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Market research is a systematic process of collecting, analyzing and interpreting information. The information could be about a target market, consumers, competitors and the industry as a whole. This is the foundation of any successful company. The research has a number of different purposes – from identifying a new market to launching a new business.
Market research helps entrepreneurs make well-informed decisions. It can take the guesswork out of innovation, and funnel resources into ideas and projects that hold the most potential. Businesses at different stages of growth carry out market research for different reasons. There is a list of ways of how businesses can use market research:
There is a list of ways of how businesses can use market research:
- Determine the feasibility of a new business. If market research indicates there’s little or no demand for the product or service, the business is unlikely to succeed.
- Identify and develop potential new markets.
- Keep close tabs on marketing trends and develop strategies on how to stay ahead or adapt to changing market conditions.
- Test the demand for new products or features.
- Ensure optimal product placement – how, when and where should a product enter the market.
- Improve and innovate their business. You can identify issues with certain business aspects such as customer service early. This can help companies overcome costly disruptions later.
- Boost the success of their promotional campaigns. By gauging customer sentiment and understanding the perception of their brand, businesses can better shape their branding and marketing strategies.
Why is market research important?
Conducting research is one of the best ways of achieving customer satisfaction, reducing customer churn and elevating business. Here are the reasons why market research is important and should be considered in any business:
- Valuable information: It provides information and opportunities about the value of existing and new products, thus, helping businesses plan and strategize accordingly.
- Customer-centric: It helps to determine what the customers need and want. Marketing is customer-centric and understanding the customers and their needs will help businesses design products or services that best suit them. Remember that tracing your customer journey is a great way to gain valuable insights into your customers’ sentiments toward your brand.
- Forecasts: By understanding the needs of customers, businesses can also forecast their production and sales. Market research also helps in determining optimum inventory stock.
- Competitive advantage:To stay ahead of competitors market research is a vital tool to carry out comparative studies. Businesses can devise business strategies that can help them stay ahead of their competitors.