Our Contextual Experience Lab can provide you with a crucial part of marketing strategy: to understand customer desires and how the market is behaving.
Today’s consumers wield a lot of power. Rather than talking to company sales reps, they vet a company through online reviews or ask friends and colleagues for referrals. By doing their own research, they can make purchase decisions entirely on their own.
With this knowledge in mind, it seems that companies have two options: become complacent and keep marketing the way they always have OR they can adapt their marketing strategy in response to the way today’s consumers research, shop, and buy.
Yet, altering your marketing strategy is not that easy. You need to have a deep understanding of who your buyers are, your specific market, and the influences over the behavior of your target audience members and their purchase decisions.
The answer? Market research.
What is Market Research?
Market research is a deeply important part of the marketing strategy process, but what is it? According to Entrepreneur, the term is defined as “The process of gathering, analyzing and interpreting information about a market, about a product or service to be offered for sale in that market, and about the past, present and potential customers for the product or service; research into the characteristics, spending habits, location and needs of your business’s target market, the industry as a whole, and the particular competitors you face.”
There are two types of market research that involve data collection:
- Primary information is based upon research you gather yourself or hire someone to compile for you.
- Secondary information is based upon research that has already been compiled and organized for you. Examples of secondary information include studies and reports by trade associations, government agencies or other businesses within your industry.
You can also take your market research one step further through competitive analysis. According to the United States Small Business Administration, conducting competitive analysis is key for defining a competitive edge that creates sustainable revenue as it involves learning from competitors.
Your competitive analysis should identify your competition by market segmentation and product or service line. Your assessment should look into the following characteristics:
- Market share
- Strengths and weaknesses
- Your window of opportunity to enter the market
- The importance of your target market to your competitors
- Any barriers that may hinder you as you enter the market
- Indirect or secondary competitors who may impact your success
Pro tip: make sure you’re differentiating your competitive analysis by industry because several industries might be competing to serve the same market you’re targeting. Important industry factors to consider include the threat of new competitors or services, the level of competition, and the effect of suppliers and customers on price.
How to Conduct Market Research
As mentioned above, conducting market research is built upon primary and secondary information:
Basic types of information to collect when conducting primary market research fall into two categories: exploratory or specific. Exploratory research is open-ended, helps you define a specific problem, and usually involves detailed, unstructured interviews in which lengthy answers are solicited from a small group of respondents. Simultaneously, specific research involves a precise scope and is used to solve a problem that was identified by exploratory research. As opposed to exploratory interviews, specific interviews are structured and formal. When compared to exploratory research, specific research tends to be more expensive.
When using your own resources to conduct primary research, begin by deciding how you’ll question your targeted group: by direct mail, telephone, or through personal, in-depth interviews.
Typically, mail response is low. A return rate of 3 percent is average; 5 percent is considered exceptional. Conducting research reports via a direct-mail questionnaire, increase your response rate by following these guidelines:
- Use questions that are short and concise
- Address questionnaires to specific individuals – and make sure they are of interest to the respondent
- Keep questionnaires to two pages or less
- Include a cover letter that explains why you’re doing this questionnaire
- Include a postage-paid, self-addressed envelope for respondents to return the questionnaire in.
- Think about offering an incentive, such as “15 percent off your next purchase,” to complete the questionnaire
The most timely, cost-effective method involves phone surveys. Try the following tips when conducting telephone surveys:
- Memorize a prepared script ahead of time
- At the beginning of the conversation, confirm the respondent’s name
- Keep the respondent’s interest by avoiding pauses
- If you require additional information, ask if a follow-up call is possible
The personal interview is one of the most effective forms of marketing research tools and typically falls under one of these two types:
- A group survey: focus groups or group interviews are helpful for gathering information on buying habits, product ideas, and purchasing decisions.
- The in-depth interview: These face-to-face interviews can be focused or nondirective. While focused interviews are based on questions selected ahead of time, nondirective interviews inspire respondents to address certain topics with minimal prompting.
Assembled by entities ranging from government agencies to media sources, secondary research is typically published in pamphlets, magazines, and newspapers, among others. These sources include the following:
- Public sources: These are usually free and include business departments of public libraries, government departments, and so on.
- Commercial sources: Accessing these usually involve paying subscription and association fees. Commercial sources include research and trade associations, banks and other financial institutions, and publicly traded corporations.
- Educational institutions: These can reveal highly valuable information since more research is conducted in colleges, universities, and technical institutes than any sector of the business community.
Our Contextual Experience Lab
Looking to better understand market context and further develop your voice? Our Contextual Experience Lab, which is one of five Interactive Labs we offer, provides a quantitative analysis in order to gain these insights and help you with your business planning. We recommend working with this lab if you have the following goals:
- To better understand who your competitors are;
- Discover market trends;
- Learn more about who the end customer is;
- Have new project initiatives and create a competitive advantage;
- And to understand market context before applying solutions.
We accomplish these specific goals through applications like desk research, customer surveys, benchmarking, social listening, and others.
After working with our Contextual Experience Lab, you’ll get:
- A comparative diagnosis of your product when contrasted with other market players;
- Recommendations for improving products and services;
- Perceptions and opportunities for action;
- And a vision of your voice and pain points.