There’s no substitute for knowing what your customers know. More than that, market research probes into how your customers think and feel about things. These days, it’s not enough to know where your prospects and customers live and what they look like. With competition encroaching on your territory unexpectedly and getting more sophisticated, it’s a must to anticipate reactions to promotions, messages, products, and services as they come on stream.
Wanting unique answers to discover motivational triggers often means that customized market research becomes relevant. There are numerous types of market research available to modern business enterprises. Some enable you to self-administer these with some guidance and templates. In other cases, the market research gets quite technical, requiring specialized training, and therefore more expensive. We will look into the types of market research more carefully to give you all the ins and outs.
What is market research?
Market research is when one applies a methodology to accumulate market information to further the interests of a business through improved sales. The obtained data generally converges on improving your products, developing better message content, and smoothing out the customer journey through buying and beyond. It’s a formidable resource for damping down customer churn and generating customer loyalty to unimaginable heights.
Market research is a business strategy activity. It embraces everything involved in analyzing habits, aspiration groups, and peer group influence (i.e., commonly referred to as behavioral segmentation). Going deeper, it delves into why viable customer groups behave the way they do by exposing emotions and hidden thoughts (i.e., psychographic segmentation).
Businesses today cannot survive without resorting to market research resources in one form or another. There are studies prepared and available for free by non-profit entities (including government) that are accessible and available if you know where to look. In other cases, industry-specific market research may be revealing for a low or nominal price.
For example, demographic segmentation market research focuses on segmenting communities. It can do this by race, gender, age, language, income group, etc. It’s readily available in most states and pertinent to many business categories. So, too, is geographic segmentation market research that whittles down demographic profiles to locations as pinpointed as zip codes. In short, market research and market segmentation are integrated fields that are inseparable.
Look at it this way — without research, understanding your customers’ actions is hit and miss. Other than a vague idea of what’s happening, there’s no way to track cause-and-effect market occurrences.
Selecting the right market research tool is vital. Quantitative or qualitative research fits somewhere into the types of market research to get the answers you need. Whether you are an SME or a large enterprise, staying competitive revolves around the most valuable asset driving success into the 2020s — data. Gut-feel or putting your wet finger to the wind isn’t going to cut it in markets where fortunes can turn on a dime. Data collection is front and center to make it both practical and profitable.
Here are the key things to keep in mind about market research in general and the types of market research available to businesses today:
- We want to get information directly from the customer as far as possible.
- We want to make the process as simple as possible — even if it requires drawing on market research design, analytics, reports, and various versions of the market research survey across numerous verticals to make sense of raw data.
- Our takeaway goal is to measure our target customers’ brand awareness and obtain customer insights.
- Market research techniques that can capture the voice of customer types in real-time situations are worth their weight in gold. They are the most penetrative strategic weapons for testing innovative product and service ideas, marketing initiatives, and bypassing obstructions that disrupt the customer experience (CX).
- Market research analytics takes you into such detailed occasions as customers leaving a landing page, with a reasonable explanation of why. It overrides guesswork and wild assumptions that are energized mostly by panicked or overly emotional reasoning.
In short, market research as a backstop keeps you objectively looking at prospects and CX — keeping you on the straight and narrow. It teaches us that markets aren’t moving in a vacuum, and change is a constant challenge. Your instincts and assumptions may be spot-on, but wasting money without testing them defies sound management thinking.
Market research methods
Companies like Sogolytics, professionals in market research and aligned activities like customer experience mapping, believe in lean and mean market research strategies. They can connect you to the customer behavior fast and affordably, with meaningful customer segmentation insights that make you competitive.
As an SME entity entering the market research arena, the four most common methods of market research will get the job done the way you expect.
This methodology builds around asking customers and prospects open-ended and close-ended questions by email, social media, and other eCommerce communication channels. The compelling benefits are that market research surveys are easy to use, inexpensive, and can effectively obtain useful information over a representative sample. Moreover, it’s not rocket science to interpret the data and get incisive answers. It’s amazing what one or two short questions can generate, taking so many “what ifs” out of the equation.
Interviews conducted by trained staff or consultants revolve around direct conversations with customers who are either loyal, on-the-fence, or churning toward a competitor.
The objective is to find out one thing — WHY? Of course, it’s more expensive, but nothing comes close to a skilled interviewer’s deep dive into customers’ thoughts and feelings. Video conferencing can work here as well, considering the COVID-19 limitations. CX and market research interviews are highly compatible concepts that align closely with one another.
3. Focus groups
You know you’re conducting a focus group when you:
- Bring a carefully selected collection of people into a room.
- Lead them into discussing aspects of CX with your product and service.
- Talk about their reactions to promotions and messages.
Focus groups do have drawbacks though. Often you can glean the same feedback from market research surveys and interviews. They’re costly, so unless there’s a genuinely defined intelligence item you need to know about, don’t go this far. Even with a trained focus group moderator, errors can occur when some participants are over-forceful and others too docile or withdrawn.
Market research using observation can be a very powerful viewfinder that scans customer behavior. How does it work? Three easy steps:
- Watch customer movements in-store or virtually on your website.
- Take notes
- Analyze your notes and observations.
You’ll be surprised at what comes up. Observe customer engagement with your client support by playing back phone conversations, as one example. Also, software apps give you the power to map out touchpoint inter-connections a customer makes. All of it impacts your market research information to provide much more than a surface impression of your markets.
Market research is a vast arena, and there are many angles not covered here. For example, how to conduct an interview or structure a questionnaire? Companies like Sogolytics are at the cutting edge of it all. Bring them into the discussion if you’re interested in market research as a strategy and a way to improve competitiveness. The company has a library of templates and a team steeped in talent and skills to put you on the most productive — and affordable — track toward success.