Market Research: Types and How to Conduct it.
Do you know that you can conduct Market Research to test the viability of a new product or service?
You will need to conduct market research by communicating directly with your potential customer.
With market research, your company can figure out the target market and get opinions, and feedback from consumers in real time.
Keep on reading.
Market Research is also known as ‘Marketing Research”.
You can use this type of research to find the viability of a new service or product through research that you can directly conduct with potential customers.
Moreover, it allows you to discover the target market and get feedback from consumers about their interests in the product or service.
Let’s learn more about it.
You can choose to conduct a market research in-house, by the company itself, or by a third-party company that specializes in it.
Moreover, you can conduct it through surveys, product testing, and focus groups.
Test subjects are often compensated with product samples or paid a small stipend for their time.
It is important to note that market research is a critical component in the research and development and R&D of a new product or service.
Market research is the process where you gather information about your target market and customers.
This helps to verify the success of a new product, helps your team iterate on an existing product, or understands brand perception to make sure your team is effectively communicating the value of your company effectively.
With the help of market research, you can answer a number of questions about the state of an industry.
However, it is hardly a crystal ball that markets can rely on for insights into their customers.
Moreover, market researchers tend to investigate a number of areas of the market, and it can take weeks or even months to get an accurate picture of the business landscape.
Certainly, you can make sound judgments on your experience in the industry and your existing customers.
But keep in mind that market research tends to offer benefits beyond those strategies.
There are two things you will need to consider:
1# Your competitors also have experienced individuals in the industry and a customer base
It is also possible that your immediate resources are equal to those of your competition’s immediate resources, in a lot of ways.
Thus finding a larger sample size for answers can provide you a better edge.
2# Your customers do not represent the attitudes of an entire market
They, however, represent the attitudes of the part of the market that is already drawn to your brand.
The market research services market is growing rapidly, which shows a strong interest in market research as of 2022.
Moreover, it is expected to grow from roughly $75 billion in 2021 to $90.79 billion in 2025 at a compound annual growth rate of 5%.
Why should you do Market Research?
Market research will allow you to meet your buyers where they are.
As the world, both digital and analog is becoming louder and demands more and more of your attention, this provides invaluable.
By understanding the problems of your buyer, pain points, and desired solutions, you can craft your product or service to naturally appeal to them.
Moreover, it provides insight into a wide variety of things that will affect your bottom line.
- where your target audience and current customers conduct their product or service research
- which of your competitors does your audience tend to look for information, options, or purchases
- what is trending in your industry and in the eyes of your buyer
- who tends to make up your market and what their challenges are
- what tends to affect purchases and conversions among your target audience
- consumer attitudes about a certain topic, pain, product, or brand
- whether there is demand for the business initiatives you are investing it
- unaddressed or underserved customer needs that can flip into a selling opportunity
- attitudes about pricing for a certain product or service
Finally, market research will allow you to get information from a larger sample size of your target audience, eliminating bias, and assumptions so that you can get to the heat of consumer attitudes.
As a result, you will be able to make better business decisions by knowing the bigger picture.
Types of Market Research
As you begin to hone in on your market research, you will likely hear about primary and secondary market research. The easy way to think about these two is to envision two umbrellas that are sitting beneath market research: one for primary market research and one for secondary market research.
Keep on reading to learn more about it.
Under these two umbrellas tends to sit a number of different types of market research.
Defining which of the two umbrellas your market research fits beneath is not necessarily important, though some marketers tend to prefer the distinction.
So, in case, you encounter a marketer who wants to define your types of market research as primary or secondary, or if you are one of them, let us understand the definitions of the two categories nest.
Primary vs. Secondary Research
To understand how extensive market research can get, consider that it can either be qualitative or quantitive in nature.
It depends on the studies you conduct and what you are trying to learn about your industry.
Qualitative research is about public opinion and tends to explore how the market feels about the products currently available in that market.
On the other hand, quantitative research is about data and looking for relevant trends in the information that you gather from public records.
There are two main types of market research that your business can conduct to collect information on your products.
This includes primary and secondary research.
Let’s dive into them.
Primary research is first-hand information about your market and customers within your market.
Moreover, this research tends to fall into one of two buckets: exploratory and specific research.
Exploratory Primary Research This kind of primary research is less concerned about measurable customer trends and more about potential problems that are worth tackling as a team.
It often takes place as a first step, before any specific research is performed and can involve open-ended interviews or surveys with small numbers of people.
Specific Primary Research This often follows exploratory research.
