Use market research to develop your business
Research, as a universal concept, is the process of gathering information to learn about something that is not fully known, many times it finds solution for a problem. In business, market research is the process of collecting data to determine whether a particular product/service will satisfy the needs of customers, will a new product sell, whether pricing of a product is correct or wrong, or does the packaging need an alteration. Marketing research helps organizations in multiple ways. With effective market research, an organization can gain irreplaceable information about their competitors, economic shifts, demographics, the current market trends and the spending behaviors of customers. Markets change faster than we imagine, hence it is advisable that marketers take support of MR.
For business firms, research is not only used for the purpose of learning, it is also a critical component for the sake of good decision making. Market research helps by giving marketers a picture of what is happening or what is likely to happen and, when it is soundly conducted, it offers alternative choices. For instance, good research may suggest multiple options for introducing new products, which new segment to enter, or what promotional strategies to adopt while entering new markets. In most cases marketing decisions prove less risky when the marketer can select from more than one option.
Marketing research is the foundation of marketing. Just as a well-built house/building requires a strong foundation to remain sturdy, marketing decisions need the support of research in order to be viewed favorably by customers and to stand up to competition and other external pressures. Therefore, all areas of marketing and all marketing decisions should be supported with some level of research.
While research is key to marketing decision making, it does not need to be elaborated to be effective. Sometimes small efforts, such as doing a quick search on the Internet, or interviewing a group of customers provides the needed information. However, for most marketers there are times when more intricate research work is needed and understanding the right way to conduct research, whether performing the work themselves or hiring someone else to handle it, can increase the effectiveness of these projects. Vodafone, Bharati Airtel, Hindustan Unilever, Cadbury, Coca-Cola India, PepsiCo, ITC and Sony India are some companies which are strong in marketing. These companies use marketing research for effective decision making.
YouTube began as a video dating site called “Tune in Hook Up.” Founders Chad Hurley, Steve Chen, and Jawed Karim were disappointed with limited buying, but then they had another idea. After the Janet Jackson Super Bowl fiasco (which referred as pre planned publicity stunt) they realized that finding proper videos online was surprisingly difficult. Even when you could find one, the sites were buggy and unreliable. Plus, sharing it was a chore: video email attachments were unreliable, and most sites failed to provide dedicated video links. The trio set out to solve these problems. They researched the market thoroughly, and determined that they had a great shot at solving online video better than anyone else. In 2006, Google bought YouTube for $1.65 billion. The trio decide to do more research to determine the next move for their company.
Here are three reasons why market research cannot be ignored:
Market research can guarantee the success of marketing campaigns, and in-turn help improve sales: Market research not only helps in identifying new business opportunities, but also helps in designing marketing campaigns that help directly target the interest of potential consumers and help in increasing sales. Marketing research provides valuable information about the potential of a particular market segment, during a specific time, and within a particular demographic group. To choose its latest chip flavor, Frito-Lay used social media to replace focus groups and survey panels. The company asked Facebook fans to weigh in by having them click an “I’d Eat That” button next to suggested new flavors. They found that consumer tastes varied by location: they found that a beer-battered onion-ring flavor is popular in California and Ohio, while a churro flavor is a hit in New York.
Market research helps firm to keep a tab on its competitors: When marketing research is used methodically it can become a good evaluation tool that can be of great use in comparative studies. A firm can track its own progress as well as the growth of its competitors, by keeping an eye on its competitors, it can devise business strategies which can help it go ahead of its rivals. Kevin Systrom and Mike Krieger put a full year of work into a new location-based, check-in app called Burbn, even developing a full-fledged iPhone app. After releasing the app, the team wisely chose to reexamine the market. “It felt cluttered, and overrun with features,” said Systrom. He and Krieger decided to face reality: they were late to the game in a trendy space already dominated by Foursquare (the city guide app). They removed almost all of their features, leaving only photos, commenting, and liking. They rebranded their business as Instagram. By looking closely at the market, understanding their strengths, and researching competitors, they were able to make the right call. The rest is history. Facebook bought Instagram in late 2012 for a whooping amount.
Market research can helps in minimizing losses in business: with market research, firms can reduce the chances of loss to a large extent. Before launching a product, they can identify potential problems and even determine the solutions. The research carried out after the launch of a new product helps in finding loopholes and devise plans to counter that loss and increase the profits. Apple has been the biggest name in technology for years. This is not necessarily because they are the most innovative. Instead, it is because they use market research to find out exactly what their customers want from their devices; they then figure out how to make those wants a reality. Their “Apple Customer Pulse” research group is a prime example. Because these are online surveys, the company is able to compile and analyze the data faster, and the surveys are easy to administer, without much effort. This makes the market research more interesting to those that participate, as well as to the company. These surveys have led to different designs and modifications of Apple products.
Smart companies use marketing research on a continual basis. They understand that if they want to keep up with the latest market trends and gain a competitive edge in the business, they need to be updated. It is well known that Lego has been a toy but more geared towards boys for many years. In a study done by the company, it was reported that only 9% of the primary users of the toy were female. Upon seeing this, the company decided to come out with a new product to entice more girls to play with Legos. Lego sent out researchers to do a four year study involving 3,500 girls and their mothers. This market research included studying the girls’ playing habits and extensive questioning regarding what would make Legos more interesting for girls.
At the conclusion of the market research, Lego came out with a new line of toys on January 1st, 2012. This line was called “Friends”. The brick colors for this line were changed to more vibrant colors. The packaging also changed, along with the porcelains included in the set. Collectibles were made to be slightly bigger to accommodate accessories such as hairbrushes and purses in their grips. All of these changes were in line with what the market research data found to be more appealing.
So friends, using research doesn’t always mean commissioning a big project with an even bigger fee. A firm collects more information and analyses it. The key is using competent and qualified research firms. Some firms are ahead of times, they conduct research on their own.