One of the foundations of every business strategy is market research. How will you be able to sell your product if you don’t know who you’re selling it to? You need to know who your potential customers are, what their shopping and purchasing habits are, what influences these habits, and how you stand amongst competing brands. All of these insights are beneficial to help you reach your target market, increase customer loyalty and satisfaction, and improve sales. You can also take the help of business planning consultants which help you to boost your business in 2x speed. While doing market research of any kind of business, business needs some planning to promote and to do that one can use sample business plans for exceeding competitiveness in the market.
Simply put, an in-depth market analysis is a must in order to stay afloat in the competitive business arena. In this article, we’ll quickly define market research and its importance for your business, what are the different methodologies you can use, and we’ll guide you on how to conduct a market analysis in 5 steps.
What is market research?
Market research is the process of gathering information about the business’s target market and analyzing the information to create better products and services for their customers. It’s a two-pronged approach that aims to answer the “what” – who your customers are and how they think – as well as the “why” – why they are thinking this way.
Doing thorough market research is a necessary part of every business strategy. Through research and analysis, you get to paint a picture of your potential customer, understand their buying decisions, and design your marketing strategies to best capture this market. Every other company in your industry is competing for that customer’s patronage, and market research is your weapon to stand out from the competition and win. Strategic market research can help you to build a perfect marketing plan for your business.
Remember, whoever gets closest to the customer, wins.
What are the different methodologies for market research?
The different techniques when conducting primary market research can be divided into two broad categories: quantitative and qualitative. In most cases, both of these methodologies are integrated in one market analysis to answer different questions about the market.
Quantitative market research
Quantitative market research involves numerical data from a successfully large portion of the market, statistically analyzed to look for trends and patterns that can help you understand the customer. Quantitative research mainly answers the “what” about your customers and their behavior. From your findings, you can answer questions like “how much are people willing to pay for a certain product?” or “what are some factors that customers consider when purchasing a product?”
Some commonly used methods of data collection for quantitative research are surveys and questionnaires, whether online or on-ground. Because they are easy to perform and are highly standardized, a larger number of respondents can be tapped for data collection. This large pool of data is crucial for statistical analysis to make sure that your data sufficiently represents the whole population of your target market.
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Qualitative market research
Where quantitative research covers the “what” about customer behavior, qualitative research connects the dots and tries to answer the “why”. Instead of hard, numerical data, qualitative market research relies on opinions and insights from the customers themselves to explain certain purchasing habits, motivations, and emotions.
Some methods of qualitative market research include focus groups and group discussions, in-depth interviews, and online forums. Simple observations of customer behavior in real life can also be a powerful source of information for qualitative research.
The goal here is to break down the psychological mechanisms governing your customers’ behavior to better understand their rationales behind certain decisions. With qualitative market research, you look between the lines and try to answer questions like “why does my potential customer prefer one brand over another?” or “what makes them convert to another product and why?”
What are the 5 key steps when conducting market research?
1. Identify your target market and buyer personas.
Not everyone will be your customer, and proceeding with your marketing strategies trying to target everyone will ultimately be a waste of resources. That’s why it’s important to identify who you’re selling to early on in the process.
Build your buyer personas – generalized representations of your ideal customers. Based on demographic data, start painting a picture of your customer and their main motives. Aside from the usual demographics like age, gender, and profession, make sure to answer these questions:
- Who are they?
- What is their main motivation and goal? (in relation to your product or service)
- What prevents them from achieving this goal?
2. Collect your data – both quantitative and qualitative.
Once you have identified your buyer personas, begin planning how you will engage these personas for your data collection and research. Make sure to use methods that will accurately represent your buyer persona’s demographics, both quantitatively and qualitatively.
For example, let’s say your product is a new scheduling app, and your main buyer persona is university students. You can send out online and on-ground surveys to students from different universities, and for qualitative data, you can conduct interviews and small focus groups. Some important questions that you can use to pattern your data collection are:
- Who are you and what do you do? (Customer demographics)
- What does your day look like? (Motivations, spending habits)
- Have you ever purchased X, and what made you do so? (Goals, influences)
- What made you stop/want to stop using the product? (Challenges)
3. Size up your competition.
Every other brand you’re competing with is conducting their own market research, and you need to understand how they’re leveraging this analysis to improve their own products. Compare your competitors, determine their strengths and weaknesses (SWOT analysis), and see where your business is positioned in the market. Use these insights to further guide your data analysis. Do also SEO research to rank higher on SERP’s Rank. If you don’t know about SEO and Digital presence then contact SEO Expert in Bangladesh, which helps you to increase SEO and SERP’s rank on search engines.
4. Analyze your data.
After collecting all that data, it’s time to start transforming these into actionable insights. For big, quantitative data, use statistical software to look for trends and patterns about your customers’ behavior. Create visualizations like graphs and charts to best present your findings.
For qualitative data, make sense of the different opinions and observations you have gathered and start connecting the dots of how your customers think and why they think that way. You can build diagrams like a flow model or affinity diagram to illustrate your points.
5. Present your findings to your team and key decision-makers.
The next step would be to present your research to your company to help design targeted marketing strategies. Your presentation must summarize your research procedures, illustrate your key findings, and suggest plans of action to bring your research to life.
Our collection of free business PowerPoint templates can help you express your market research findings to your team competently.
Final words
Conducting market research may initially seem daunting, but it’s quite straightforward as long as you have laid out the work and created a game plan. The benefits of successful market analysis for your business are clear, and it will truly help you understand your customers better and stay ahead of the competition.
