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Written by Mary Kate Miller | June 1, 2021

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Market research is a cornerstone of all successful, strategic businesses. It can also be daunting for entrepreneurs looking to launch a startup or start a side hustle . What is market research, anyway? And how do you…do it?

We’ll walk you through absolutely everything you need to know about the market research process so that by the end of this guide, you’ll be an expert in market research too. And what’s more important: you’ll have actionable steps you can take to start collecting your own market research.

What Is Market Research?

Market research is the organized process of gathering information about your target customers and market. Market research can help you better understand customer behavior and competitor strengths and weaknesses, as well as provide insight for the best strategies in launching new businesses and products. There are different ways to approach market research, including primary and secondary research and qualitative and quantitative research. The strongest approaches will include a combination of all four.

“Virtually every business can benefit from conducting some market research,” says Niles Koenigsberg of Real FiG Advertising + Marketing . “Market research can help you piece together your [business’s] strengths and weaknesses, along with your prospective opportunities, so that you can understand where your unique differentiators may lie.” Well-honed market research will help your brand stand out from the competition and help you see what you need to do to lead the market. It can also do so much more.

The Purposes of Market Research

Why do market research? It can help you…

• Pinpoint your target market, create buyer personas, and develop a more holistic understanding of your customer base and market.
• Understand current market conditions to evaluate risks and anticipate how your product or service will perform.
• Validate a concept prior to launch.
• Identify gaps in the market that your competitors have created or overlooked.
• Solve problems that have been left unresolved by the existing product/brand offerings.
• Identify opportunities and solutions for new products or services.
• Develop killer marketing strategies .

What Are the Benefits of Market Research?

Strong market research can help your business in many ways. It can…

• Strengthen your market position.
• Help you identify your strengths and weaknesses.
• Help you identify your competitors’ strengths and weaknesses.
• Minimize risk.
• Center your customers’ experience from the get-go.
• Help you create a dynamic strategy based on market conditions and customer needs/demands.

What Are the Basic Methods of Market Research?

The basic methods of market research include surveys, personal interviews, customer observation, and the review of secondary research. In addition to these basic methods, a forward-thinking market research approach incorporates data from the digital landscape like social media analysis, SEO research, gathering feedback via forums, and more. Throughout this guide, we will cover each of the methods commonly used in market research to give you a comprehensive overview.

Primary vs. Secondary Market Research

Primary and secondary are the two main types of market research you can do. The latter relies on research conducted by others. Primary research, on the other hand, refers to the fact-finding efforts you conduct on your own.

This approach is limited, however. It’s likely that the research objectives of these secondary data points differ from your own, and it can be difficult to confirm the veracity of their findings.

Primary Market Research

Primary research is more labor intensive, but it generally yields data that is exponentially more actionable. It can be conducted through interviews, surveys, online research, and your own data collection. Every new business should engage in primary market research prior to launch. It will help you validate that your idea has traction, and it will give you the information you need to help minimize financial risk.

You can hire an agency to conduct this research on your behalf. This brings the benefit of expertise, as you’ll likely work with a market research analyst. The downside is that hiring an agency can be expensive—too expensive for many burgeoning entrepreneurs. That brings us to the second approach. You can also do the market research yourself, which substantially reduces the financial burden of starting a new business .

Secondary Market Research

Secondary research includes resources like government databases and industry-specific data and publications. It can be beneficial to start your market research with secondary sources because it’s widely available and often free-to-access. This information will help you gain a broad overview of the market conditions for your new business.

Identify Your Goals and Your Audience

Before you begin conducting interviews or sending out surveys, you need to set your market research goals. At the end of your market research process, you want to have a clear idea of who your target market is—including demographic information like age, gender, and where they live—but you also want to start with a rough idea of who your audience might be and what you’re trying to achieve with market research.

You can pinpoint your objectives by asking yourself a series of guiding questions:

• What are you hoping to discover through your research?
• Who are you hoping to serve better because of your findings?
• What do you think your market is?
• Who are your competitors?
• Are you testing the reception of a new product category or do you want to see if your product or service solves the problem left by a current gap in the market?
• Are you just…testing the waters to get a sense of how people would react to a new brand?

Once you’ve narrowed down the “what” of your market research goals, you’re ready to move onto how you can best achieve them. Think of it like algebra. Many math problems start with “solve for x.” Once you know what you’re looking for, you can get to work trying to find it. It’s a heck of a lot easier to solve a problem when you know you’re looking for “x” than if you were to say “I’m gonna throw some numbers out there and see if I find a variable.”

How to Do Market Research

This guide outlines every component of a comprehensive market research effort. Take into consideration the goals you have established for your market research, as they will influence which of these elements you’ll want to include in your market research strategy.

Secondary Data

Secondary data allows you to utilize pre-existing data to garner a sense of market conditions and opportunities. You can rely on published market studies, white papers, and public competitive information to start your market research journey.

Secondary data, while useful, is limited and cannot substitute your own primary data. It’s best used for quantitative data that can provide background to your more specific inquiries.

Find Your Customers Online

Once you’ve identified your target market, you can use online gathering spaces and forums to gain insights and give yourself a competitive advantage. Rebecca McCusker of The Creative Content Shop recommends internet recon as a vital tool for gaining a sense of customer needs and sentiment. “Read their posts and comments on forums, YouTube video comments, Facebook group [comments], and even Amazon/Goodreads book comments to get in their heads and see what people are saying.”

If you’re interested in engaging with your target demographic online, there are some general rules you should follow. First, secure the consent of any group moderators to ensure that you are acting within the group guidelines. Failure to do so could result in your eviction from the group.

Not all comments have the same research value. “Focus on the comments and posts with the most comments and highest engagement,” says McCusker. These high-engagement posts can give you a sense of what is already connecting and gaining traction within the group.

Social media can also be a great avenue for finding interview subjects. “LinkedIn is very useful if your [target customer] has a very specific job or works in a very specific industry or sector. It’s amazing the amount of people that will be willing to help,” explains Miguel González, a marketing executive at Dealers League . “My advice here is BE BRAVE, go to LinkedIn, or even to people you know and ask them, do quick interviews and ask real people that belong to that market and segment and get your buyer persona information first hand.”

Market research interviews can provide direct feedback on your brand, product, or service and give you a better understanding of consumer pain points and interests.

When organizing your market research interviews, you want to pay special attention to the sample group you’re selecting, as it will directly impact the information you receive. According to Tanya Zhang, the co-founder of Nimble Made , you want to first determine whether you want to choose a representative sample—for example, interviewing people who match each of the buyer persona/customer profiles you’ve developed—or a random sample.

“A sampling of your usual persona styles, for example, can validate details that you’ve already established about your product, while a random sampling may [help you] discover a new way people may use your product,” Zhang says.

Market Surveys

Market surveys solicit customer inclinations regarding your potential product or service through a series of open-ended questions. This direct outreach to your target audience can provide information on your customers’ preferences, attitudes, buying potential, and more.

Every expert we asked voiced unanimous support for market surveys as a powerful tool for market research. With the advent of various survey tools with accessible pricing—or free use—it’s never been easier to assemble, disseminate, and gather market surveys. While it should also be noted that surveys shouldn’t replace customer interviews , they can be used to supplement customer interviews to give you feedback from a broader audience.

Who to Include in Market Surveys

• Current customers
• Past customers
• Your existing audience (such as social media/newsletter audiences)

Example Questions to Include in Market Surveys

While the exact questions will vary for each business, here are some common, helpful questions that you may want to consider for your market survey. Demographic Questions: the questions that help you understand, demographically, who your target customers are:

• “What is your age?”
• “Where do you live?”
• “What is your gender identity?”
• “What is your household income?”
• “What is your household size?”
• “What do you do for a living?”
• “What is your highest level of education?”

Product-Based Questions: Whether you’re seeking feedback for an existing brand or an entirely new one, these questions will help you get a sense of how people feel about your business, product, or service:

• “How well does/would our product/service meet your needs?”
• “How does our product/service compare to similar products/services that you use?”
• “How long have you been a customer?” or “What is the likelihood that you would be a customer of our brand?

Personal/Informative Questions: the deeper questions that help you understand how your audience thinks and what they care about.

• “What are your biggest challenges?”
• “What’s most important to you?”
• “What do you do for fun (hobbies, interests, activities)?”
• “Where do you seek new information when researching a new product?”
• “How do you like to make purchases?”
• “What is your preferred method for interacting with a brand?”

Survey Tools

Online survey tools make it easy to distribute surveys and collect responses. The best part is that there are many free tools available. If you’re making your own online survey, you may want to consider SurveyMonkey, Typeform, Google Forms, or Zoho Survey.

Competitive Analysis

A competitive analysis is a breakdown of how your business stacks up against the competition. There are many different ways to conduct this analysis. One of the most popular methods is a SWOT analysis, which stands for “strengths, weaknesses, opportunities, and threats.” This type of analysis is helpful because it gives you a more robust understanding of why a customer might choose a competitor over your business. Seeing how you stack up against the competition can give you the direction you need to carve out your place as a market leader.

Social Media Analysis

Social media has fundamentally changed the market research landscape, making it easier than ever to engage with a wide swath of consumers. Follow your current or potential competitors on social media to see what they’re posting and how their audience is engaging with it. Social media can also give you a lower cost opportunity for testing different messaging and brand positioning.

SEO Analysis and Opportunities

SEO analysis can help you identify the digital competition for getting the word out about your brand, product, or service. You won’t want to overlook this valuable information. Search listening tools offer a novel approach to understanding the market and generating the content strategy that will drive business. Tools like Google Trends and Awario can streamline this process.

Ready to Kick Your Business Into High Gear?

Now that you’ve completed the guide to market research you know you’re ready to put on your researcher hat to give your business the best start. Still not sure how actually… launch the thing? Our free mini-course can run you through the essentials for starting your side hustle .

About Mary Kate Miller

Mary Kate Miller writes about small business, real estate, and finance. In addition to writing for Foundr, her work has been published by The Washington Post, Teen Vogue, Bustle, and more. She lives in Chicago.

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Why Is Market Research Important: We Give You 7 Reasons

Planning and conducting market research is a critical component of any business. It provides decision-makers with important information to decide the course of the company, launch a new product, or to keep a tab on what competitors are doing.

Data indicates that market research is a growing industry of 47.36bn USD , globally – and rightly so. For a business to succeed, all its resources – financial and otherwise – must be invested in areas where they are needed the most. Conducting market research helps you identify those areas. It also helps you discover and understand your customers’ needs so you can innovate better, expand when the time is right, and work with more focus.

In this article below, we will share a few pointers with you about why market research is important for every business – big and small. But first, let’s talk about the types of market research.

Types Of Market Research

Depending on the purpose of your research, you can choose either of the two main types of market research. These are primary research and secondary research.

– Primary Research

Primary research is direct research that you conduct yourself or hire someone else to do it for you. It involves reaching out to your target market, asking them questions, collecting data, and analyzing the information gathered. Based on the data, strategies are devised, decisions are made, and policies are created.

Primary research helps you explore issues, dig deeper, and ask specific questions that are relevant to what you are looking for. Because it takes more time and effort, it may also cost a bit more than secondary research but it is more effective and helps you gain a solid picture of what’s going on.

– Secondary Research

Secondary research is using somebody else’s primary research for your business purposes. Research that is already conducted, organized, and published is often used by small businesses to gauge market trends, current economies, and to devise plans.

A lot of government agencies conduct market research for various purposes. If you’re on a budget, going to one of those agencies may help you out a lot as most of that research is freely available to the public. If you want to access a private market research company’s report, you may have to pay a fee to access the complete file.

However, there are private companies that publish their reports publicly. Additionally, you can also go online and conduct Google searches looking for specific phrases relevant to your research purpose to find valuable data.

Why Is It Important?

Now that we know what market research is and what different kinds it has, it’s time to learn why it is important, and why you should invest in it if you want to become a successful entrepreneur.

1. It Helps You Identify The Problem Areas As Well As Strong Areas

Knowing what you are good at and what you’re not, help you take profitable risks in life. It’s true in business too. Accurate market research helps you identify business areas that are performing well, those that need more attention, and also those that you should perhaps give up.

Back in 2010 , two young tech enthusiasts launched a location-based app – Burbn – that would allow consumers to check-in, make plans of hangouts with friends, share pictures, and more. Few weeks into the launch, they realized through internal discussions and reevaluation of the market, that Burbn is cluttered and their target market is more into Foursquare and they won’t be able to budge them.

They took a long, hard look at their app again – which had already been launched – and started working on it from scratch, removing all the features and only letting the photo-sharing, liking, and commenting options intact. And thus, Instagram was born.

It also helps you discover and understand your customers’ needs so you can innovate better, expand when the time is right, and work with more focus. For example, if you plan on starting a digital marketing agency, you’d know that there’s more need for social media in your area, than for PPC services. Thus, you’ll hire more social media experts.

2. It Helps You Understand Your Customers’ Needs

It is not enough that you know your business; you got to know what your customers are saying about you – and about your competitors. If you have got your pulse on what your customer is thinking, you’d create products that solve their issues, reach out to them when they are most ready to listen, and help them become your loyal ambassadors.

A huge part of business market research is always dedicated to gauging customer satisfaction rates, their reactions to a new product, and what they are looking for next.

In 2005, when YouTube initially launched, it was for a very different purpose : dating. Pretty soon into launch, however, and by investing in robust market research (a part of which they conducted themselves) the founders realized that their video dating app is not what their customers are looking for. Analyzing the data, they discovered that there is no app or platform in the market for video sharing. The websites that were offering this service were patchy at best and not intuitive at all.

Being attuned to their customers’ needs and spotting a wide space in the market, they tweaked their video platform and launched YouTube .

Following what your customers are talking about, listening to them, and then delivering on their needs is an important task that you can fulfill with timely customer-centered market research.

3. Helps You Conduct Your Marketing Based On Informed Decisions

Launching and running a business means making decisions every day – about products, services, expansions, HR, and so much more. Without solid market research backing your decisions, all you are doing is guess-work, hoping the results will be in your favor.

With research helping your business, you are better informed about areas to invest in, gauge the potential success of new products, test new markets to expand into, and to determine what kinds of products/services will be most favored by your customers.

This is certainly what Starbucks does. The company has a whole dedicated platform ‘My Starbucks Idea’ where employees and customers and anyone who wants can pitch in and share what they think the company should do next, the flavors it should try, the new products it should launch, bring back some old favorites, and more.

The platform helps them remain informed on all important aspects of business investment and propels them towards ventures and venues that hold the most potential.

If you aren’t a humungous company like Starbucks and cannot afford to host dedicated platforms to gain important information, invest in market research whenever you have a big decision coming up. It isn’t as expensive as you think and doesn’t take that much time. Plus the results can be relevant for a lot of related areas that you may want information on.

4. Helps You Keep An Eye On Your Competitors

As a startup founder, you may think being original is all about being focused on what you’re doing and not worry about what everyone else may be up to. This approach spells long-term disaster. While you should certainly keep your focus on your own efforts, it is critical – and smart – to keep tabs on your rivals and know what they are thinking or planning.

With sound market research on your side, you can better prepare for what your competitor may be about to do next and make sure they aren’t able to put a dent in your market share. With regular research, you can not only learn to anticipate their next move but be in a better position to avert any possible damage from their end.

In addition to conducting market research, you can pair it up with regularly monitoring their social media or to increase Instagram followers , blog posts, and seeing what is trending in your market. Here is a great resource on how you can go about it.

5. Helps You Expand And Innovate

Market research can help you identify markets and geographical areas where you can expand to. It can also help you to invest in ideas that have the most potential to succeed based on what customers are looking for and what the market is lacking.

For example, if you are a retail company, conducting market research can help you identify locations where your store can profit the most. If you are planning to buy a business to increase your market share, market research can help you point towards businesses that may be ripe for acquiring. Not only that, conducting market research before you launch your business can help you figure out ways to put your best foot forward.

It guides you towards opportunities where you have the most room to innovate and take risks with the highest return potential. For example, if your competition is employing cutting edge tech such as VoIP to get better results, you can also employ the same to improve your customer care and business goals.

6. Helps You Set Business Goals

Goal-setting is one of the major parts of running a business – big and small. Goals give you directions, help you remain in sight of the bigger picture, and set you on the path of continued success. Goals can be of different kinds: short-term, long-term, department-oriented, over-arching, and such.

To set all these kinds of goals and get ready to meet them, businesses need to have a thorough and complete knowledge of their strengths and weaknesses. They need to be aware of how the market is behaving and predict what may come next.

All of this is only possible after conducting market research. With the help of focused market research, you can set achievable business goals and not follow some vague notions of instant success. These often include how to improve productivity, customer satisfaction, and business’ financial health. You can also use market research to learn ways you can reduce expenses without hurting the business, find out how to amplify your digital marketing, generate copywriting tips for research paper writers , or introduce a new employee incentive program.

7. Helps You Know Which Risks To Take And Increases Earning Potential

Risk-taking is an important component of the business. Without it, you can become stagnant and a sitting-duck for a more ambitious rival. But risk-taking cannot be a shot in the dark. To know which risks to take and when to take the plunge are attributes of successful innovators. From Dropbox’s Drew Houston who refused Steve Jobs to Google’s buying of YouTube when it was a fledgling startup, the history of business success and innovating is packed full of stories of ambitious – but informed – risk-taking.

Using market research, you can also join the ranks of informed-decision makers who do not shy away from taking risks. It prevents you from making costly mistakes that could have been avoided and take steps that result in massive profits.

Take the example of Frito-Lay . When the potato chip maker wanted to introduce a new brand, it launched online market research conducted through Facebook to ask its customer-base which flavor they would like the best. The results showed that beer-battered onion-ring flavor is a hit in California and Ohio, while New Yorkers preferred the Churros flavor idea. This research also helped him increase Instagram followers as his posts became popular over the internet.

The research helped the company come up with different flavors and market them strategically to different states. If the research would not have been done, the company would have come up with a new flavor that could have been a hit – or a miss.

