Why is it Important for a Business to Conduct Market Research?
All businesses start with a fundamental idea. You have identified a need, want to follow hot trends, or just prove to others that you are an expert in a field or niche. You have taken the first step towards a great opportunity. What makes your business stand out among all others? Passion. A drive to make a difference. However, after establishing a thriving business, the next step is establishing a measurement system to ensure performance and success.
Surprisingly, we are talking about a topic that is still neglected by many companies, independent of their maturity: Market research.
All market research is not created equal
Of course, when developing a business concept and strategy, budget decision makers must allocate their resources by prioritization. Small businesses often have limited budgets. As a result, they are often forced to spend their marketing budgets on traditional — and at first glance, less expensive — techniques for market research.
The truth is many traditional marketing methods are outdated. As a result, small businesses often realize the hard way that their conclusions were based on vague data and knowledge gaps. Unfortunately, this realization comes after the money has been already spent.
A Forrester report suggests that less than 0.5% of available market data is ever analyzed and used. Even worse, according to their analytics, a simple 10% increase in data accessibility would generate $65 million net income for a typical Fortune 1000 company.
Knowledge converts into growth
Sources consistently show that markets consist of various dynamics that require a certain level of understanding in order to make product performance accelerate business growth.
As numbers show, the more businesses carefully perform market research, the more value it will bring to the business. How is this done in a more practical approach? Read more about How proper market research can lead to new growth opportunities.
Defining a common core
Obtaining tangible data will help you compose your buyer personas — an approach that has shown to help businesses and entrepreneurs better understand their target markets and keep business customer-focused. The method compiles and groups specific persona characteristics to describe the ideal customer which makes referring to “the market” less abstract. This also helps align sales and marketing.
Buyer personas become the common core for which all other marketing activities and goals are built upon to drive business. According to HubSpot, the strongest buyer personas are derived from coherent market research, and surveys are one part of data collection.
Be the competitor that doesn’t sleep
One of the most interesting characteristics about markets is that some needs are not as obvious as others. Who would have known there was a need to make cell phones smarter when we already had computers doing most of the work? Demand can be created. The market is adapting to changes and so is business. It’s a phenomenon of constant interaction.
In turn, if you want your company to survive over the long term, then you need to be flexible and adjust your product or service to market demand by always being one step ahead of your competition. Cases show that market research is a highly profitable and solid investment to improve competitive advantage.
Return on investment is not a matter of perspective
Depending on the scope and aim of a market research project, you may need to allocate your resources accordingly. Prioritization is needed.
There is no one-size-fits-all approach to market research. However, market research does benefit businesses of all sizes.
The evidence shown above proves that looking at a big-picture view of market research is incredibly meaningful and crucial to a company’s overall growth and survival. The aim is to use your budget in a wise manner, keeping in mind that a failure to fully grasp and understand the market will end up costing you more. This also applies to the early stages of running a business.
There is good news: The world wide web makes market research considerably easier. With the help of online surveys businesses can obtain a large amount of high-quality and real-time data. The key is choosing the right tool to help you design surveys that cover various market segments and objectives. Take a deeper look at what kind of data really matters and how it can be used. Source: Netigate
