Market research is the process of collecting, analysing, and interpreting information about a particular market, target audience, or industry. It is a crucial tool for understanding ongoing trends in the market, consumer behaviour, and surrounding competition.
It is typically used in areas of product development, market entry and expansion, advertising, and pricing, among others.
How is Market Research Typically Done?
Market research can be conducted through several methods and techniques, depending on the objectives of the research, the resources available for the research, and the target audience. Mainly, it involves – defining your objectives (what information are you trying to gather?); identifying your target audience (such as current customers or potential customers or even competitors); picking a research methodology (such as surveys, interviews, observations, etc.), data collection, data interpretation, and finally, taking action.
Let’s understand this better with the help of an example. Take the case of a bakery which wants to diversify its offerings by including gluten-free items. To make this a successful venture, the bakery decided to conduct market research to identify if there is sufficient demand for gluten-free products in the local area and what customers would be interested in. This market research would most preferably be conducted by interviewing regular customers or using survey tools like Google Forms. After meaningful amounts of data are collected, it can be interpreted and acted upon. For example, the bakery might note great interest in gluten-free products and introduce muffins and cookies of the sort.
Main Purposes of Market Research
Market research is widely used for the following four purposes:
- Understanding your consumer base to create a business that centres the customer. Market research helps to understand the demographic of your consumer base, which enables you to make decisions that they would engage with in the future.
- Making important and profitable business decisions. It helps you assess demand in the market and enables you to appropriately price your product/service to make it profitable.
- Acquiring funding and investment. A well-researched business is liable to make fewer mistakes in its functioning and is more likely to succeed in its endeavours. This makes the business more likely to secure external funding.
- Avoiding business failures. It helps to identify potential risks and challenges in the market, enabling you to be adequately prepared.
Graphic Credits: Sabia, Graphics Intern at Mandonna
Tips and Tricks for a Successful Research
To make your market research effective and useful, it is important to keep in mind some crucial tips and tricks. Here are our suggestions!
Make sure you select the absolute correct procedure for conducting your research. Different methods of gathering data are suitable for different kinds of endeavours and there may be a chance of choosing the wrong one due to improper knowledge beforehand! For example, a company is trying to understand the market demand for its luxury dog collars. For this, if they stand outside of a local cat show and ask attendees about their preferences then this will lead to a sampling bias (as data will not reflect the target market i.e. dog owners), lack of control (as there will be no control over the kind of people responding to the survey), and a limited reach. This is the result of using an incorrect methodology. To correct this, the company must use a sample of their target market (dog owners or enthusiasts) and collect the data in a more controlled and unbiased manner (such as through an online survey).
Another trick to acing market research is to create a detailed research plan beforehand! Make sure you outline the process, timeline, budget, and responsibilities. This will keep you on track and make you organised.
Keep your surveys and questionnaires concise. Long and complex surveys can discourage participation and skew results.
Test and iterate: Test your strategies and research methods, and be open to making changes based on your findings. Continuous improvement is essential for successful research.
Market Research and Gender
A lot of market research is gender-based and for many marketers, gender is typically considered a major factor when deciding on new campaigns and products. Based on how a message regarding the product is delivered, it can positively or negatively impact the attitudes of the target audience. However, gender marketing can be off-putting with many modern audiences today as most of it tends to lean into gender-based stereotypes.
While gender-specific market research may lead to brand recognition and effective targeting of specific needs, it also perpetuates the limitation of gender roles and alienates certain audiences. Today, many companies are engaging in gender-neutral marketing and are being met with resounding success.
Therefore, market research is an important and non-excludable part of any business operation. It is necessary to make sure that adequate and intelligent research is undertaken before making any momentous or significant decisions.
Authorship Credits
Mihika Jain is a 2nd-year Political Science student at Miranda House and a Research Intern at Mandonna
