In a nutshell, market research is the process of collecting, analysing and deciphering data/information. The key to any successful business is to understand the customers’ wants and needs.
In addition to knowing the customers, it can also be used to know the competition. By knowing the customers and the competition; it helps companies to strive to give the customers what they want/need; in a way that is profitable for the company. Understanding industry shifts, changing consumer needs and preferences, and legislative trends, among other things, can shape where a business chooses to focus its efforts and resources.
The most common methods of gathering data are as follows:
- Surveys – Asking customers a series of questions to better understand how they feel about the product (e.g. product’s features/taste/packaging, or about the consumers experience using the product). Surveys consist of a list of questions that can be shared with an individual by phone, in person, on a card or paper, or online.
- Focus groups – Bringing together groups of people with a common characteristic, such as age, hobby, or buying habits, to better understanding their likes and dislikes is a focus group. Focus groups typically consist of 8-12 people with a moderator who poses questions for the group to discuss. They are a useful way of getting feedback on a new product, new features, or new ad campaign.
- Observation – When the researcher gathers information simply by watching how a subject interacts with a product, the technique is observation. This is often used in comparing preferences for several types of products.
- In-depth interviews – Another market research technique is the one-on-one interview with an individual, during which probing questions are posed to better understand that person’s product preferences.
Understanding market trends will ensure the sustainability and the profitability of the company in the market. Understanding the consumers will ensure the brand heath/reputation/popularity of the company in the market. Understanding the competition/competitor will ensure the company’s longevity in the marker. Market research plays an important and vital part in ensuring the survival/growth of any business.