You can use it to dive into issues or opportunities your business has already identified.
In this research, your business can take a smaller or more precise segment of the audience and ask questions aimed at solving a suspected problem.
Secondary research is about data and public records you have at your disposal to draw conclusions from trend reports, market statistics, industry content, and sales data you already have on your business.
Moreover, secondary research is particularly useful for analyzing your competitors.
The main buckets this research falls into include:
Public Sources These sources are your first and most accessible layer of material when conducting this type of research.
These are often free to find and review.
Government statistics are one of the most common types of public resources according to Entrepreneur.
For instance, two U.S. examples of public market data are the U.S. Census Bureau and the Bureau of Labor & Statistics.
Both of these offer helpful information on the state of different industries nationwide.
Commercial Sources These often come in the form of market reports, that consist of industry insight compiled by a research agency like Pew, Gartner, or Forrester.
As this info is so portable and distributable, it often costs money to download and obtain.
Internal Sources This one deserves more credit for supporting market research that they often get.
Why? This is the market data your organization will already have.
The average revenue per sale, customer retention rate, and other historical data on the health of old and new accounts can help you to draw conclusions on what your buyers may want right now.
Types of Market Research
There are different types of market research. These include:
- focus groups
- product/service use research
- observation-based research
- buyer persona research
- market segmentation research
- pricing research
- competitive analysis research
- customer satisfaction and loyalty research
- brand awareness research
- campaign research
Let’s learn more about them in detail:
Interviews allow for face-to-face, either in-person or virtual interviews.
It allows for a natural flow of conversation and watching the body language of the interviewee while doing so.
Moreover, your interviewees can answer questions about themselves to help you design your buyer persona.
These will help to describe the age, family size, budget, job title, the challenges they face at work, and similar aspects of the lifestyle of the ideal customer.
Having this buyer profile in hand can help shape your entire marketing strategy from the features you can add to your product to the content you publish on your website.
Learn more about Content Writing at Markfinti here.
This will help you provide a handful of carefully-selected people that you can have test out your product, watch a demo, provide feedback, and/or answer specific questions.
Moreover, this type of market research can give you ideas for product differentiation or the qualities of your product that make it unique in the marketplace.
You can consider asking your focus group questions about your services and use the feedback of the group to make these services better.
Product/Service Use Research
Product/service use research that offers insight into how and why your audience uses your product or service.
And it also offers insight into specific features of that particular item.
This type of market research gives you an idea of the product or service’s usability of your target audience.
By comparison, digital analytics was rated 7.7, and user surveys 6.4.
This type of research allows you to sit back and watch the ways in which your target audience goes out about:
- using your product or service
- what works well in terms of UX
- what roadblocks did they hit
- which aspects of it can be easier for them to use and apply
Buyer Persona Research
Buyer persona research will give you a realistic look at:
- who makes up your target audience
- what their challenges are
- why they want your product or service
- what they need from your businesses and brand and more
Market Segmentation Research
This will allow you to categorize your target audience into different groups or segments.
Moreover, this is based on specific and defining characteristics, and in such a way, you can find effective ways to meet their needs, understand their pain points, and expectations, learn about their goals, and more.
Pricing research will give you an idea of:
- what similar products or services in your market sell for,
- what your target audience expects to pay,
- is willing to pay, for whatever it is you sell
- what is a fair price for you to list your products or services at?
All this information will help you define your primary strategy.
Competitive analysis is valuable as it will give you a deep understanding of the competition in your market and industry.
You can learn about what is doing well in your industry, and how your audience is going already in terms of products like yours.
Moreover, which of your competitors should you work to keep up with and surpass, and how you can separate yourself from the competition?
Answering these questions will help you differentiate yourself from your competitors.
Customer Satisfaction and Loyalty Research
Customer satisfaction and loyalty research will give you a look into how you can get current customers to return for more business.
Moreover, it will help you understand what tends to motivate them to do so.
For example, loyalty programs, rewards, remarkable customer service, etc.
With the help of this research, you can discover the most-effective way to promote delight among your customers.
Brand Awareness Research
Brand awareness research will tell you about what your target audience knows about and recognizes from your brand.
Moreover, it will tell you about the associations your members make when they think about your business and what they believe you are all about.
This type of research looks into your past campaigns and analyzes their success among your target audience and current customers.
It will require experimentation and then a deep dive into what reached and resonated with your audience.
It will help you keep those elements in mind for your future campaigns and hone in on the aspects of what you do that matter to those people.
Now that you know about the categories and types of market research, read on to learn how you can conduct your market research.