Popular Instruments Of Market Research

As technology keeps advancing, market research keeps evolving. Where before you had to rely on face-to-face interviews, telephone surveys, or lengthy online questionnaires, now it’s all about short online surveys, instant case studies aided by technologies, and focused groups that are already available on your social media channels.

Below we talk about 4 popular instruments of market research that are frequently used by companies worldwide with excellent results.

– Surveys

The survey is a quantitative method of research which means it gives you numerical scores. These scores pertain to specific answers and don’t leave much room for multiple interpretations. Because they are precise, provide specific answers, and immediate interpretation, quantitative methods are popular to conduct research when you are looking for exact information: to find out how to solve a particular problem, etc.

According to a study conducted by Statista.com , 26% of all market research is conducted through online quantitative methods, with online surveys accounting for a major share of 79%.

If you know how to create an easy survey online for your company, here is a great resource to get you started.

– Case Studies

Case studies are usually qualitative research methods; however, you can incorporate a mixed approach with a quantitative questionnaire thrown in for additional information. Using case studies, you focus on a single individual or single entity to research them thoroughly. The purpose of using case studies in business market research is usually to test theories of what went wrong in a particular situation or what went right.

Case studies are time-taking but provide extremely valuable information, detailed data, and in-depth analysis opportunities.

– Focus Groups

Focus groups are another popular instrument to conduct market research in business. A focus group consists of a small portion of your target audience that you can study in detail. It is a qualitative method of research and allows you to bring together a group of individuals that can take part in a guided form of discussion.

You can give them one or more focus questions that the group can talk about and share their views on. Focus groups are great to use when you’re creating a new product, researching a particular market segment, or want to know what your customers are thinking about you or your market.

Similar to case studies, focus groups give you a comprehensive view of a situation and allow you to conduct an in-depth analysis of different business elements.

The Future Of Market Research

The future of market research is bright. As a budding and burgeoning industry, it shows all the trends of continued growth. But as technology becomes more accessible and mobile devices more popular than desktops, market research is also evolving to fulfill the shifting customer needs.

The surveys are becoming shorter as nobody has got the time or interest to fill out a 10-page questionnaire. Artificial Intelligence is making the data collection process quicker and more intuitive, including contact database . And as time passes, you’ll see more and more market surveys being optimized for mobile.

So use all that modern market research has to offer you and use it to propel your business for the success you’d always dreamed of.

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« Re-Imagine Marketing Strategy To Ensure Your Business Thrives Even In The Lockdown

Why mental health surveys are important during the covid-19 pandemic ».

About The Author Kelvin Stiles

Kelvin Stiles is a tech enthusiast and works as a marketing consultant at SurveyCrest – FREE online survey software and publishing tools for academic and business use. He is also an avid blogger and a comic book fanatic.

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Why Market Research Is Important: A Complete Guide

Did you know that 66% of customers expect companies to understand their needs, while customer-centric companies are 60% more profitable than companies that aren’t. Meanwhile, over half (53%) of business executives are concerned about competition from disruptive businesses.

If you aren’t on top of your market and meeting your ideal customers’ needs, you risk being left behind. Outmanoeuvred by better informed, faster-moving competitors.

This is why market research is important: it gives you valuable insights that protect your market position. In this article, we take a deeper look at the value it can bring to your business in a comprehensive guide.

Defining Market Research

Market research refers to the process of gathering and analysing data about customers, competitors, and market trends to gain insights and make informed business decisions. It helps businesses understand their target audience, identify opportunities, and develop effective marketing strategies.

By undertaking market research , businesses can make data-driven decisions that drive growth, innovation and competitive advantage.

The Core Components Of Market Research

Market research comprises several essential components and methods:

A) Qualitative research

This approach focuses on exploring the underlying motivations, attitudes and perceptions of individuals or groups. It often involves techniques such as interviews, focus groups and open-ended surveys. Qualitative research helps uncover insights that quantitative data alone cannot provide, offering a richer understanding of consumer behaviour.

B) Quantitative research

In contrast to qualitative research, quantitative research relies on numerical data and statistical analysis. It involves surveys, questionnaires, experiments, and structured observations to gather data from a large sample size. Quantitative research is valuable for measuring and quantifying trends, patterns, and correlations within a market.

C) Primary research

Primary research involves collecting firsthand data specifically for the research objectives at hand. This can be done through surveys, interviews, observations or experiments tailored to the research’s unique requirements. Primary research provides fresh and specific insights but can be time-consuming and costly.

D) Secondary research

Secondary research, also known as desk research, involves the analysis of existing data and information collected by others. Researchers access databases, reports, academic papers and publicly available data to gather insights. It’s a cost-effective way to obtain a broader perspective on a market but may lack the specificity of primary research.

E) Market segmentation

Market research often involves dividing a market into distinct segments based on various criteria such as demographics, psychographics, behaviour or geographic location. Segmenting a market helps businesses target their marketing efforts more effectively and tailor their products and services to meet specific customer needs.

F) Data collection methods

Market researchers employ various data collection methods, including surveys, interviews, focus groups, observations and online analytics. The choice of method depends on the research objectives, budget and the type of data required.

G) Data analysis

Once data is collected, it must be analysed to extract meaningful insights. Statistical tools, software and expertise are often used to process and interpret data accurately.

Market research is not a one-size-fits-all activity. The choice of components and methods depends on the specific research objectives, the target audience and the resources available. It’s a dynamic and iterative process that can uncover valuable insights, guide strategic decisions and ultimately contribute to business success.

The Importance of Market Research: An Overview

In an increasingly competitive and rapidly changing business landscape, market research is important because it helps organisations of all sizes and industries. It offers critical insights, reducing uncertainty and enabling data-driven decisions. 

In this section, we’ll delve into the overarching importance of market research in today’s business environment.

1) Navigating uncertainty

Businesses operate in an environment marked by uncertainty. Market conditions can shift unpredictably due to economic fluctuations, technological advancements and global events. Market research acts as a stabilising force, helping businesses navigate uncertainty by providing a solid foundation of knowledge.

2) Risk mitigation

One of the primary roles of market research is risk mitigation. Understanding the potential risks and challenges that lie ahead allows businesses to prepare effectively. By identifying market trends, consumer preferences and competitive landscapes, organisations can anticipate challenges and develop strategies to mitigate them. This proactive approach not only safeguards businesses but also positions them for resilience and growth.

3) Strategic decision-making

The strategic decisions made by a business are pivotal to its success. Market research informs these decisions by offering insights into market dynamics, customer behaviour and industry trends. Whether it’s expanding into a new market, launching a new product or fine-tuning marketing strategies, businesses can align their actions with market realities, increasing the likelihood of success.

4) Customer-centric approach

In the age of customer-centricity, understanding the needs, preferences and expectations of consumers is paramount. Market research places the customer at the heart of business operations. By collecting and analysing customer feedback, businesses can tailor their products, services and marketing efforts to resonate with their target audience. This customer-focused approach enhances customer satisfaction and loyalty.

5) Competitive advantage

In a crowded marketplace, gaining a competitive edge is a constant pursuit. Market research provides the tools to outmanoeuvre competitors by offering insights into their strategies, strengths and weaknesses. Armed with this knowledge, businesses can differentiate themselves, identify unexplored opportunities and stay ahead of the competition.

6) Financial planning & resource allocation

Efficient resource allocation is essential for a company’s financial health. Market research informs budgeting decisions by identifying areas where investments will yield the highest returns. Whether it’s allocating marketing budgets, research and development funds, or capital for expansion, businesses can optimise their resource allocation based on data-driven insights.

7) Adaptation to change

Change is the only constant in the business world. Market research equips businesses with the agility to adapt to shifting market dynamics. By staying attuned to emerging consumer trends, economic shifts, and unforeseen events, organisations can pivot their strategies effectively. This adaptability is crucial for survival and growth, particularly in fast-paced industries.

8) Measurable outcomes

A well-executed market research strategy comes with measurable outcomes. Businesses can track the impact of their decisions, assess the effectiveness of marketing campaigns, and adjust strategies in real-time based on data-driven insights. This leads to less waste, improved efficiency and better results.

9) A strategic asset

Market research is not an optional extra but a strategic asset. It is the compass, the risk mitigator and the foundation upon which successful businesses are built. It guides organisations through uncharted waters, helping them make informed choices, seize opportunities and navigate challenges.

How To Conduct Market Research

Market research is a process that involves gathering, analysing and interpreting data to gain insights into markets, consumers and competitors. 

Conducting effective market research requires careful planning and the use of various research methods and techniques. In this section, we will outline the steps and strategies involved in conducting market research.

Step 1: Define your research objectives

Before diving into research, it’s essential to clearly define your objectives. What specific information are you seeking to obtain through market research? Are you interested in understanding consumer preferences, evaluating market trends or assessing the competitive landscape? Clearly defined research objectives will guide your research efforts and help you stay focused.

Step 2: Choose your research methodology

Market research can be broadly categorised into two main types: primary research and secondary research .

Primary research : Involves collecting original data directly from sources via methods such as surveys, interviews and observations, offering specific and current insights aligned with research goals.

Secondary research : Entails analysing existing data from sources like market reports and academic studies, providing cost-effective access to valuable context and background information.

Select the research methodology that aligns with your research objectives, timeline and budget. Often, a combination of primary and secondary research is used to gain a comprehensive understanding of the market.

Step 3: Design your research instruments

If you choose to conduct primary research, you’ll need to design research instruments such as surveys, questionnaires or interview guides. Ensure that your research instruments are clear, unbiased and designed to collect relevant data. Pilot testing your instruments with a small group can help identify and address any issues before full-scale data collection.

Step 4: Collect data

Data collection is a critical phase of market research. For primary research, you’ll administer surveys, conduct interviews or organise focus groups to gather data from participants.

Ensure that data collection methods are consistent, and follow ethical guidelines when handling sensitive information. For secondary research, you’ll access and review existing data sources, extracting relevant information for your analysis.

Step 5: Analyse data

Once you’ve collected data, the next step is data analysis. This involves organising, cleaning and interpreting the data to extract meaningful insights. Data analysis may include statistical techniques, content analysis or qualitative coding, depending on the nature of the data.

6) Interpret findings

After analysing the data, it’s essential to interpret the findings in the context of your research objectives. What do the data and insights reveal about the market, consumers and competitors? Consider the implications of your findings and how they relate to your business goals.

7) Make informed decisions

The ultimate goal of market research is to inform decision-making. Based on your research findings, make informed decisions about product development, marketing strategies, target audiences, pricing and other aspects of your business. Use the insights gained from market research to enhance your competitive advantage.

8) Continuous monitoring

Market research is not a one-time activity. Markets evolve, consumer preferences change and competitors adapt. Therefore, it’s important to establish a system for continuous monitoring and updating your market research efforts. Regularly gather new data, track market trends and reassess your strategies to remain competitive.

Final Thoughts

To conclude, market research is vital in today’s business landscape. M arket research is a dynamic and iterative process that empowers businesses to make informed decisions, minimise risks and stay competitive . By understanding customer preferences, industry trends, and competitive landscapes, businesses can tailor their strategies for success.

Market research is the compass that guides product development, marketing campaigns and expansion efforts, ensuring resources are invested wisely. By following these steps and adopting a research-driven mindset, organisations can unlock valuable insights and position themselves for success in today’s ever-changing business landscape.

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Why Market Research Is Important

2022-06-02 Market Research

A consumer sees an ad for a product that seems perfect for them and rejoices over their luck, but this scenario likely didn’t (and shouldn’t) come down to luck. Companies make these scenarios possible through strategic market research. Equipped with valuable information about its target market, a company can develop products and create marketing campaigns that appeal directly to consumers. And the benefits don’t stop there. You can leverage the data procured through market research to propel your company to success in a variety of ways.

We’ll break down the basics of market research below to show how companies use it and explore some of the key benefits. If you’re not taking full advantage of market research to make data-driven decisions, you should start considering the ways it could help your company grow.

What Is Market Research in Business?

Market research involves gathering data to learn more about target demographics and consumers so a business can market itself more effectively and, ultimately, succeed in the market. Market research is a vital part of any business strategy, whether that business is B2B or B2C, big or small, new or old. It provides the answers companies need to make decisions that will move them forward instead of back by empowering them to base decisions on data.

Most companies know what market research is and acknowledge its importance in a general sense, but they may not realize just how crucial market research is to the success of their business. When you need to identify market trends, understand your core customer better, or achieve a long list of other important goals, market research is the answer.

Types of Market Research

Market research is a broad category. In fact, there are many varieties of market research that you can use to meet the specific goals of your business. Below, we’ll explore the different benefits of each type of market research.

• Brand research:  Brand research is focused on creating or refining your company brand to make a bold and favorable impression on your target market. You could look into the level of brand awareness among your target audience, how loyal customers are to your brand, what sorts of qualities people associate with your brand, and other aspects of customers’ relationship with your brand.
• Marketing campaign evaluation:  Some market research focuses specifically on  marketing campaign effectiveness . You can evaluate how many people have seen your online ads and what the click-through rate has been, for example. This type of information can help you make adjustments if needed and inform future campaigns so you reach consumers effectively and keep customer-acquisition costs down.
• Competitor research:  Competitor research focuses on the competition to help you gain insights into how your company can pull ahead. Looking into a competitor’s marketing campaigns, brand reputation, revenue or sales volume, and other important data points can help you learn from their strengths and weaknesses.
• Customer segmentation research:  An important type of market research, especially for new businesses, is customer segmentation. These studies divide your larger consumer base into different groups or personas. Understanding the different types of consumers you want to connect with can help you create individualized campaigns tailored for each group.
• Consumer research:  Nearly all market research involves the consumer in some fashion, but some research is focused specifically on understanding consumers within a certain segment better. You may want to learn about their purchasing habits, interests, motivations, and more. The better you understand your consumers, the more effectively you can appeal to them.
• Product development:  Developing products calls for market research first to ensure the concept has value and then to refine the product over time. For example, you may see sales dipping on a flagship product and discover that customers’ needs have shifted and this product should offer a new feature to be more useful or convenient.
• Usability testing:  Similar to product development research, usability testing is focused on products. However, the focus here is on how consumers use your product. You may release a beta version of your mobile app, for example, and get feedback from users to find out if there are any bugs or other problems you need to work out.

The Benefits of Market Research

Market research can deliver valuable benefits to companies like yours. Let’s look at some of the most impactful ways market research can empower your company to succeed.

1. Maintain a Customer-Centric Approach

Market research is all about understanding your consumer base better, and that is an essential step to creating a customer-centric business. Customer-centric companies keep the customer experience at the forefront of all they do. Research has shown that customer-centric  businesses are 60% more profitable . It’s easy to see why prioritizing the customer’s needs and desires is a recipe for success.

Market research is how you come to understand those needs and desires in the first place, along with other important aspects of your target customers. You can’t effectively build a customer-centric business unless you understand your customers. Conducting market research allows you to appeal more specifically to your customers’ pain points and preferences. It’s a win-win for your customers and your business.

One of the most effective ways to be customer-centric in your market research is by using a segmentation-targeting-positioning (STP) model. This marketing model involves:

• Segmentation:  Brainstorm the possible segments your product or service may appeal to. These segments can be defined geographically, demographically, or otherwise.
• Targeting:  Determine which segment or segments offer the most profitable opportunities for your company so you can focus on marketing to these segments.
• Positioning:  Develop a strategy for addressing your target segment’s needs and do it better than your competitors. You can also consider the best way to promote your solution to the target segment.

2. Connect With Your Audience More Effectively

When you understand your target customers better, that means you’ll be able to more effectively reach them. When it comes to your marketing campaign, you don’t want to waste time and money on trial and error — you want to have an informed marketing strategy. There are two main elements of effectively connecting with your audience: the marketing channels you use and the content you share.

Using a one-size-fits-all approach, regardless of your audience, can be a costly mistake when it comes to marketing channels. The print publications your audience reads, the television shows they watch, and the websites they spend time on can dramatically differ from those of the target audience for your last product.

For instance, you can reach  close to half of the urban population  by advertising or marketing on Instagram, but you’ll only reach approximately a fifth of the rural population this way. So advertising your farm equipment on Instagram is likely a poor choice.

Choosing the right marketing channels is an important first step to reach your audience, but to truly connect with them, you also need to tailor the content of your marketing materials. Everything from the features of your product you advertise to the tone and visuals you use should be crafted to speak to your target audience. When customers feel you’re “speaking their language,” they’re more likely to pay attention to what you have to say.

3. Identify Opportunities for Growth

Market research isn’t just an important step for new companies or companies launching new products. Conducting market research periodically can help you discover new opportunities to improve and grow. For example, you may discover:

• Unreached segments:  You may come across unreached segments that, like your current customers, could benefit from your products or services. Perhaps they just don’t know about your brand yet, or they think your products are intended for someone else. This segment could be consumers of a different age, gender, income level, or geographical region, for example. A simple modification in your product or marketing strategy may be all it takes to unlock a whole new customer base.
• Business partnerships:  Through market research, you may also discover opportunities to partner with other businesses that already have an established connection with your target audience. Joint promotions can be mutually beneficial for you and the partner company. Essentially, you can combine the power of both your brands to expand and strengthen your reach.
• Product improvements:  Market research can reveal possible shortcomings in your product or services that, if remedied, would allow you to appeal to more customers and improve customer satisfaction. You may also discover opportunities for add-ons, product bundles, or other upsells that appeal to customers’ preferences and help you increase profits.

4. Reduce Risks by Testing Concepts

Risk is a necessary part of any business venture. If businesses didn’t take on risks, they would also limit the potential for reward. However, successful businesses tend to mitigate their risks in strategic ways. The way to avoid risk is not to avoid doing anything. Instead, businesses should use market research to minimize risks and maximize rewards.

A major way you can minimize risks is by ensuring there’s demand for a product. The reality is that many products fail. Some experts place the  failure rate as high as 95% . While that estimate is likely too high, it remains true that many new products fail to connect with consumers and end up in clearance bins. One study found that, of the 9,000 new products that were broadly distributed at a national retailer,  60% were no longer sold  within three years.

