unaddressed or underserved customer needs that can be flipped into selling opportunity
Attitudes about pricing for a particular product or service
Ultimately, market research allows you to get information from a larger sample size of your target audience, eliminating bias and assumptions so that you can get to the heart of consumer attitudes. As a result, you can make better business decisions from knowing the bigger picture.
Primary
Secondary
Qualitative
Quantitative
Branding
Customer
Competitor
Product
Steps Involved in Marketing Research Process:
Identification and Defining the Problem
What is the issue?
Statement of Research Objectives
How can researching help?
Planning the Research Design or Designing the Research Study
Four common types of market research techniques include surveys, interviews, focus groups, and customer observation.
Planning the Sample
Who is your target audience(s)?
Data Collection
There can be broadly two types of sources
Internal sources—existing within the firm itself, such as accounting data, salesmen’s reports, etc.
External sources—outside the firm.
Data Processing and Analysis
Formulating Conclusion, Preparing and Presenting the Report
Answer the following questions to get a good sense of your market:
Demand: Is there a desire for your product or service?
Market size: How many people would be interested in your offering?
Economic indicators: What is the income range and employment rate?
Location: Where do your customers live and where can your business reach?
Market saturation: How many similar options are already available to consumers?
Pricing: What do potential customers pay for these alternatives?
Assess the following characteristics of the competitive landscape:
Market share
Strengths and weaknesses
Your window of opportunity to enter the market
The importance of your target market to your competitors
Any barriers that may hinder you as you enter the market
Indirect or secondary competitors who may impact your success
Strategic
Strategic decisions are major choices of actions and influence the whole or a major part of business enterprise.
Tactical
These decisions relate to the implementation of strategic decisions.
Operational
These decisions relate to day-to-day operations of the enterprise.