Before starting a new business or launching a new product, it is important that you do market research.
Market research is the process of collecting large amounts of data and answering a certain question based on insights proportional to your target audience. It allows businesses, whether small or big, to understand their market and prevent damage to their reputation and company.
It is less risky launching when you have an idea of who you're targeting and who you're competing against.
But is it really necessary for your business? What are the advantages and disadvantages of market research that you should be aware of before conducting one?
For a product launch and product testing it is imperative that you do your own research and gather data through primary research - insights collected through self-conducted research - rather than secondary - through the analysis of other publications and studies rather than conducting your own research. This is to ensure that the data you gather is recent and appropriate.
A few of the advantages of market research are:
Market research will act as a risk preventative before launching a new product.
This means that by researching the market you're operating in you identify potential risks that could put your processes on hold for a while, costing you both money and time.Does your ideal customer like this product of yours? Do they find it useful? How do they interact with it?
All these are questions you need to ask before launching, in order to find out whether your product needs improvement or not. With feedback like this, you are able to avoid extra costs both from making improvements and from relaunching the improved product. Market research acts as a preventative to product failure; you are also able to manage your business and its expenses more effectively, and strategise accordingly.
By listening to the customer feedback, you refine and improve accordingly and make more sales.
You know exactly what your ideal customers and people who are interested in your product think of it, and how they would want it to be better. By refining based on the feedback, you are actually boosting customer retention rates as well as customer acquisition. This is because you make your customers happy by listening to their needs and giving value back to them.
You understand exactly what your customer needs, and you give it to them, increasing sales, customers and brand loyalty in the long-run.
It is crucial to understand who you're selling to before launching a product, and who your competition is.
What you want to avoid is launching your new idea and having zero sales in return after putting so much work into it. You also want to avoid your competition having a better sales performance than you.
This is why market research can help you find your ideal customer and the audience that finds your service or product useful and needed. For instance, a survey can do that for you or a focus group, where you will have the chance of talking to people face-to-face and exploring their ideas.
Market research can also help you identify your biggest competition and why their product launches are better and more successful. It can help you understand their strategy, as well as how you can be different and much better than them.
In marketing, this is called STP or Segmentation, Targeting and Positioning, where you segment your customers and identify the consumers who relate the best to your brand and product, and you position yourself as a brand in accordance to the consumer feedback and who your competition is. You do the same research on the audience and competition, but using a different method.
Although market research may sound idyllic, it can also push back processes and delay certain tasks. You need to examine whether you have the time, the money and the energy to conduct market research for your business, and whether it is worth it.
This is because you might need a large sample to test and get feedback from, giving your product for testing for free to applicants. These mean costs for you and your business.
Surveys sometimes are not cheap either. When surveys don't seem interesting to potential applicants, they don't click on them ever and data is difficult to gather. This is where a good incentive enters the picture. It is common for researchers to use cash incentives or vouchers as an exchange for genuine feedback to their product.
Not every company and start-up has a large budget to afford this, meaning that, yes, research can be expensive.
Research takes time. It is not a simple process of sending a general survey to a number of people and getting instant replies back.
The process involves deciding on the target audience that you want to answer your survey or join your focus group, organising how to get and collect the feedback, coming up with strategic questions to ask participants for insights into your product usability. And then waiting for this feedback.
It is not a one day project, as you will need to plan ahead for any delays and inconveniences.
When testing a new product, you need to understand that it doesn't represent the whole population or the whole segment you want to target with your service, but a small group.
What might not work with someone, might work with someone else.
You need to be careful with how you conduct your research and who you choose to get your data and insights from.
Panel Opinion helps you make informed decisions and strategise accordingly after conducting a thorough market research through their platform.
Identify new opportunities for your business today too and improve your brand reputation - with market research based on real insights and real people.