Because of the high risk involved, you should never create a product based on a mere hunch. Use thorough market research to predict whether a product concept has real potential for success. Will your product meet a need or desire your customers have, and will it do so more effectively than your competitors are doing? When you have proof of concept, you can be more confident in your efforts and more effectively attract investors.

After you’ve created your product, whether it’s a prototype or a limited run, you can employ market research again to help you refine your strategy before an official product launch. For example, you could give samples of a new food product to passersby in exchange for their feedback. You can also use market research to test reactions to a new logo, new packaging, or any number of other business decisions.

5. Make More Informed Decisions

Market research empowers companies to make more informed decisions that are backed by data. Gut feelings are not reliable means of making decisions. For instance, you may think releasing a luxury version of your product at a higher price point is a great business idea, but consumers willing to pay that price may associate your brand with budget-friendly products and opt for luxury products from luxury brands instead. The only way to know for sure is to conduct market research.

Market research data can serve as a compass, steering each choice a company makes to take them one step closer to their goal of successfully converting and retaining their target customers.

Here are some examples of decisions you can make more accurately with the help of market research:

• Choosing a different consumer base to target through a new marketing campaign
• Determining which channels to include in your advertising campaign
• Selecting design and personality elements to form a brand persona that will connect with your audience
• Choosing whether to open a new retail location
• Deciding whether a product should be discontinued or modified
• Pricing products in a way that maintains margins and appeals to customers

Through market research, you can make these and other decisions based on data rather than guesses and, as a result, boost your chances of getting it right the first time.

6. Compete More Effectively

Solid market research can be the difference that gives you a competitive edge in the marketplace. For one, by understanding your customers better, you may be able to engage them more effectively than your competitor is doing. Additionally, competitor research can give you direct insight into your competitors so you can understand how you fit into the marketplace.

If you’re a newcomer and want to know the best ways to draw customers away from legacy brands, market research can help you find out where consumers are dissatisfied with these brands and their offerings. By pinpointing these gaps, you can appeal directly to consumers’ desires and market yourself as a disruptive company with a superior solution.

You can also use market research to help you discover underserved segments of the market. By targeting these underserved consumers, you can carve out a place in the market for yourself where you’ll excel. For example,  the founder of War Paint, a cosmetic company  marketed to men, said, “Growing up, I never felt there was a brand for me, that spoke to me.” War Paint and some other emerging cosmetic brands target male consumers who were previously not part of the equation in the makeup market.

7. Stay on Top of Trends

Market research isn’t just important for new businesses. As consumers evolve, companies must also evolve to optimize the way they connect with customers. Market research is a valuable means of staying up on relevant trends. Researching trends can often be done through secondary research. Industry reports or research from your competitors, for example, can reveal what new product features consumers are interested in.

Today’s culture changes rapidly, and market research is essential if you want to keep up. You need to stay aware of trends regarding your consumers’ purchasing behavior, the most popular advertising channels, packaging preferences, product features, relevant messaging, and much more. Mimicking what your competitor did last year isn’t a good strategy.

Trends are especially important and cycle more frequently in some industries, such as fashion and design. If your company sells light fixtures, for example, you need to conduct research frequently to see what styles appeal to modern interior designers and homeowners. You also need to be aware of any new technology you can incorporate into your product to help you stay at the cutting edge and deliver the latest and greatest products to your consumers.

How to Conduct Market Research

Companies can conduct market research through various means. First, it’s helpful to understand the difference between two main categories of sourcing market research data — primary and secondary research:

• Primary research  is the data a company collects or an expert collects on the company’s behalf for their market research purposes. In other words, it’s field research. Some primary research is exploratory, meaning it’s more open-ended, and other forms of primary research aim to provide insight into specific questions or issues.
• Secondary research  involves using data that already exists and is at your disposal for market research purposes. For example, you could consult government census data, industry data reports or statistics on market trends. This type of research can provide a good starting point for understanding the market more broadly and learning about the competition.

Secondary research tends to be a starting point before conducting primary research.

There are several methods of primary research companies use to learn from consumers. Some of the most popular methods include:

• Surveys:  Surveys involve asking consumers questions they can quickly answer. Survey questions can be multiple choice or more open-ended. Surveys can be conducted in-person, over the phone, through the mail or  online . They provide a fast and simple way of reaching a large audience and getting their feedback.
• Focus groups:  Focus groups tend not to involve as many participants as a survey. Instead, a market researcher leads a small group of consumers in a discussion to get a window into consumers’ thoughts. Because the groups are small, most companies will assemble multiple focus groups and take all the results into account. They may observe through a one-way mirror or watch a recording.
• Interviews:  Interviews are similar to focus groups but may involve even fewer people. A one-on-one interview can be a valuable way of gaining detailed insight from one customer. These insights can be helpful, but they don’t provide statistically reliable data as you can get with a large survey.
• Observation:  Market observation involves watching consumers to see how they behave under natural conditions, such as a retail store. These consumers may or may not know they are being observed. For example, researchers may watch security footage taken from a store to see which departments customers tend to go to first and whether they stop to look at point-of-purchase displays.
• Field trials:  Field trials involve making a business move but doing so on a smaller scale and observing the results. For example, a restaurant chain may try a new menu item at a handful of locations and see how popular it is. If it’s a success, the company can feel more confident about adding the item to their menus throughout the region.

Companies can conduct their own market research in-house, but many choose to share their goals with a third-party expert who can create a market research strategy and execute it. By outsourcing your market research, you can streamline the process, focus on your core competencies, and receive valuable data from the experts that you can then leverage to drive your business forward.

Does Market Research Work?

Market research takes time, effort, and finances to complete, so it makes sense to spend these resources only if you’re going to get a positive return. The reality is that market research remains a crucial part of running a successful business because it is indeed worth the investment. Of course, market research alone won’t cause your business to succeed — but it will give you the information you need to make strategic decisions that will steer your company to success.

We looked at several benefits of market research but consider the inverse reality. Without market research, you could fail to connect with customers, miss out on growth opportunities, be vulnerable to risks, make poor business decisions, and ultimately lose your customers to your competitors. Some businesses get lucky without doing their research, but these instances are rare. Market research can help you avoid common pitfalls and grow your business.

Learn More About Our Market Research Tools

Market research should be a key part of your company’s recipe for success. Surveys are one of the most popular and effective means of reaching consumers and gaining insight into their values, preferences, opinions, and more. At Cint, we help brands and agencies conduct online studies that can empower them with the market research data they need. We can connect your company with millions of consumers, deliver fast results, and ensure those results are accurate through robust quality checks. Cint can help you produce the primary data you need on a tight timetable so you can make informed decisions to help you connect with customers and grow your business. To learn more about our market research tools, contact our team today.

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How to do market research: The complete guide for your brand

Written by by Jacqueline Zote

Published on  April 13, 2023

Reading time  10 minutes

Blindly putting out content or products and hoping for the best is a thing of the past. Not only is it a waste of time and energy, but you’re wasting valuable marketing dollars in the process. Now you have a wealth of tools and data at your disposal, allowing you to develop data-driven marketing strategies . That’s where market research comes in, allowing you to uncover valuable insights to inform your business decisions.

Conducting market research not only helps you better understand how to sell to customers but also stand out from your competition. In this guide, we break down everything you need to know about market research and how doing your homework can help you grow your business.

Table of contents:

What is market research?

Why is market research important, types of market research, where to conduct market research.

• Steps for conducting market research
• Tools to use for market research

Market research is the process of gathering information surrounding your business opportunities. It identifies key information to better understand your audience. This includes insights related to customer personas and even trends shaping your industry.

Taking time out of your schedule to conduct research is crucial for your brand health. Here are some of the key benefits of market research:

Understand your customers’ motivations and pain points

Most marketers are out of touch with what their customers want. Moreover, these marketers are missing key information on what products their audience wants to buy.

Simply put, you can’t run a business if you don’t know what motivates your customers.

And spoiler alert: Your customers’ wants and needs change. Your customers’ behaviors today might be night and day from what they were a few years ago.

Market research holds the key to understanding your customers better. It helps you uncover their key pain points and motivations and understand how they shape their interests and behavior.

Figure out how to position your brand

Positioning is becoming increasingly important as more and more brands enter the marketplace. Market research enables you to spot opportunities to define yourself against your competitors.

Maybe you’re able to emphasize a lower price point. Perhaps your product has a feature that’s one of a kind. Finding those opportunities goes hand in hand with researching your market.

Maintain a strong pulse on your industry at large

Today’s marketing world evolves at a rate that’s difficult to keep up with.

Fresh products. Up-and-coming brands. New marketing tools. Consumers get bombarded with sales messages from all angles. This can be confusing and overwhelming.

By monitoring market trends, you can figure out the best tactics for reaching your target audience.

Not everyone conducts market research for the same reason. While some may want to understand their audience better, others may want to see how their competitors are doing. As such, there are different types of market research you can conduct depending on your goal.

Interview-based market research allows for one-on-one interactions. This helps the conversation to flow naturally, making it easier to add context. Whether this takes place in person or virtually, it enables you to gather more in-depth qualitative data.

Buyer persona research

Buyer persona research lets you take a closer look at the people who make up your target audience. You can discover the needs, challenges and pain points of each buyer persona to understand what they need from your business. This will then allow you to craft products or campaigns to resonate better with each persona.

Pricing research

In this type of research, brands compare similar products or services with a particular focus on pricing. They look at how much those products or services typically sell for so they can get more competitive with their pricing strategy.

Competitive analysis research

Competitor analysis gives you a realistic understanding of where you stand in the market and how your competitors are doing. You can use this analysis to find out what’s working in your industry and which competitors to watch out for. It even gives you an idea of how well those competitors are meeting consumer needs.

Depending on the competitor analysis tool you use, you can get as granular as you need with your research. For instance, Sprout Social lets you analyze your competitors’ social strategies. You can see what types of content they’re posting and even benchmark your growth against theirs.

Brand awareness research

Conducting brand awareness research allows you to assess your brand’s standing in the market. It tells you how well-known your brand is among your target audience and what they associate with it. This can help you gauge people’s sentiments toward your brand and whether you need to rebrand or reposition.

If you don’t know where to start with your research, you’re in the right place.

There’s no shortage of market research methods out there. In this section, we’ve highlighted research channels for small and big businesses alike.

Considering that Google sees a staggering 8.5 billion searches each day, there’s perhaps no better place to start.

A quick Google search is a potential goldmine for all sorts of questions to kick off your market research. Who’s ranking for keywords related to your industry? Which products and pieces of content are the hottest right now? Who’s running ads related to your business?

For example, Google Product Listing Ads can help highlight all of the above for B2C brands.

The same applies to B2B brands looking to keep tabs on who’s running industry-related ads and ranking for keyword terms too.

There’s no denying that email represents both an aggressive and effective marketing channel for marketers today. Case in point, 44% of online shoppers consider email as the most influential channel in their buying decisions.

Looking through industry and competitor emails is a brilliant way to learn more about your market. For example, what types of offers and deals are your competitors running? How often are they sending emails?

Email is also invaluable for gathering information directly from your customers. This survey message from Asana is a great example of how to pick your customers’ brains to figure out how you can improve your quality of service.

Industry journals, reports and blogs

Don’t neglect the importance of big-picture market research when it comes to tactics and marketing channels to explore. Look to marketing resources such as reports and blogs as well as industry journals

Keeping your ear to the ground on new trends and technologies is a smart move for any business. Sites such as Statista, Marketing Charts, AdWeek and Emarketer are treasure troves of up-to-date data and news for marketers.

And of course, there’s the  Sprout Insights blog . And invaluable resources like The Sprout Social Index™  can keep you updated on the latest social trends.

Social media

If you want to learn more about your target market, look no further than social media. Social offers a place to discover what your customers want to see in future products or which brands are killin’ it. In fact, social media is become more important for businesses than ever with the level of data available.

It represents a massive repository of real-time data and insights that are instantly accessible. Brand monitoring and social listening are effective ways to conduct social media research . You can even be more direct with your approach. Ask questions directly or even poll your audience to understand their needs and preferences.

The 5 steps for how to do market research

Now that we’ve covered the why and where, it’s time to get into the practical aspects of market research. Here are five essential steps on how to do market research effectively.

Step 1: Identify your research topic

First off, what are you researching about? What do you want to find out? Narrow down on a specific research topic so you can start with a clear idea of what to look for.

For example, you may want to learn more about how well your product features are satisfying the needs of existing users. This might potentially lead to feature updates and improvements. Or it might even result in new feature introductions.

Similarly, your research topic may be related to your product or service launch or customer experience. Or you may want to conduct research for an upcoming marketing campaign.

Step 2: Choose a buyer persona to engage

If you’re planning to focus your research on a specific type of audience, decide which buyer persona you want to engage. This persona group will serve as a representative sample of your target audience.

Engaging a specific group of audience lets you streamline your research efforts. As such, it can be a much more effective and organized approach than researching thousands (if not millions) of individuals.

You may be directing your research toward existing users of your product. To get even more granular, you may want to focus on users who have been familiar with the product for at least a year, for example.

Step 3: Start collecting data

The next step is one of the most critical as it involves collecting the data you need for your research. Before you begin, make sure you’ve chosen the right research methods that will uncover the type of data you need. This largely depends on your research topic and goals.

Remember that you don’t necessarily have to stick to one research method. You may use a combination of qualitative and quantitative approaches. So for example, you could use interviews to supplement the data from your surveys. Or you may stick to insights from your social listening efforts.

To keep things consistent, let’s look at this in the context of the example from earlier. Perhaps you can send out a survey to your existing users asking them a bunch of questions. This might include questions like which features they use the most and how often they use them. You can get them to choose an answer from one to five and collect quantitative data.

Plus, for qualitative insights, you could even include a few open-ended questions with the option to write their answers. For instance, you might ask them if there’s any improvement they wish to see in your product.

Step 4: Analyze results

Once you have all the data you need, it’s time to analyze it keeping your research topic in mind. This involves trying to interpret the data to look for a wider meaning, particularly in relation to your research goal.

So let’s say a large percentage of responses were four or five in the satisfaction rating. This means your existing users are mostly satisfied with your current product features. On the other hand, if the responses were mostly ones and twos, you may look for opportunities to improve. The responses to your open-ended questions can give you further context as to why people are disappointed.

Step 5: Make decisions for your business

Now it’s time to take your findings and turn them into actionable insights for your business. In this final step, you need to decide how you want to move forward with your new market insight.

What did you find in your research that would require action? How can you put those findings to good use?

The market research tools you should be using

To wrap things up, let’s talk about the various tools available to conduct speedy, in-depth market research. These tools are essential for conducting market research faster and more efficiently.

Social listening and analytics

Social analytics tools like Sprout can help you keep track of engagement across social media. This goes beyond your own engagement data but also includes that of your competitors. Considering how quickly social media moves, using a third-party analytics tool is ideal. It allows you to make sense of your social data at a glance and ensure that you’re never missing out on important trends.

Email marketing research tools

Keeping track of brand emails is a good idea for any brand looking to stand out in its audience’s inbox.

Tools such as MailCharts ,  Really Good Emails  and  Milled  can show you how different brands run their email campaigns.

Meanwhile, tools like  Owletter  allow you to monitor metrics such as frequency and send-timing. These metrics can help you understand email marketing strategies among competing brands.

Content marketing research

If you’re looking to conduct research on content marketing, tools such as  BuzzSumo  can be of great help. This tool shows you the top-performing industry content based on keywords. Here you can see relevant industry sites and influencers as well as which brands in your industry are scoring the most buzz. It shows you exactly which pieces of content are ranking well in terms of engagements and shares and on which social networks.

SEO and keyword tracking

Monitoring industry keywords is a great way to uncover competitors. It can also help you discover opportunities to advertise your products via organic search. Tools such as  Ahrefs  provide a comprehensive keyword report to help you see how your search efforts stack up against the competition.

Competitor comparison template

For the sake of organizing your market research, consider creating a competitive matrix. The idea is to highlight how you stack up side-by-side against others in your market. Use a  social media competitive analysis template  to track your competitors’ social presence. That way, you can easily compare tactics, messaging and performance. Once you understand your strengths and weaknesses next to your competitors, you’ll find opportunities as well.

Customer persona creator

Finally, customer personas represent a place where all of your market research comes together. You’d need to create a profile of your ideal customer that you can easily refer to. Tools like  Xtensio  can help in outlining your customer motivations and demographics as you zero in on your target market.

Build a solid market research strategy

Having a deeper understanding of the market gives you leverage in a sea of competitors. Use the steps and market research tools we shared above to build an effective market research strategy.

But keep in mind that the accuracy of your research findings depends on the quality of data collected. Turn to Sprout’s social media analytics tools to uncover heaps of high-quality data across social networks.

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Sprout Social helps you understand and reach your audience, engage your community and measure performance with the only all-in-one social media management platform built for connection.

11 Benefits of Market Research + Free Templates

The benefits of market research are long-proven. Yet still, there are many who focus on instinct instead of insight.

While intuition is all good and well, there’s no getting away from the power of cold-hard data.

In this post, I list 11 market research benefits, with real-world examples and six free research templates thrown in for good measure.

1. Better communication with customers

Why it matters: Effective communication is the cornerstone of good relations. And, with how much time, effort, and money it takes to win a new client, ensuring you stay in their good books isn’t just nice – it’s a necessity.

The first benefit of market research is the ability to learn about your customer’s likes and dislikes – so you can adapt how you position the business and its products accordingly. Tailored communications speak to customers in a way that resonates far better than generalized messages.

The one-size-fits-all approach no longer works. Delivering comms in the right format, at the right time, via the right platform can boost engagement and help focus on driving value. With it, customers feel appreciated and receive information that’s both useful and relevant.

These days, all it takes is a quick click, and customers can unsubscribe from communications. This is why businesses must ensure every communication counts.

Example: Market research surveys are an ideal way to quickly understand how customers feel about your communications with them. Be direct, and ask them about the content, frequency, and formats they prefer.

If you want to establish the best time or day of the week to email, you can use your email campaign tracking data to show you the best and worst times, based on open rates, and click-through rates.

