Intuition and a knack for business is an essential quality of any entrepreneur. While it is undoubtedly an exceptional talent, simply relying on your intuition and gut feeling is not enough. You will need to depend on reliable data obtained from Market Research to ensure success and minimize risks. Market Research will be your guiding light in this ever-changing landscape of business and market research methods the key to it.
Perhaps you would like to know why some product sales show a stellar performance whereas others don’t! Market Research can provide answers to all these questions. Market Research can also shed light on who your consumers are, their needs and pain points, and how you can help them. By utilizing market research methods, you can take a step back, get a big picture of your industry and where you stand. Market Research makes sense of the vast data at your fingertips and lets you make informed decisions. Each informed decision, in turn, has the power to turn your business around.
What is Market Research?
Market Research is a well-defined process of gathering, analyzing, and understanding information about your target market. A significant component of business planning, market research methods shed light on the viability of new products and services. Market Research involves interaction with the customers of a company’s target market by collecting their opinions. This information, in turn, provides feedback that can help fine-tune their products or marketing campaigns for success.
Why Should You Conduct Market Research?
Market Research is vital to understand your users. You may have an overall idea about them, but to ensure customer satisfaction, you need to know them well, which is possible only through market research. Understanding your users and their needs help companies design fantastic marketing strategies.
Consider the unique story of Kelloggs.
Kellogg’s – the much-loved cereal brand- decided to enter the Indian Market in the year 1994. With a series of massive launches and numerous marketing campaigns, Kelloggs entered India with a huge bang. But its initial foray into India was not as smooth as expected. They owe their initial challenges to a lack of market research. Let’s see what went wrong and how Kellogg’s overcome this challenge.
They saw their sales decline, and analysis revealed that there were no repeat purchases of cereals. Now that they got to the bottom of “what happened,” they needed answers to ” why did this happen.” This is where Market Research methods came in. Kelloggs decided to take a look into the daily food habits of Indians. Indians are used to boiling their milk and having it warm with sugar. One main challenge would be to convince customers to have their milk cold rather than hot since crispy flakes would turn soggy in warm milk. Besides, they had heavy breakfasts like parathas and dosas. Bland cereal did not seem like a good substitute, and that too, at twice the price of competitors.
Every cloud has a silver lining – How Kelloggs turned the situation around.
After their initial market research, Kellogs brought out changes in their marketing strategy in India. The first to go on their packaging was their brand mascot “Corny,” the green rooster. But it didn’t sit quite well with Indian consumers, who were predominantly vegetarians. They brought out flavors like banana and mango to suit the Indian taste buds. They rolled out advertising campaigns that repositioned cornflakes as an evening snack for kids to recapture their market share. Fortifying cornflakes with iron and adding phrases like “Shakti.” also appealed to their Indian consumers. Kellog’s reduced the prices of their products and started to offer a variety of product sizes. Another variant called Frosties, launched in 1997, was also a great success.
Kelloggs now enjoys a 70% market share in breakfast cereals and is an undisputed leader, despite the initial challenges it faced in India. Their Marketing Research Techniques played a massive role in their success later on.
What Are The Two Main Types Of Market Research?
Market Research methods are of two types: Primary and Secondary. The former is most commonly referred to as field research and the latter as desk research. Primary market research methods encompass going out in the field to collect data, or in other words, carrying the research out, yourselves, as opposed to secondary research. Secondary research is the research conducted by others that you would want to utilize.
Primary market research methods
We shall further delve into the primary research methods:
1. Focus Groups
It is one of those marketing research methods that seem simple in theory but tricky to practice. Focus groups gather a group of people in a room. These participants are carefully selected to represent a sample of a target population. There would be a moderator who suggests a topic for discussion- A new idea for a product, opinions on feature updates, or political views. These free-style discussions offer a treasure trove of information for the researcher. They can glean many insights from the participants when an open discussion takes place. One of the downsides is that focus groups can go off-topic, and conversations may occur on what was originally not intended. Dominance bias and moderate style bias are some of the ways the research results could get skewed. Focus Groups are one of the best means to conduct qualitative and exploratory research.
Survey research is by far the most common market research methodology. Surveys are highly convenient and are administered through phone, in-person, and as an online questionnaire.
The questions in a survey are either closed-ended or open-ended questions. Close-ended questions are of different types: ranging from Dichotomous (questions with two answer options yes or no), checkbox, rating scales, multiple-choice to the fancier ones like matrix (where the presented options are in a grid format) and Likert Scale. The Likert scale has five options that vary from strongly agree to strongly disagree.
Crafting a survey requires a lot of skill- knowing what questions to include, apart from choosing the format of questions, involves a lot of thought and consideration. Good questions form the foundation of good analysis-one that reflects the genuine opinion of the respondent. Online Surveys are pretty straightforward, inexpensive, and let you collect data quickly.
When it comes to doing a survey, you can either do it on your own or let an online survey platform like SurveySparrow do it for you.
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Collecting and analyzing data through surveys form a part of quantitative marketing. Evaluate the responses statistically to answer questions such as “Who all currently use my products” and “How can I improve my products/services?”.The responses collected are in a very structured format. Since most questions in a survey are close-ended, there is little to no uncertainty. Surveys are one of the best market research techniques.
