Market research is a systematic method of determining how much consumers value something and what they would pay for it. Market research includes two parts, primary and secondary market research. Primary market research involves collecting information about consumer preferences. Secondary market research consists of surveying producers, distributors, retailers, and service providers.
Once these industries have been surveyed, the data collected is analyzed and conclusions are drawn. Through this analysis, marketers can make educated decisions regarding their future business practices. There are many different tools and methods for conducting market research. These can range from surveys to focus groups, from online questionnaires to observational studies. To conduct market research effectively, it is best to use multiple tools when possible.
How does market research work?
I am sure many of you have heard about market research before, but I want to give you a little insight on how it works and what methods you can use to get started.
1. How does market research work?
Knowing how market research works is the first step to understanding how it can benefit your business. Market research is a process of gathering information about the wants, needs, and desires of consumers in order to determine what is needed in the market and how to meet it. The research is typically done by conducting surveys, focus groups, and other research methods.
Market research is conducted for many different reasons. For example, market research can help companies decide where to locate a new product and how much to spend on it. It can also help companies decide what to do in the event of a crisis. The purpose of market research is to understand the needs of customers and make decisions based on that understanding.
Once a company has decided on its marketing strategy and product/service offerings, it’s time to start getting feedback from potential consumers. Market research begins when a marketing team is given a brief describing their customer base and any goals they wish to accomplish. Next, they begin building a list of questions to ask prospective customers. Questions are designed to help answer specific questions about their customer base including but not limited to:
- What are typical purchasing habits?
- Who are these customers buying from?
- Are these customers happy with their current supplier? If yes, why? If not, why not?
- Why did they choose this particular vendor?
- What do they think of our product/service offering?
2. what methods you can use to get started?
Here are some ways you can conduct your own research yourself:
- Google Trends – Searching the internet for keywords related to your product or service will help you find out what topics consumers are interested in and if they are searching for information about these topics.
- Social Media Websites – Researching popular social media platforms such as Facebook, Instagram, Twitter, Pinterest, etc., can help you gain an understanding of what people are talking about.
- Online Forums – If you have an idea for a product or service, there are online forums where people discuss various topics. These forums are great places to discover what people are asking questions about and what they think about your product or service.
- YouTube Videos – There are millions of videos being uploaded to YouTube every day. Watch them and see what types of products/services are discussed and what type of questions people ask.
Why do we need to perform market research?
When conducting market research, marketers should always consider the purpose of the study. If the objective of the survey is to understand consumer behavior, then the survey design should be focused on gathering relevant data; if the goal is to determine the potential demand for a product, then the study design should target the specific demographic group the product is intended for. A marketing survey may not only reveal useful information about consumers’ attitudes toward products, but it will also give insight into consumer behaviors and interests, helping businesses make informed decisions. In addition, a survey that gathers information about competitors can help companies learn about the competitive landscape of their industry and identify opportunities for gaining an advantage.
Types of market research
There are many different types of market research, but there are some types of market research that are the most common.
2. Secondary Market Research
Secondary market research involves gathering information from third parties, such as industry publications, trade magazines, blogs, online forums, etc. These sources give you additional insights into market trends, consumer behaviors, competitors’ strategies, etc.
3. Primary Market Research
Primary market research includes surveys, focus groups, interviews, etc., conducted internally at the business. While primary market research is often less expensive than secondary market research, its results may not always be accurate due to a lack of internal expertise.
4. Strategic Market Research
Strategic market research includes analyzing data collected from previous market research, using analytics tools, and developing detailed plans for future marketing activities.
5. Competitive Analysis
The competitive analysis compares your brand or company to your competitors. You’ll find out if your products are similar to those already on the market, or whether your product offers unique qualities that set you apart. To conduct competitive analysis, collect detailed information about your competitors’ products and services. How many companies offer the same service/product? Are they selling the same way? Do they have any special pricing discounts or promotions going on? If you’re considering entering a new market, conduct a competitive analysis before making final decisions.
6. Customer Segmentation
Customer segmentation analyzes data provided by past customers to group them according to similarities in demographics, interests, lifestyles, purchasing habits, etc. Customer segmentation is useful for identifying target markets and determining how best to reach these markets.