2. Enables strategic, data-driven plans

Why it matters: Market research benefits all types and stages of business planning. It gives you the numbers and insights you need to make accurate forecasts. It can also impact key decisions that can help you develop and adapt your strategy.

Here are a few examples where market research can benefit data-driven decision-making :

• Deciding whether to modify or discontinue a product.
• Prioritizing new features to develop for an existing product.
• Establishing which marketing channels to invest in.
• Selecting which social media platforms to utilize.
• Choosing which new markets to enter or where to open a new retail outlet.
• Evaluating the impact of a cost increase or change to pricing strategy.
• Discover new partners, affiliates, or publishers to work with.
• Targeting a new persona or different segment of a market.

Market research serves as a trusty compass, helping guide and steer decisions that impact growth and profitability. Once you implement a new tactic or campaign, you can again benefit from market research to measure and track ongoing success.

3. Develop detailed target personas

Why it matters: It’s no secret that a comprehensive understanding of one’s target audience is fundamental to an organization’s success. Everything from product development to positioning and marketing is impacted by the effective development of target personas.

While most companies have a decent understanding of what their ideal customer profile looks like; a distinct advantage of market research is the depth of detail it offers about the preferences, behaviors, and habits of a target audience – based on actual facts and everyday actions they take online.

By doing audience analysis and consumer journey tracking , organizations can discover insights about their ideal customers quickly and in finite detail. So instead of having a static persona that doesn’t really change with the times; marketers can discover things like:

• Age, gender, and geography
• Audience loyalty & interests
• Cross-shopping behaviors
• Product search trends
• View audience overlaps with rivals
• Identify drop-off points in funnels
• Optimize conversion funnels
• Discover which marketing channels appeal to a specific audience

Grab our customer persona template to use a framework for this research – it’s at the end of this post, along with 5 other useful market research templates !

4. Reduce costs and save time

Perhaps one of the biggest benefits of market research for a business is its ability to help organizations improve efficiency and reduce outlay – both from a time and cost perspective. While each business achieves different outcomes, doing proper research can help pave the way for process improvements.

A few examples include:

• Spending less on marketing channels that don’t appeal to a target audience or drive ROI.
• Decrease customer churn via surveys, enhanced support, or more suitable product offerings.
• Prevent you from entering a new market in a territory that’s already saturated.
• Testing the viability or appetite for a new product or service before making investment decisions.
• Reduce customer acquisition costs (CAC) through clearer targeting and messaging.
• Identification of new partnerships or affiliates who can drive referrals to your business.

DocSend uses Similarweb to reduce marketing spend by 20% and reduced research time by 10% – as an added bonus it saw website traffic gains of around 10%.

Read more about how market research benefited DocSend here .

5. Stay ahead of the competition

Why it matters: These days, the competition is fierce in almost every market. Customers have many options to choose from, and outpacing your rivals is a constant battle. From new product or service offerings to campaigns and content – not to mention promotions and partnerships; keeping a keen eye on your market positioning is key.

A core benefit of market research is knowing what other players in your market are doing. More to the point, market research actually shows you how well these offerings are doing.

A competitive analysis framework is a great way to systematically record and track what your rivals are doing. It can help you spot opportunities, such as:

• Develop new marketing campaigns and creatives
• Adapt your product or service offerings
• Give insights into new content to write about
• Show you which channels work best for your target market
• Find underserved segments of a market
• See what customers like or dislike about your rivals
• Help you develop your unique selling proposition (USP)

Good market research can be the differential factor that gives you an edge in your market.

In this scenario, I want to analyze the competitive landscape of a social media management company. I chose Sprout Social to review as it’s considered a market leader.

See how much competitive intel I can grab in less than a minute

In a snapshot, I can see an overview of its traffic and engagement. This includes the total visits, unique visitors , a link to its apps, and a breakdown of traffic by channel. With a quick compare, I see how these metrics stack up against others in the market. Later.com and influencermarketinghub.com are two players who consistently outperform sproutsocial.com – which means I can delve deeper into their successes, campaigns, and content next.

From the platform, I can see how many referrals they’re getting, and from where. Which ad networks and campaigns they’re running, and copies of the creatives being used.

Next, I look at the most popular pages on Sprout Social’s site. This shows several pages on the topic of small business social media are achieving significant growth – indicating my target audience is responding to these pages, so I should be covering or promoting content on a similar theme.

So, in less than a minute, I’ve discovered

• How my competitor stacks up vs others in the market
• Which traffic channels are growing
• The best referral partners and advertisers
• What marketing channels are showing the best results
• Copies of their ad creatives
• What content topics are the most popular
• Top industry search terms
• Uncovered two other major players to evaluate

Software like Similarweb makes it quick and easy to see the insights and metrics that matter most. Here, you can discover where you can get a competitive edge, and keep track of market trends and rival campaigns.

6. Discover the best marketing channels

From email marketing to socials, affiliates, referrals, paid ads, and more; there are many marketing channels to leverage – and it’s not always obvious which is right for your business. Another key benefit of doing market research is the ability to hone in on the channels that deliver the best return on investment.

A trial-and-error approach can be costly. Not just from a dollar perspective, it can be a drain on your resources too. By first establishing the optimal marketing mix for your target audience or market, you can save time and money, and reach your goals faster.

Similarweb Digital Research Intelligence can show you which channels work best for your market and rivals. It also highlights the specific ad creatives and content being used for high-performing campaigns.

Here, you see a snapshot of the marketing channels being used across five competitive sites. It shows the biggest drivers of traffic are direct and organic search. By clicking on any single channel, you can get a complete breakdown of the respective details. I’ve clicked to expand social media, as just one example, here’s what it tells me.

As well as being able to instantly see the insights that count, I can click on any channel to see a detailed breakdown of performance. Next, I can compare each channel to see who is outperforming others – which tells me exactly who I need to take a closer look at.

7. Identify growth opportunities

The benefits of doing market research apply to those launching new products or entering new markets . However, periodic research can also help you spot growth-focused opportunities that may not have been considered before.

Another compelling entrant to include in the benefits of market research is its ability to unearth opportunities to grow. Whether that’s through finding new customers, markets, channels, or creative ways to go to market and get more eyes on your business. A good case in point is in the identification of new partnerships for referrals; something that often comes about when doing a competitive analysis .

The advantages of using market research for growth are ongoing, throughout the lifecycle of your business. For example:

• Reviewing competitor marketing channels could uncover key findings about a new affiliate site that’s sending a volume of traffic to their site.
• A guest post or piece of content generates a high level of interest and drives traffic to the site.
• Untapped segments for your products. Perhaps a rival is doing a better job of appealing to a different demographic. This, in turn, presents an opportunity to diversify your messaging or switch marketing channels. The same could apply to a new location or geographic region.
• New partnerships. Joint ventures between businesses that share a similar target demographic can be mutually beneficial – helping both parties reach a new ready-prepped customer base.
• Perhaps a rival is offering an add-on or upsell that you’ve failed to consider.
• You might also conduct market research surveys where customers tell you something they’d like but which you don’t yet offer.

Success story: See how AirBnB used Similarweb to uncover opportunities for growth in new markets.

8. Spot new or emerging trends

Why it matters: With how quickly consumer behaviors change and markets shift, it’s important to move with the times. Market research can help businesses stay in touch with what’s happening – something that applies to consumers, competitors, and the industry as a whole.

From changes to purchasing behaviors, new technologies, new products, or service features; researching trends and staying close to rising players in your market allows you to keep tabs on what things are attracting attention.

• Which keywords or phrases are trending in your industry?
• Is there a new player showing significant growth in your market?
• What are your rival’s highest-hitting pages?
• How are apps impacting your market – do you know which of your competitors have one, and is it successful?
• Which campaigns in your industry are working and gaining traction?
• Is there a specific asset, whitepaper, or offering that your target audience responds to?
• Are there any seasonal trends that impact your market?
• Can you see spikes in specific search terms or phrases?

While you can use digital research tools like Similarweb to quickly analyze a market, search trends, seasonal patterns, mobile app intelligence , and more – qualitative data, like surveys can be leveraged to understand customers and changing behaviors too.

Read more about how Wonderbly achieved its success here.

9. Makes it easy to evaluate and track your success

Why it matters: With the knowledge of where your business is performing well, or falling behind, you can set goals and direction more clearly. Benchmarking shows you industry standards, and maps out how rivals are doing; so you can measure relative performance.

For a business to grow, it needs to push the boundaries. The benefit of using market research here is that it shows you where and how big those boundaries are. A survey from PWC found businesses that set benchmarks achieve 45% more productivity and grow, on average 69 times faster than those that do not.

There are various types of benchmarking – each of which makes it possible to unpack and track the successes of those in your market and drill down into what success looks like for your business.

10. Inform market analysis – SWOT

Why it matters: A further benefit of doing market research is that it can show you any relative strengths, weaknesses, opportunities, and threats that exist between competitors and in a market. Greater awareness of these facts helps drive the right actions and gives clarity on areas of focus for the business. Without it, your business is susceptible to preventable mistakes.

With company and market research , you find out where opportunities and threats exist in your ecosystem. From environmental or technological factors to internal considerations; forewarned is forearmed. What’s more, a regular review of your SWOT, informed by market research, allows you to capitalize on new opportunities faster than others and keeps you in the strongest position where gaining a competitive edge is concerned.

Helpful: Read our complete guide to doing an industry SWOT analysis .

11. Inform a content marketing strategy

Why it matters: These days, the importance of having an effective, relevant, and successful content marketing strategy cannot be overstated. According to a 2020 competitive intelligence survey , companies have, on average, 29 competitors. So, regardless of your sector, in the digital world, it’s constant competition – be it for better visibility online, a higher CTR, or increased engagement.

So, how does market research benefit a business? And how can you stand out and get found online? With content marketing, of course.

An advantage of using market research to inform your content marketing strategy is that data doesn’t lie. Yes, it’s an old one but a good one. A data-driven approach to content marketing is a surefire way to uncover the most searched keywords , the right topics, and content to harness to your advantage.

You can use market research to uncover the following:

• The busiest pages on any website.
• Which topics and keywords drive the most traffic in your market?
• New topics or keyword phrases that are trending or appearing seasonably.
• Inform topic planning or theme building for a blog.
• Help you discover new opportunities for dedicated landing pages.
• What content or assets an audience engages with most.
• Which channels are the most effective to deliver content?
• The best time of day to post new content.

Success story:  See how Tourism New Zealand benefits from market research ; and how they use Similarweb to research content and keywords.  

Limitations of Market Research

Regardless of whether it’s for an enterprise company or an entrepreneur – time, cost, and experience are viewed as the biggest limitations of market research. But this is an outdated perception that is no longer relevant or true to life.

Here’s how things are in 2022.

• If cost is considered a limitation of market research – use secondary market research methods. Most of the time, the data can be found online, for free.

This guide to desk research shows you the best places to find secondary research data. 

• Should you view time as a limitation – use software like Similarweb Digital Research Intelligence to quickly view insights in almost any market, company, or product.

If you’re on a deadline, let’s say you need to do market research for a business plan , market research tools can help you get it done in a day.

• Perhaps you feel a lack of experience is preventing you from doing market research. Most market research tools require little to no training and are highly intuitive.

Use market research templates to guide you through the key data points you need to collect. 

Benefits of market research – In summary

Market research benefits any business, at any stage. From product teams to sales, customer support, marketing, operations, and management – there’s a relevant application in almost every department. However, many organizations choose only to use it for limited periods in limited areas of their business.

Similarweb Research Intelligence makes key insights accessible to all. And with the ability to impact an entire business, at almost every level, it’s a market research tool with the power to deliver immense value and insights at pace.

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Get actionable insights for market research here

What are the advantages and disadvantages of market research?

The advantages of market research include things like gaining a competitive edge, data-driven decision-making, reducing expenditure, finding new markets to enter, trend-spotting, and developing growth-focused strategies. The only disadvantage is in how it’s conducted, and the time it takes to carry out the research. However, market research tools are designed to make the task of conducting research more efficient, and cost-effective.

Which goals can market research help you accomplish?

Market research can help you achieve key business objectives, such as growing your customer base, retaining a higher number of customers, improving marketing effectiveness, and increasing revenue.

How can market research benefit entrepreneurs?

The benefits of market research to entrepreneurs are plentiful. It can help startups and new businesses research the viability of a new product or service they want to bring to market. In addition, it allows entrepreneurs to accurately forecast demand, which can help both operationally and financially.

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How to Do Market Research: The Complete Guide

Learn how to do market research with this step-by-step guide, complete with templates, tools and real-world examples.

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Get trusted first-party funding data, revenue data and firmographics

What are your customers’ needs? How does your product compare to the competition? What are the emerging trends and opportunities in your industry? If these questions keep you up at night, it’s time to conduct market research.

Market research plays a pivotal role in your ability to stay competitive and relevant, helping you anticipate shifts in consumer behavior and industry dynamics. It involves gathering these insights using a wide range of techniques, from surveys and interviews to data analysis and observational studies.

In this guide, we’ll explore why market research is crucial, the various types of market research, the methods used in data collection, and how to effectively conduct market research to drive informed decision-making and success.

What is market research?

Market research is the systematic process of gathering, analyzing and interpreting information about a specific market or industry. The purpose of market research is to offer valuable insight into the preferences and behaviors of your target audience, and anticipate shifts in market trends and the competitive landscape. This information helps you make data-driven decisions, develop effective strategies for your business, and maximize your chances of long-term growth.

Why is market research important? 

By understanding the significance of market research, you can make sure you’re asking the right questions and using the process to your advantage. Some of the benefits of market research include:

• Informed decision-making: Market research provides you with the data and insights you need to make smart decisions for your business. It helps you identify opportunities, assess risks and tailor your strategies to meet the demands of the market. Without market research, decisions are often based on assumptions or guesswork, leading to costly mistakes.
• Customer-centric approach: A cornerstone of market research involves developing a deep understanding of customer needs and preferences. This gives you valuable insights into your target audience, helping you develop products, services and marketing campaigns that resonate with your customers.
• Competitive advantage: By conducting market research, you’ll gain a competitive edge. You’ll be able to identify gaps in the market, analyze competitor strengths and weaknesses, and position your business strategically. This enables you to create unique value propositions, differentiate yourself from competitors, and seize opportunities that others may overlook.
• Risk mitigation: Market research helps you anticipate market shifts and potential challenges. By identifying threats early, you can proactively adjust their strategies to mitigate risks and respond effectively to changing circumstances. This proactive approach is particularly valuable in volatile industries.
• Resource optimization: Conducting market research allows organizations to allocate their time, money and resources more efficiently. It ensures that investments are made in areas with the highest potential return on investment, reducing wasted resources and improving overall business performance.
• Adaptation to market trends: Markets evolve rapidly, driven by technological advancements, cultural shifts and changing consumer attitudes. Market research ensures that you stay ahead of these trends and adapt your offerings accordingly so you can avoid becoming obsolete. 

As you can see, market research empowers businesses to make data-driven decisions, cater to customer needs, outperform competitors, mitigate risks, optimize resources and stay agile in a dynamic marketplace. These benefits make it a huge industry; the global market research services market is expected to grow from $76.37 billion in 2021 to $108.57 billion in 2026 . Now, let’s dig into the different types of market research that can help you achieve these benefits.

Types of market research 

• Qualitative research
• Quantitative research
• Exploratory research
• Descriptive research
• Causal research
• Cross-sectional research
• Longitudinal research

Despite its advantages, 23% of organizations don’t have a clear market research strategy. Part of developing a strategy involves choosing the right type of market research for your business goals. The most commonly used approaches include:

1. Qualitative research

Qualitative research focuses on understanding the underlying motivations, attitudes and perceptions of individuals or groups. It is typically conducted through techniques like in-depth interviews, focus groups and content analysis — methods we’ll discuss further in the sections below. Qualitative research provides rich, nuanced insights that can inform product development, marketing strategies and brand positioning.

2. Quantitative research

Quantitative research, in contrast to qualitative research, involves the collection and analysis of numerical data, often through surveys, experiments and structured questionnaires. This approach allows for statistical analysis and the measurement of trends, making it suitable for large-scale market studies and hypothesis testing. While it’s worthwhile using a mix of qualitative and quantitative research, most businesses prioritize the latter because it is scientific, measurable and easily replicated across different experiments.

3. Exploratory research

Whether you’re conducting qualitative or quantitative research or a mix of both, exploratory research is often the first step. Its primary goal is to help you understand a market or problem so you can gain insights and identify potential issues or opportunities. This type of market research is less structured and is typically conducted through open-ended interviews, focus groups or secondary data analysis. Exploratory research is valuable when entering new markets or exploring new product ideas.

4. Descriptive research

As its name implies, descriptive research seeks to describe a market, population or phenomenon in detail. It involves collecting and summarizing data to answer questions about audience demographics and behaviors, market size, and current trends. Surveys, observational studies and content analysis are common methods used in descriptive research. 

5. Causal research

Causal research aims to establish cause-and-effect relationships between variables. It investigates whether changes in one variable result in changes in another. Experimental designs, A/B testing and regression analysis are common causal research methods. This sheds light on how specific marketing strategies or product changes impact consumer behavior.

6. Cross-sectional research

Cross-sectional market research involves collecting data from a sample of the population at a single point in time. It is used to analyze differences, relationships or trends among various groups within a population. Cross-sectional studies are helpful for market segmentation, identifying target audiences and assessing market trends at a specific moment.

7. Longitudinal research

Longitudinal research, in contrast to cross-sectional research, collects data from the same subjects over an extended period. This allows for the analysis of trends, changes and developments over time. Longitudinal studies are useful for tracking long-term developments in consumer preferences, brand loyalty and market dynamics.

Each type of market research has its strengths and weaknesses, and the method you choose depends on your specific research goals and the depth of understanding you’re aiming to achieve. In the following sections, we’ll delve into primary and secondary research approaches and specific research methods.

Primary vs. secondary market research

Market research of all types can be broadly categorized into two main approaches: primary research and secondary research. By understanding the differences between these approaches, you can better determine the most appropriate research method for your specific goals.

