It’s easy to dismiss the importance of marketing research. After all, when you first think of a business idea, spending hours on market research is the last thing on your mind. Most of us would rather start making and selling products right away than think about the value of marketing research. Show
But for any type of business, there's a real need for market research. This is especially the case for small businesses, where the first few months can prove to be precarious. New businesses need sales and customers as soon as possible, and market research can ensure that those sales and customers don’t stop coming. The value of marketing research is that it helps you learn more about your customers. (Image Source: Envato Elements)In this article, I'll explain some basic marketing research concepts. I'll also explain why marketing research is important and share some resources to help you get started on your own marketing research. If you want to stay up to date, you should also read the in-depth guide to the latest marketing trends over on the Envato Blog. What Is Marketing Research?Before you can understand the importance of marketing research, you need to know what it is. Market research isn’t about a specific method or activity, it’s just what businesses call their attempt to learn more about their target customers. While tasks like surveys and focus groups can help, they aren't absolutely necessary, and they aren’t the only things you can do to research your target market. Here are some tasks that can be part of your market research:
The above activities are just a handful of tasks that could be part of your market research. In fact, you can classify any task as a market research activity as long as you end up knowing your target market’s needs, behaviors, and preferences. The Importance of Marketing ResearchThese are the seven reasons why market research is important, especially for smaller teams and businesses: 1. Easily Spot Business OpportunitiesAfter you’ve done your market research, it'll be clear to you who you want to reach out to (your target customers), where you can reach them (your marketing channels), and what they're interested in. Once you’ve defined these, you’ll be able to easily spot business opportunities. For example:
2. Lower Business RisksAround half of businesses with employees don’t survive past the fifth year, according to data from the Bureau of Labor Statistics. The way to make sure that your business survives for longer is to ensure that you've got a steady stream of sales and customers. To do that, you need market research. Regular market research will be your way to check in with your current customers and potential customers to ensure that you’re still meeting their needs. Here’s how you can apply this:
3. Create Relevant Promotional MaterialsIf you’ve ever wondered what text or images to put on your fliers, website, or social media accounts, with thorough market research, you’ll know exactly what to do. Since target customers have already expressed all their wants, needs, and frustrations with you, you’ll know exactly what to address and how to address it when you start creating your marketing materials. For example, author Tiffany Sun surveyed her readers to find out which problems they’re trying to solve. Instead of coming up with blog topics or headlines in a vacuum, she uses the results of this survey to brainstorm compelling topics. Surveying your audience about their main problem points can help you create compelling content for them.Here are some other ways your marketing materials will be easier to create:
4. Know Where to AdvertiseOne of the problems that small business owners face is a limited budget. Because of this, your marketing budget should be optimized to give you the best returns possible. Your market research can help ensure that you’re reaching your intended audience in the channels where they’re most likely to see your message. These are some of the budgetary tasks that your market research can help with:
5. Outsell CompetitorsThe business that knows their customers more tends to win more. If you can beat your competitors at finding out your customers’ needs and you aim to fulfill those needs, you've got a better chance of standing out from the competition. Here are some ways you can use market research to outsell competitors:
If you need to know more about conducting market research with competitors in mind, here are some helpful guides:
6. Set Better Goals for Your BusinessWhen business owners set goals for their business, it’s typically related to growth in sales or customers. But without market research, you won’t be able to know if your goal is achievable and how to achieve it in the first place. You might say that you want to double sales by the end of the next quarter. How would you know if this goal is feasible if you don’t know whether the size of your target market is more than twice the size of your current customer base? Without knowing the current size of your potential market, you’ll just be setting arbitrary goals. With market research, you’ll be able to determine the specific directions you want to grow your customer base. For example, do you want to grow your customers via a new untapped market segment? Or do you still have room for growth among your current target audience? If you need help setting growth goals for your business, the following tutorials can help:
7. Decision-Making Becomes SimpleThe need for and importance of marketing research frequently comes up when making tough business decisions. Instead of having arbitrary criteria for the decisions you make as a business owner, you can always go back to your market research report. Based on that report, will this decision lead to more customers? Will you be able to reach more people who are likely to buy from you? Will it be clear to them that your business can meet their needs? While not all decisions should be solved by market research, many of them can be, such as:
There's a real need for market research because it provides you with solid facts. Through market research, you'll make more informed decisions rather than resting the fate of your business on guesswork. More Resources to Help You Start Your Marketing ResearchNow that you see the importance of marketing research, it’s time to get started on the process. Don’t be intimidated by the task ahead. Instead, start by gathering data only on these two things: your target customer and your competitors. You don’t need to get all the information right away. After all, your target customers’ sentiments might change over time. Also, as a business owner, you can’t spend all your time on research and forget about execution. To make sure you've got a focused start, you can follow this step-by-step tutorial: If you need to present your market research report to other people, such as a business partner, an investor, or your team, you can simplify the process by using a presentation template such as this Digital Marketing Agency PowerPoint template or the Digital Agency template from Envato Elements. The Importance of Market Research for Your BusinessNow that you understand the need for market research, you're ready to get started. Your business doesn’t have to commit tens of thousands of dollars on focus groups and extensive surveys to conduct market research. But, it’s important that you do market research in the first place. As long as you end up with a thorough list of your target market’s demographics, needs, and frustrations, you’ll be able to reap the above benefits as you grow your business. Why not get started with your marketing research today? |