Throughout your journey as an entrepreneur, you will encounter a multitude of challenges. Some, you will be able to solve fast, while others will result in sleepless nights and countless working hours. There is, however, one thing that can help solve these challenges faster and with much less stress on your hands — market research.
Market research is paramount for any business that wants to be successful, not only before launching a new product or service, but also when looking for growth opportunities. When done correctly, market research can reveal important and, most importantly, credible information that can help you improve your business plan, upgrade your offer, acquire new clients, as well as attract investors.
Market research should get more attention from business owners, as it can be one of the best methods to gather knowledge about the industry and make educated business decisions.
To prove its importance, below are some of the ways market research can help businesses grow. Before we get into that, however, it is important you understand what it means to do market research.
Market research – a comprehensive definition
If you’ve developed a business plan for your company, you probably already have a bit of knowledge about market research. It is one of the most important elements of a business plan and revolves around the process of inviting your audience to talk about the products or services they need and want. This can be done through various methods, including focus groups, surveys, polls, as well as social media monitoring.
If you are looking to grow your business in a meaningful and organic way, market research will be an important guiding stone that you can refer to whenever you have an important business decision to make.
Customers are the fuel of any company, and the key to having your tank full all the time is becoming a master of understanding what customers need and want. Once market research has been performed, you can leverage the useful insights from consumer surveys to improve your existing products, develop new ones, and many more.
Now that you know what market research is and how it can be done, it’s time to talk about what it can do for your company.
Understanding customer behavior
Customers are the ones who will purchase your service or product, so understanding their pain points and needs is crucial. To create successful products, you need to know who your customers are, what they need, what they expect from businesses, as well as how often they will be satisfying those needs (aka purchase frequency).
Market research can help you develop an ideal customer profile and determine various details about customers, such as their approximate age, income, and gender, as well as what triggers them to make a purchase. All of this information can be used to tailor marketing campaigns, establish prices, and make important business decisions.
Gathering industry data fast
Thanks to the existence of the internet, there is a wealthy amount of data waiting around to be collected. This information can be extremely relevant to the type of business you are conducting, and if you don’t gather it, others may. This is how competitive advantages are created.
By gathering industry data in a timely manner, you can gain a better understanding of what consumers want and tailor your products so that they suit the needs of the market. At the same time, analyzing the data you find can help you determine market trends before your competitors do. This allows you to act fast and come up with solutions to problems your consumers did not even notice they had in the first place.
Making informed decisions based on unbiased data
Each decision you make is going to influence your business, so you need to ensure your facts are as accurate as they can be. What better method to find out what type of sale campaign to run for the next season than by asking the customers themselves?
As much as you try to be objective, it is your business we are talking about. There will be times when you won’t be able to make a decision without being a little biased. This is where market research can help, as it provides real information about the consumers, industry, and business you are running.
By making decisions based on real facts, you will have fewer chances of error. This will uncover actionable ideas that can be used to help your business grow.
Consolidating the company’s reputation
Customers value a brand’s reputation a lot. In fact, research shows customers are now willing to pay more for certain products or services if the company’s reputation is better. Times have changed, and people value what they spend their money on more than ever before.
If you base your decision on objective analysis, people will know you care about them, and your reputation will only improve. This applies to potential business partners, clients, and investors as well. If you prepare a presentation that is based on accurate data you found, it will weigh much more than a presentation based solely on your thoughts and beliefs.
Spotting new business opportunities
Market research will reveal important information about your customers and the industry, such as:
- Customer demographics
- Size of the market
- Market share statistics
- Major competitors in the field
- Industry dynamics
All of this information can be used to spot and take advantage of new market opportunities. Customers have a very free way of speaking about their needs and wants, so it won’t be hard to find out what they want. Identify their pain points, figure out why no one cared to solve them by now, and come up with a practical solution to do it yourself. This is how legendary products are born.
Market research is one of the pillars of a successful business, so you need to leverage it as much as you can. Only this way will you be able to learn more about the market and make informed decisions that will lead to business growth.