Primary market research 

Primary research involves the collection of original data straight from the source. Typically, this involves communicating directly with your target audience — through surveys, interviews, focus groups and more — to gather information. Here are some key attributes of primary market research:

• Customized data: Primary research provides data that is tailored to your research needs. You design a custom research study and gather information specific to your goals.
• Up-to-date insights: Because primary research involves communicating with customers, the data you collect reflects the most current market conditions and consumer behaviors.
• Time-consuming and resource-intensive: Despite its advantages, primary research can be labor-intensive and costly, especially when dealing with large sample sizes or complex study designs. Whether you hire a market research consultant, agency or use an in-house team, primary research studies consume a large amount of resources and time.

Secondary market research 

Secondary research, on the other hand, involves analyzing data that has already been compiled by third-party sources, such as online research tools, databases, news sites, industry reports and academic studies.

Here are the main characteristics of secondary market research:

• Cost-effective: Secondary research is generally more cost-effective than primary research since it doesn’t require building a research plan from scratch. You and your team can look at databases, websites and publications on an ongoing basis, without needing to design a custom experiment or hire a consultant. 
• Leverages multiple sources: Data tools and software extract data from multiple places across the web, and then consolidate that information within a single platform. This means you’ll get a greater amount of data and a wider scope from secondary research.
• Quick to access: You can access a wide range of information rapidly — often in seconds — if you’re using online research tools and databases. Because of this, you can act on insights sooner, rather than taking the time to develop an experiment. 

So, when should you use primary vs. secondary research? In practice, many market research projects incorporate both primary and secondary research to take advantage of the strengths of each approach.

One rule of thumb is to focus on secondary research to obtain background information, market trends or industry benchmarks. It is especially valuable for conducting preliminary research, competitor analysis, or when time and budget constraints are tight. Then, if you still have knowledge gaps or need to answer specific questions unique to your business model, use primary research to create a custom experiment. 

Market research methods

• Surveys and questionnaires
• Focus groups
• Observational research
• Online research tools
• Experiments
• Content analysis
• Ethnographic research

How do primary and secondary research approaches translate into specific research methods? Let’s take a look at the different ways you can gather data: 

1. Surveys and questionnaires

Surveys and questionnaires are popular methods for collecting structured data from a large number of respondents. They involve a set of predetermined questions that participants answer. Surveys can be conducted through various channels, including online tools, telephone interviews and in-person or online questionnaires. They are useful for gathering quantitative data and assessing customer demographics, opinions, preferences and needs. On average, customer surveys have a 33% response rate , so keep that in mind as you consider your sample size.

2. Interviews

Interviews are in-depth conversations with individuals or groups to gather qualitative insights. They can be structured (with predefined questions) or unstructured (with open-ended discussions). Interviews are valuable for exploring complex topics, uncovering motivations and obtaining detailed feedback. 

3. Focus groups

The most common primary research methods are in-depth webcam interviews and focus groups. Focus groups are a small gathering of participants who discuss a specific topic or product under the guidance of a moderator. These discussions are valuable for primary market research because they reveal insights into consumer attitudes, perceptions and emotions. Focus groups are especially useful for idea generation, concept testing and understanding group dynamics within your target audience.

4. Observational research

Observational research involves observing and recording participant behavior in a natural setting. This method is particularly valuable when studying consumer behavior in physical spaces, such as retail stores or public places. In some types of observational research, participants are aware you’re watching them; in other cases, you discreetly watch consumers without their knowledge, as they use your product. Either way, observational research provides firsthand insights into how people interact with products or environments.

5. Online research tools

You and your team can do your own secondary market research using online tools. These tools include data prospecting platforms and databases, as well as online surveys, social media listening, web analytics and sentiment analysis platforms. They help you gather data from online sources, monitor industry trends, track competitors, understand consumer preferences and keep tabs on online behavior. We’ll talk more about choosing the right market research tools in the sections that follow.

6. Experiments

Market research experiments are controlled tests of variables to determine causal relationships. While experiments are often associated with scientific research, they are also used in market research to assess the impact of specific marketing strategies, product features, or pricing and packaging changes.

7. Content analysis

Content analysis involves the systematic examination of textual, visual or audio content to identify patterns, themes and trends. It’s commonly applied to customer reviews, social media posts and other forms of online content to analyze consumer opinions and sentiments.

8. Ethnographic research

Ethnographic research immerses researchers into the daily lives of consumers to understand their behavior and culture. This method is particularly valuable when studying niche markets or exploring the cultural context of consumer choices.

How to do market research

• Set clear objectives
• Identify your target audience
• Choose your research methods
• Use the right market research tools
• Collect data
• Analyze data 
• Interpret your findings
• Identify opportunities and challenges
• Make informed business decisions
• Monitor and adapt

Now that you have gained insights into the various market research methods at your disposal, let’s delve into the practical aspects of how to conduct market research effectively. Here’s a quick step-by-step overview, from defining objectives to monitoring market shifts.

1. Set clear objectives

When you set clear and specific goals, you’re essentially creating a compass to guide your research questions and methodology. Start by precisely defining what you want to achieve. Are you launching a new product and want to understand its viability in the market? Are you evaluating customer satisfaction with a product redesign? 

Start by creating SMART goals — objectives that are specific, measurable, achievable, relevant and time-bound. Not only will this clarify your research focus from the outset, but it will also help you track progress and benchmark your success throughout the process. 

You should also consult with key stakeholders and team members to ensure alignment on your research objectives before diving into data collecting. This will help you gain diverse perspectives and insights that will shape your research approach.

2. Identify your target audience

Next, you’ll need to pinpoint your target audience to determine who should be included in your research. Begin by creating detailed buyer personas or stakeholder profiles. Consider demographic factors like age, gender, income and location, but also delve into psychographics, such as interests, values and pain points.

The more specific your target audience, the more accurate and actionable your research will be. Additionally, segment your audience if your research objectives involve studying different groups, such as current customers and potential leads.

If you already have existing customers, you can also hold conversations with them to better understand your target market. From there, you can refine your buyer personas and tailor your research methods accordingly.

3. Choose your research methods

Selecting the right research methods is crucial for gathering high-quality data. Start by considering the nature of your research objectives. If you’re exploring consumer preferences, surveys and interviews can provide valuable insights. For in-depth understanding, focus groups or observational research might be suitable. Consider using a mix of quantitative and qualitative methods to gain a well-rounded perspective. 

You’ll also need to consider your budget. Think about what you can realistically achieve using the time and resources available to you. If you have a fairly generous budget, you may want to try a mix of primary and secondary research approaches. If you’re doing market research for a startup , on the other hand, chances are your budget is somewhat limited. If that’s the case, try addressing your goals with secondary research tools before investing time and effort in a primary research study. 

4. Use the right market research tools

Whether you’re conducting primary or secondary research, you’ll need to choose the right tools. These can help you do anything from sending surveys to customers to monitoring trends and analyzing data. Here are some examples of popular market research tools:

• Market research software: Crunchbase is a platform that provides best-in-class company data, making it valuable for market research on growing companies and industries. You can use Crunchbase to access trusted, first-party funding data, revenue data, news and firmographics, enabling you to monitor industry trends and understand customer needs.

• Survey and questionnaire tools: SurveyMonkey is a widely used online survey platform that allows you to create, distribute and analyze surveys. Google Forms is a free tool that lets you create surveys and collect responses through Google Drive.
• Data analysis software: Microsoft Excel and Google Sheets are useful for conducting statistical analyses. SPSS is a powerful statistical analysis software used for data processing, analysis and reporting.
• Social listening tools: Brandwatch is a social listening and analytics platform that helps you monitor social media conversations, track sentiment and analyze trends. Mention is a media monitoring tool that allows you to track mentions of your brand, competitors and keywords across various online sources.
• Data visualization platforms: Tableau is a data visualization tool that helps you create interactive and shareable dashboards and reports. Power BI by Microsoft is a business analytics tool for creating interactive visualizations and reports.

5. Collect data

There’s an infinite amount of data you could be collecting using these tools, so you’ll need to be intentional about going after the data that aligns with your research goals. Implement your chosen research methods, whether it’s distributing surveys, conducting interviews or pulling from secondary research platforms. Pay close attention to data quality and accuracy, and stick to a standardized process to streamline data capture and reduce errors. 

6. Analyze data

Once data is collected, you’ll need to analyze it systematically. Use statistical software or analysis tools to identify patterns, trends and correlations. For qualitative data, employ thematic analysis to extract common themes and insights. Visualize your findings with charts, graphs and tables to make complex data more understandable.

If you’re not proficient in data analysis, consider outsourcing or collaborating with a data analyst who can assist in processing and interpreting your data accurately.

7. Interpret your findings

Interpreting your market research findings involves understanding what the data means in the context of your objectives. Are there significant trends that uncover the answers to your initial research questions? Consider the implications of your findings on your business strategy. It’s essential to move beyond raw data and extract actionable insights that inform decision-making.

Hold a cross-functional meeting or workshop with relevant team members to collectively interpret the findings. Different perspectives can lead to more comprehensive insights and innovative solutions.

8. Identify opportunities and challenges

Use your research findings to identify potential growth opportunities and challenges within your market. What segments of your audience are underserved or overlooked? Are there emerging trends you can capitalize on? Conversely, what obstacles or competitors could hinder your progress?

Lay out this information in a clear and organized way by conducting a SWOT analysis, which stands for strengths, weaknesses, opportunities and threats. Jot down notes for each of these areas to provide a structured overview of gaps and hurdles in the market.

9. Make informed business decisions

Market research is only valuable if it leads to informed decisions for your company. Based on your insights, devise actionable strategies and initiatives that align with your research objectives. Whether it’s refining your product, targeting new customer segments or adjusting pricing, ensure your decisions are rooted in the data.

At this point, it’s also crucial to keep your team aligned and accountable. Create an action plan that outlines specific steps, responsibilities and timelines for implementing the recommendations derived from your research. 

10. Monitor and adapt

Market research isn’t a one-time activity; it’s an ongoing process. Continuously monitor market conditions, customer behaviors and industry trends. Set up mechanisms to collect real-time data and feedback. As you gather new information, be prepared to adapt your strategies and tactics accordingly. Regularly revisiting your research ensures your business remains agile and reflects changing market dynamics and consumer preferences.

Online market research sources

As you go through the steps above, you’ll want to turn to trusted, reputable sources to gather your data. Here’s a list to get you started:

• Crunchbase: As mentioned above, Crunchbase is an online platform with an extensive dataset, allowing you to access in-depth insights on market trends, consumer behavior and competitive analysis. You can also customize your search options to tailor your research to specific industries, geographic regions or customer personas.

• Academic databases: Academic databases, such as ProQuest and JSTOR , are treasure troves of scholarly research papers, studies and academic journals. They offer in-depth analyses of various subjects, including market trends, consumer preferences and industry-specific insights. Researchers can access a wealth of peer-reviewed publications to gain a deeper understanding of their research topics.
• Government and NGO databases: Government agencies, nongovernmental organizations and other institutions frequently maintain databases containing valuable economic, demographic and industry-related data. These sources offer credible statistics and reports on a wide range of topics, making them essential for market researchers. Examples include the U.S. Census Bureau , the Bureau of Labor Statistics and the Pew Research Center .
• Industry reports: Industry reports and market studies are comprehensive documents prepared by research firms, industry associations and consulting companies. They provide in-depth insights into specific markets, including market size, trends, competitive analysis and consumer behavior. You can find this information by looking at relevant industry association databases; examples include the American Marketing Association and the National Retail Federation .
• Social media and online communities: Social media platforms like LinkedIn or Twitter (X) , forums such as Reddit and Quora , and review platforms such as G2 can provide real-time insights into consumer sentiment, opinions and trends. 

Market research examples

At this point, you have market research tools and data sources — but how do you act on the data you gather? Let’s go over some real-world examples that illustrate the practical application of market research across various industries. These examples showcase how market research can lead to smart decision-making and successful business decisions.

Example 1: Apple’s iPhone launch

Apple ’s iconic iPhone launch in 2007 serves as a prime example of market research driving product innovation in tech. Before the iPhone’s release, Apple conducted extensive market research to understand consumer preferences, pain points and unmet needs in the mobile phone industry. This research led to the development of a touchscreen smartphone with a user-friendly interface, addressing consumer demands for a more intuitive and versatile device. The result was a revolutionary product that disrupted the market and redefined the smartphone industry.

Example 2: McDonald’s global expansion

McDonald’s successful global expansion strategy demonstrates the importance of market research when expanding into new territories. Before entering a new market, McDonald’s conducts thorough research to understand local tastes, preferences and cultural nuances. This research informs menu customization, marketing strategies and store design. For instance, in India, McDonald’s offers a menu tailored to local preferences, including vegetarian options. This market-specific approach has enabled McDonald’s to adapt and thrive in diverse global markets.

Example 3: Organic and sustainable farming

The shift toward organic and sustainable farming practices in the food industry is driven by market research that indicates increased consumer demand for healthier and environmentally friendly food options. As a result, food producers and retailers invest in sustainable sourcing and organic product lines — such as with these sustainable seafood startups — to align with this shift in consumer values. 

The bottom line? Market research has multiple use cases and is a critical practice for any industry. Whether it’s launching groundbreaking products, entering new markets or responding to changing consumer preferences, you can use market research to shape successful strategies and outcomes.

Market research templates

You finally have a strong understanding of how to do market research and apply it in the real world. Before we wrap up, here are some market research templates that you can use as a starting point for your projects:

• Smartsheet competitive analysis templates : These spreadsheets can serve as a framework for gathering information about the competitive landscape and obtaining valuable lessons to apply to your business strategy.
• SurveyMonkey product survey template : Customize the questions on this survey based on what you want to learn from your target customers.
• HubSpot templates : HubSpot offers a wide range of free templates you can use for market research, business planning and more.
• SCORE templates : SCORE is a nonprofit organization that provides templates for business plans, market analysis and financial projections.
• SBA.gov : The U.S. Small Business Administration offers templates for every aspect of your business, including market research, and is particularly valuable for new startups. 

Strengthen your business with market research

When conducted effectively, market research is like a guiding star. Equipped with the right tools and techniques, you can uncover valuable insights, stay competitive, foster innovation and navigate the complexities of your industry.

Throughout this guide, we’ve discussed the definition of market research, different research methods, and how to conduct it effectively. We’ve also explored various types of market research and shared practical insights and templates for getting started. 

Now, it’s time to start the research process. Trust in data, listen to the market and make informed decisions that guide your company toward lasting success.

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• → Market research: What it is, how to u...

Market research: What it is, how to use it, + examples

Market research allows you to categorize your target audience to better understand your consumers. Learn more about how to do market research here.

Latest posts on Tips

Typeform    |    05.2024

Typeform    |    04.2024

So, you’ve got the next billion-dollar idea that’ll blow the top off your profit margins. You just know you’re onto a winner! Time to throw a huge budget (or your life savings) at this idea, right? 

Not so fast! You're not likely to get very far in the marketplace if you only rely on your gut instincts.

How can you know if your idea even has a chance of surviving in the cutthroat marketplace? 

The answer: market research. A realistic prediction, based on data , of your chances of success. Basically, it’s a way to find out the market viability of your idea.

If you’re new to market research, don’t be intimidated. This guide will take you from basic concepts through to advanced techniques. Plus, our in-house experts will walk you through real-life examples of how we do it here at Typeform.

What is market research and why does it matter?

Market research is the process of collecting information about your target market and customers so you can:

Learn who your customers are

Find out what they want and/or need

Gauge potential market size

Discover trends in your industry

Get wise about what your competitors are up to

Determine how you can stand out

This way, you’ll better understand how to serve your customers, prioritize, and get higher returns on your own marketing and product development efforts. Market research is an essential part of any business’s strategy, whatever the size of your company.

There are many ways to approach market research, and at Typeform, we’ve developed our own spin on it, thanks to continuous testing and the insights we get from being a market research tool ourselves ( forms and surveys).

Uncertainty is an inevitable part of business—however, it’s still possible to reduce some of the uncertainty.

This is where market research is your best ally. Nothing is guaranteed, but making an informed decision based on comprehensive research beats a stab in the dark. Market research helps reduce the thickness of that fog to see what your options are and which direction you might want to take.

Convinced you shouldn’t be sleeping on market research? Great—let’s dive deeper.

Types of market research

Finding what works best for you is a must for useful and actionable market research. We don’t believe in a cut-and-paste approach for all businesses and markets, nor in one definitive “right” way to do things. However, there are some basic principles that apply across the board. Here are a few types of market research.

Secondary and primary research 

Secondary market research delves into information that you don’t create yourself. It’s data that’s already out there, which you can buy or access for free, and is great for benchmarking. 

Examples of secondary research:

Industry reports

Census data

Research paper

Articles in journals or newspapers

Primary market research involves collecting information yourself—this may be more expensive and time-consuming than secondary research, but it’s a better investment in the long run. Focus on your own target audience and gather information directly relevant to your goals. 

Examples of primary research:

Interviews (face-to-face or over the phone)

Focus groups

User testing

Quantitative and Qualitative

Ahh, the classic quantitative vs. qualitative dichotomy.

Quantitative market research gathers data that's numerical, descriptive, and structured. You can draw statistics from quantitative research. It involves more of the “what” questions and can be done at scale.

This type of market research is usually carried out through surveys and questionnaires and can be internal or external. Internal quantitative research examines your current customers, while external can help you identify new customers and see the actual distribution of the whole market. External is more likely to be objective, as your own customers already know you and will have formed opinions.

Examples of quantitative questions:

“Where do you live?”

“How much do you spend on electricity per month, on average?”

“Do you use this product?”

“How often do you go to the gym?”

“On a scale of 1–10, how satisfied are you with our service?”

Qualitative market research involves more of the “how” and “why” questions. It’s done at a much smaller scale, is less structured and more exploratory, aiming for insight rather than certainty. It helps you find out how customers feel about your product, their opinions and preferences—in other words, things that can't be quantified.

Examples of qualitative questions:

“Why did you choose product A over product B?”

“How does this image make you feel?”

“What do you feel is missing from this service?

“Describe the last time you purchased something online.”

“What are your favorite brands for dog grooming products?”

