Market research is the process of collecting data regarding the market a business operates in and its customers. Very often, market research is conducted to determine the feasibility of a new product or service. But it’s not uncommon to use research to re-evaluate current business strategies or before making pivotal changes, like rebranding.
Market research is a process no business should overlook – no matter how big or small, new or established. The market constantly evolves, with new products supercharging competition and consumers becoming all the more knowledgable and demanding. Market research is the best way to stay on top of market trends and make wise strategic decisions.
In this post, we will explore the different types of market research and popular methods to conduct each one of them. We will also see an overview of how you can use market insights collectively to drive your business strategy.
8 Types of Market Research
Let’s go over 8 types of market research you should conduct to create or improve your existing business strategy.
1. Brand Research
Brand research is a look into how people perceive your brand. It focuses on building or even redefining a company’s brand. It’s always a good time to conduct brand research to know where you stand with your customers.
There are several types of brand research. Depending on your goals, you can focus on monitoring brand awareness and brand perception. Or you might want to measure brand penetration in the market, how loyal your customers are, and whether they are strong advocates of your brand. If you are currently considering reworking your brand, you may focus on positioning as well.
Brand research is usually done through surveys, focus groups, and interviews. You can also use social listening tools to see what is being discussed about your brand and analytics tools to measure traffic and user behavior while on your website.
2. Competitor Research
Competitor research, also known as competitive analysis, is monitoring what your competitors are doing and how they are performing. The scope of this analysis is not to copy the competition. Rather, to identify their strengths and weaknesses and leverage this knowledge to update your marketing strategy and offerings.
Competitive research is a long process that requires a methodical approach. Relevant information can be gathered through social media monitoring, mystery shoppers, and the examination of publicly available data, including financial information.
3. Customer Satisfaction
Customer satisfaction surveys aim to measure how satisfied customers are with a product or service. To simplify the process, most businesses use Likert scale surveys. Customer satisfaction surveys can identify problematic areas, from inadequate product features to inefficient customer service. It is also another great way to understand customer preferences.
The customer satisfaction score is a strong indicator of customer retention, as these two are inextricably linked. This research gives you a “second chance” to improve things that do not work, add what is missing from your services, and elevate the customer experience to meet expectations before you start losing customers.
4. Marketing Campaign Evaluation
Most businesses use a good proportion of their budget on marketing campaigns. It makes sense to want to measure whether these campaigns are working and how people perceive your brand. Managing a campaign is no easy feat – so it is best to monitor results closely and adjust as needed. Look at the “hard” evidence: the click-through rate of your emails and PPC campaigns, impressions, conversion rate, and the number of qualified leads – to name a few.
Does your messaging resonate with your target audience? Are you getting valuable leads? Are people now more likely to buy from you? Do more people know your brand? All these questions and more will be answered, so you can fine-tune your marketing efforts. The benefits of a more effective marketing campaign are considerable, from better brand awareness to reduced customer acquisition costs and more revenue.
5. Customer Segmentation
This type of market research helps you identify the different types of customers among your audience. Through customer segmentation, you can divide customers into groups based on the common characteristics they exhibit. For example, in B2B markets, customers can be grouped based on industry or location. In B2C, customers can be grouped based on age, average income, educational level, etc.
Customer segmentation is particularly helpful for marketing, as it enables you to know your customers better. It allows you to create targeted campaigns for each group, selecting the most appropriate messaging and communication channels. It also enables businesses to identify niche markets and untapped audiences and develop new products and features to meet their needs.
Customer segmentation can be conducted through surveys, interviews, and focus groups, and also by analyzing your existing customer database.
6. Customer Insights
Customer insights, or consumer research, aim to understand your customers’ behavior, purchasing habits, and needs. There are several ways to gather customer insights, from social monitoring to getting feedback from customers and sales personnel.
Customer insights can benefit your business in multiple ways. For instance, it is essential to gain customer insights before creating any sort of marketing campaign, so you can create more accurate customer personas. And, you can use customer insights to improve the customer experience and your products.
Consumer insights will also help you stay on top of emerging trends and changes in consumer behavior, thus staying one step ahead of the competition. Overall, businesses that leverage consumer behavior data outperform competitors by 85% in sales growth, which is impressive!
7. Product Development
This type of market research takes place as a product is developed or updated and helps find ways to improve it. Product development research helps understand whether a product has a place in the market and how it can be shaped or further optimised to better address customer needs. It also helps with pricing and overall positioning in the market.
Product development research is done by contacting customer with surveys, focus groups, and interviews, and also through user testing to see how customers use the product. This way, you can make improvements before it hits the market, increasing its chances of being a success.
8. Usability Testing
Usability testing, or user testing, focuses on how users use your product. Doing usability testing before launching the product can help you identify and rectify bugs and flaws before the product enters the market, saving you from unpredictable costs and from a hit to your credibility.
Usability testing can be performed either moderated or unmoderated, remotely, or in person. There are several methods that can be used, from using eye-tracking tools to monitoring user behavior on-site, and asking for feedback.
Using Market Research to Enhance Your Business Strategy
We have seen the different types of market research and how each one benefits your business. Now, let’s put all this together:
Create an Effective Marketing Strategy
Customer insights and segmentation will give you tons of information about your customers, allowing you to create personas and customer journey maps, and create the right messaging for them. By understanding customer preferences and consumer behavior, you will also be able to position yourself more effectively in the market and change your overall marketing strategy and your preferred communication channels.
Improve Customer Experience
Market insights will give you valuable information about who your customers are, what they need, whether they are satisfied with your offerings, and what you could do better. For example, you may find that offering customer support via email only is a huge downside for your customers. Based on this feedback, you might decide to offer phone support or deploy a customer education program.
Take Calculated Risks
Risk-taking is an inevitable part of running a business. But risk is translated to monetary losses and, depending on your financial status, you may not always afford a miscalculated business move. Through market research, though, you get valuable insights regarding customers, competition, overall market trends, and most importantly, your own brand. This enables you to minimize risk and predict future growth, therefore making the right decisions at the right time: like opening a new store, launching a new product, or targeting a new audience.
Introduce Products Consumers Love
Know what customers want right now, what their pain points are, their purchase power, what competitors aren’t offering them, and what they seek from a product and a brand. And what you may be missing or doing wrong at the moment! All this data will be at your disposal after comprehensive market research, so you can stay on top of the competition and introduce products that cover customer needs.
Grow Your Business With Market Insights
Knowledge is power, and that is true when it comes to business, too. Leverage market insights to know your customers better, identify opportunities for growth, and expand your business with fewer risks!
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