Market research is an organised effort to gather data about potential clients and target markets: understand them, starting from where they are. It’s a very vital part of business strategy and a key factor in preserving competitiveness. Market Research may be defined as the process of gathering and comparing information that will eventually affect buying decisions. Companies use market research to identify new opportunities, to forecast consumer demand, to establish competitive advantages and to minimize risks.
Market Research can help define your marketing approach. If done well, it can provide a solid foundation on which to build. However, companies often proceed with market research in a haphazard way. This leads to poor decisions, and even worse – failure. Here are five of the most common mistakes made when conducting market research – in no particular order:
* Interpreting survey results: The first mistake is often to interpret survey results as the actual user experience level. For instance, a market research example may show that a particular customer preference is expressed by users when they are presented with a list of features. However, if we dig deeper, we soon realise that this feature has one or more negative outcomes – users might actually find the other features preferable.
* Concentrating on one dimension of users instead of users as a whole: Another error that is common is to treat “whichever group size you capture” as the representative sample. Even if we focus on a single dimension of users, such as age, gender, income level or location, we still do not have the whole picture. The reality is that different groups report differently. Surveys that are conducted among hundreds or even thousands of consumers will only give us a small snapshot of the actual consumer experience.
* Not setting enough goals: In a Marketing Research Process, setting realistic goals is important. The most effective Marketing Research Processes will involve defining clearly the learning objectives and measures. It is also advisable to set the learning objectives based on realistic financial and time constraints. Without these objectives, there will be no way to measure how the marketing research efforts are performing.
* Not developing an approach to the problem: The second major mistake is to develop a Market Research Process that is too generic. Instead of designing a specific methodology for the problem, it is better to develop a generic strategy. This allows the researcher to adopt a flexible approach for the secondary data analysis. The strategy can be changed as needed without having to change the primary framework. Market Research Processes development is most effective when it involves defining the problem domain, developing specific measures, designing appropriate questionnaires, collecting secondary data analysis and validating the results.