Usually, this type of market research is done through surveys with open-ended questions or interviews. A small number of interviews are conducted, which are then projected to apply to a larger population. 

Quantitative and qualitative research don’t need to be seen as opposite or distinct techniques. It can be an “and” instead of an “either-or.”

Market research for product development and marketing efforts

Market research tends to inform two main areas in a business: product development and marketing efforts. Whether it’s creating a new product or a new set of features, at Typeform, we always start from the end. 

Who’s going to use this? 

Who will buy it? 

How do I justify engineers spending time on this? 

Market research is one of the most important tools to answer these questions. Nobody wants to invest time, money, and effort into making something that no one wants or needs. Market research allows you to assess the market size, its opportunities, and your competitors. This is also where user research and market research inform one another.

Segmenting the market is one of the main activities in market research, as it gives you your target audience(s). How else will you know who is buying from you already, who to market to, and which marketing messages work best?

Competitor analysis , another cornerstone of market research, helps you craft your positioning. In simple terms: How you're different from your competitors and why should buyers pick you?

How to conduct market research

So you can probably see by now how varied market research is. The way we do our own market research here at Typeform has evolved over the years through testing and experimentation. After much trial and error, we finally landed on the approach that works best for us.

Set your goals

Before we even think about launching market research of any scale, we make sure to have a clear objective in mind. 

Are you trying to enhance a particular metric (such as customer numbers or customer satisfaction level), gauge potential market size, or something else?

Define your objective(s) first, then move on to the next step.

Define your audience 

Whatever your approach, the next thing you should always have at the front of your mind is your customer.

Still, focusing on the customer can mean different things to different people.

Focus on jobs, not personas

Brace yourself, because we’re about to say something controversial: don’t focus on buyer personas.

This flies in the face of what most other market research guides will tell you: Research your audience to create buyer personas and frame your offering around them.

Not that buyer personas aren't important—they are. And at Typeform, we definitely use them, but we also follow the “Jobs To Be Done (JTBD)” model. This is the backbone for how we conceptualize everything, from our marketing messaging to our product development. It informs how we see our customers and how we segment them.

How many people in your business speak directly to customers? The bigger your organization, the smaller this number is likely to be, and the further removed the customer becomes from the decision-making. The job creates a consistent framework for everyone to work with and remains close to the customer’s needs.

As you identify needs that intersect, you can begin to find unique differentiators for your product. 

At the end of the day, your customers don’t care about you or your product or its features. They care about the job or jobs they are trying to get done, and if you provide the best solution, they'll pay you for it. If you don’t, they'll move on to your competition faster than you can say, “job to be done.”

 So how does this all relate to market research?

Rather than framing your market research efforts on creating buyer personas and targeting them, frame them around jobs your customers are trying to get done. There'll be some natural overlap with personas, but you need not be wed to them.

Market segmentation

Market segmentation is the act of dividing a target market into groups (or segments). This lets you tailor your efforts to each segment, whether that be your marketing strategy or deciding on features for your product.

The four most common methods: 

Demographics: age, gender, ethnicity, income, industry, job

Psychographic: lifestyle, values, personality traits, interests

Geographic: country, region, city, town

Behavioral: spending habits, internet browsing habits

Depending on your situation, any of these might be useful focus points, and all of them no doubt provide valuable insight.

The benefits of segmentation include:

A better experience for customers: A better understanding of your customers can only really be a win-win. You’ll be able to tailor each part of your customer experience, from marketing message to product experience, based on their segment.

More targeted marketing: In other words, this means better use of your marketing resources. Rather than casting the net wide and crossing your fingers that you haven’t just thrown a lot of time and money away, your segments let you focus your efforts where they’re likely to have the most return.

Improved product development: Knowing the real demands of your target audience will allow for product development that they'll actually appreciate (read: pay for).

Developing a market research strategy

Now that you’re convinced of the importance of market research and how it can help your business, you’re probably pumped to get started. Having even a basic plan can be the difference between a piece of research that has a real and lasting impact on your business and gathering some interesting insights that are forgotten in two weeks. 

Always start with the question: Why? What’s the purpose of the research? 

Your objective shouldn’t be “to do some research,” nor should you select a method first, whether that be a JTBD-based questionnaire, customer interviews, etc. 

Make sure you’re always starting with a question you want to answer and adapt the method to the question.

Examples of questions to think about:

“How can we increase conversions?”

“Why are people churning after two months?”

“What is the appetite for this product?”

“Which product features are most useful to our customers?”

“In which region(s) should we focus our next marketing campaign?"

Let this always be front and center as you go about planning and executing your research.

Market research tips 

Do preliminary research: Have a basic understanding of the industry and the landscape you’ll be investigating. It doesn't have to be extremely in-depth, but it’s important to have a foundation. This ensures you ask the right questions, know what to assess, and can get a more accurate vision of the market.

Align with potential stakeholders: There may be others in your organization who could benefit from the data you're about to gather. It may be worthwhile checking around to see how you could maximize your research efforts. Even just one extra question on your survey might provide essential data for someone else.

Use the right tools for your market research purposes: Make sure that whichever tools you use are fit for purpose. As technology develops, market research automation becomes more important. Using the right tools won't only save you lots of time and energy; it's also essential for correct and high-quality data.

Market research questions

The questions you ask depend on your objectives. You should write market research questions that are purposeful and will help strengthen your relationship with your customers.

You should also consider running a test first, depending on the scale of your research. Sending your survey to a smaller population and analyzing the first few responses will let you check that you’re getting useful responses that are answering your research questions.

Sometimes, until we start getting results, we’re unaware that a question is ineffective. This may be because the question uses terminology not understood by the target audience. 

For example, you may ask, “What SaaS tools do you currently use?” If you get responses like “iPhone 11” and “desktop computer,” then you know you need to adapt your questions better to your audience! 

Here at Typeform, we sometimes send out test emails to smaller populations (around 10% of the target audience) for this purpose and adjust our surveys if necessary.

How many responses to collect for market research

400 is the magic number.

Well, no, in fact, there is no magic number, sorry.

Generally speaking, 400 is the standard recommended sample size—this just means the number of people who responded to your market research survey. 

But this number can vary greatly depending on your total population (i.e., all the people that this research will apply to) and the way you segment them. 

But there’s a mathematical explanation for the popularity of 400: With 400 responses, your margin of error is 5%. 

For example, say you got 400 customer responses to your market research survey. 80% of your respondents answered “yes” to the question, “Would you buy from us again?” That means there’s a 95% chance that in your total population of customers, around 80% would buy from you again.

Don’t forget that to reach your target sample size, you'll need to reach out to many more people! If sending out surveys by email, open rates tend to hover around 15-25% . The percentage of people who then go on to complete a survey will be even lower. 

To increase your chances of survey opens and completions, offering an incentive is never a bad idea. Prize draws or discounts on your product have worked well for us. And, of course, the experience of answering a market research survey is paramount for completions—make sure your form is user-friendly with a smooth and beautiful interface. 

Try to aim for a sample that'll be a good approximation of your overall population. There’s a risk of bias , depending on the channel through which your research survey is shared. For example, if you share it on social media, you might get a younger average age of respondents, which may not be accurately representative of your total population of customers.

Sample market research template

Below is a sample market research template for planning a piece of primary market data.

A brief summary of why this research was started:

What led to this research being done/requested? 

What needs to be validated or explored?

What's been done prior to this research? E.g., competitive analysis, brainstorming, previous research

What insights will this research generate? 

How will these insights be used?

Business/product objectives

We can't emphasize enough the importance of having a clear goal in mind. What metric(s) are you trying to enhance? E.g., more conversions, less churn. This helps people understand the bigger picture of this research.

State what decisions are going to be made or impacted based on the research. As a general rule, if you’re not prepared to make changes, don’t run the research.

Research objectives 

State the high-level objectives for this research. Try to keep it specific, actionable, and two to three points max. 

Research questions 

Provide a list of market research questions you plan to answer during this research (these questions are not the interview questions). 

Participant criteria 

List the primary characteristics of the people you'll recruit for the research, like:

Job(s) to be done

Also decide on the minimum and maximum number of participants you'll need for your study.

Taking action on market research insights

Remember, data isn't reality—however, market research can give you a pretty decent view of reality.

Data can also be unpredictable. Missing a small detail can skew ‌results significantly, so try to be as methodical and meticulous as you can.

Put our market research survey template to the test with customizable questions and design. Take your questionnaire to the next level with over 1 million photos, videos, and icons, or upload your own. Build your ultimate market research survey today with the help of Typeform.

Useful tools for market research

Demographic survey questionnaire template

User persona survey template

Competitor research tool for the SaaS industry

Margin of error calculator for sample size

Google Sheets

About the author

We're Typeform - a team on a mission to transform data collection by bringing you refreshingly different forms.

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Home Market Research

Importance of Market Research + Types & How to Plan it.

Market research will help you develop a successful marketing strategy. It is one of the reasons why market research is so important for organizations that want to make informed decisions. This article will highlight the relevance of market research and importance of market research.

For your products and services to be well-accepted by customers, you must know the choices and preferences of your target audience . Market research provides you with essential information about your competitors and existing products. 

The results offer you insights into what it would take to succeed in the market. Hence, organizations base their business decisions on good market research, such as sales and marketing strategies.

LEARN ABOUT: Market research vs marketing research

Market research helps reduce risk by allowing you to determine product features, pricing, and promotions from the outset. It also helps you focus resources where they will be most effective.

LEARN ABOUT: Marketing Insight

This blog will discuss the importance of market research, its types, and how to plan it for your business.

Content Index

What is market research?

Types of market research, the importance of market research for your business, how to plan market research, how questionpro helps in market research.

Market research is a systematic process of gathering, evaluating, and interpreting data. It is the basis of any business that does well. The data could be about a target market, customers, competitors, or the industry as a whole. The research serves a variety of reasons, ranging from identifying a new market to launching a new business.

Market research assists entrepreneurs in making sound business decisions. It may remove the guesswork from innovation and direct resources to the most promising ideas and projects. Different companies conduct market research for different purposes.

Businesses use various types of market research to gather information about their target market, competitors, and market research industry trends . There are two main types of market research: 

• Quantitative research.
• Qualitative research.

Quantitative research

Quantitative research focuses on generating numbers, for example, what percentage of the population buys a specific product. It is conducted using surveys and questionnaires. You can do simple quantitative research yourself by talking to customers. 

More detailed quantitative research can be used to identify markets and understand customer profiles while launching a new product.

Qualitative research

Qualitative research relies on facts and figures to discover what people think and feel about products and what factors affect their purchasing decisions. Researchers use surveys and focus groups to gather this information while interpreting the results is a job that requires certain research skills .

To learn more about the differences and characteristics of these types of research, we recommend reading Qualitative vs. Quantitative Research .

LEARN ABOUT: Qualitative Interview

You can also conduct secondary research using existing surveys and business reports. Use free online information on market size, sales trends, customer profiles, and competitor activity.

Your customer records can give you a wealth of knowledge about purchasing patterns, the most popular services among various demographic groups, etc. 

Market research can help you analyze key trends and predict how the market will change. Here are some of the reasons why market research is important for your business:

Identifies new products and services

Market research can assist you in determining what new products or services the market requires and how you can provide them. Key issues with developing a specific product or service can be identified, allowing you to avoid costly development mistakes. 

It also assists you in determining which factors are most important to customers and how to implement them into what you want to bring to market.

Identifies potential customers

Demographic information such as gender, age, income, occupation, and lifestyle can help you better understand your customer base. If you know who your current customers are, you can target them in the future. Marketing to the wrong type of customer can lead to poor product performance.

Establishes product or service viability

If your company plans to launch a new product or service, you must first determine whether the market is ready for it. Will the product be well received? Is the product required by the customers you want to reach? Will it be workable, and what are the chances of success?

Keeps your company ahead of competitors

Comparative studies are excellent for tracking your competitors’ progress compared to your company’s. 

If they are far ahead of you, this is an excellent opportunity for you to learn what they are doing differently than you. Business strategies can be developed to help you stay ahead of your competitors.

Reduces risk and enhances profitability

Knowledge can help reduce your company’s risks and determine which risks are worth taking based on past and future market trends. 

Market research help in determining market viability , lowering the risk of failure. Understanding your customers’ needs is also important for risk reduction. At the end of the day, lowering risk helps to increase profitability.

Helps to understand existing customers

Your customers are complex, and what they require previously may not be what they require now. To be successful, you must constantly monitor the pulse of your customer base. Market research can help you better understand your current customers. 

The market research also helps to determine customer satisfaction levels. If you discover their low satisfaction levels, you can figure out why and fix it. If it is high, you can figure out why and learn how to keep it that way.

Helps set realistic goals

You can set realistic goals by using current data about your market and customer base. Establishing a growth pattern over time lets you know what to expect in the future and how to really develop that growth. 

Setting attainable goals will save resources, succeed before you start, and miss out on better long-term goals for your company.

Effective market research starts with knowing what you are trying to accomplish and what information you need. You can do it yourself. 

For example, if you are considering buying or renting a store, you can analyze traffic levels at different times. Or you can talk to your potential customers.

However, to make good business decisions , you will need a more comprehensive approach. 

For example, if you conduct a market survey , you will need survey software to design a survey, customize the look and feel and generate reports. You might also want to integrate the tool with other CRM and marketing automation software. 

Survey software can let you export results in standard formats or share the reports with others. You can also create online surveys in multiple languages and let your respondents select the language of their choice.

One of the most important aspects of planning market research is asking the right questions. Design the survey such that it collects meaningful and high-quality data.

If you want to know more about how to do this, we recommend our article: How to Write a Market Research Plan?

LEARN ABOUT:  Test Market Demand

QuestionPro is a market research software platform that assists businesses in conducting various types of market research. It has market research tools to create, distribute, and analyze surveys and other research methods. QuestionPro can assist organizations with their market research in a variety of ways, including:

Surveys: QuestionPro has a full survey builder that lets organizations make their own surveys, add questions, and choose from a variety of question types, like multiple choice, open-ended, and rating scales.

Data collection: QuestionPro enables organizations to collect data via online surveys, email, web pop-ups, and mobile devices. It also provides a variety of data collection methods, including panel sampling, random sampling, and targeted sampling.

Data analysis: To assist organizations in gaining insights from their data, QuestionPro offers a variety of data analysis tools such as cross-tabulation, descriptive statistics, and inferential statistics .

Real-time data reporting: QuestionPro provides real-time data reporting, allowing organizations to monitor the progress of their research in real-time and make changes to their survey design as needed.

Integration with other tools: QuestionPro integrates with a variety of other tools, including Google Analytics, Salesforce, and Zapier, to provide organizations with a comprehensive view of their market research data.

QuestionPro offers businesses a comprehensive platform for conducting market research and gaining valuable insights into their target audience, competitors, and industry trends. It enables businesses to make informed decisions based on data-driven insights.

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Market research should be well-structured, concise, and provide useful insights to help the organization make informed decisions. It should also serve as a starting point for future research and assist organizations in identifying areas for improvement in their business strategies.

Market research is an important component that summarizes the research findings and insights. It gives you a clear picture of the market and its trends, consumer behavior, and the overall competitive landscape.

If you are interested in conducting online survey research, QuestionPro can help you. Request a demo and learn how our survey software works and the advantages of using it in your next market research. Get started today!

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5 reasons why marketing research is important to your business

Marketing research is a critical tool that businesses and organisations use to gather valuable information about their target market and industry. By conducting research, companies can gain insights into customer needs, preferences, and behaviour, as well as market trends and the competitive landscape. In this article, we'll explore five reasons why marketing research is important for businesses and organisations.

5 reasons why marketing research is important

Is your company on the fence about investing in marketing research? If so, read on for five reasons why marketing research is important to the viability and longevity of your business.

1. Marketing research helps businesses understand their customers.

Knowing your customers is the first step in running a successful business. And while this may sound simple enough, it can be difficult to look inside the consumer psyche—one whose needs, preferences, and behaviours are ever-evolving.

Fortunately, marketing research can give you a peek behind the curtain, helping you understand what motivates current as well as potential customers. A marketing research survey , for example, can provide insight into pricing sensitivity among a segment of your target population. The data yielded may suggest that boomers are more likely to purchase a product based on price alone while millennials are more motivated by the values of the respective company. Based on this information, you can tailor your offerings to better meet these needs.

Let’s take a closer look at what else marketing research can tell you about your target audience.

a. Marketing research reveals demographic data.

Through conducting surveys, you can better understand characteristics of your buyers, like age, gender, race, and ethnicity. You can also collect socioeconomic information like education, income, and employment status. These variables can help you engage in audience segmentation, which essentially involves tweaking your brand messaging to appeal to various subgroups.

b. Marketing research illustrates purchasing behaviour.

Marketing research tools like surveys, transaction tracking, and social media tracking can also shed light on when, why, how, and what consumers are buying. A better understanding of purchasing behaviour can help your company develop brand messaging that strikes a chord with its target audience. If consumers tend to shop between the hours of 5 and 8 p.m., for instance, your company may send an email coupon at 4:45 p.m. to prime that behaviour.

c. Marketing research helps companies appeal to potential customers.

It’s important to learn as much as possible about your current customers. However, it’s equally important to learn about people who are at the beginning of the customer journey. A deeper understanding of what motivates these individuals can help your business turn clicks into conversions.

2. Marketing research helps businesses manage risk.

Risk is an intrinsic part of the business world. However, by understanding market trends and customer behaviour, businesses can anticipate changes in demand and adjust their strategies accordingly. Market research can also help businesses identify potential obstacles or challenges and develop contingency plans to mitigate those risks.

For example, let’s say a company hopes to introduce a new product to the market. Before investing significant time and financial resources into product development, market researchers may conduct a series of surveys to determine if consumers are even interested in the respective product. This mitigates the risk of introducing a good for which there is no demand.

