Marketing is the process of promoting a product or service to make it appealing to buyers.
Market research helps businesses in identifying and targeting their ideal customer base. Marketing research helps businesses to compete effectively with other companies. Market research is a structured effort to collect information about consumers and target markets: understand them, beginning with who they are. It is also a vital factor in maintaining competitiveness and a key element of business strategy. For example:
Companies conduct market research to understand consumer buying habits.
They want to know what they buy, why they buy it, and what makes their buying experience pleasant or unpleasant. Businesses conduct surveys to gain a competitive advantage by understanding customer attitudes, purchasing decisions, and product qualities. Surveys also help companies to segment their customer base. They may do research on customers who buy their products on the Internet, on the job, in schools or on television. Surveys can even be conducted for scientific studies.
Marketing research methods can be done by individual firms or by organizations that specialize in market research.
These firms can be independent agencies or they can work for marketing firms. Corporate research institutes generally contract researchers to carry out market research through focus groups. The focus group is a small group of people, typically from a local community, who are asked for their opinions regarding a specific issue.
The market research firm researches the issue, collects the data and uses tools to identify characteristics of the customer group, which it then attempts to address. One popular tool used is questionnaires. Some firms use focus groups to discover what consumers think about new product lines. They do not use polls to determine whether a new product is successful because they do not want to promise something that is unlikely to happen.
Focus groups are an excellent research resource.
This is true especially when dealing with older target audiences.
Older groups are more likely to be familiar with certain products and brands, so the research questions may not be too specific. These data collection efforts also allow the marketers to tailor their marketing messages to a specific target audience. Marketers may also choose to have focus groups to discuss a single product category, allowing them to make the marketing message consistent with the product.
Many research firms contract with companies that create online surveys.
The surveys are available for purchase or for free use. The price of online surveys depends on the length of the survey and the number of questions included. Some of these surveys are open-ended, where the participant has to be committed to participate in the research study; some surveys are closed, where participation is required only for a limited time. Free surveys generally offer more options, larger response rates and better compensation than those that require participants to pay.
Marketing companies rely on key business decisions made by consumers.
Through market research, these companies learn what consumers think about their products and services. Consumers provide insights on everything from how well a company’s products function to how well they appeal to potential buyers. Market research helps marketers develop and implement an effective marketing strategy. In the process, they learn what their customers want and what changes would yield the best results.
Marketing companies can benefit from market research.
It allows them to create new ideas, conduct market research to determine what changes would benefit their company and conduct in-depth studies on existing campaigns to find out what works and what doesn’t. Knowing what strategies and tactics work the best can help them fine tune their strategies. As marketers, it is essential to understand what actions produce the most impact, while minimizing the effort and expense. The insights from the research methods used can be critical in making key business decisions.