How to conduct or commission market research

You must have conducted solid market research before making business decisions to disrupt your target market. If you want to master the art of market research, make sure you continue to read as we explain how to conduct market research to keep your business competitive.

Today customers have the ability and resources to make their own purchase decisions by doing their research on products and services. Therefore, if you want to sell to your customers successfully, you need to understand them (their behaviors, needs, and wants) and what influences their decisions.

You must have conducted solid market research before making business decisions to disrupt your target market. If you want to master the art of market research, make sure you continue to read as we explain how to conduct market research to keep your business competitive.

In this article, we will look at:

  • Why you should conduct market research.
  • Six steps to conducting conduct market research.
  • The process of doing the actual research.

Why conduct market research?

Conducting market research can help any company, service provider, organization, or individual to make more informed decisions. The more research a company can include in its business strategies, the better it becomes in adapting to the environment in which it operates. Additionally, it generates a fast track for your business to boost brand awareness and conversions as you learn the latest trends and thus are able to keep up with them.

Here are just a few advantages of doing market research:

  • Minimizes investment risks.
  • Strengthen your market positioning.
  • Provides revenue projections.
  • Enables businesses to stay ahead of competitors.
  • Evaluates a business’s success against benchmarks.

Big brands such as Microsoft, Google, and Apple spend millions on consumer behavior and analysis, which enables them to stay ahead of the market. In other words, market research is very important for all types of industries, sizes, and types.

Investing in market research

The cost of market research depends on many things. It may vary anything from thousands of pounds to millions. Generally speaking, it depends on the size of the company, the type and level of analysis, and the offerings.

Estimated costs may be:

How to conduct or commission market research

  • Individual in-depth interviews: Customer interviews cost $200-300 per interview, excluding incentives.
  • Focus groups: $4,000-$6,000 per group, excluding incentives and travel costs is required.
  • Online surveys: qualitative research for consumers may be $15,000-$35,000, and for business-to-business, it may be $20,000-$50,000, excluding incentives.

Furthermore, market research takes about six to seven weeks to conduct. This is the daily standard for smaller projects of around 10-30 in-depth interviews or four to eight focus groups. For larger projects, this will, of course, take longer.

Six steps to conducting market research

Market research is a time-consuming project that can cause a lot of stress and overwhelm. This is why we created this step-by-step guide to help you conduct market research with more ease.

1. Determine your purpose of market research

Some businesses prefer to dive deep into past successes to understand why certain things worked or did not work to ensure better outcomes in the future. However, you may want to conduct market research for different reasons, such as to assess bottlenecks and threats. Similarly, you may want to maximize available opportunities.

We recommend that you decide whether the analysis is for external or internal purposes. While the latter includes activities such as improving business operations or cash flow, the former involves things such as trying to convince lenders to give you a business loan.

The kind of research you do depends on the purpose of the analysis. For instance, if you aim to conduct a study to improve cash flow, you will not need as much data as when conducting a study for external purposes. It’s crucial to know why you want to research your market.

2. Target customer’s establishment

It is important to remember that not everyone can be your target customer. However, you can identify who your target customer is by doing a target market analysis. This research should aim to uncover your target audience’s following factors:

  • Gender.
  • Age.
  • Location.
  • Educational level.
  • Occupation.
  • Income.
  • Marital or family status.

Once you know the above, you can define your target customers and identify their demographics, interests, needs, and personalities. Granted, different customers will, of course, have different characteristics. Therefore, you may want to compile various personas or profile to represent the average customer.

This will enable you to market more efficiently and cater to future customers. Furthermore, your potential customers may change or evolve as your business grows. This is only natural – especially in the beginning stages. Therefore, it is important to revisit and redefine your target market and know the latest preferences and trends.

3. Competitive analysis

Understanding your competition is one of the key factors of market research. You need to know who your competitors are and who they are trying to target. Not only will this make you more aware of your own and their strengths and weaknesses, but it will also give you the crucial insights needed for an effective business and marketing strategy.

