The Market Research Toolkit: Types of Research
A company’s survival depends on its ability to remain relevant to its customers, existing and prospects. The better a company knows its audience, the more likely it is to come out on top.
Market research is an essential tool in the competition for consumers’ hearts and minds. This is especially true in these turbulent times when the rate of social and technological change is constantly increasing, and consumers have little patience for companies that don’t understand their needs.
Yet the phrase market research is quite broad. It encompasses many different types of research, each with its own specific focus.
In this post, we will explore the various forms of market research — what each area focuses on and how it can help companies become more competitive.
A reasonable place to start is Product Development. Without something to sell, after all, why would we need to worry about the market?
In his 2001 essay “The Law of Accelerating Returns,” American inventor Raymond Kurzweil argues that the rate of technological innovation is increasing exponentially.
Product development lifecycles are getting shorter all the time. To stay relevant in such a fast-paced environment, businesses have to continually evaluate their offerings and keep on the hunt for opportunities to innovate.
Without rigorous New Product Development (NPD), a company risks falling too far behind the competition to ever catch up.
The process of product development begins with a concept, moves to the design stage, and then finally delivering a product or service to the real-world marketplace. Efficiency is key to ongoing success — complacency, its nemesis.
Pulitzer Prize-winning writer Herbert Bayard Swope is often quoted as saying, “I can’t give you a sure-fire formula for success, but I can give you a formula for failure: try to please everybody all the time.”
This is as true in business as it is in life. Businesses have to know their limitations. If a company tries to reach too many people, it ends up reaching no one at all.
Market segmentation research can help businesses identify their consumers by thinking of them in terms of segments and then targeting specific segments with bespoke strategies.
By using a mix of quantitative and qualitative methods, businesses can find their opportunities in the market and arm themselves with the knowledge and insight necessary to thrive.
Though they are often used interchangeably, the word brand is not synonymous with the words company or business. Brands, in fact, are actually perceptions — how the public sees, feels, and thinks about a company or business.
Companies conduct brand research to build new brands or to keep their current brands strong. They use surveys, focus groups, and analysis of social media to understand what people commonly associate with given brands.
The insights gained from brand research can help companies build a successful launch strategy or renew enthusiasm toward an existing brand.
It’s essential that companies regularly assess the effectiveness of their marketing measures. In doing so, a company looks to estimate how much a specific marketing strategy has boosted revenue while also reducing the costs of acquiring new customers.
In the past, assessing marketing effectiveness was far from simple. Before the rise of digital technologies, companies were limited to traditional outbound marketing strategies, such as TV, radio, and print adverts. It was difficult to gauge how these measures were affecting people in real-time.
It is much easier to assess the effectiveness of inbound marketing strategies such as blogs and social networking. Companies can track how many people encounter their messaging online and likewise monitor how messaging influences online behaviors.
To compete in the marketplace, a company must know its competitors’ strengths and weaknesses. This is why competitor analysis is such a key tool in identifying opportunities and threats in the marketplace.
Many firms fail to engage in regular, in-depth studies of their competitors. This leaves them open to getting blindsided by shifts in the market. To stay competitive, companies should frequently and systematically update competitor profiles.
Consumer insights really put the “quality” in qualitative research.
Traditionally, market research relied heavily on quantitative research methods, such as opinion surveys. More modern methods, however, often emphasize nuance overbreadth. And nothing digs deeper into complexity and idiosyncrasy than consumer insights.
In fact, consumer insights teams often combine the business savvy of brand managers with the academic acumen of anthropologists and ethnographers. The goal is to study consumer behavior with the same scrutiny that zoologists bring to newly discovered species of animal.
We’ve all had our fair share of both satisfying and unsatisfying experiences. Yet rarely do we pause to examine exactly what evokes these feelings inside us.
In the business world, satisfaction is key to winning new customers and inspiring loyalty in old ones. But how do businesses satisfy people? First, they must understand what the customer expects.
An exceptional product or service means nothing to a customer who expects something different. Businesses have to know what their customers want so they can work to either satisfy those needs or adapt their messaging to better manage expectations. Otherwise, they’re doomed to having unsatisfied customers — and eventually no customers at all.
Even with the best engineers and designers on the job, sometimes a product or service just doesn’t turn out to be as accessible or user-friendly as its creators had hoped.
This is why Usability Testing has become an essential tool in today’s market research toolkit. A company hoping to keep customers satisfied simply must get its products in front of the humans who will one day (hopefully) use them and test to see how the interaction plays out.
When testing usability, researchers observe participants as they attempt to complete various tasks in a controlled setting. The researchers are hoping to identify any problems with the product or service before it is made available to the general public.
This is not quality control. The defining feature of usability testing is that real-life consumers try out the products, not company employees, or hired contractors. This prevents potential bias and offers an invaluable channel for receiving feedback directly from users before it’s too late — when the feedback is posted online in the form of a negative review.
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