Market research is the calculated and often complicated process of identifying the most pertinent aspects of a marketplace so that a company can glean and then use insight to effectuate better (i.e., more profitable) business decisions. While sometimes confused with marketing research, which is a more narrow type of research focused primarily on uncovering information regarding specific products and their pricing, promotions and distribution channels, market research delves more deeply, seeking to answer questions about these issues, as well as those concerning the trends, competitors and consumer characteristics that affect the evolution of a market as a whole. Take a look at four common market research objectives and how a quality research methodology can help you reach them:
How Can We Sell More Products to Our Existing Customers?
An established company can use market research to help retain its customers. You’ve heard the saying: “Make new friends, but keep the old. One is silver, and the other is gold.” It’s poignant advice for us as individuals, but it’s also applicable in business settings. According to Small Business Trends magazine, research shows that "65% of a company’s business comes from existing customers” and “82 percent of consumers in the United States said they stopped doing business with a company due to a poor customer experience.” If a company can figure out how to encourage its current customers to remain loyal and buy more (up-sell), it can bypass the added expenses associated with attracting new ones, reducing some of their overhead costs and improving their ROI. By developing market research objectives that identify customer satisfaction levels (via customer satisfaction surveys or analysis of the Net Promoter Score, retention and churn numbers, for example) companies can identify possible ways to increase satisfaction and maintain brand loyalty among the people they serve.
How Can We Attract New Customers?
Existing customers may be cheaper to service, but sometimes businesses need to expand their reach in order to increase revenue and/or prove their relevancy within a market (often critical for third party sources demanding evidence for their support). Market research objectives that seek to uncover competitor strengths (and weaknesses), identify potential influencers, reveal customer demographics, improve brand awareness and measure marketing effectiveness are just a few of the ways companies can use quality research to strengthen consumer engagement.
Can/Should We Develop New Products for Our Existing Customers?
Another likely scenario that businesses will need to address at some point is how they can persuade their existing customers to try some of their other products/services. Such cross-selling initiatives allow companies to avoid the costly prospect of having to attract new customers while permitting them the opportunity to build customer loyalty and satisfaction by providing convenient and useful solutions. When companies can demonstrate that they care for all the needs of their customers, they make those customers feel valued. And customers who feel valued often do a lot of free advertising via recommendations and favorable reviews. Market research objectives that strive to understand buyer personas and customer journeys and monitor customer chatter and/or engagement, can help companies develop predictive models for consumer behavior, increasing their chances of targeting the right customers with the right products in the right ways.
Can/Should We Develop New Products for New Customers?
Finally, companies can always try to develop new types of products and services for new types of customers. It’s the riskiest kind of endeavor, requiring a company to use a comprehensive research plan with specific market research objectives in order to fully understand market threats and opportunities. The possibility of failure is too great to leave anything to chance. Indeed, a combination of the three previous types of objectives — including brand awareness, customer satisfaction and brand value studies, as well as competitive and marketing analyses and exploration of market demand (to name but a few) — can guide businesses to better-informed and better-secured decisions when undertaken with care and precision.
Ready to Learn More?
Better business practices depend on quality market research objectives. If you don’t ask the right questions, you can’t get the right answers. Communications for Research (CFR) has over 20 years experience helping businesses across many different industries develop research plans that garner actionable and profitable feedback, strengthening customer satisfaction and increasing ROI. Contact us to see how we can support your company’s market research needs.