What is Market Research? – Importance And Types

Market research is the process of gathering information about consumer preferences, target markets, and the viability of a product. It is also defined as the process of evaluating the achievability of a new service or product through research conducted directly with potential customers. This method can be conducted directly by companies or organizations or can be outsourced to agencies that have expertise in the process.

What is Market Research? - Importance And Types

It can be done through product testing, surveys, and focus groups. Furthermore, market research is a very critical component in the research and development of a new product or service. However, the primary purpose of conducting a market survey is to know and understand or examine the market associated with a particular service.

To decide how the audience or customers will react to a product or service. The information or details gotten from conducting a market survey can be used to tailor marketing/ advertising activities. It can also be used to determine the feature priorities or service requirements of customers.

Why is Market Research Important?

Conducting market research is one of the best ways of achieving business elevation, reducing customer churn, and customer satisfaction. Nevertheless, below are the reasons why it is so important to be considered in any organization or business.

  • It provides opportunities and information about the value of new and existing products. Thus, helping strategize and plan accordingly.
  • It helps to know what the customers want and need. Marketing is customer-centric, and knowing and understanding the customers and their needs will help the business make products or services that suit them best.
  • By understanding what the customers need, businesses can also forecast their sales and production. This method also helps to determine the optimum inventory stock.

Market survey helps to stay ahead of customers because it is a vital tool for carrying out comparative studies. Businesses can devise strategies that can help them stay one step ahead of their competitors.

Types of Market Research

Now that you know why market research is so important, let’s talk about the types of market research. Although there are different market research tools to use, there are only two types of market research data. Below is the market survey data. Check it out.

  • Primary market research: It is a process whereby businesses or organizations get in touch with the end customers or employ a third party to carry out relevant studies to gather data. The data gathered can be qualitative data or quantitative data. It is a very useful process when your business establishes your buyer personas. Primary market survey tends to fall into one of two buckets; specific and exploratory research.
  • Secondary research: This is the entire set of data and public records you have at your disposal to conclude from, e.g., market statistics, industry content, trend reports, and sales data you have on your business. Secondary market research is very useful for analyzing your competitors. The main buckets secondary research falls into including public sources, internal sources, and commercial sources.

How to do Market Research

Congratulations!! You want to use market research in your business or company. Below are the guidelines to follow to do a market survey;

  • Define and know your buyer persona: Before you go into how consumers in your industry make decisions, you must know and understand who they are. And this is where your buyer personas come in handy. Buyer personas also referred to as marketing personas, are generalized representations of ideal customers.
  • Choose a persona group to interact with: Now that you know who your buyers are, use those details and information to help you identify a group to conduct your market survey with. The group you identify should also include people who have made a purchase or purposely did not want to make one.
  • Prepare research questions for your market research group: The best way to make sure you get the most out of your conversation is to be well prepared. You should always create a discussion guide, whether it is for an online survey, focus group, or phone interview. Just make sure you cover all of the major brain questions and use your time wisely.
  • Summarize your findings: Are you happy with the notes you took? I suggest looking for common themes that will help you create a list of action items. To make the process easier and faster, try summing your favorite software presentation to make a report. It will make it very easy to add diagrams or call clips.

Just make sure you find the market survey tool that works the best for you. For more information about market research, check out this link.

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