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Market research helps you to understand who your target customers are, where they can be found and what they’re looking for from your product/service. This information can be essential when finding ways to attract customers.
There are many different ways in which you can conduct market research. Below are some of the main forms of market research that could be worth trying.
Scope out your competitors
One of the most valuable forms of market research that you can do is analysing your competitors. By seeing what your competitors are doing right and what they are doing wrong, you can then create a business model that borrows some of their best traits while improving on some of their weaknesses. You may find ways of outperforming your competitors such as beating their prices or offering faster service. Alternatively, there may be ways of setting yourself apart – market research could help you to find your USP (Unique Selling Proposition) so that you can appeal to a gap in the market.
What are some of the best ways to do competitor research? You could trial out their company as a customer – or if you don’t want to give the competition your money, you could simply browse their website or their store to get ideas. It’s also worth following them on social media, checking out their online reviews and conducting competitor analytics (such as finding out what keywords they’re using for their website).
Conduct surveys
Surveys allow you to ask questions directly to consumers. These questions could be anything related to your industry that could help you to improve your business. Some common uses for surveys include getting feedback on product ideas, testing brand awareness, understanding customer interests or seeing what your customers think of your competition.
Surveys could be given out to people in person or they could be conducted online (there are specialist survey sites that can allow you to generate surveys). If it’s a long or complex survey, you could consider paying people to take part. It’s important that surveys are targeted at your target market (unless you’re trying to find out who your target market are) and you should try to get as many people answering the survey as possible in order to gather as much data as you can. This data could be turned into graphs to help you visualise it or you could use standard deviation to work out the average or most popular response. From this data, you may then be able to make improvements based on what the majority of consumers are saying.
Organize focus groups
Focus groups are another form of market research that you could try. This usually involves assembling a group of people from your target consumer base and then getting them to answer questions or test your product. Focus groups can allow you to capture consumer reactions as well as seeing how group peer pressure may affect results (how an individual reacts to a product and how a group reacts to a product can be very different).
When assembling a focus group, make sure to assemble relevant consumers. You may even want to quiz participants beforehand to ensure that they’re the right demographic. It’s common for companies to pay focus groups for their time – especially if you’re carrying out multiple tests that could last hours. Plan your questions and activities in advance and work out the best way of recording information so that you can refer back to it. The location is also important – make sure that it is accessible for all of your participants and that there are no distractions that could affect the results.
Encourage customer feedback
You can also conduct market research by gathering feedback from your existing customers. Such research can often be more valuable than surveying consumers – when surveying customers, you know that you are getting answers from people who are interested in your product and willing to pay for it. You can also use this feedback to gather vital information on how customers are discovering you, whether they were satisfied by your service and what improvements they would make were they to use you again.
Customer feedback can be private or public. Private customer feedback is much like a survey and the results are shared only among you and your employees. Public customer feedback includes online reviews, testimonials and social media comments – such feedback can be read by anyone and so can have an impact on your reputation as well as serving as useful advice (you probably don’t want to encourage unhappy customers to give public feedback, however it could be a good marketing strategy to encourage happy customers to give public feedback).
Observe your customers
You can often conduct market research simply by observing your customers and their behaviours. Simply by using observation, you can often work out who your average customer is and what they hope to get from your business. This research can often be more valuable than any other type of research.
In order for customer observation research to be effective, it can be helpful to have a means of recording data. You may be able to simply use sales figures data or website traffic analytics. Alternatively, you could ask customers to record certain interactions (many companies record customer phone calls for training and research purposes or use CCTV footage to look back at customer interactions).
Run tests and experiments
Experiments and tests can be a form of market research – providing that you’re recording the results and then acting upon them. For instance, if you want to release a new product, but aren’t sure if customers will get behind it, you could produce and sell a handful of these products and see how these products fare before producing a full batch and making it a permanent product. Such experiments can also be carried out when conducting marketing campaigns.
There are various different types of tests and experiments that you can carry out. AB split testing is an effective form of testing that involves testing two ideas and seeing which one performs better – this could be used to test out two different website pages, two different marketing emails, two different price plans or two different versions of the same product. You can also allow customers to test out products with limited features (popular with software) or you could test out a product on a small scale. If you’re brave enough, you can even look into ‘destructive testing’ – encouraging customers to try to break your product in order to find faults and improve it.
Read studies and listen to experts
There are likely to be studies already out there on your target market. Reading these studies could give you the vital information you need in regards to your consumers and how to appeal to them. On top of this, you may be able to seek out advice from experts. This could include reading books, attending seminars or watching videos dedicated to your target market. This is sometimes known as secondary research. Such research may not always be entirely relevant to your business model, so you need to consider this. You should also check the date of such research to ensure that its relevance to today’s business world – a 1990s study on how to attract customers to your hotel may not be useful in today’s world of online booking sites and social media.
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