3. One on One Interviews
In one on one interviews, the interviewer has a direct conversation with the respondent. Among all the market research methods, this one is the most personal and allows for open communication. Through interviews, one can probe deep into the respondent’s mind and investigate in great detail. Apart from the fact that one-on-one interviews can be time-consuming and costly, it’s worth it. Speaking to a customer will help you become more empathetic, and you get a chance to see how they view your products. For these types of market research methods to truly work, the interviewer has to choose good leading questions that offer more insights.
It’sIt’s up to the interviewer to decide how they want the interview to go forward. Will it be a more casual conversation loosely based on your topic or a highly structured interview based on specific questions.
One on One interviews are best when conducted in person; if that is not possible, the next best option would be video-conferencing.
Observation Research falls under different categories: Strict Observation with very little interaction with the consumer and observation with some interaction level. Among all the market research methods, this one tests actual behavior. The researcher observes the consumer using their product in real-time, and it reflects real life. A fly-on-the-wall observation is an excellent way for you to assess how people interact with your products. Standard observation methods are:
Most familiar in the retail industry, we observe shoppers in a store setting. What do they notice at first, and how do they behave within the store?
With a combination of interview and observation method, the researcher interviews the consumer as they use their product.
Eye-tracking technology can create heat maps of the user’s eye movements while viewing a website showing you the most and least viewed portions. We can further optimize the website with this information.
5. Experiments and Field Trials
Experiments are based on two variables- A dependent and an Independent variable. In an experiment, the researcher varies the independent variable to test its effect on the dependent variable. The main objective here is to try if there is causality between variables. Does the independent variable cause a change in the dependent variable?
Experiments and field trials can either be in a controlled environment or a natural setting. An example of this in real life is A/B testing done on websites. Modifying their banner image, Call to Action button, or introducing new designs on their website has reported having increased click-through rates and sign-ups.
What are the steps of market research?
Now that we got a glimpse into the various Market Research Methods, here are some steps to take while doing market research:
1. Problem Definition
Note down the objective behind conducting the research. Researchers should have a clear idea of what information they have with them and what is needed. This will help when they draft questions they need to ask respondents. To ensure that the questions are practical, conduct a test with a small group and judge their responses.
2. Selecting the sample
To conduct market research, researchers need a sample representative of their target population. To obtain the most accurate results, the sample must have similar characteristics to the people they need to investigate. The larger the sample, the better. A large sample can reduce the effect of bias, but always remember that the survey will always be prone to bias since not all people will answer it or may not complete it. Sampling (i.e., Selecting the sample from the population) can be done by probabilistic and non-probabilistic sampling. Random selection of sampling is known as Probabilistic sampling. In non-probabilistic sampling, researchers select the sample based on specific demographics like age and gender.
3. Collect and analyze the data
Data from your consumers is precious. Ensure that your respondents answer the survey altogether to avoid research bias and to obtain accurate results. Once all the responses are collected, analyze the results and interpret them to form your research findings.
4. Finally, present your results and findings in the form of a report.
To create the best report, answer the most important questions that led to the investigation in the first place. Begin the report with your findings and present it in the form of a story for it to be fascinating.
Market Research Tools
Now that we know how crucial Market Research is for a business let’s take a look at some tools that can help you leverage the power of market research. These are some Market research tools that enable secondary market research methods:
Make My Persona
Each user has a persona of their own- Be it their occupation, age, gender, or the purpose of using your products. Make My Persona lets you create a buyer persona for your product. Choose a name, age, career, and the needs of your buyer. Before a product launch happens, you could refer to the documented list of Buyer personas to get a clear idea of who your customers are. Defining your audience is the most effective way to market your services properly.
SurveySparrow is a powerful tool for creating insightful market research surveys to study your market in-depth. Crafting the perfect survey can help you gain an overview of your target market and gain actionable feedback from your customers. Market research surveys will give your business that much-needed competitive edge from identifying the ideal market opportunities to analyzing your competition and choosing the perfect pricing strategy.
Social Media use is at an all-time high. It has become part and parcel of our daily lives. Therefore it is not surprising that your brand or product can be discussed on social media. Social Mention is a tool that ensures you don’t miss a single comment about your brand on the internet. It helps you gain a clear understanding of how consumers interact with your brand, apart from sentiment analysis- positive and negative mentions.
UberSuggest is a popular market research tool, especially among digital marketers. It is mainly used for research on keywords and content. Ubersuggest provides a glimpse into who your top competitors are and the frequency with which your brand name is searched. Moreover, you can also find out what your audience searches for regarding your product. These questions could be converted into a blog post or a thought leadership article showcasing your brand authority.
Yet another valuable tool to have among your arsenal of market research techniques is Statista. It is a data visualization website that retrieves data from across the internet and converts it into an easy-to-understand format. Researchers and Marketers can analyze information at a glance, saving a ton of time and effort. Visualizations and charts are updated each year. Take, for example, a research study on the increasing use of cosmetics among women. The statistics of the year 2015 won’t be the same as the year 2020, and the graph would have automatically updated over the years.
Wrapping it up…
Market Research is the foundation of any successful marketing strategy. The main goal of market research is to provide your company with an understanding of its consumers. Choosing market research methods that are right for your business needs a lot of thought and consideration. Market Research Methods fall under Primary and Secondary Market research. While choosing a suitable one, consider your objective, the data that you require, along with the advantages and disadvantages of each one.
Armed with the best of market research methods and tools, get ready to take your business to the next level.