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Marketing research helps you understand your position, spot opportunities, lessen risks and take better decisions. It is more than just market research, which is concerned only with examining aspects of a given market. Marketing research allows you to make marketing decisions based on the best, most up-to-date information available.
Types of research
Five areas provide key market intelligence:
Customer research looks at who you sell to and who else might buy
Product research looks at what you are selling, how it compares with other products and how it might be refined and developed
Promotion research looks at what impact your publicity spend is having
Pricing research tests whether you could be selling your product for more
Distribution research examines how your product gets to the marketplace
Can you do it yourself?
Non-specialist desk research can usually be
handled in-house. DIY field research will only work
if it is set up properly, right from the start:
You must be clear what data you require
You must give the individuals doing the research enough time to do it properly
There must be a realistic budget to cover the costs involved
Data you can use
Research results provide an important reality
check, to stop you being too convinced by your own
assumptions. Numerical and motivational
information can often be combined to modify an
idea and convert a potential failure into a success:
If the numbers deliver a clear negative signal, do not ignore it
Good qualitative research may reveal information that can lead to new business ideas
Choosing an outside agency
Small businesses often cannot use agencies,
because most agencies will not work on projects
where the budget is less than £3,000 to £5,000.
This is not greed. If you cannot afford enough
interviews, your results will not be reliable:
Find out what kind of reputation the agency you are considering has
Decide how comfortable you would feel about working with the research agency
Be realistic about the likely scale of fees
Consider using a freelance researcher
What do you need to know?
You need to know what you want from the research
before you can decide on the depth, methods and
justifiable budget:
Use exploratory research for quick clues to aid real-time decision making
Invest in detailed research when you need to put flesh on the bone
Causal research can be extremely valuable, but is often hard to carry out and interpret
Desk research
Where it is appropriate, desk research is the
cheapest and quickest research of all. It can be
very useful for exploratory work. Much of the data
will be available to you at little or no cost:
Internal sources are free, reliable and usually instantly available. They can yield valuable data about sales volumes, buying patterns, customer size and location and causes of dissatisfaction
There is a wealth of external sources to investigate, especially the Internet. External data will be especially important when you are launching new products, entering new markets or starting a business
Field research
Field research is usually more expensive and
difficult to organise than desk research. There
are three main ways of gathering data:
Use questions to reveal what people think
Use observation to reveal what people do, rather than what they say or think they do
Use experiments to see what people will do in a particular, controlled situation
Quantity or quality?
You must base quantitative research on samples that are big enough to give reliable information, if you aim to establish statistically valid data
When you need to know about people’s feelings and motivation, you must use qualitative research methods. These are concerned with depth, rather than breadth
Talking to customers and ‘keeping your ear to the ground’ are low-key forms of qualitative research
Two quick questions
Many businesses often cannot afford marketing
research. But they can carry out some useful DIY
research. Half a day on the phone to your
customers, asking just two key questions, can
make a vital difference to your chances of success:
Ask 20 customers: “Who do you see as my competitors?” A litho printer who did this was surprised to find that his advertising agency customers did not compare him with other two-colour printers, but with four-colour printers in the area
Ask them: “What makes you use us, rather than the others?” The litho printer had assumed customers bought from him almost wholly on price. He discovered that reliability and quality were what kept them coming back. As a result of his afternoon on the phone, the printer shifted the emphasis of his marketing. He targeted his activities at larger ad agencies, and soon found that many of his jobs could safely carry much healthier margins
