Market research is a term that we’re all familiar with, but is often used more loosely or jokingly, as opposed to genuinely discussing market research tactics. But market research is a powerful tool for any business, even in an increasingly data-driven world. That’s because market research and actually communicating directly with consumers in your target market achieves something that you can only guess about when pouring over data – the “why” of the purchase. Data can tell us when, how, what and even where, but you can never truly know why the decision to purchase something was made without speaking to the end user.
This marks the first in a small series we’ll be doing on market research and how you can use it to help grow your business.
What makes why more important than any of the other Ws in this framework? Simply put, the why of a purchase is the best way to see what problems the products are solving for the consumer and the overall “job” your products do. Do any small amount of research into product development or product marketing and you’ll see one phrase appear time and time again, people don’t want products, they want solutions. If you’re developing or considering developing a new product, or thinking about moving a new location or region, questioning your target market will bear two results: you can see what problems the market has that you can develop your product to solve, or you can see what problems the market thinks your product solves, and adjust your messaging as such. This can make the product creating process much simpler and more efficient, allowing you to eliminate features that are just contributing the feature bloat, and instead focus on features that the market really wants.
Of course, many businesses are reasonably sure they know the use cases for their products and services, so why spend time and money figuring out what we already know? Well, simply put, you never know what you don’t know. Perhaps some customers are doing something completely unexpected with your products. Bringing this to your messaging could make this use more widespread and increase sales. Or perhaps there’s a part of your product or service that’s used, but isn’t a very nice user experience. Your data would show purchases and usage so you’d assume it’s fine, but if a competitor fixes a problem you didn’t know you had, you’ll very soon find out.
Keeping an open and inquisitive mind about your own products and services is one of the best ways to keep quality up, and market research helps to further this.
How to conduct market research?
Market research has a couple of different methods, each with their own pros and cons. First things first, good market research isn’t quick, and quick market research often isn’t good. It’s important to budget the time you need to get the most out of the efforts you’re putting in.
The main forms of market research are surveys, interviews, and focus groups. Surveys themselves come in a few different kinds, but for now let’s just consider two: self-administered or agent-administered surveys. These are pretty self-explanatory, but they do achieve slightly different goals. Self-administered surveys are the most common, you see these all the time online. They usually ask you a short series of questions and then you’re done. Many large market research firms like RedC make their bread and butter of research with these. Agent-administered surveys have someone else present recording your answers. These are closer to an interview, but with more rigid structure. Agent surveys have the advantage of being able to drill down into the reasons behind an answer more, at the cost of fewer responses, but this additional detail can often be extremely insightful.
Surveys are made up of two main kinds of questions, open- and closed-ended questions. Open ended questions are things like “What do you think of when you think of X brand?”, they allow the user space to enter their own words. Closed-ended questions just allow users to select a response from a pre-determined list. This brings us nicely to the two kinds of data you’ll be dealing with in Market research: qualitative and quantitative data.
Qualitative vs Quantitative
You see these words a lot when you deal with data, especially in market research. These are two different scales by which you measure data, and are almost fundamentally incompatible with one another. As we said at the beginning, data collected from online and ecommerce sites etc. can answer some, but not all questions – most notably it doesn’t capture why. That’s because the data captured online is almost entirely Quantitative data – it has a natural scale by which it can be measured. For example, a store might notice a spike in traffic every Thursday at 11am, with sales increasing 30% on the baseline then and returning to normal by 12 noon. This is quantitative data; we know how to measure each of the variables in this situation.
Qualitative data, however, is a very different thing. It has no natural scale to measure it by, meaning it needs much more processing before you can really extract value from it. That being said, qualitative data is the only reliable way to gauge how a customer feels about something, and the only real way to get the answer to the elusive “why”. Qualitative data measures quality of answers. That’s not how good they are, but rather what they’re expressing. Open-ended answers in surveys are capturing qualitative data, while closed-ended questions are quantitative usually. Quantitative data is the result of speaking to the consumer directly, or letting them speak to you, and will often have insights that could not be expressed in quantitative data.
So now that we’re introduced more formally to qual- and quantitative data, we can move on and start discussing the other ways to capture qualitative responses, and how to start processing those into actionable insights for your business.
Market research can be a daunting proposal, but with a good plan, an inquisitive mind, and the knowledge of the brand or product you’re asking about, it can become second nature. This article has introduced the concept of market research, one of the core parts of the practice in surveys, and the concepts of qualitative and quantitative research. Next time we’ll discuss one to one interviews and how to properly conduct those, as well as starting to talk about how to process qualitative data to begin to use it.
Posted: 02/09/2022 09:30:00