How Important is Market Research?
Not only is the entire world changing and new products emerging every day, the medium through which we market products also continues to expand at a rapid rate. In such a fast-paced world with numerous competitors trying to outlast each other, the need to gain an edge over the field becomes even more profound.
Luckily, there is an age old tool for doing this that continues to be effective and will be so for a long time. We're talking about none other than market research. But what exactly is it and just how important is it for a successful product launch? We take a detailed look below.
What is Market Research?
Market research is as much a science as it is an art. It is the various steps taken by businesses to identify a target audience for their products, understand this target audience, and put themselves in a position to properly optimize a medium to properly deliver this product to their identified target audience
To do this, businesses make use of a varying array of tools that include surveys, focus groups, search engine data tracking among others.
Proper market research also involves taking the time to analyze competitors to further understand what they do best, where they fall short, and how to gain an edge on the market.
The Importance of Market Research
From the above definition alone, one is able to catch a glimpse of just how important market research is in orchestrating a successful product launch. Below are a few significant benefits businesses tend to obtain from putting a great deal of time into market research.
1. Identify a Target Audience
First of all, the initial goal at the beginning of a market research is to either identify your target audience, or confirm it. Developing a new product is exciting, and usually businesses have an idea who they're targeting beforehand.
Market research allows a business to be sure they're indeed targeting the right audience, or where applicable, tweak their strategy to target a more optimal audience.
2. Understand & Optimize for Launch Excellence
Once a target audience has been identified, businesses can put the knowledge into use by optimizing their product to appeal to the identified demographics.
For example, through data obtained during market research, a better understanding is obtained regarding what medium the target audience prefers. This way, they know where to target to achieve the best results.
3. Create Pertinent Promotional Content
Knowing where to target is one thing, the next step afterwards is knowing how and with what. Different medium calls for different kinds of promotional content.
Without market research, businesses wouldn't know what kind of content to create because they wouldn't know who exactly they're trying to reach. By having a clear idea of who they're targeting, they're able to create content specifically for that medium, and specifically for that demographic.
4. Outpace Competitors
As touched upon earlier, understanding your audience is just one aspect of market research. An additional task is to also understand your competition. In fact, proper competition research will also help you understand your target audience better.
For instance, after an adequate competitor research you get to understand their frustrations with the competition. You can then use this data to improve where the competition falls short.
Additionally, you also get to identify areas where they're not doing enough. This will then become your focal point, instead of focusing on areas where they're already providing the best possible value.
5. Lower Market Risks
There is always a good amount of risk involved when launching a product. Luckily, businesses are able to lower this risk significantly through proper market research.
By focusing on a more targeted group of people, whose interests have already been determined through market research, a product launch has a better chance of success than focusing on a wide range of people without an established interest.
6. Set Realistic Performance Metric
Performance metrics are the best ways to determine launch excellence. They help you keep track of how great your product is doing so that you can either double down on what you're doing right, or make changes to get yourself back on track.
It is a lot harder, however, to set performance metrics if you don't know what demographic you're targeting anyway. And that is where market research comes in.
What's more, market research doesn't just help you set performance metrics, it helps you set realistic ones. A business that doesn't know its target audience might set unrealistic goals or those that are not ambitious enough.
With market research, however, you know exactly what your ideal target should be.
7. Discovering New Opportunities
The market has a lot of opportunities to offer. And that is the beauty of it. You may set out looking to understand how to market a product and end up stumbling upon a better opportunity.
In the process of market research, you also get to form partnerships, expand your existing products, and find new locations to take your business to the next level.
8. Better & Easier Decision Making
Lastly, market research helps businesses make better and easier decisions. For instance, as a business it may be hard to make a decision on where to spend and what to spend on if you don't have data backing up your target points.
This may lead you to spend money in random places leading to further loss down the line.
With data from market research, however, you're able to decide upon where to spend money a lot more easily because you're not just spending blindly. You're spending based on valuable data obtained from thorough research.
So there you have it - the importance of market research. All of the points above are more than enough to emphasize just how crucial proper market research is to the future of any business.
The market is a beautiful place with tons of opportunities. But it is also extremely brutal and unforgiving. Market research goes a long way to help you make the right decisions and position yourself in the best place to experience unprecedented success. The use of the right tools, will leave your competition behind in the dust