A Guide To Understand What is Market Research

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What is Market Research Customer Intelligence
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Conducting Market research may sound exhausting, but it can paint a clear picture for the business to understand what the customers really want. 

It is more important to learn and go through the process at the early stages of business to establish a deeper apprehension of what influences the customer’s decision and behavior. So, in this blog, we’ll address ‘what is market research’ and how to conduct it.

What is market research?

Market Research is a procedure to obtain information and recognize the target market best for the company. The process involves obtaining information from prospective customers about how reasonable and successful the new service and products are. 

A business can use this derived information to design a market strategy that results in an improved conversion rate. The marketing team uses the particulars of the data to create products that can improve customer experience.

Why should you conduct market research - 4 benefits

Market Research is the first step to define the users and their needs. Customer satisfaction and successful business all depend on an intuitive knowledge of market research. 

Apart from the fact that market research is cost-effective, that is, you don’t have to hire an agency or firm to conduct the research, the following are the other advantages of market research. 

Market research helps you gather insights on: 

  • Customers 
  • Your company and its offerings
  • Competitors
  • Overall industry

To better understand what is market research let’s look into the benefits of conducting it. 

1. Customers are important – 

Ensuring that customer’s needs are a top priority is an essential guideline of market research. Improving customer experience with the service and products of your company will take you a step closer to having a fortunate business. 

2. Market Research can answer the “Why” – 

Research can provide information on what the customers think and why they behave the way they do. It can gather details on the customer’s interest and opinion on existing and new services. As a result, it leads to establishing better strategies. 

Also, it helps you understand and examine what the customers prefer that’s in the market. 

3. Listening to customers means factual planning – 

Research can overcome assumptions and give proper data to base the production and sales planning. Understanding customer experience can prevent from following trends and focus more on the company’s goal and user satisfaction.

Moreover, customer’s needs can change when influenced by new products and services. Listening to customers can help you learn what you can provide better to keep them interested. 

4. Marketing research gives insight into the competition – 

It can provide intelligence on the competitor’s business. As a result, a company can build a strategy to stay ahead of competitors and dominate the market.

Learning the strengths and weaknesses of your competitors can aid you in thoroughly revising your own market strategy. What the competitors are offering and finding your own unique selling point (USP) can prove beneficial for your business. You can learn how to advertise your product or service, and how you can provide a better experience takes you several steps ahead of your competitors.

Additional read: The importance that market research holds for brands 

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What are the two types of market research?

Primary and secondary market research are the two fundamental types of research that further include a variety of research. The various types of research fit underneath these two research types based on their characteristics. 

01. Primary Market Research: 

It is a method of obtaining first-hand information to segment the market and establish the buyer’s persona. Further falling into two sub-categories are Exploratory primary research and Specific primary research. 

  • Exploratory primary research, as the name suggests, focuses on exploring possible problems. Tackled before any specific research is conducted, this method may involve open-ended interviews with a small group. 
  • Specific primary research follows once exploratory research is conducted. The method is used to clear out any issues that the business identifies as worth solving. Aimed to solve specific problems deemed important, the research aims at a precise segment of the target audience to question issues. 

02. Secondary Market Research: 

The data is readily available to you in the case of Secondary market research. Public records such as trend reports or sales data you have on your business from which you can draw conclusions are examples of secondary research. Falling into its sub-categories are Public sources, Commercial sources, and Internal sources.

  • Public sources are most accessible and often free when conducting market research. The U.S. Census Bureau and the Bureau of Labor and Statistics are examples of public reports. 
  • Commercial sources are data compiled by a research agency that consists of industry insight. Mostly, such sources cost money to obtain.
  • Internal sources are the reports you already have at your disposal. These are the reports which are present in the organization. 

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Common types of market research methods

There are many methods you can use to conduct a market research as we have explained in our blog on different types of MR methods. Here we will focus on four most common methods used to understand what is market research and how you can conduct it. 

1. Interviews/ Surveys: 

Face-to-face discussions or online surveys are one such research type. It allows a personal interaction of the researcher with the interviewee and a smooth flow of conversation. Asking open-ended questions and opening a room for discussion, along with reading the body language of the interviewees, is the purpose of interviews. 

2. Focus Groups: 

A focus group includes a small group of customers who fit the target audience to test your product. They usually provide online feedback and answer specific questions provided to them. This method does not necessarily involve direct interaction with the members of focus groups. However, despite providing extensive information, focus group research is expensive. 

3. Observation-Based Research: 

This method, as the name suggests, involves observation of the ways the customer or audience interacts with the products or services of your company. Observation research is less expensive. Moreover, the audience is less likely to be influenced, and you can observe them in a neutral and natural atmosphere. 

