Module 5 : Market Research

5.1
Introduction

This
module will give you an overview of market research when it comes to marketing.
By reading
through this module, you will come to know that market research is one of the
fundamental pillars of marketing and advertising.

5.2
Researching the Customers

The basic definition of research means collecting data for
something that you do not know a lot about.
Similarly, when we talk about market research, it simply means that it is the
research that is conducted on the market or to get to know the market. Market
research is an essential part of marketing. When a business wants to sell its
products/services, it has to think from a customer's perspective, and this is
the way to do it.

Marketers are responsible for creating marketing strategies, and
they need to make sure that everything that they plan will result in the
company's success. Research helps to create these strategies.

A market researcher will gather data, look at current trends and the possible
future trends, customers' psychosocial behaviours, attitudes, and much more.
The information that they collect plays a crucial role in a marketing campaign,
and getting to know consumers is the key to success.



Customers are the key to your business; in fact, they are the ones who make it
possible for businesses to succeed. Therefore, when it comes to designing a
marketing strategy, every marketer first needs to conduct thorough market
research on their customers. You need to know who your customers really are,
what they are looking for, what is their financial status, where do they live,
what do they think, what are their perceptions, what they like, what they
dislike, etc.



Customer research has its own set of research methods. Let's take a look at
them below:

Questionnaires

When marketers need to know the target audience, they can conduct research
through questionnaires.Questionnaires can be used to learn about customer needs, their perception
about your business, and their views. These questionnaires contain a set of
questions that the researcher distributes amongst the target audience, and once
all the questionnaires are filled, the researcher then calculates the answers
and learns about the customers' preferences. During this process, a researcher
can ask any question that they find relevant for their business.



Researchers also target past customers during this process. These customers are
no longer involved with the company, and something may have resulted in
dissatisfaction, which the company can learn from.

Surveys

In order to find out information about customers, researchers often make use of
surveys. Surveys are very similar to questionnaires, but are often more diverse. They
can be used to conduct research of consumer purchase decisions and the things
that influence them.

Focus Groups

Focus groups allow marketers to provide a specific scenario to a group of
customers and then observe their statements, reactions, and views on the topic.
There is a moderator who leads the discussion and notes down everyone's views.
The participants in the focus group are presented with topics relating to the
company, and when the focus group discussion ends, a researcher analyses the
data.

Personal Interviews

A personal interview is a face-to-face research method that allows a researcher
to gather relevant information from customers.



The main aim of personal interviews or surveys is to learn customer behaviour.
This research method allows the researcher to get a better response from the
audience than questionnaires. Furthermore, it is also easier for the customers
to judge a product when they can touch, feel, use, and see it.



Another reason that makes personal interviews better than questionnaires is
that they are tolerable. A customer will not like to write a lengthy answer,
but will have no trouble giving the answer verbally. Therefore, most of the
questions in personal interviews are open-ended.

Personal interviews also allow researchers to observe customer
behaviour. By seeing how the customer is reacting, the researcher can get a
good idea of their behaviour and attitude towards the product.

5.3 The Importance of Customer Research

Due to the increased competition between brands, it
has become essential for every business to invest in customer research to gain
an edge over their competitors.



Customer research
allows businesses to offer better products and services, and when the customers
are satisfied, the business will automatically come on top. A product that
is designed after extensive market research is the one that is perfect for the target
audience and sells more.



Market research
allows a company to know exactly what its customers are looking for. It also
helps them learn about customers' problems and needs, which gives them a chance
to come up with a solution. Customer research allows marketers to learn about
customer psychology, behaviours, attitudes, and perceptions. This information
is enough to design a marketing plan that is highly targeted and gets the
desired action from the customers.



In order to
achieve success over the competitors, a business needs to invest in marketing.
Marketing is not complete without proper customer research because customers
are the driving force of their business. Unless the business knows its
customers, it is impossible to target them or make them perform any action, and
the products and services the company offers will not meet the needs of your
customers.

Customer Research Helps with Sales

Customer research
is conducted to design and implement highly targeted strategies to grab the
customers' attention and to urge customers to purchase. Every business' main
aim is to make more sales and earn more profits. However, if a business does
not perform extensive customer research, then it is not fully aware of what the
audience really needs. By conducting proper research, businesses can find out their
customers' needs, wants, likes, dislikes, and their attitudes.

Customer Research Helps to Keep you Informed About Your
Competitors

Customer research
is also beneficial for keeping an eye on the competitors. When businesses
conduct research on their target audience, they find out about the products and
services that they are more inclined towards and the brands that they follow.
They also get to learn about their behaviour, attitudes, and beliefs, which
allows them to get an idea of their competitors. When a business knows which
brands are more popular amongst their audience, they can easily catch the
things that their competitors are doing better than them.

Customer Research Helps Prevent Losses

When a business
is unaware of their target audience's likes and dislikes, they design a
marketing plan that does not work. When the target audience is not interested
in buying products and services from your brand, you are left with nothing but
financial loss. The money that businesses put into creating a product/service,
marketing, and advertising all goes to waste. However, if businesses start
investing in customer research, they can make the most of every pound that they
invest.

