Why Do You Need Market Research?
Before you pick up the telephone and start dialing arbitrary numbers or hurrying out there and informing individuals about what you would like to sell them, you must first determine who would like to be your audience. This is the segment of the total market from where you will get the major part of your sale. Having a detailed knowledge of the gaps and needs of your target market empowers you to sell the right merchandise or services to the right customers. And, this power comes from asking your customers what they want.
Knowing your market not only helps in sizing it for a new venture/product or a company reorientation, but also in improving your offerings by including the end-user feedback. Market research answers a whole range of questions, such as:
- Who will be directly benefited by purchasing your product/service?
- Who will indirectly reap the benefits of purchasing your product?
- Who can afford the products?
- What payment methods do individuals prefer to use when buying your merchandise – cash or credit?
- Is the merchandise you provide a need or luxury?
- What is the demographic profile of your customers? Considerations will include, gender, age group, marital status, geographical location, and so on.
- Where and how are these products used?
- Is it a seasonal business?
- Do your customers already have competing options available?
- How do customers respond to your offerings and perceive your company?
- Can a modified version of your current products/services be used in other markets?
- Why is each customer sub-segment buying your product?
- What is the demand elasticity?
- Are the existing customers satisfied with your company?
The list is long.
Now, here comes the important question. If market research is so useful, why do small and medium sized businesses shy away from it? There are two main reasons. Entrepreneurs often fail to understand the importance of a market study and treat it as a dispensable exercise. If you have a growth-oriented mindset, you might want to pay attention to the point of consumption of your merchandise. You may blame your dwindling sales or lower-than-expected growth on the missing piece of the puzzle – customer insight. For instance, not all products sell for the same reason and not everyone buys for the same reason. Odds are, young people buying your item may have different buying considerations than the older individuals. The same product may hold different value to different groups and data to this effect can help you understand your segment performance, while affording you the opportunity to tweak what you sell.
The second reason why business owners will not undertake market research is because it is incorrectly perceived as expensive, especially primary research. Practically speaking, it depends upon the consultant or agency your hire. There is no single best way to conduct a study that will apply to all industries and situations. An experienced consultant will package the right mix of methodologies and techniques to meet your intended purpose within your cost constraints. Remember that primary and secondary market research methods can be combined to achieve the optimum results.
Running a business without understanding your buyers is a blind shot. Do not place a product or service on the market unless you have conducted an extensive research on what consumers need and want. You have to know precisely which products will sell and which products won’t. Eurion Constellation helps entities of all sizes in acquiring market intelligence to further your business interests. Let us know your requirements at email@example.com. To know more about us, please visit www.eurionconstellation.com.