Market research is the process of gaining a better understanding of your customers and industry. It includes everything from asking for feedback from your potential or current customers, to evaluating the products or prices of a competitor. Formalising your information gathering process will produce valuable data that can guide critical business decisions.
“Effective market research should answer important questions about your business, such as who the customers and target markets are, and what the market penetration strategy is. Ask yourself: what information do I need, how best can I gather that information, and how will I aggregate, analyse and put the data to use?” – Emmanuel Olawale, Nigeria-based market intelligence consultant for BSH Group.
Some of the ways you can collect market data include observation (physically and in the digital realm) to ascertain consumer behaviour; developing surveys; setting up focus groups; and product testing. There are many online market research tools available, including SurveyMonkey and Typeform.
Remember, data is only meaningful if you can turn it into useful insights that can deliver value for the business. Although there is no silver bullet for analysing data, online platforms such as DataCracker and DataHero make the process much easier.
Here are some examples of how you can use data to grow your business.
1. Understand your customers better
A manufacturer of a new breakfast cereal in Cameroon developed a complete buyer persona using data from questionnaire surveys he’d conducted in major cities. Thanks to these insights, he was able to focus on the right target market, put in place effective strategies and achieve great results from marketing activities.
2. Identify new opportunities
Data from government departments and industry-specific reports can help, for example, a retailer looking to open a new store to find the right location. The information from these sources shed light on the size of the market in specific areas, household incomes, and the locations of key competitors. The retailer will then be able to develop an ideal strategy for expansion.
3. Get insight into service/product features
If you want to launch a new product or service, rich data from qualitative research (interviews/focus groups/customer feedback) can gauge reaction to a sample product and its features (look, design, usability, etc). This insight will assist in making informed decisions on the concept and design of the final product.
4. Measure the effectiveness of your marketing
Data gathered from customers can help a business owner do a better job of promoting a product/service and generating sales. This type of data, which measures awareness and reaction to specific campaigns, can help you design marketing strategies that resonate with your target audience.
5. Improve your branding
What do customers think of your brand? How does your brand compare with the competition? Through analysing information from focus groups and interviews that explore brand awareness, competitive comparisons and personification (the characteristics and traits customers associate with your brand), you can develop your brand positioning and improve your marketing initiatives.