5.4 Learning
About Customer Satisfaction

Through ResearchCustomer satisfaction is vital for every
business' success.



The customers that are satisfied with your business are the ones that will
return and spread a good word about your brand to others. Happy customers will
also be ready to pay a premium to buy from someone that they trust. Customer satisfaction is the backbone of any business, and that
is the reason it is important for businesses to spend time and effort in
keeping their customers by their side.

The competition is fierce and the market is growing daily. There are so many
options available to the audience, and if a business does not keep its
customers happy, there is a high chance that they will leave their brand for
someone better. Customer satisfaction is important because if a business does
not make their customers feel valued, they will leave them. Retaining customers
is harder than bringing new customers to your business.

Get Questionnaires Filled

One of the most popular and highly effective ways of determining customer
satisfaction is to get questionnaires filled. The questionnaire should contain
specific questions about the brand and the customers' experience with it.

Some
of the example questions that you can add to the questionnaire are given below:
-Are you
satisfied with our performance?

• -Are you satisfied with our service?

• -Are you satisfied with the quality of our products?

• -Do we treat every customer professionally?

• -Do you think our customer representatives are well
  supervised and trained?

• -Do the salespeople in our stores treat you right?

• -Do our managers respond to your queries in a timely
  manner?

• -Do our salespeople answer your questions?

• -What is your overall satisfaction with our company?

Conduct Interviews

A good way to learn what your customers think about your brand and how
satisfied they are is to conduct interviews. Select a group of customers
belonging to different categories and interview them. The questions can be more
personalised in interviews because you are talking in person. Ask your
customers if they are satisfied with the overall performance of the brand.
Businesses should make sure that they give customers a chance to share their
problems.



By asking the customers about their conflicts with the brand, businesses can
find problems and devise strategies to fix them.

For instance, if a customer tells the interviewer that they are
not satisfied with the way their customer representatives behave, then
businesses can look into the matter, investigate, and come up with an action
plan to remedy the situation.

Measure Satisfaction Based on Different
Factors

To find out about customer satisfaction, businesses should conduct studies on
different factors such as price, product, staff, customer service and delivery.



Make questions for each of these factors and interview customers, or design a
questionnaire. This technique will help businesses learn about the weak areas
in a better way. If the customers think that the products are too pricey and do
not offer great value, then getting to know about it through a survey will
definitely help businesses come up with a strategy.

Businesses should not hesitate to ask detailed questions to
their customers to get to the real problem. The more extensive the research is,
the easier it is for a business to fix it.

However, if the majority of your customers have positive reviews for the
company, then businesses need to adopt a customised approach for the few
unsatisfied ones or to evaluate whether going above and beyond for a couple of
customers is suitable or not.



By learning about your customers' views based on the above mentioned factors,
businesses can revise their strategies to turn them into customer centric
strategies. Businesses also need to find out how satisfied their customers are
with their products and services. At the end of the day, every business looks
into the profits that they have earned, therefore, it is important to learn
about their products/services.

Businesses
can learn about customer satisfaction by adopting two different techniques of
research given below:

• Qualitative -
  With the help of this research method, businesses can find out how
  their customers perceive their products/services and what they
  have to say about them.

• Quantitative - With the help of this research,
  businesses can get their hands on subjective data that tells them the
  number of times customers come to buy their products.

These two research methods are great for determining how customers connect with
the brand and whether they are pleased with the products/services or not. You
can also opt for other methods of research including surveys, interviews, and
questionnaires. Finding out about customer satisfaction is essential for
keeping your business running smoothly.

5.5 The
Different Types of Market Research

Marketers
make use of different market research methods to find answers to different
questions regarding market dynamics, consumer behaviour, and the business
environment.



There are
numerous techniques that marketers use to gather and evaluate market
information. The main purpose of market research is to find detailed
information about customers in order to offer products that satisfy them.



Market research
also involves both analytical and statistical techniques to gather and evaluate
information. Although there are no limitations in the research methods that the
marketers choose, there are some defined techniques that are given below:

Primary

Primary market
research is the type of market research that is conducted by a company. This
type of research is done from scratch, which means that the company does not
take information from available resources, but conducts its own research using
different methods. Primary data can be gathered by using both qualitative and
quantitative data. This research method is quite authentic and is conducted by
the company itself. Therefore, the information collected with the help of
primary research is to the point and more useful for the company.

Secondary

Secondary market
research is the technique that is used to collect information that is already
present. The company does not need to gather the information on its own, but
can make use of information that has previously been conducted. When a business
is making use of secondary data, it will either use information that is free or
pay for it. Secondary data can be collected from magazines, websites,
government, newspapers, etc. Businesses can use multiple resources to gather
secondary information. Many companies opt for secondary research because it
costs less or is even free, and it saves a lot of time.

