Have a Great Product Service Idea - Conduct Market Research
How would you react if you come to know that a mere 3% of consumer packaged goods go beyond the sales goal benchmark of a successful product launch?
You may "think" that your product will be successful in the market. But, conducting a market research establishes the fact that there will be demand for your product once you launch it.
Having a great product or service idea is just the first step, it's vital to know if there is a sustainable market for it before you delve any further into the logistics. Market research is a great way to collect information about the market where you will launch your product or service. It helps you understand the customer preferences, their buying patterns and exact requirements, and make your product / service market ready.
Not Interested in Market Research?
There are several business owners and companies which fail to undertake the major step of conducting market research before launching their product or service in the market. One of the reasons could be that they do not like to receive negative feedback right at the beginning. Most of the time they are convinced about their product idea and do not want to waste time on market research to assess the marketability of their idea.
Some companies skip the market research route because it could prove to be time consuming and expensive. Nonetheless, not conducting research for your business could ring the death knell for your business, sooner or later - it is like not doing your homework before appearing for the final exam!
Read our article on "Why is Market Research Important for your Business?" to know more.
Categories of Market Research
One of the major components of research design is to determine the type of market research that will best suit one's requirement at hand. The process of market research can be classified into three buckets, based upon the objectives of the research.
- Exploratory Research - Primarily used to gain knowledge in a domain and not necessary for making business decisions
- Descriptive Research - Used for answering business-centric questions like, "will there be demand for my product," etc.
- Casual Research - This type of research helps understand cause analysis. It gives insights into scenarios as to what would happen if a certain version of a product was launched, etc.
Types of Market Research Data
Essentially, there are two types of data that you will come across when conducting market research -primary data and secondary data. Primary data is the one which originates from the source giving you first-hand information, such as the data obtained from the respondents to a survey who could be potential customers of your product or service.
Secondary data refers to the available data already from sources like trade journals, and statistic reports, surveys, studies conducted by the authorized bodies, etc. Reference libraries and the Internet are great sources of secondary research data. Publications rolled out by trade associations, chambers of commerce and trade, and Government agencies usually provide information related to key upcoming trends in the market, which can help businessmen make informed decisions.
If you do not have time to read trade magazines or surf the Internet for secondary research, you can consider hiring an information broker who can provide all the data that you are looking for, at a nominal fee.
Tools to Conduct Market Research
There are many ways in which you can conduct market research. However, it is always good to have some market research tools at your disposal to conduct research efficiently, such as -
- Marketer's Almanac - An offering from the stable of Google, this tool provides insights into consumer behavior and the pattern in which they shop during a year
- American FactFinder - Using this tool can help you get access to census data in the US, with the possibility of filtering the data by age, income, location and more
- County Business Patterns - It lists all the information of various businesses in different parts of a geographic location
- Business Dynamics Statistics - It leverages census data to provide insights like several jobs created, newly opened startups, business mergers, and expansions, etc.
- FedStats - It gives updated information about data released by federal agencies, and other agencies such as education, energy, and transportation
- Nielsen MyBestSegments - It helps researchers understand and analyze an area's demographic information, with insights into the lifestyle habits of the people who live there
- SurveyMonkey - A very useful tool that helps create impactful surveys to gauge consumer preferences
- Other Tools - Apart from the ones mentioned above, you can use the following tools to conduct market research -
- Pew Research Center
- Social Mention
- HubSpot Research
7 Stages to Marketing Research Success
Market research cannot guarantee success; you must do it correctly to see results. Following methods can assure the outcomes you are expecting from your market research exercise. Steps you should follow to ensure success in your market research campaigns -
- Establish the need for market research
- Develop the research design, which is a framework for carrying out the entire market research process
- Determine the method of data collection - primary or secondary
- Collect the data in the determined method of data collection
- Identify sampling method from the population under study
- Analyze and make inferences from the data collected
- Make the final market research report with the necessary recommendations
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