However, observation cannot provide any data from the customer’s point of view, which a survey or an interview can. 

4. Campaign Research: 

Campaign research is more of an internal analysis. It involves examining and analyzing past campaigns and their success rate among the target audience. The process includes measuring the plans and strategies that resonated with the target audience and were viable.

Additionally, using those plans for future campaigns and improving those elements to conclude a better customer experience. 

How to conduct market research?

There is software that can help conduct market research and provide information about user persona and what they want. The following are steps that can help you understand how market research is conducted.

Step 1: User’s persona

A user or buyer’s persona is a marketing persona created in terms of demographic and psychographic data. These data are collected from consumers/audiences who buy your product and use your website or those similar to yours. Understanding the user’s persona will help create a purpose for the market plan. A relative picture of your user persona is used as a guideline to learn about the audience’s demand in the market. 

These personas are established as a generalized representation of your target audience. The data is mostly obtained through email or website surveys and interviews. 

After conducting a survey to understand your user, you should be able to answer questions about the audience; questions like

  • Who are these customers?
  • What does the customer want?
  • What is preventing them from achieving their goal/ stopping them from buying the products?

Step 2: Survey / Observation

Surveys → 

Preparing a question for the survey is necessary, and the questions should be clear so that the audience understands them. Researchers can use open-ended questions to target specific issues or sections. Open-ended questions motivate the audience to openly provide their review and observation

Open-ended questions allow you to get deep insight and explore the concerns of the audience regarding services or products.

Observational Research → 

Observational research involves a researcher staying on the sidelines and observing the audience’s behavior and engagement with the product or service. There are overt and covert types of observational research. 

Overt observation is conducted under the permission of the customer to let the researcher observe. 

In covert observation, the audience doesn’t know they are being observed. This is possible when the product is a type that customers use regularly.

Step 3: Analyze your Research

Analyzing so much data or summarizing them to make them comprehensible may seem too exhausting. But this is an important step, and the goal of the research market is to find quick insight. 

You can interpret the information into a visual representation to make the flow of data smooth. Connecting customer’s interactions with your service/product can give you a better direction to assess their behavior and reasons for the decision. 

Or, you can group certain data where you notice a trend. Segmenting customer’s responses or by their profession or by the market can help create a vivid picture. 

Step 4: Create a Customer Journey Map

A customer journey map shows the path of a prospective customer becoming a paying customer. It tracks the first interaction a customer has with your brand through every step. The customer journey will provide a picture of the reasons why the customer decided to purchase the product or service from your company. Moreover, it can show you what almost stopped them from continuing your service. 

Step 5: Research reports  

The research report should tell a story of the successful purpose of the research market. There is no need to follow the order of questions to build the report. The research report should provide the conclusion of the market research first and then followed by the fundamental details. 

Step 6: Communication and Action

The research report must also be discussed with the entire team responsible for the marketing strategy. The discussion must be open so that every valuable member of the team can give their opinion. 

Additionally, the market research and report should lead to proper actions. Issues should be resolved, and performance should be improved for a successful business strategy.

Additional read: 10 Best Practices for Conducting Market Research with Survey Software

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Conclusion

In answer to the key question – what is market research – it is an indispensable tool in the business landscape, serving as the guide that propels companies to make informed decisions. Market research provides valuable and reliable insights into consumer preferences, competitive landscape, product/services, emerging trends, and more. 

In today’s fast-paced and ever-evolving business environment, the ability to adapt to the changing market dynamic is critical. Market research equips you with the insights to stay competitive and relevant.

FAQs

  1. What are the main types of market research?

Market research can be categorized into ow types: 

  • Primary research – gathering data directly from target.
  • Secondary research – analyzing existing data and informations.
  1. What is online market research?

This refers to using online tools like Voxco to gather data and insights from intended customers about a market. 

  1. How to do your own market research?

Here are some steps you can follow to conduct your own MR: 

  • Define research goal. 
  • Identify target audience. 
  • Choose suitable research method. 
  • Collect and analyze data. 
  • Interpret findings to make informed business decisions. 
  1. Do I need a market research firm to get reliable data?

Market research firm can provide expertise and resources, however, it is possible to conduct your own reliable market research. Leverage a market research software that equips you with capabilities required to run your own research. 

  1. What is the difference between market research and user research?

Here’s how to differentiate between market research and user research: 

Market research helps gather data on target demographic, competition, market size, and industry trends. 

User research focuses on evaluating the needs, behaviors, and preferences of specific customers/users.   

  1. What is a market study?

It is a comprehensive analysis of a target market, including its size, growth potential, customer segments and competitive landscape.

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