How to Conduct Market Research?
To conduct market research, you will need to define your buyer persona, identify a persona group to engage in, and prepare research questions for our market research participants.
Moreover, you will need to list your primary competitors, and summarize your findings in this process.
Keep on reading.
1# Define your Buyer Persona
Before you dive into how your customers and the industry make a buying decision, you will need to understand who they are.
This is where the buyer persona comes in.
Buyer personas referred to as marketing personas, are fictional, generalized representations of your ideal customers.
Moreover, it will help you to visualize your audience, streamline your communications, and inform your strategy.
Some key characteristics you should be keen on including in your buyer persona are:
- job title
- family size
- major challenges
The idea is to use this persona as a guideline for how to effectively reach and learn about your real audience members in the industry.
Moreover, it can help you find that your business lends itself to more than one person, which is fine.
You just need to be thoughtful about each specific persona when optimizing and planning your content campaigns.
2# Identify a Persona Group to Engage
After understanding your buyer persona, use that information to help you identify a group to engage to conduct your market research with.
This will be a representative sample of your target customers so that you can better understand their actual characteristics, challenges, and buying habits.
The group you will identify to engage should be made of people who recently made a purchase or purposefully decided not to make one.
The following are some guidelines and tips to help you find the right participants for your research:
Identifying the right People: when choosing who to engage for market research, start by focusing on people who have characteristics that apply to your buyer persona.
Make sure you aim for 10 participants per buyer persona.
Select people who have recently interacted with you, and gather a mix of participants.
Moreover, when selecting a mix of participants, keep in mind the following:
- pull a list of customers who made a recent purchase
- pull a list of ones who were in an active evaluation, however, did not make a purchase
- call for participants on social media
- leverage your own network
- choose an incentive
3# Prepare Research Questions for your Market Research Participants
One of the best ways to make sure that you get the most out of your conversations is to be prepared.
You should make sure to create a discussion guide, whether it is a focus group, an online survey, or a phone interview.
Make sure that you cover all of the top-of-mind questions and use your time wisely.
Moreover, your discussion guide will be an outline formal, with time allotment, and open-ended questions for each section.
4# List your Primary Competitors
When listing your primary competitors, keep in mind that listing the competition is not as always as simple as Company A vs. Company Y.
In some cases, a division of a company may compete with your main product or service, even though that brand may put more effort into another area.
For instance, Apple is popular for its laptop and mobile devices, however, Apple Music competes with Spotify over its music streaming services.
In the case of content, you may compete with a blog, YouTube channel, or similar publication for inbound website visitors.
Identify Industry Competitors: To identify your competitors whose products or services overlap with yours, find which industry you are pursuing.
Make sure, to begin with, a high level, using terms like education, construction, media $ entertainment, food services, healthcare, retail, financial services, telecommunications, and agriculture.
Though the list goes on, find an industry term that you identify it.
Then use it to make a list of companies that also belong to he this industry.
Build your list in the following ways:
- review your industry quadrant on G2 Crowd
- download a market report
- search using social media
Identifying Content Competitors: Search engines are your best friends in this area of secondary market research.
Take an overarching industry you identify like in the previous section and come up with a handful of more specific industries your company identifies with to find online publications.
Once you have this list, do the following:
- Google it
- compare your search results against your buyer persona
After a series of similar Google searches for the industry terms, you tend to identify with, look for repetition in the website domains you come up with.
Examine the first two or three result pages.
It is important to note that these pages are respected for their content and you will need to watch them carefully as you build your own library of videos, reports, web pages, and blog posts.
5# Summarize your Findings
You might feel overwhelmed by all the notes you consider.
Experts suggest that you look for a common theme that will help you tell a story and create a list of action items.
Moreover, to make this process easy, try using your favorite presentation software to make a report, as it will help to make it easy to add quotes, diagrams, or call clips.
Feel free to add your own flair, however, make sure to outline the following when you craft a clear summary:
- background: goals and why you conducted this study
- participants: who you talked to and table works so that you can break groups down by persona and customer./prospect
- executive summary: interesting things you learned and your plans about it
- awareness: common triggers that lead someone to enter into an evaluation
- consideration: main theme you uncovered, detailed sources buyers use when conducting their evaluation
- decision: how you made decisions including the people at the center of influence and any product features or information that can make or break a deal
- action plan: your analysis will probably include a few campaigns that you can run to get your brand in front of buyers earlier and/or more effectively, also provide a list of priorities, a timeline, and the impact it will have on your business