Market research and brand positioning strategy can be seen as two complementary processes which should go hand in hand to deliver maximum results in terms of creating a powerful and differentiated brand identity.
Instead, the two processes are often seen as sequential. In other words, you 'do' your market research and then you plan your brand strategy. This can mean that some businesses embark on intensive market research without a clear objective. They know they are gathering information on potential customers to help them position their brand well in the marketplace but they're not fully clear about how the process ties in with their goals.
On the other hand, some companies focus squarely on brand strategy with little if any market research to guide them. Both approaches often lead to wasted time and money, either by generating the wrong kind of answers from their market research or by rolling out a poorly thought-out brand to the wrong type of customer.
So how should a business use market research to build brand equity or reposition their brand?
Assess the Foundations First
There are two powerful factors that will warp a brand strategy out of shape unless they are jumped on from the early stages. Whether you are launching a new brand, rebranding or partial rebranding (e.g. creating a new logo and packaging concept), you run the risk of being blinded by your own assumptions about the marketplace.
Of course, every business knows this but that doesn't stop them from creating bias in their market research studies, either by pre-loading their questions, making poor sampling choices or introducing unintended pressure during interviews or focus groups.
It is vital that you get an honest customer-eye view in the early stage so that you can challenge your own assumptions about customer drives and detractors.
Another mistake businesses make is to go the other way and get too abstract too early by testing out their concept statements on huge samples to generate the numbers. Having not carried out the groundwork, they risk getting the right answers but to the wrong questions leading to missed opportunities.
To generate the rich data that will give you a true insight into the marketplace it is usually best to start with some small scale, qualitative market research. There are numerous qualitative techniques – from IDIs (In-Depth Interviews) and focus groups to ethnographic studies where people are observed 'in the wild' as it were. The best market research agencies will carry a toolbox of such techniques and select the right tool depending on the client they are working with and their marketplace.
Concept Testing your Brand
After this first phase of research you should be ready to concept test your brand and truly gauge its potential position within the market. Your brand needs to be powerful and also well differentiated from whatever else is offered. Therefore, your baseline research results should enable you to create some strong brand statements for testing on a larger sample.
Although qualitative research may still be useful at this stage, it is mainly quantitative market research that is required to really test your hypothesis. Although a competent agency will have carefully chosen the samples for the earlier research, any bias can be swept away with a larger study. Hopefully, your qualitative research will have identified some interesting trends (e.g. your customers are strongly motivated by locally-sourced ingredients or there is a gap for high quality customer service in your niche) and your quantitative research will bear this out in cold, hard numbers. At this stage it is important that the concept statements you are testing are clear and strongly distinct from one another.
Again, the precise market research tools used by your chosen agency will vary by agency, business type and marketplace but having been based on a strong foundation, the net result will be numbers you can trust.
A Cyclical Process
Of course, building significant brand equity is not the end of the journey. Far from it; the more successful and unique your brand is perceived to be, the more competitors will be drawn towards you like a bear to a honey pot! In addition, consumer attitudes are constantly changing and whether you supply to end users, other businesses or the channel you are going to need to monitor and adapt your brand to remain relevant.
Now, there is no need to conduct an extensive market research campaign every time your results fall behind expectations – sometimes an in-house survey can reveal enough information for you to tighten up your operation and get back on track. However, if there are signs that something is wrong or market conditions have changed (e.g. a big new competitor has swallowed up market share) then you may need to reimagine your brand and thus begin the whole process again. Like a wheel, constantly in motion, your brand equity is likely to rise, stay for some time at the top and then begin to slip.
Another reason for conducting another market research phase is when you are introducing something major that will impact on your brand – this could be a physical change (e.g. in packaging or pricing), an update in your brand values or voice or a combination of these.
Whether internally or externally motivated, you will need to go back to the foundation stage, using all the data you have accumulated so far as your new baseline.
Choosing a Market Research Partner
Choosing a great market research partner, like Communications for Research, is as important as selecting a top brand strategy firm when starting off a branding project. Of course, it is possible and sometimes wise to use in-house market research, particularly if funds are limited and the risks of making costly mistakes are low. However, in many cases a professional market research agency will be far more effective in terms of sample selection, study design and data analysis.
Whichever route you go down, effective market research lies behind all high impact brand positioning and, in turn, businesses with a powerful, well-differentiated brand will find focusing their ongoing market research a more efficient process.