7. Consumer Research
Consumer research studies the behavior of different types of buyers – young, old, men, women, students, families, etc. Consumer research allows you to identify and understand the characteristics of individuals who influence buying decisions. Conducting consumer research gives insight into customer preferences, motivations, and attitudes toward brands.
Benefits of market research
Marketers who conduct market research collect valuable information about consumer preferences and habits. They can gain insights into consumer attitudes toward their company’s brand, products, services, and advertisements. Marketers can also observe trends, predict future sales patterns, and discover new markets. Market research conducted by third parties can provide additional data points that complement the findings of internal studies.
Market Research is defined as “a systematic investigation intended to provide information about prospective customers’ motivations and behaviors related to goods and services. Market research may be conducted using several methods including survey research, focus groups, and qualitative analysis of existing data.”
In the cannabis industry, many companies and startups use market research as a way to gain insight into what their potential customers want. Now we’re going to discuss some of the advantages of conducting market research.
Some of the benefits that companies get from market research include:
- Discovering insights into customer psychology and attitudes towards their products.
- Developing stronger and more effective marketing campaigns
- Understanding the best ways to communicate with current and potential customers
- Identifying problems in the market and developing solutions
- Measuring how well a company is doing marketing outreach
Cost of market research
The cost of conducting market research varies depending on project scope, budget, and time frame. However, it is often cheaper than advertising. Other costs associated with market research include salaries, printing, paper, postage, and internet access fees.
Common errors in market research
There are several ways that market researchers can fail to achieve accurate results.
1. the sample size used in a survey should be representative of the targeted population.
2. questions should be clear and concise.
3. respondents should answer honestly and accurately. Finally, the researcher should avoid bias when interpreting and analyzing the survey results.
4. Not conducting external research
The best way to learn about what competitors are doing is by talking to them. Conducting external research through industry publications, social media, and company websites can give you valuable insight into your competition’s plans. Even though looking at competitor strategies can tell you a lot, don’t rely solely on this information.
You need to dig deeper and get out into the field to ask real questions about how they operate. You’ll want to talk to customers directly who’ve purchased from your competitor, and even those who haven’t bought from them yet. These interviews will allow you to identify any trends or problems that could affect your business. If your competitor’s strategy seems to be changing, chances are you’ll face similar changes soon enough.
5. Using unreliable data
There are many ways to collect market research. Online surveys are one of the easiest and least expensive methods, but they aren’t perfect either. People are notoriously bad at answering survey questions accurately, and some online platforms make it difficult to get a good sample size, making them unreliable.
One of the biggest downsides of using online surveys is that they often aren’t anonymous. Therefore, it’s impossible to truly know if the answers are coming from real people or bots. What’s worse is that some companies hire people to fill out the surveys for them, meaning they don’t get accurate responses. So, while they may not be as reliable as direct conversations, they’re still worth checking out.
6. Poorly written survey
Your survey should be concise and clear. Use bullet points, not paragraphs. Make sure your questions are short and simple. People are busy and don’t have time to read long surveys. In addition, make sure your questions are relevant and interesting.
7. Too much data
Try to keep the length of your survey under 10 minutes. If you run out of space, add more questions later. Most importantly, keep your survey short and sweet!
8. Using irrelevant pictures
Pictures can really help convey your message, especially if it is about food or beverages. However, avoid using ugly or funny-looking pictures. Avoid using pictures that could be considered offensive, sexist, etc.
9. Lack of clarity
Include details, descriptions, and examples wherever possible. Include words like ‘always’, ‘never’ and sometimes. Always use verbs and nouns instead of pronouns when possible. A good example would be instead of saying “I always eat breakfast”, say “I consume breakfast”.
10. Focusing on the wrong problem
Avoid making assumptions about the customer based on their behavior. Focus on the customer’s problems instead. Get to know them personally before you start asking questions. Your goal should be to uncover things they don’t already know, rather than telling them something they already assume.
11. No incentive
People love free stuff. Give incentives like coupons, discount codes, or special promotions to encourage participation. Many companies offer rewards programs that reward loyal customers.