Market Research is the process of gathering information about potential clients and target markets: learn about them, beginning with whom they are. It’s a big deal and an important aspect of competitive strategy. Market Research is essential for product development, pricing, advertising, distribution, and selling. Without it, a company stands the risk of missing out on opportunities for growth, failure to penetrate and understand competitors, and being left behind as new technologies emerge and provide competing products or services.
Marketing plans always include some form of market research. Market Research helps companies determine what their target market is and what marketing mix would be most likely to drive that market. It can also help companies determine which competitors’ products or services are most likely to appeal to customers in a particular area. Market research data can also help marketing managers determine whether or not they have the right marketing mix in place. Once a firm has a basic understanding of its own customer base and what its competition’s are doing, they can start working on marketing activities that will most likely yield the kind of response that they’re looking for.
There are three major types of market research: qualitative, quantitative, and qualitative-quantitative. Qualitative-quantitative research involves gathering consumer reaction to product features, advertisements, and other forms of communication. Most importantly, it tries to uncover what works – what products and services are what consumers find most appealing. This type of research usually involves asking people how they found out about a particular product, service, or feature and then following up to see what kind of experience they had. For instance, one might conduct an internet survey to find out what kinds of ads and other promotional materials draw in consumers; another may focus on understanding what consumers are thinking about when they’re presented with various ads.
Quantitative market research attempts to draw conclusions about segmentation of a market. In essence, it’s done by surveying a large number of consumers about characteristics of a good or service, then breaking them down into subgroups according to things like gender, race, age, or income level. Different industries employ different segmentation techniques – for example, car companies might try to determine which cars are popular among girls, or find out which car brands are favored by middle-aged men. Market research helps determine the most profitable segments for a business.
Finally, the third type of market research lets companies know how they’re doing in regards to their target markets. Marketers use this information to understand how their company is doing against its competitors and to increase their production levels. It also helps determine what kind of advertising strategies work better than others, and what types of events to draw in the most consumers. Secondary market research helps determine whether there is room for improvement. For example, if there are just a few hundred people who find a particular type of product interesting, it won’t make much sense to spend a lot of money advertising to those people – at least if those consumers can’t be found online.
There are many more types of market research, including the three mentioned above. However, each of these covers a specific area of focus, and all marketers should be able to identify marketing opportunities through utilization of any one or more of these techniques. Just remember to keep your market research specific: if you want to know which kinds of events draw the most people, ask your target audience! For more information on identifying marketing opportunities through market research, visit the website Openended Business Solutions.