Other examples in which marketing research can be used as a tool for mitigating risk include:

• Conducting ad testing to determine if brand messaging resonates with consumers
• Hosting product development focus groups to receive feedback before revealing a new product to the larger market
• Organising customer satisfaction surveys at various points of the customer journey to determine any issues affecting sales
• Administering price testing to determine the ideal price for a new product

3. Marketing research helps businesses stay competitive.

Marketing research gives companies a competitive edge in many ways, one being a greater awareness of the industry itself. By understanding what other businesses are doing, your company can develop strategies to differentiate itself and stay ahead of the curve. For example, if research indicates that laundry detergent manufacturers are increasing prices, a company can either decide to a) keep up with the times and increase costs, b) keep costs the same, or c) decrease pricing to appeal to a specific target market.

Marketing research also helps companies determine areas where they may be falling behind. If several healthcare conglomerates are expanding telehealth services, it would be wise for a hospital to also make moves to provide digital appointments. Otherwise, patients may take their business elsewhere.

How else can marketing research help your business stay competitive?

a. Marketing research aids in trendspotting.

It’s important for companies to keep up with industry patterns. However, it’s also important for companies to predict patterns before they even happen. The fashion industry provides a good example of this. Trend forecasters analyse decades—centuries even—of socio-cultural data in an attempt to be the first company to put out a ‘hot’ new product that appeals to modern sensibilities.

b. Marketing research allows businesses to identify gaps in the industry.

Similarly, marketing research can help companies realise a demand that has yet to be satisfied. Through marketing research surveys, for instance, an organic snack food company may see that consumers are craving more savoury gluten-free snack options. Using this data, the company can one-up competitors by introducing a new product.

4. Marketing research gives businesses the tools to measure success.

Net profit is an important indicator of a company’s success. However, if profits are plummeting, it can be difficult to know if this is because of your company’s performance or industry-wide factors like increased materials costs and decreased demand. Because of this, businesses must rely on a more holistic approach to evaluating success.

Fortunately, marketing research can be a helpful tool if you want to measure business health using more than dollar signs. Here’s how marketing research can help you gauge company success.

a. Marketing research provides insight into customer satisfaction.

Sure, your company could be making money. But if your customers aren’t satisfied, your financial gains are likely to be short-lived. To determine if customers are happy with your products or services, you can conduct a customer feedback survey questionnaire.

Alternatively, you may choose to conduct a longitudinal panel survey . Unlike an ad hoc survey, which takes a snapshot of consumer opinions and behaviours, longitudinal studies (like monthly or quarterly trackers) monitor how consumer attitudes change over time. This tool is especially helpful if you want to see how customer satisfaction changes after the introduction of new protocols or training methods.

b. Marketing research helps businesses assess employee satisfaction.

A financially profitable company isn’t necessarily successful if its employees aren’t satisfied. To assess this metric of success, you can conduct surveys, in-person interviews, or focus groups. The results from these marketing research assessments may also shed light on the efficiency of your staff.

c. Marketing research provides insight into the performance of competitors.

It can be constructive to compare your company’s performance to that of competitors. This can help you understand if dips or rises in profit are unique to your company or simply an industry trend.

5. Marketing research helps businesses make informed decisions.

For decades, companies have made key business decisions based on gut feelings alone. But the new age of marketing revolves around data-driven decision-making: a process in which business decisions are informed by metrics and analytics. This contemporary model helps companies make solid choices that reduce risk while improving performance.

Since marketing research lends itself to data generation, it’s an integral part of this equation. For example, data yielded from a brand awareness survey may illustrate that men aged 50 to 65 in a specific geographic area are the least familiar with the brand. Using this information, the company can invest marketing dollars in a way that will yield true results.

Other examples of using marketing research to support data-driven decision-making include:

• During a focus group, a company discovers that 60% of women are dissatisfied with the playback speed options of an audiobook app. In response, software developers dedicate time and financial resources to adjusting that feature.
• Survey data reveals that as the price of microwaves increases, so does customers’ perceived value of the product. With this in mind, a company chooses to increase prices by 30%.
• A popular food chain conducts a series of phone interviews to assess customer service at various locations. Afterward, the company mandates that employees at the restaurants with the lowest reviews take customer service training courses.

All this to say, marketing research has many different applications. By gathering data about customer preferences, market trends, and industry dynamics, businesses can make decisions based on facts rather than assumptions or intuition. This can help businesses avoid costly mistakes and increase their chances of success.

Conduct high-quality marketing research with Kantar

Marketing research is a critical tool that businesses and organisations can use to gather valuable information about their target market and industry. By conducting research, businesses can gain insights into customer needs and behaviour, stay competitive, make informed decisions, manage risk, and measure success.

And during VUCA times (volatile, uncertain, complex and ambiguous), keeping a consistent pulse on consumer sentiment and behaviour is essential to driving the right decisions for business growth.

However, in today's rapidly changing business landscape, marketing research can feel complicated and overwhelming. That’s where Kantar comes in. As an industry leader, we provide tips and tools to help you navigate each step of the marketing research process, from survey design to data visualisation.

Want to get started? Speak to our award-winning team  to learn how we can help you conduct marketing research.

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What is Marketing Research? Examples and Best Practices

12 min read

Marketing research is essentially a method utilized by companies to collect valuable information regarding their target market. Through the common practice of conducting market research, companies gather essential information that enables them to make informed decisions and develop products that resonate with consumers. It encompasses the gathering, analysis, and interpretation of data, which aids in identifying consumer demands, anticipating market trends, and staying ahead of the competition.

Exploratory research is one of the initial steps in the marketing research process. It helps businesses gain broad insights when specific information is unknown. If you are seeking insight into how marketing research can influence the trajectory of your SaaS, then you have come to the right place!

• Market research is a systematic and objective process crucial for understanding target markets, refining business strategies, and informing decisions, which includes collecting, analyzing, and interpreting data on customers, competitors, and the industry.
• Primary market research gathers specific data directly from the target audience using tools like surveys and focus groups, while secondary market research utilizes existing data from various sources to provide broader market insights.
• Effective market research combines both qualitative methods, which explore consumer motivations, and quantitative methods, which provide measurable statistics, to create comprehensive insights that guide business strategy and decision-making.

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Defining marketing research

Launching a product without knowing what your target audience wants is like walking in the dark. Market research lights the way, helping you collect, analyze, and understand information about your target market. This allows you to refine your business strategies and make decisions based on solid evidence.

Gone are the days when just intuition or subjective judgment was enough. Objective insights from market research help avoid costly mistakes and meet consumer needs by identifying trends and changes in the market. This is crucial for assessing a product’s potential success, optimizing marketing strategies, and preparing for market shifts.

Market research is a systematic approach that provides essential information, helping businesses navigate the complexities of the commercial world. Partnering with market research companies can offer additional benefits, leveraging their expertise in understanding market demands, trends, market size, economic indicators, location, market saturation, and pricing. Whether starting a new business, developing products, or updating marketing plans, understanding how to conduct effective market research is key to success.

To conduct market research effectively, businesses must determine study goals, identify target consumers, collect and analyze data, and use the findings to make informed decisions. This process is vital for evaluating past performance, measuring changes over time, and addressing specific business needs. It guides businesses in product development, marketing strategies, and overall decision-making, ensuring a better ROI and providing an eye-opening view of the market through various research methods, whether conducted in-house or outsourced.

The purpose of marketing research

Conducting marketing research is more than just gathering data; it’s about turning that data into actionable insights to refine your business strategies. This process helps you understand what motivates your customers, enabling you to tailor your products and services to minimize risks from the start. Importantly, market research plays a pivotal role in measuring and enhancing customer satisfaction and loyalty, which are critical for understanding key demographics, improving user experience, designing better products, and driving customer retention. Customer satisfaction is measured as a key outcome, directly linked to the success of marketing strategies and business activities.

For SaaS product managers, market research, including competitive analysis, is crucial. It evaluates past strategies and gauges the potential success of new offerings. This research provides essential insights into brand strength, consumer behavior, and market position, which are vital for teams focused on sales, marketing, and product development.

A key aspect of market research is analyzing customer attitudes and usage. This analysis offers detailed insights into what customers want, the choices they make, and the challenges they face. It helps identify opportunities in the market and aids in formulating effective strategies for market entry.

Overall, market research equips SaaS entrepreneurs with the knowledge to meet their target audience’s needs effectively, guiding product adjustments and innovations based on informed decisions.

Key components of market research

Conducting market research is analogous to preparing a cake, requiring precise ingredients in specific quantities to achieve the intended outcome. Within this realm, necessary components consist of primary and secondary data gathering, thorough analysis, and insightful interpretation.

Primary research techniques such as exploratory studies, product evolution inquiries, estimations of market dimensions and shares, and consumer behavior examinations play a crucial role in collecting targeted information that can be directly applied. These methods afford a deeper understanding of your target demographic, allowing for customized strategy development.

In contrast, secondary research enriches the specificity of primary findings by adding wider context. It taps into external resources encompassing works from other investigators, sector-specific reports, and demographics data, which provide an expansive yet less particularized landscape view of the marketplace.

The subsequent phase involves meticulous analysis of collated data offering unbiased perspectives critical for identifying deficiencies while recognizing emerging patterns. Technological progress now facilitates examination efforts on both structured and unstructured datasets effectively addressing large-scale analytical complexities.

Ultimately, it’s through expert-led interpretation that value transcends raw figures, yielding strategies grounded in deep comprehension. Akin to decoding recipes using selected ingredients—this interpretative step enables crafting optimal business maneuvers just as one would bake their ideal confectionery creation utilizing proper culinary guidance.

Types of market research: primary and secondary

Now that you know the importance of clear research objectives, let’s explore the different types of market research and the techniques available to achieve these goals. Market research methods can be divided into two main categories: primary research and secondary research . The choice between these depends on factors like your budget, time constraints, and whether you need exploratory data or definitive answers.

Primary research involves collecting new data directly from sources. This process is like mining for precious metals, as it requires using various methods to gather fresh insights.

• Surveys (here – in-app survey templates from Userpilot ).

• Interviews.

• Focus groups.
• Product trials.

This approach gives you first-hand insight into your target audience.

Conversely, secondary research uses already established datasets of primary data – which can add depth and reinforcement to your firsthand findings.

Conducting your own market research using primary research tools can be a cost-effective strategy, allowing businesses to gather valuable insights directly and tailor their research to specific needs.

Let’s look a bit deeper into them now.

What is primary market research?

Market research uses primary market research as an essential tool. This involves collecting new data directly from your target audience using various methods, such as surveys , focus groups, and interviews.

Each method has its benefits. For example, observational studies allow you to see how consumers interact with your product.

There are many ways to conduct primary research.

Focus Groups : Hold discussions with small groups of 5 to 10 people from your target audience. These discussions can provide valuable feedback on products, perceptions of your company’s brand name, or opinions on competitors. Additionally, these discussions can help understand the characteristics, challenges, and buying habits of target customers, optimizing brand strategy.

Interviews : Have one-on-one conversations to gather detailed information from individuals in your target audience.

Surveys : These are a common tool in primary market research and can be used instead of focus groups to understand consumer attitudes. Surveys use structured questions and can reach a broad audience efficiently.

Navigating secondary market research

While marketing research using primary methods is like discovering precious metals, secondary market research technique is like using a treasure map. This approach uses data collected by others from various sources, providing a broad industry view. These sources include market analyses from agencies like Statista, historical data such as census records, and academic studies.

Secondary research provides the basic knowledge necessary for conducting primary market research goals but may lack detail on specific business questions and could also be accessible to competitors.

To make the most of secondary market research, it’s important to analyze summarized data to identify trends, rely on reputable sources for accurate data, and remain unbiased in data collection methods.

The effectiveness of secondary research depends significantly on how well the data is interpreted, ensuring that this information complements the insights from primary research.

Qualitative vs quantitative research

Market research employs both qualitative and quantitative methods, offering distinct insights that complement each other. Qualitative research aims to understand consumer behaviors and motivations through detailed analysis, while quantitative research collects measurable data for statistical analysis.

The selection of qualitative or quantitative methods should align with your research goals. If you need to uncover initial insights or explore deep consumer motivations, qualitative techniques like surveys or interviews are ideal.

On the other hand, if you need data that can be measured and analyzed for reliability, quantitative methods are more suitable.

However, these approaches don’t have to be used separately. Combining qualitative and quantitative methods in mixed-method studies allows you to capture both detailed exploratory responses and concrete numerical data. This integration offers a comprehensive view of the market, leveraging the strengths of both approaches to provide a fuller understanding of market conditions.

Implementing market research tools: Userpilot’s role

Similar to how a compass is essential for navigation at sea, businesses need appropriate instruments to carry out effective market research. Userpilot’s suite of product analytics and in-app engagement tools are critical components for this purpose.

Acting as a Buyer Persona Research instrument, Userpilot’s product analytics provide key quantitative research capabilities. This helps clearly define and comprehend the attributes and behaviors of potential customers, providing you with insights into your ICP (Ideal Customer Persona), user preferences, and product-market fit.

Beyond product analytics, Userpilot offers robust in-app engagement features such as modals and surveys that support real time collection of market research information. These interactive features work synergistically with the analytical tools to enable companies to gather detailed data and feedback crucial for informed business decision-making.

Marketing research process: Step-by-step guide

Marketing research conists of several critical stages:

• Defining precise goals.
• Delving into the knowledge of your target demographic.
• Collecting and scrutinizing data.
• Revealing insights that can be translated into tangible actions.

Following these steps allows you to gather critical information that guides business decisions.

An effective research strategy is crucial and involves:

• Properly allocating funds.
• Formulating testable hypotheses.
• Choosing appropriate methods for the study.
• Determining the number of study participants.
• Considering external variables.

A well-planned strategy ensures that your market research is focused, efficient, and produces useful outcomes.

After collecting data, the next step is to analyze it. This involves comparing the data to your initial questions to draw conclusions relevant to your business strategies.

Userpilot makes your data analysis easier by providing handy analytics dashboards for key user metrics such as activation, engagement, core feature adoption, and retention out of the box:

Finally, you report the findings and the process, providing recommendations based on the evidence. This is like solving a puzzle: each piece helps to complete the overall picture.

Challenges and best practices in market research

Delving into market research comes with its own set of hurdles. Those conducting the research must deliver more profound insights within increasingly shorter timespans, and they need to cultivate strategic, continuous research methods to stay abreast of an ever-changing business landscape.

Ensuring high-quality data can be demanding due to issues such as disjointed tools or insufficient analytical expertise. New solutions like Userpilot are surfacing that make these obstacles less daunting by offering accessible and user-friendly options. Maintaining clear lines of communication with your market research team is crucial for achieving both punctuality and quality in outcomes.

The advantages of engaging in marketing research cannot be overstated.

Real-life examples of successful market research

Real-life examples of market research in the SaaS industry often showcase innovative approaches to understanding customer needs and product-market fit.

For instance, Slack, the communication platform, utilized extensive market research to identify gaps in communication tools and understand the workflows of teams. This led to the development of features that seamlessly integrated with other tools and catered to the needs of various team sizes and structures.

Another example is HubSpot, which conducted market research to understand the pain points of small to medium-sized businesses in managing customer relationships. The insights gained helped shape their all-in-one inbound marketing, sales, and service platform, which has become integral to their users’ daily operations. These examples demonstrate how SaaS companies can employ market research to inform product development, improve user experience, and strategically position themselves in a competitive market.

Choosing the right market research tools

For B2B SaaS product managers aiming to do market research, having the right set of tools can make a significant difference. Here’s a list of valuable SaaS tools that can be leveraged for effective market research:

• Userpilot : A comprehensive Product Growth Platform offering in-depth product analytics, a code-free in-app experience builder, bespoke in-app survey capabilities, and robust integration options with platforms like Salesforce and Hubspot. This tool is particularly useful for understanding user behavior, enhancing user engagement, and gathering targeted feedback.
• Qualtrics : Known for its powerful survey tools, Qualtrics helps businesses gather and analyze customer feedback effectively. Its advanced analytics features are ideal for testing market hypotheses and understanding customer sentiments.
• SurveyMonkey : A versatile tool that enables product managers to create, send, and analyze surveys quickly and easily. SurveyMonkey is suitable for gauging customer satisfaction and collecting feedback on potential new features.
• Mixpanel : Specializes in user behavior analytics, offering detailed insights into how users interact with your product. This is essential for identifying patterns and optimizing product features.
• Hotjar : Combines analytics and feedback tools to give teams insights into user behavior and preferences. Hotjar’s heatmaps and session recordings are invaluable for understanding the user experience on a deeper level.
• Tableau : A leading platform for business intelligence and data visualization, Tableau allows product managers to create comprehensive visual reports that can inform strategic decisions based on user data analysis.

Each of these tools provides unique functionalities that can assist SaaS product managers in conducting thorough market research, thereby ensuring that their products are perfectly aligned with user needs and market demands.

Measuring the impact of market research

The pivotal challenge for market research lies in demonstrating its return on investment (ROI) and overall influence on corporate success sufficiently enough to justify regular financial commitment from company leaders. The worth attributed to a market research firm hinges not only on their ability to deliver relevant and high-caliber information, but also on their pricing structures and their contribution towards propelling organizational growth.

To gauge how effectively business choices made based on market research findings succeed, various metrics and key performance indicators (KPIs) are utilized. These numerical tools act as navigational aids directing enterprises toward achieving objectives while simultaneously verifying that efforts invested in conducting market analysis are yielding fruitful guidance.

Throughout our look at market research, we’ve seen its importance and impact. Our discussion covered the basics of market research, its key components, and different types, including both qualitative and quantitative methods, and the role of Userpilot’s tools. We’ve examined the details of the market research process, tackled challenges, identified best practices, and shared success stories. We also provided advice on choosing the right market research partner and how to measure the effectiveness of your market research.

In today’s data-driven world, comprehensive market research is crucial for companies that want to succeed. It acts like a guide, helping businesses navigate the complex market landscape. Start your own detailed research today, supported by insightful analytics to help you succeed.

Frequently asked questions

What is market research and why is it important.

Understanding your target market, honing business strategies, and making informed decisions are all essential components that depend heavily on effective market research. It offers objective insights to help avoid expensive errors and foresees the needs of customers .

What is the difference between primary and secondary market research?

