The Importance of Spending Time & Resources Conducting Market Research (and How to Do It)
Understanding your customers and prospective customers are at the heart of producing products and services that users want to consume. The true difference between brands that excel and produce products that people want to buy again and again (not just the one-hit-wonders of the world), is that they are keeping the user at the center of their design, product development, and marketing strategy. They’re also staying relevant and keeping trends, global insights, and social patterns top of mind in their strategy.
Chances are that if you are imagining a brand that has remained a solid player over the last decade (or even over the past few years), they are doing some kind of market research.
So what exactly does that term mean: True market research involves collecting both primary and secondary data to inform the business decisions your brand makes.
- Primary data includes information that comes to your prospective customers directly (I will explore more examples of this in just a bit).
- Secondary data includes reports, statistics, case studies, and other information that you may not be collecting directly, but it considers the customer demographics, business competitors, and other relevant knowledge that can aid your own brand’s development before implementing strategy.
Collecting Primary Data. If you are interested in conducting market research yourself then you can absolutely start with secondary research, or in other words, relevant research that already exists in the world that you just need to dig up and apply! From there you may realize that you have enough to make informed decisions, but most often, companies who do market research decide to collect primary data based on their own unique pool of consumers. In other words, that means existing customers and prospective customers that meet target audience expectations.
Considering A Market Research Firm Vs. In House Research
The big question that businesses are concerned with is whether to hire a firm or conduct the research in-house. To truly answer that you need to ask yourself the following questions:
- Do you have the knowledge in-house? Do you have social scientists or other data aficionados that are capable of designing a study and executing it to get the kind of data you need?
- Do you have the resources? For example, do you know how to recruit the audience you want to get answers from?
- Do you have any experience or is this your first shot at conducting a study? Some research is easier (i.e, a survey) to conduct than others (i.e, a lab-based project).
If you have people on your team who are comfortable with social research design and fully executing a study, then in-house can be a cost-effective option. That being said, if this is not your team’s primary role, conducting even just one small study can take an extraordinary amount of time—we are talking to a team of multiple people focused on that project alone from design to data analysis over several weeks.
This is why most companies if they have the budget to do so, decide to hire a market research firm to conduct their study. These firms generally have the staff, resources, knowledge, and ability to take a study from design to analysis, as that is their primary workload. That being said, you as the client are not hands-off and disengaged, waiting for the results to come in. Generally speaking, most reputable firms want their brands to be involved in their own studies (as much as they want to be!). The idea is that the results shouldn’t really be a surprise to you once the project has wrapped, you should know what is coming by being involved along the way. After all, you should use any market research as a marketing tool.
Why Market Research is Worth It
Regardless of how you choose to do market research, it is absolutely worth your time and resources. Here are five reasons why:
- You Can Better Understand Your Existing Audience. In marketing, we talk a lot about getting to understand your audience. With market research, you can achieve this understanding through actual data, which can help to make important decisions and strategic marketing moves. One market research study can serve to improve several future decisions.
- Strategic Innovations that are Data-Driven. When you are looking to improve a product or service, you want to make the most innovative, cutting-edge decisions that you possibly can. Oftentimes marketing professionals have very good grounded insights about their target market, but market research can surface key findings to help drive specific innovation and strategy, based on study results.
- Find Something Surprising. When we step back from our work and let a fresh set of unbiased eyes look at the problem and conduct research around it, surprising findings can emerge. These surprises can lead to creative product evolution, but can also spark key marketing ideas that can help your business to excel.
- Identify New Customers. When research is done right, you will get information from a wide range of relevant demographics, and sometimes this can allow for identifying new customers that were not your initial target. Identifying a new customer base that you had not previously been reaching can help you redesign your marketing strategy to reach even more successfully.
- Look Into The Future Business Opportunities. Market research studies allow your audience to be heard in a direct way. This means that they have a channel to express their frustrations, desires, likes, and dislikes (all the more reason third party firms can be beneficial—people often feel like they can be more direct and honest). These comments or ratings, whether in a survey or some other kind of qualitative feedback, can help to identify patterns that can lead to future business opportunities you had not yet considered.
- It’s a Great Marketing Tool. Readers love case studies and facts. If presented in the right way for your audience (infographic, article, eBook, etc.) you should see a big surge in backlinks and engagement. If you’re the most recent company to conduct a specific study (or the only one), you should see these benefits for a long period of time.
Market research, whether done in house or with a third party firm, can be very insightful and help to redirect and improve your brand’s strategy. By knowing your target audience better, getting key insights into the products you offer, and identifying new opportunities, one study can open up a whole new world of possibilities if done well. If you have the and ability and you do not have the knowledge and resources in house, it is always better to work with an unbiased third party (just remember that not all firms are created equal, really do your homework before spending the money). Overall conducting one market research study, or several over time can be very beneficial for your brand’s development.