With this in mind, make sure to research and make a list of all your competitors and what other businesses are doing. Observe their target customers, offerings, and shortcomings.

By all means, do a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis to determine where you are in the market compared to your competition. Additionally, you can rank all your competitors from most to least threatening to most threatening. Then you may analyze how your business fares against them.

Definitely be honest during the analysis. The more honest you are, the more it will give you an accurate representation of your business‘s positives and negatives. Likewise, it will give you a more accurate and overall positioning in the market.

4. Choose your research type

You will want to choose what kind of marketing information to use for your market research. You can do this by:

  • Deciding if you want primary or secondary information for your research.
  • If you choose primary, the format you want. This might look like asking your social media followers to complete an online survey or asking your current clients to participate in interviews.
  • If you select secondary, you need to decide what sources to investigate.

5. Getting relevant data

Make sure your data is relevant, factual, and unbiased. Also, make sure it is only referred to highly credible sources such as:

  • Journals.
  • State of local commerce websites.
  • Information from focus groups and interviews within your target market.
  • Competitors’ strengths and weaknesses.
  • Target market surveys and questionnaires.

6. Doing the actual research

We have provided you with three effective ways to conduct customer or market research.

Option one: interviewing your customers

As previously mentioned, interviews are a great way to conduct your research. You can do this over the phone, virtually or in person. You may want to aim to speak to 10-15 different individuals who fit into your target audience persona.

Thus, if you have 10-15 current clients who will be willing to participate, that would be great as you already know they fit your persona, and thus also saves you time. Once you have your people, make sure you ask for 30min of their time and that you have prepared for questions that enable you to do in-depth into different areas, such as asking open-ended questions. This allows them to elaborate on areas than just give you yes or no answers. In addition, you may also want to record the session.

Furthermore, it is important that you keep unbiased throughout the session. As well as, do not guide or coach the respondents into giving answers you want to hear. Instead, build trust and make sure they feel comfortable with you, so they are open to sharing their honesty. This, therefore, also means that you do not want to agree or disagree with them, as this may lead them to give you answers you want to hear rather than what is true.

Option two: holding focus group sessions

A focus group often contains 8-10 participants. You can create either online or in-person to get in-depth insights regarding your research topic. Online or offline conferences, trade shows or community centers offer tons of opportunities to conduct focus groups and interviews. Here one of the most important things to do is handle discussions tactfully. Otherwise, you might not get the answers you are looking for.

You might want to start by introducing respondents, so you can then inform everyone that there are no incorrect answers and that everyone’s opinions are valued and valid. You then might want to be able to guide them through discussions to get the conversations started.

Option three: conducting surveys

One of the best techniques to gather customer feedback is conducting surveys. Today most online surveys are done through a professional survey tool. Compared to interviews, for surveys, you want to make sure you have close-ended questions – so yes or no answers. This will enable you to collect demographics (such as age, title, gender, and industry) or any other additional data you may need.

Option four: collect data through observation

By observing your company’s or customers’ past or present behaviors, you may be able to predict their future purchasing behaviors.

You may also utilize customer journey mapping, market segmentation, and brand tracking tactics to predict past behavior. Make sure you record and document the results.

Step seven: analyzing your findings

At this point, you should have all your data needed to be able for the analysis stage.

Start by organizing all your findings into different sections, such as your purpose, target market, and competition. In addition, make sure to include an overview of your findings, buying trends, industry outlook, etc.

Here are a few things you may want to consider for your final analysis:

  • Cash flow projections.
  • Forecasted business growth.
  • Your target customer groups.
  • How much your customers are willing to pay.
  • Prices and products or discounts you plan on offering.
  • Results of other analyses.

Post-market research

Once the market research is done, it is time to put all your research into action, so you can achieve the results wanted. You may want to conduct smaller research projects consistently, every few months, or years (depending on your industry and how quickly it moves), to make sure you are relevant to the industry and are on trend. This will enable you to grow brand equity and become more competitive as your customers begin to see you as an authority. Good luck!

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