IS MARKET RESEARCH REALLY NECESSARY?
Market research is any organized effort to gather information about target markets or customers. You may have a lot of data coming from different sources, but that means absolutely nothing if you don’t look at it properly and analyze it thoroughly.
By properly researching your market, you get one step ahead. You have an advantage against your competitors. Market research is highly recommended for all businesses on a regular basis and for start-up businesses it is absolutely imperative.
Market research is a systematic, objective collection and analysis of data about your target market, competition, and/or environment and your goal should be to increase your understanding of them. What most people forget is this: market research is not an activity conducted only once. It is an ongoing cycle, or at least it should be if you are really going to benefit.
The power of information is outstanding when it comes to market research. The information you find can guide your most important strategic business decisions and usually, if done properly, the findings and conclusions you reach have a value that exceeds the cost of the research itself.
Here are my top 10 benefits why businesses need to conduct market research:
Market research helps you minimize risks:
Through market research, you may find all the information you need to decide whether to take action on a particular subject. For example, you may find that the particular location where you wanted to open a shop already has a saturated market in your line of business, which should make you refrain from making that decision and look for a more appropriate spot.
Market research guides your communication with current and potential customers:
Once you have your research results, you should have enough ammunition to formulate the most effective way to communicate to your customers. You should know what they like/don’t like to hear/see/do. Then you can tailor what you say to them to make them take action.
Market research helps you identify opportunities in the marketplace:
Research might make it obvious that a new product you have planned may not be what your market wants or needs. You may then decide to make modifications on what you are going to offer to suit your audience.
Market research measures your reputation:
It’s always good to know how you measure against your competitors. Market research finds out just where you are and then, according to the results, you can take action to change perception.
Market research helps you establish your market positioning:
It’s important to know the position of your business at particular moments in time. Information from market research helps you benchmark and monitor your progress, which can be useful to make decisions and take action. Market research helps you understand what your competitive position is in the market places which lessen the risk of competitors beating you and helps you make better marketing decisions in your business.
Market research uncovers and identifies potential problems:
You can get consumers’ reactions to a new product or service when it is still being developed. This should enlighten any further development so it suits its intended market.
Market research can determine the most persuasive ‘promise’:
Every brand needs to make a promise. If you think of the most known brands, they all make a promise to you and you usually know what is by just looking at their logo. It can be security, a fast and tasty meal or the assurance of top technology. It needs to be simple and market research can help you define what your brand’s promise is.
Market research helps you plan ahead:
Research can estimate the likely sales of a new product/service and also the advertising expenditure required to achieve maximum profits.
Market research can help you establish trends:
If you treat your market research as an ongoing exercise that you do periodically, you’ll find that you’ll have a lot of data to be able to analyze your customers and establish any particular trends.
Market research can find that compromise:
The team involved in the launch of a new product/service all have their individual perceptions and gut feelings. These certainly should not be ignored, but by going straight to the target audience, you will gain thoughts and opinions from people who may be less biased or less emotionally attached to a new development or service. It helps gain a new angle, hopefully a compromise in just how you are going to go about a new launch, a new brand or a brand re-positioning.
In a nutshell, market research is an invaluable tool that, at first, might seem expensive and slow, but it’s nothing more than an investment.
