In its simplest terms, you can say market research is a survey done in the market, and it could be for several reasons. Your market research may be used to determine the viability of your product or solution, in relation to the needs of the consumers. It may also be used to determine or ascertain product-market fit for your solution. Does your product factor in price-fit for the market? If you are producing a much-needed solution for the customers but putting a price beyond what they can pay, how realistic is that?
The ultimate goal of your research will be to tell you what works, and what doesn’t; how much your target consumer would be willing to pay for such a product?; how big a problem would the product solve for the consumer? including other opinions and feedback that would show their interest in the solution, and the amount of pain or discomfort they have already which your product would resolve for them.
You may have an in-house team (like a research and development R&D department) conduct your market research for you, or get a third-party company that specializes in market research. Either way, it is important that you do a proper interpretation of the information gathered from the research. You may get a Data Analyst to make meaning of the data, and come up with several conclusions which you would then use in your decision-making.
When to do market research?
Market research can be done anytime in the business. It is a point where you communicate directly with the consumer instead of merely basing all your actions and decisions on assumptions and baseless theories.
You can do market research during the ideation stage, to validate your product idea, and to get more information that will help you build a product that solves a real problem. You can also do market research after you have your Minimum Viable Product (MVP), perhaps to see how it will pan out in terms of market acceptance and pricing. This may also help give you a proper guide and direction as to how to approach marketing your product to the consumer.
You can use it to gather information for the purpose of market segmentation and product differentiation, and then tailor your marketing efforts based on what you perceive to be the consumer’s priority.
An already existing business may also do market research anytime they want to launch a new product. Or maybe when they want to do a product upgrade, like a version 2.0, a version 3.0, etc. It helps you to keep upgrading your product/solution in line with what the consumer wants and to maintain a competitive advantage.
How it can be done?
The first stage in market research is to determine exactly what information you want to gather from the market. On the basis of this, you now construct them into questions. The questions must be clear and direct enough to get the exact information you want from the consumer. No ambiguity should come into your research. This is the reason why most business owners would rather just have companies or teams specialized in the market research, to do all of this.
Exploratory or specific research?
Depending on the information you want to get, you may choose either. Exploratory research will get you less structured information through open-ended questions. This gives you a richer pool of data to gather sufficient information about customers’ opinions. However, analyzing the information can be time-consuming.
Specific research employs close-ended questions that give you a more structured data pool of information. With these, you can get specific answers to previously identified issues. Analyzing the information is also pretty direct and easier.
How to get the answers you seek
There are many ways to get the answers you seek from consumers. The “good old questionnaire” method still works very well, but the method of distribution will now be up to you. Depending on your target consumers (and the market you want to connect with), you can do an offline or online survey. Whichever you opt for, ensure that you are taking your research to the exact place where your target market is.
There is also the product testing method where you get consumers to test the product and give feedback. Again the choice of the location and other details will determine where you take it to. You may also use focus group discussions after getting the consumers to try the product, and get all the information about what they think about the product, brand, and price point. There is also phone research that seeks to gather the needed information without the need for face-to-face contact.
The Big Question
A big question for many small business owners is this. Can I do market research myself? Do I need to outsource it to an expert team? Do I need to spend a large amount of money? Well, not always. Thanks to new tools available online, you can conduct your research with a very small team. You can create the forms online, use paid ads campaign to distribute them, and get the information you need. You can even attach your survey form to your products, and encourage customers to fill and send it back to you in exchange for a voucher, discount or free gift in their next purchase.
Let’s get our thinking caps on. If you create a 24-seater vehicle (for public transportation) that can fly up in traffic, what would be the right method to find out how consumers will accept the product? Or how can you determine just how much they would be willing to pay to get to work 30 minutes earlier every day? Or how much they can pay for the privilege of waking up 30 minutes later than usual? Give your thoughts in the comment section.