Qualitative

Qualitative
research is the type of market research that involves exploration of the market
and consumers. This research is used to determine customers' behaviours and
attitudes in order to reach out to them in a better way. However, this research
method does not provide statistical results.



Instead, this
research means finding out what customers think about you or how they perceive
your brand based on a variety of factors. Businesses can gather qualitative
data in numerous ways, including questionnaires, surveys, focus groups, and
interviews. The best way to gather qualitative data is to meet with customers
and conduct face-to-face interviews. This research method is perfect for
businesses that are planning to introduce new products and services.

Quantitative

Quantitative
research is conducted to gather statistical data on the market and consumers.
This method allows businesses to gather factual data in the form of numbers and
percentages. The reason that this research method is used by many businesses is
that it provides authentic data which can be used to get solid results.



When a company
knows how many people in their target audience are fond of a particular
product, it can design products that its customers want to buy. Companies can
gather both primary and secondary data to back their research with this method.

5.6
Competitors and Industry Data

When you are part of the market or industry, it becomes
essential to conduct research on competitors.



When you understand the competition, you can bring your business to the top.
Businesses need to continually invest in industry and competitors' research to
capture a greater chunk of the market.



Competitors' data also helps businesses differentiate themselves and make a
unique identity of their own. This research also gives companies a chance to
learn about current market trends and design products that are in demand.

No business should ever take their competitors lightly.
Therefore, it is important to conduct proper industry and competitor research
on a regular basis.

There was a time when marketers could only gather data from a couple of
sources. Today, however, the Internet is a great help to marketers, and it
makes their jobs easier. There are several competitor research tools that
marketers can use to gather information on digital strategies, and when you
understand what your rivals are capable of, you can devise better strategies.



In addition, marketers also must find information about customers' perception
about their competitors. They need to know what the audience thinks about their
brand and then compare it with customer comments about competitors. When
businesses invest in industrial and competitor research, they can make smart
decisions, choices, and strategies.



In order to succeed in the industry, every business needs to find out two
things: what their company is doing and what their competitors or rivals are
doing. By comparing data on both sides, marketers will be able to get a better
idea of what they are lacking in and what their strengths are.

Conduct SWOT Analysis

A good way to find out where your company stands is to conduct a
SWOT analysis. SWOT is the acronym for Strengths, Weaknesses, Opportunities,
and Threats. This analysis helps businesses analyse their performance and
position in the market. The competitors' data that companies gather should be
added to the SWOT analysis, and they should then compare the data.

This will allow companies to learn of their rivals' strengths so that they can
improve their performance to become stronger; their weaknesses to take
advantage of them; their opportunities to include them in their business plan;
and eventually the threats that your competitors may face to compare them with
yours.

FACT

UK advertising expenditure recorded its eighth consecutive year of market
growth in 2017 which, with expected increases in 2018/19, puts the industry on
course for a decade of continuous expansion.
Source: adassoc.org.uk

5.7
Targeting the Right Audience

When it comes
to conducting research, the most important aspect is to get to know the right
target audience.



For instance, a
company that wants to sell luxury cars cannot target the middle class because
that audience will not purchase these cars.



In marketing, it
is important for businesses to know their target audience because without
knowing who you will be trying to impress, you cannot entice them. When you
know that target audience, you can devise strategies that work best to attract
them towards your brand and products. Without knowing who your customers really
are, you will be advertising and marketing for unknown people, which will only
end up in wasting your time and money.



You also need to
learn about your customers' behaviour, psychology, and needs. The part where
you find out about these intimate details is called demographics. Demographic
research is an important part of market research which allows markets to gather
information about the characteristics of the population. This research method
includes characteristics like race, gender, age, income, and marital
status.



Marketers also
need to think about the exact demographics that the brand is targeting for a
particular product or service. If the brand is trying to promote a car, they
need to determine which type of people should be surveyed. If the marketer is
trying to promote a product that is a luxury car, then they should survey only
the audience who will buy the car instead of wasting time on those who will
not. This is how demographics play a major role in marketing. If the marketer
does not have knowledge about the demographics of their brand, then there is a
high chance that all their marketing efforts will fail.



When getting
questionnaires filled by the target audience, the demographic questions
included in it will give relevant information to the marketer about their
customers and their interests. They will come to divide different groups within
the target audience based on the demographics that they fall into.

Module Summary

Market research is an essential part of the marketing process. When a company
is about to launch a new product or if it is just trying to gather information
about their brand and its standing in the market, the various market research
methods allow marketers to get insight on everything that they require to
improve.



Most of the businesses now have an online forefront which is a major outlet for
their business, and with the availability of easy data and resources, marketers
have a chance to look into their customers and competitors' data without any
hardships.



There are several online tools and techniques which marketers can use to spy on
their competitors' data without them knowing about it. This includes websites
that provide solid information about a brand's online reach, traffic, and much
more. Apart from that, marketers can interact directly with their audience with
the help of social networks and forums. They can also view trending topics and
brands that the audience is most interested in, which is another great
advantage for businesses to improve their offerings and differentiate
themselves from their competitors at the same time.