What is Market Research?
Market research is a crucial aspect of any business strategy. It involves gathering information on market trends, needs, and preferences related to your brand, product, customers, prospects, or competition.
The information collected helps you make informed decisions, remove distracting noise, and focus on the market information that matters most.
Why Is Market Research Important?
The market is rapidly changing, product life cycles are shrinking, and customer preferences continue to shift. Researching the market helps your business keep up with the changes and remain competitive.
In fact, according to Hinge Marketing, companies that conduct market research at least quarterly grow almost 12 times faster and are practically 2 times as profitable as firms that do no research.
Primary vs. Secondary Market Research
When conducting research, there are two methods: primary and secondary. Primary market research involves original research conducted by you or someone you hire. This method involves gathering information directly from the source through surveys, interviews, questionnaires, and focus groups.
Your research participants could include current customers, former customers, prospects, industry experts, and influencers. The information you collect is raw, unanalyzed, and specific to your project goals.
On the other hand, secondary market research involves gathering information that’s already published and publicly available. This method includes analyzing studies, reports, statistics, and data that answer your market research questions.
However, the data you gather from secondary research has already been analyzed or interpreted by a third party, which might not be specific to your goals.
Qualitative vs. Quantitative Market Research
There are two types of market research: qualitative and quantitative. Qualitative market research involves gathering non-numerical data or subjective insights, such as feelings, attitudes, and concerns. Marketers use qualitative insights to add depth and perception to the overall research.
It helps market researchers understand the “why” or develop a hypothesis for further study. Examples of qualitative market research include interviews, focus groups, and open-ended survey questions.
Quantitative market research involves the collection of numerical data that is objective and measurable. Quantitative market researchers analyze the data to find correlations, determine causations, conduct regressions, and perform other types of market analysis.
It helps you identify “what” is happening in the market. Examples of quantitative market research methods include polls, questionnaires, and surveys.
Market Research Objectives
You can conduct market research on almost anything. But before starting a market research project, you need clearly defined objectives. Common market research objectives include:
- Buyer personas: Build profiles that represent your ideal customer based on research
- Market segmentation: Divide your customers and prospects into specific segments based on demographics and psychographics
- Marketing message testing: Create or adjust your marketing messages to match what your target audience wants to hear, read, or see
- Market sizing: Understand the total available market and serviceable available market
- Competitor analysis: Analyze your competition to determine your market position or conduct a gaps analysis to improve your go-to-market strategy
Common Market Research Mistakes
Many marketers jump into the market research process only to find themselves overwhelmed. Before starting your next market research project, avoid the most common mistakes, including:
- Not clearly defining market research objectives
- Dumping too many research objectives into one study
- Allowing confirmation bias to skew your research
- Analyzing data without context
- Thinking correlation is causation
- Not spending enough time collecting and analyzing data
- Believing your customers and prospects are telling you the truth
- Thinking you’re too big to worry about the competition
Examples of Market Research
As a consultant for large companies and startups, I have helped my clients improve their products, services, strategies, and operations using market research. I’ll share three examples of how I have applied my expertise in B2B strategy to provide recommendations based on the information uncovered through primary and secondary research.
One crucial component of a successful market research project is the ability to tie and apply the results to a specific goal.
For instance, I worked with a global B2B industrial equipment manufacturer that wanted to understand its competitors and improve its go-to-market strategy.
Using a combination of qualitative insights and quantitative data, I conducted a competitive analysis and presented my client with a detailed gap analysis, competitive positioning, and GTM strategy recommendations.
Similarly, a domestic O&G distributor approached me to improve its sales strategy and key account management program.
By leveraging voice of the customer (VOC), quantitative analysis of market & sales data, and competitive benchmarking, I recommended improvements to their sales strategy and key account management program.
In another example, a global B2B company wanted to redesign its sales performance management strategy. Using primary and secondary research, I conducted a market and competitive benchmarking project and analyzed its current sales performance management process.
Based on the results, I recommended a new and innovative strategy to improve their sales performance.
Can You Conduct Market Research Yourself?
Yes, you can conduct certain aspects of market research yourself. However, there are certain pitfalls to avoid, such as creating a non-biased market research questionnaire and avoiding confirmation bias.
Moreover, unless you have marketers with specific expertise in analyzing market research, it might be best to hire an outside resource to analyze the data collected.
Additionally, customers and prospects are more likely to provide truthful insights to a third party, especially when the market research is blind.
If you conduct primary research interviews yourself, customers might be reluctant to provide critical feedback about your company or products.
In conclusion, market research is essential in developing a content strategy, improving a GTM strategy, or building a new product or service.
I hope this issue provided some insights. And feel free to reach out if you have any questions.
Take care, and have a wonderful rest of your day.