Market research involves the process of gathering information regarding your specific target market or current customer base. As far as business strategies go, this process is an important factor in completely understanding your market and maintaining an edge over your competitors. The basic components of market research are ascertaining the needs of your market, the size of your market and the general state of your competition. Throughout this process, you methodically compile social opinion data that is then interpreted using statistical and analytical social science techniques. Understanding this research will help you to obtain a deeper insight into your target market and help you make more informed business decisions. This article will address steps on how to conduct market research.
See also: How to Create an Effective Survey
1. Understanding the Types of Research
The first step in this process is to understand the two types of market research. The first type is called Primary Research and references data that is compiled through interviews, surveys, questionnaires, and focus groups. Those interviews can be completed in person or on the phone. Additionally, the surveys and questionnaires can be completed online or by mail. Focus groups are a small gathering of individuals who are prospective customers or clients and you seek direct feedback from them. The basic goal of completing primary research is to evaluate your company sales and whether or not your business practices are effective. Secondary Research evaluates data that has already been published and not compiled by you. Basically, with regard to this data, you are trying to classify your competitors, set standards, and identify your specific target market.
2. Collecting Your Data
For a small business owner to succeed, it is vital for him or her to completely understand the customer. Additionally, the owner needs to comprehend the ins and outs of their products and services in order to properly promote them to the correct target market. Knowledge of the general market trends is also important for the business to stay successful. Collecting data is a key way for business owners to understand their competition and find that edge which can catapult them to the top of the leader board. There are two types of methods of collecting data:
- Quantitative – This data collection requires a large sample size and utilizes a mathematical analysis for interpreting the data acquired. Evaluated results from this data type showcases statistical variances.
- Qualitative – This data collection is less scientific than the quantitative type. Qualitative data is generally collected from a smaller sample size. Business owners can utilize this collection method to further cultivate the results of the quantitative data. They will be enabled to specifically outline issues with their products or services. Generally, this method uses the customer and client interview techniques to ascertain their perspective on the products and services offered.
3. Stick with the Plan
During the process, it is important to stick with your plan and not to take any shortcuts. If you take shortcuts, you may think you’ll save time. However, you will not acquire accurate data and then won’t be able to make good business decisions. Make sure that you utilize both primary and secondary research sources. You want your data to be reliable and current with regard to your specific target market. Solely using secondary research published by someone else is not going to provide you with enough data to make informed decisions. Additionally, you may run the risk of using out-of-date published information.
The second factor to remember is that you need to utilize a variety of resources such as online data, your local library, and your local SCORE office which is part of the Small Business Administration. With regard to gathering online data, you can register for Google Analytics to track the various demographics of traffic to your website. Finally, be open to truthfully survey a wide variety of people, not simply those you know who will only give you positive feedback.
See also: How to Become a Market Research Analyst
Conducting market research is an invaluable process for your business in order to accurately understand your customers and clients, and increase your profit margin. If you have done market research for your business, how did the experience go?