In today’s fast-paced world, it is easy to ignore the idea of market research. After all, entrepreneurs already have a lot on their plate. From managing finances to recruiting talent – spending hours on market research is perhaps, the last thing on their mind. As a result, most of them jump straight to the product development and marketing stage. While such practices can escalate business operations, they pose a real-time threat to profitability. What if people don’t interact or respond to your ads?
For every type of company, whether big or small, market research is necessary. It helps you learn about target audiences and their changing tastes and preferences. Simultaneously, it also unfolds purchase patterns and buying behaviors, letting you develop pertinent marketing campaigns. So, do you know how to conduct market research? Unlike old times, researching on the internet-savvy world is super easy, all thanks to Google.
You can send out surveys to focus groups, start conversations with your target market, or surf through social media. Understanding what customers ‘want’ will help you design strategies that align with market demand, making your business thrive. In case you are still getting second thoughts about it, have a look below. Here we are listing five reasons why market research is crucial before launching a campaign.
1. Unfolds New Business Opportunities
Undeniably, comprehensive market research will give you a full-fledged idea of who your target customers are and where you can reach them. Similarly, it would also unfold their evolving tastes and interests, helping you keep up with evolving demand. With these exclusive insights on-hand, you can launch strategic marketing campaigns. If your goal is to boost web traffic, understand market dynamics and insert backlinks to direct referral traffic to your webpage.
Likewise, you can form partnerships with other businesses for joint promotions. In addition to creating brand awareness, it can expand your customer base. Moreover, market research can help you find new locations for business. It will unfold geographical areas where most of your target audience lives, allowing you to create compelling, targeted campaigns. Besides, knowing what your customers want can help you design order upgrades. You can offer add-ons, product bundles, or upsells that increase the value of your products and services.
2. Fosters the Decision-Making Process
Unlike old-time, entrepreneurs no longer have to make decisions based on their instinct. Every significant or small business decision requires extensive market research to ensure its effectiveness. You can determine whether there is a demand for your product or not. Similarly, research can help you define where to spend advertising and marketing budget. For instance, if pay-per-click (PPC) ads generate a high return on investment, you can allocate 30% of the budget to PPC advertising.
Moreover, market research can assist you with pricing strategies. It can determine how price-sensitive your customers are, allowing you to set affordable prices for everyone. Lastly, it will help decide the fate of low-performing products. You can determine which products to discontinue and the ones that need a complete upgrade and remarketing.
3. Gives Insights from Problem Areas
According to Bureau of Labor Statistics, more than 50% of the business don’t survive past the 5th year. Before investors start raising questions about your business’s survival, you have to get a steady stream of sales and customers. Here, market research will come into play. It gives insights from the problem areas in your business, letting you fix glitches quickly. It is also an ideal way to check-in with your existing and potential customers to ensure you are fulfilling their needs. Here are some tips on how market research can help you overcome problems.
- Before you go all-in with your marketing campaign, test new designs before the final launch. You can pick a smaller chunk of the audience and see how they react to your unique offerings.
- Discover reasons why customers won’t come back. You can set focus groups or surveys to remove obstacles and increase the retention rate.
- If your existing products encounter a substantial drop in sales, dig into stats and data to fix the problem. You can survey existing customers to figure out the issue. For instance, if you own an apparel business, the color of the cloth might be fading away after a couple of washes. And, you will never know this until you ask.
4. Helps in Setting Business Goals
What are your business goals? Perhaps, profit maximization, growth, or global expansion. Undoubtedly, these sound like reasonable goals, but without market research, you won’t know if the goal is achievable or not. You might want to double the sales before the quarter ends, but what if your customer base isn’t substantial enough? Without knowing the size of your potential market, you will end up setting arbitrary goals. Hence, invest some resources into research and development.
It will help you grow your customer base via new untapped markets or through customer retention, anything that works for your business. Similarly, research would help you set measurable and achievable goals that can contribute to a business’s success.
5. Outranks Competitors
Believe it or not, a company that knows its customers is always ahead in the game. Hence, with sufficient know-how of your target audience, you can outrank the competitors and become a competent market player. Here are some tips.
- Target Dissatisfied Customers: Firstly, use your market research to find customers who are not happy with your competitors. You can read product reviews or check survey responses to decipher the reason behind customer’s dissatisfaction. In turn, you can resolve those issues and entice them to switch brands.
- Recognize Unaddressed Audience Needs: Usually, brands are too busy in promotions and forget to address customer needs. You can pull off research on current market trends to determine what modern-day customer wants. Likewise, you can spy on competitors to uncover customer pain points and address them.
- Explore New Segments: Is there any region where your rivals don’t ship their products? Usually, some places have complex logistics systems, and companies don’t want to indulge in that hassle. Well, your market research can reveal such regions; meaning, you can reach out to a new customer segment.
Most business owners think of market research as an expensive and challenging task. However, with some proficient researchers onboard and a minimal budget, market research can become effortless. It can take your business in the correct direction while helping owners with the decision-making process. Similarly, it can uncover new opportunities, give rich insights, and help marketers set achievable goals, making the business flourish.