It is widely known that conducting market research is an integral part of the business. Without analysis of consumer behavior, overall brand perception, the potential offered by the given region, and many more critical aspects, it would be impossible for the company to succeed. We have prepared this article in order to help you get a better understanding of the importance of market research. Why is market research important? We invite you to read the following article!
What is market research?
There are many definitions of market research. Most of them define it as a comprehensive action aimed at understanding the essence of doing business. Market research involves gathering information about the problems, needs, and wants of the customers.
There are two types of data collection—qualitative and quantitative information. The first one involves fewer respondents (in-depth interviews and focus groups). When it comes to the second type, it involves many more respondents (questionnaires and surveys). People use it to draw specific conclusions.
Market research is usually used in the retail and manufacturing industries. That’s because those sectors are characterized by a high level of competitiveness. They require detailed analyses before taking further action associated with launching a new business or product into the market.
What’s the difference between primary and secondary research?
There are several methods of market research depending on what the customers need. There’s brand research, consumer research, product development, usability testing, and so on. However, market research generally involves two types of research – primary research and secondary research.
Every traditional and modern research method falls into one of those two categories. The difference between these two types is quite simple, yet there’s pretty often confusion around this topic.
Primary research
This type of research is the most time-consuming. It’s a methodology used by researchers in order to collect data correctly. Professional researchers do it at the customer’s request. Thanks to the primary research, the customer receives the latest possible and accurate data in the area they are interested in. Usually, it takes a lot of people to conduct market research. All of this is to ensure the quality and accuracy of the results.
Secondary research
The second type of research is definitely easier to carry out. The whole point of secondary research is to make an overview of the publicly available data and to organize these data samples. This type of research also involves collating and analyzing the data for valid research conclusions.
Does market research work? What does it take to do market research?
Doing market research is essential to keep up with market trends and maintain a competitive edge. It is important at every stage of doing business – when you start a new business, expand and develop new products. Thanks to the results, you can understand your target market and increase sales. That’s not all! You can also spearhead business growth.
Conducting market research does not belong to the easiest. It requires extensive knowledge and experience in carrying out analyses. Without adequate preparation, it’s easy to make mistakes that can affect final conclusions.
When the results of the survey are inaccurate, there is a risk that the customer can make bad market-driven decisions. If you feel that your skills are not enough to carry out your own market research, or you don’t have much time, you can use the services of our consulting and advisory company.
What are the benefits of market research?
Undoubtedly, there are many benefits of market research, and those all are impossible to be discussed in one article. Let’s focus on the most important ones. First of all, market research allows you to monitor the market.
You can monitor the market
With this possibility, you know your market position, and you become aware of your strengths and weaknesses. You learn that the market can be oversaturated with certain products. Thanks to market research, it becomes possible to acquire knowledge about the product.
For example, you want to release some product, but the analysis shows that the product already exists. in Or you realize that your product is not competitive. You wouldn’t realize it without the proper market research. Another advantage of market research is that you can learn how our company is regarded in your region and in the industry. You can explore the potential of the region. Consider investing in home usage test iHut.
You can create new business strategies
Have you ever wondered what could help you to make more conscious business choices? The simple answer is thorough market research. You will enhance your knowledge of distribution channels, pricing, and marketing mediums.
You will be able to identify opportunities to introduce some new product or service. Market research can help you to have more fresh ideas for your existing operations and activities. It’s a key component in developing a marketing strategy.
You can identify new customers
There’s nothing wrong with wanting more customers. But how to gain new ones without knowing who they are? The key is to UNDERSTAND your potential customers. You have to create a persona.
You need to determine the age, gender, marital status, income level, geographical location, what job this person has, what his values and hobbies are, which social media he uses, and, above all, what his biggest problem is. This is extremely important because you are the one who will solve all the target customers’ problems.
You can learn more about your existing customers
Focusing on gaining new customers only is not the best idea. You have to think about your existing customers too. Who are they? Market research can help you get to know them better. If you want to understand your existing customers, you have to ask yourself why they choose your products and in what way they use these products.
Simply put, you should understand their purchase decisions. You ought to learn how to improve your products to retain delighted customers. It becomes possible thanks to market research.
You can set targets for your business
What’s important, you can set targets that are achievable and realistic! You should conduct market research if you aim for business growth and continuous improvement. It’s worth using an STP model, which is based on segmentation, targeting, and positioning.
You can solve the biggest challenges
Market research can help you determine the sources of your problems. You can collect the latest knowledge about your new competitors who entered the market. Also, you can determine if brand awareness has fallen short. You can avoid declining sales before it is too late. These are the matters that should be crucial for business owners.
You can investigate opportunities for expansion
The next benefit of market research is that you become aware of areas for possible business expansion. What’s more, you are free to test the markets, which gives you priceless knowledge. You know if introducing a new product/service is worth the effort or not, and you know which location would be the best for you to open a new store. Nothing else can give you such possibilities!
You can identify the best way to expand your offering
The last thing we would like to mention is the fact that market research can help you find untapped or unappreciated niches and under-serviced markets. It becomes more than easy to identify changing market trends. You can raise your business to the next level.
The power and importance of market research – summary
The importance of market research is huge. It helps people who want to take their first steps in business. It also helps successful businesses present for many years on the market. This is something you should never give up, otherwise, you may fail to keep up with market trends, monitor the market, and always keep an eye on the ball. Don’t underestimate the power of market research!
