We always hear that market research is important for businesses. However many business owners are not yet utilising the potential market research bears for their brand and losing out big time. So what does it really mean for your business and why this hype surrounding market research?
Getting the Grasp
Let us start with the basics first. Put in simple terms market research is about the process of gathering, analysing and interpreting data. Common practice suggests that market research starts with a question that needs to be answered and which can pretty much cover any market, topic, sector, product or service.
When it comes to market research vis-à-vis marketing, below are some handy questions to ask yourself:
- How can I assure an effective market entry into a new country/continent?
- Shall we focus our marketing budget on online or offline marketing?
- What type of creatives shall we use in our digital marketing campaign?
- What media channels will we be using to market our campaign?
- Who is our target audience vs. our ideal client? What about their demographics, interests and do we reach them effectively?
These are just a few questions, we delve into on a regular basis with our clients. Whereas some businesses do have a clear understanding of who their target audience is and how to best promote the company and their brand, there are businesses with a long-standing that are used to the status quo without yet acknowledging that external factors have an essential impact.
It’s happening right now
For example, a home décor retailer started targeting middle-income households some 30 years ago. Throughout the years, these businesses maintained their consistency with their strategy for sales and marketing. However, if the standard of living of a country increases, households might be willing to spend more on items that are not considered a necessity. Thus, there is an opportunity for the business to sell higher-value products, explore new segments, exploit opportunities to export and craft partnerships. We took this business owner on a journey of review, research, exploration, evaluation and strategic planning before we put our findings into practice and reached a 35% turnover for this business. Opportunity awaits if you open the door and take a step forward without being afraid of change.
The impact on your business
Whereas one might have a specific idea of the positioning and marketing of the brand, the characteristics of the target audience and the product or service might not support such a decision. Sustainable decisions are key to the success of any business and market research can come to the rescue to sustain or hinder certain decisions being made. Serious challenges arise for your business:
- Indecision due to lack of knowledge can cost you the competitive advantage
- Wasting time and losing momentum for crucial business decision means losing revenue
- Taking wrong decisions due to lack of insights
- Missing to meet customer needs and wishes can result in losing your market share
- Running late on trends results in your brand being a follower
How to go about Market Research
Now that you grasped the idea of the importance of market research, the next question would be from where should I start to collect the data? Formally, market research utilises two types of data:
- Primary data – is newly collected data that has been collected to answer specific question/s
- Secondary data – is readily available data which is collected for a specific purpose, but is used to address other questions.
Whereas secondary data has the advantage of being much cheaper and takes less time to get to an answer, it has its drawbacks. Indeed, even if secondary data is considered as reliable, using it to answer other questions might not result in the correct interpretation for the business’s situation. Reason being that the respondents who provided the information might not be of relevance for our purpose because they do not form part of our target audience leading to wrong decision making.
In most cases, the data required is so specific that it would be best to opt for primary data. Although primary data is more expensive it provides the ease of mind that the data is reliable if the right methodology is adopted. Continuing with the previous example of the home décor retailer, if the business has a database of customers, it would be valuable doing a customer satisfaction survey. As the name implies such a survey aims to gauge customers’ satisfaction with the products or services offered. This coupled with information on how much they are willing to pay for certain items, can provide key insights on the pricing strategy. Information on the habits of the customers, such as at the time they spend on social media, whether they listen to radio and watch TV provide input to the marketing strategy. Furthermore, other “unintended” findings can be extracted from a survey, for example, if there is a shortcoming in a service being provided, the business should consider whether it gives training to its staff members.
In market research there is no ‘one size fits all’ approach. Thus, the questions to be asked, how the data will be collected (telephone or online), how to contact the respondents etc, depends on a number of factors, including the characteristics of the business, the existence of a customer database, etc. Keen would be able to guide you and assist you throughout the whole process. We can also provide complementary services through research on best practice in the sector and competitor analysis.
Why do business by trial and error, loose opportunities and a big chunk of your profit, when you can do market research? Taking smart sustainable business decisions that help grow your brand and your bottom line comes as an investment with promising returns, not at a cost.
At Keen, we have nurtured our in-house market research team to benefit brands’ stories to success and to build strategies that deliver.
If your mind started ticking with questions and ideas, you might want to share a thought with our Head of Research, Isabel.