Primary market research is characterized by the direct gathering of data, in contrast to secondary market research which leverages existing information from alternative sources for addressing research inquiries.

Such a distinction can guide you in selecting an approach that aligns with your precise needs for conducting specific research.

What are some examples of successful market research?

Examples of successful market research are evident in the operations of well-known companies such as Starbucks, Apple, and McDonald’s. They have harnessed this tool to fine-tune their business strategies and make decisions based on solid information.

By employing market research, these businesses have managed to gain insight into their customers’ desires and needs, which has contributed significantly to their success.

How can I choose the right market research partner?

Selecting an ideal market research ally involves identifying a firm that resonates with your project requirements, financial plan, and corporate goals while also verifying their track record of dependability and consistency via reviews from previous clients.

Best wishes on your endeavor!

How is the impact of market research measured?

The effectiveness of market research hinges on the precision, representativeness, and pertinence of its data, along with how successful business decisions are when they’re based on the findings from this research. These elements define the impact of the research conducted.

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Why is market research important? Here are 7 reasons

Doing your own market research on a regular basis is essential for keeping up with current market trends and maintaining a competitive edge. Whether you are starting a new business, expanding, or developing new products, conducting market research is essential. It helps you to understand your target market, increase sales, and spearhead business growth. In this article, we share 7 reasons why you should be investing in market research .

Use Netigate to send your market research surveys .

1. Identify new customers

In order to identify potential new customers, you must first understand who your customers are. You will also need to know key demographics.

When looking at your product or service, it’s important to consider questions such as:

• Who will use your product or service?
• What is the age range of your customers?
• What is their income level, marital status, and geographical location?

Using market research to understand these factors will enable you to target customers more effectively.

• Create surveys based on our templates
• Send surveys via email, links, API or individual logins
• Analyse responses with filters & AI

2. Get to know your existing customers

Similar to the above point, you should also take the time to understand who your existing customers are. Here are some questions to ask:

• Why do your customers choose your products over your competition?
• How do your customers use your products?
• How do your products solve a challenge?
• Who or what influences their purchase decisions?
• What do your customers enjoy doing, watching, and reading?

Understanding how your existing customers use your products as well as what challenges your products solve will help businesses improve their products as well as identify upsell opportunities with existing customers.

3. Set realistic targets for your business

Now that you are armed with information about your target customers and existing customers, you can use this data to set achievable and realistic goals for continuous improvement and business growth.

Being customer-centric in your approach is essential in today’s business climate. The most common approach in market research is to use an STP model: Segmentation – Targeting – Positioning.

Segmentation : Who will your product appeal to in terms of demographic, location, or other factors?

Targeting : How can you target and reach those sectors that your products appeal to?

Positioning : How can you position yourself in front of your competitors as your target market’s choice?

4. Develop new and effective strategies 

Data from market research will help you to make more informed decisions. For example, relating to pricing, distribution channels, marketing mediums, or to identify opportunities to introduce a new product or service. These results will also help you to make more informed decisions about your existing operations and activities.

• Should you expand or reduce?
• Is there room in your current operations to diversify?
• Are you targeting the right audience with your marketing activities

Casio used market research to get better insights on customers & resellers and adjusted the marketing strategies to be more effective.

5. Solve your biggest business challenges

If you have already identified a problem in your business, conducting market research will help you determine the source of the issue. For example, you can determine if a new competitor has entered the market or if brand awareness has fallen short, causing a decrease in sales. There are several types of market research that can help you identify different shortcomings: brand research, consumer research, product development and usability testing, consumer research, and many other areas.

Get started with our free market research survey templates.

6. Investigate expansion opportunities

Market research helps you identify areas for possible business expansion. Given that it offers the opportunity to test markets to determine if there is room for a new product or service. You can also conduct market research to find the best location to open a new store.

7. Identify how to expand your offering

Market research may help you discover new markets that are under-serviced or in demand. For example, you can identify changing market trends due to new housing construction, increased levels of education, or other changes that will bring new opportunities for your business.

All in all, market research isn’t just for new startup businesses. Businesses of all shapes, sizes, scope, industry and experience levels can benefit from market research. Market research can help you to learn about new and existing customers, identify issues and solve problems, and even help explore new opportunities that pave the way for business growth.

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Market research: an important investment for long-term viability.

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Rick Kelly is the Chief Strategy Officer at Fuel Cycle . His passion is helping brands unlock the power of customer intelligence.

Businesses must future-proof themselves to endure an ever-changing economic landscape. Focusing on creating value both internally and externally through strategic planning is crucial for a brand's long-term success. Companies that prioritize market research as a fundamental function, rather than a mere expense, have a higher likelihood of thriving amid economic uncertainty.

Traditional market research, however, is often neither scalable nor fast and is often detached from decision-making processes. To stay competitive and gather relevant insights, organizations should consider embracing cutting-edge approaches and technological advancements in the market research sector.

The Future Of Market Research And The Role Of Data

Data has transformed the way companies approach future-proofing. Employing the right tools to collect valuable insights is crucial for businesses seeking long-term viability and brand success.

Market research enables businesses to:

1. Better comprehend their target audience's demographics and segment customers effectively.

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2. Study competition and recognize market trends.

3. Guide product development and collect feedback from usability testing.

4. Assess the effectiveness of current marketing campaigns.

5. Develop powerful future marketing campaigns.

However, the life cycle of data's value has dramatically decreased. The driving force behind the speed of insights is the realization that if they take too long to generate, they may already be outdated upon arrival. It's essential for organizations to comprehend the context in which data exists, as context helps to inform the adjustments necessary for effective audience engagement.

Companies skimping on insight investment may suffer serious blows to brand perception. In fact, companies that embrace a customer-centric approach are 60% more profitable than companies that don't (pg. 5).

A lack of insights investment creates conflicts between consumer and brand alignment. Customer loyalty plummets— 80% of customers say they're more likely to switch brands after just one bad experience.

Market research leveraging real-time data creates an impact that teams can multiply exponentially through its potential to help organizations identify and address issues, pivot and even change business models.

Integrating Market Research Into Business Strategy

Gathering and utilizing market research data isn't as easy as it sounds. It can present several challenges and limitations that should be considered to maintain a balanced perspective and build trust with customers.

One challenge is the availability and accessibility of accurate data. Finding relevant and up-to-date information can be difficult depending on the industry or target market. Additionally, the quality and reliability of the data sources need to be carefully evaluated to ensure their credibility.

To start with market research, define your objectives and questions. This will guide your research efforts. Conduct an internal analysis of your business, including goals, target market and competition, to develop a research plan aligned with your strategy. Then, explore data collection methods.

Here are some key approaches.

1. Employing Online Communities: Online communities provide an invaluable source of ongoing insights from predetermined customer bases, allowing market researchers to gather the information that informs product development, gauges customer loyalty and drives innovation.

2. Focusing On Speed And Convenience In Online Community Tools: To deliver value for consumers in online communities, ensure that they are user-friendly and efficient, offering comprehensive data analytics tools, advanced qualitative research capabilities and customizable platforms.

3. Fostering Innovation: Market research should strive for continuous improvement by investing in UX research, DIY market research tools and refining AI technologies to enhance market research capabilities, improve customer experience and boost sales.

Embracing A New Mindset For Market Research

It is crucial to shift the perception of market research from an unnecessary expense to an indispensable function. Investments in research are integral to a company's operation, enabling them to identify growth opportunities and outperform competitors.

Traditional market research approaches often fall short in terms of scalability and speed while remaining too disconnected from decision-makers.

To thrive in a rapidly changing landscape, businesses must closely monitor customer sentiment by leveraging comprehensive data gathered from a centralized hub of market research tools, methodologies and intelligent processes that are designed to deliver actionable insights from a single source of truth.

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Why is Market Research so Important .

Firstly, we should clarify “What is Market Research?” It can be described as the action of gathering, analysing and interpreting information to help solve marketing challenges. We use market research for a variety of reasons, it helps us make educated decisions for example determining the feasibility of launching a new product before dedicating time and budget into the new venture.  Market research is a vital element when developing your marketing strategy. When done correctly it can help to enlighten your marketing activities – such as understanding the requirements of your target audience, helping to understand what key messages you should convey and how to convey them.

It should be treated as an ongoing activity – you should always be learning about your business environment, your customers and their needs and preferences. The environment is constantly changing so it’s important to make sure you are researching it and understand what factors are changing that could impact on your marketing plans.

Without market research we are reliant on instinct and anecdotal information to make key business decisions, this is not always accurate.

What types of Market Research can you do?

Ultimately, you want to gain deep insights through market research, there are multiple types of research you can do to get the best insights, depending on what you want to know.  Some of the most common types of market research activities include:

• Brand Research
• Campaign Effectiveness
• Competitor Research
• Consumer Research
• Customer Segmentation research
• Product Development
• Usability testing

Market research involves two central types of research:

Primary Research – this can often be referred to as “field” research and involves gathering new data, first-hand, that has not been collected before.

Secondary Research – is sometimes referred to as “desk” research and involves gathering data that has already been compiled and organised for you. It includes reports, government funded studies, textbooks, historical records and statistical databases.

Within these types of research methods there are a few different types of data collection methodologies that can be used, such as:

• Qualitative research , which is an exploratory approach and uses activities such as focus groups, in-depth interviews and Ethnographic research – which involves participant observation as part of field research.
• Quantitative research uses objective measurements and numerical analysis of data that is collected through research methods such as surveys, polls and questionnaires.

How to conduct Market Research:

You should always ensure the end goals and objectives are clear. Your target audience, business objectives, challenges and end customer should be at the heart of it.

• Set out clear objectives and goals before beginning the research.
• Identify your target audience and market size.
• Make sure your sample size is representative of the audience you are targeting. This means there should be enough respondents in the research sample that reflect, as accurately as possible, the larger target audience population.
• Choose the most suitable market research and data collection methodologies based on objectives.
• Create your research questions – this is applicable regardless of which data collection method you choose.
• Ensure the questionnaire is neutral and is not leading. Remain impartial throughout the process.
• Build in questions that validate other parts of the questionnaire.
• In a qualitative focus group setting include open ended questions and allow for flexibility for respondents to freely speak on a topic that might not have been covered in the questionnaire.
• Once data have been gathered employ robust analysis skills to interrogate and decode the findings.
• When research findings are determined, make sure to not take these in isolation. Examine the macro environment also (such as language, cultural, economic, political situations) to validate the findings.

Does Market Research work?

In short yes, absolutely. There are enough examples out there of product and business failures simply because enough market research was not done from the outset. Planning to launch a new product, or export to a new market without adequate research is a recipe for disaster. You need to really understand your customers and your competitors before making such a leap.

With more and more companies exporting to many global locations it’s important to be aware of the cultural and language differences in those markets. So, while research in one geographic location will yield certain results this may not be replicated in another location.  The famous KFC case, where their company slogan “ Finger Lickin’ Good ” translated as “ Eat Your Fingers Off ” in Chinese is a great example of this.

However as per point 10 above, while market research will help determine our marketing strategy and focus where our marketing efforts should lie, they should not be taken in isolation. Take the famous “ New Coke ” example from the 1980s. While research and focus groups were extremely favourable of the new coke flavour, it failed to understand the significance of the brand affinity and nostalgia that consumers had with the original taste of Coke. In this instance the wider environment and brand impact should have been taken into consideration before making the final business decision.

Used correctly, market research is a powerful tool to help minimise the risks involved when making key business decisions.

How Market research can help your marketing strategy:

Market Research can significantly help your marketing strategy as it helps to provide key insights and information to the business. It can provide a deeper understanding on your customer and competitors. Research will help to understand who is buying your product or service, who is not buying your product or service, what motivates them, and whether they are loyal to your brand – ultimately leading to increased sales over time.

Similarly understanding the wider market environment can help identify new opportunities for your business. As the market changes its important to continue to research and understand ways you can improve on your offering based on the changing consumer preferences or market dynamics.

While there were many factors involved in why Nokia had such a spectacular fall from grace within the electronics market, ultimately, they failed to research and understand the changing market trends. They were late to the market with new innovations, while their competitors, customer preferences and technology were advancing so fast. Others such as Samsung, Sony and Apple iPhone moved in and quickly became some of the leading electronics brands in the world.

Conclusion:

It is clear that market research is vital when developing your marketing strategy. It provides great insights to your business and on the wider marketplace. Market research can identify how customers and potential customers might view your business and identify gaps in customer expectations. This is powerful information to have when completing your marketing strategy. Having good market intelligence helps to minimise risks when making key business decisions.

There are too many benefits to conducting good market research for it to be ignored as part of your marketing strategy.

To learn more about market research, please send an email to [email protected] or feel free to contact us on +353 91 739450

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What is customer experience? How to craft a CX that wins and retains clients

Customer experience (CX) examines the actions in a potential customer’s shopping journey. In this guide, we cover why it’s crucial for businesses to foster an excellent CX, how to measure it, ways to improve the customer experience and explore customer experience management. 

What is CX?

CX concerns every facet of a customer’s interactions and experiences with an organization during the client journey. This includes aspects, such as initial awareness of a product or service; touchpoints with team members; and the feelings, emotions, and perceptions a client has about a company. 

Why is customer experience important?

Consumer-facing businesses must strive to build an exceptional CX to drive sales, retain customers, and forge a positive reputation for their brand. Here are a few reasons why a top-notch CX is paramount: 

• Competition: Most organizations face fierce competition in their market. Having a strong CX makes you stand out from the crowd because customers can expect to be heard and taken care of. 
• Reputation: Customers leave reviews and talk about the experiences they have with brands. When someone Googles your company, you want them to read about positive impressions others have had with your brand so they feel comfortable trusting you to meet their needs. Plus, having a great reputation fosters word-of-mouth referrals that drive more customers to your business. 
• Customer loyalty and retention: When customers know they can expect an unparalleled experience, they are less likely to move to a competitor. This helps companies build clientele and grow revenue while reducing churn rates .

Insights from Pam Dodrill, Chief Customer Officer at Reputation

“Customer experience is the most important opportunity for business growth and brands must prioritize it to remain competitive. Consumers lead their buying experiences and no longer trust a sales pitch or a traditional brand message. They conduct research via reviews and social media, expecting a seamless experience. If they aren’t happy with their experience, they’re not afraid of telling the world. Delivering a strong customer experience is your best chance at gaining both repeat and new business.”

How to measure customer experience

Teams must measure their customer experience with various methods to ensure it is steadily improving and meeting customer’s needs and expectations. Here are some of the top ways to measure CX: 

• Net Promoter Score (NPS): This is a survey companies use to analyze customer loyalty using a scale of 1-10 that measures the likelihood a client will recommend the business to others. A higher NPS score indicates a better CX. 
• Customer churn rate: This measures the percentage of customers who stop using your products or services during a set period. Companies seeing an increasing churn rate should examine strategies for improving their CX. 
• Mapping customer journeys: Analyzing the touchpoints in the customer journey, or sales pipeline , allows teams to visualize particular pain points and work on methods to streamline parts of the buying process. For example, if leads get stuck for weeks in the negotiation phase of the purchasing process, it could be that sales representatives don’t answer questions about pricing during this period and hot leads become cool. 
• Customer satisfaction surveys (CSATs): CSAT surveys measure CX by asking customers to rate their level of satisfaction on a scale of 1-5. Often, they are administered after a purchase or after solving a customer service inquiry.

Many customer relationship management (CRM) systems offer integrations that track CSAT and NPS scores automatically, putting some CX and customer retention measurements on autopilot.

How to improve customer experience

Consider the following tips to foster an exceptional customer experience that helps brands stand out from competitors: 

• Leverage omnichannel support tools: Make it simple for clients to reach out however they prefer. Be accessible via email, live chat, chatbots, phone, and social media. Teams often use customer service tools that streamline communications in one platform to ensure customer inquiries don’t fall through the cracks. 
• Invest in employee training: Businesses must make a customer-focused culture part of their mission and train employees to put the customer first by solving client issues proactively and promptly, answering customer queries efficiently, and relying on data. 
• Be receptive to customer feedback: Companies that listen when customers express problems and aim to solve them are the ones that level up their business. Teams can analyze customer feedback with tools like social listening tools and surveys. 

Insights from Robert Blake, vice president of Digital Marketing at Arkansas Federal Credit Union

“Website chatbots can improve your customer experience whenever customers need help. The key is having relative content, help, and support pages to build the chatbot’s knowledge base. If your customers still want human interaction, a chatbot can easily pass them off to a representative.”

What is customer experience management (CXM)?

CXM involves the tools and strategies teams use to measure and improve the experiences customers have with their business. The main objective of a CXM strategy is to foster customer satisfaction and retention while building brand loyalty, leading to an overall increase in customer lifetime value (CLV) . 

CXM vs. CRM: What’s the Difference?

CXM is heavily focused on what the company looks like in the view of the customer themselves, including their feelings, emotions, and behaviors. CRM involves how the customer appears in the company’s eyes and is often measured with a CRM system that tracks customer engagements and purchase history. 

CXM strategies utilize Voice of the Customer (VoC) programs and tools that measure customer sentiments. Typically, CRM programs involve adopting software focused on outreach and sales that drive revenue. 

The takeaway  

Customer experience involves analyzing every interaction a customer has with an organization. That information is then used to create an unbeatable CXM strategy that meets customer’s needs, solves pain points, and fosters an environment where the customer is always put first. It’s crucial for companies to measure customer satisfaction and retention consistently, listen to customer feedback, and implement ongoing improvement strategies to delight customers, earn referrals, and drive revenue. 

EDITORIAL DISCLOSURE : The advice, opinions, or rankings contained in this article are solely those of the Fortune Recommends ™ editorial team. This content has not been reviewed or endorsed by any of our affiliate partners or other third parties.

The Power of Research During Collaboration: Why You Need Consumer Insights to Fuel Successful Brand Partnerships

Filed Under: Market Research , CPG , Food & Beverage , Grocery , Retail

Kat Figatner

Senior Vice President, In-Person Qualitative Research

In today’s dynamic food and beverage landscape, “collaboration” has become a cornerstone of innovation. Brands are increasingly teaming up to leverage their unique strengths and develop exciting new products that capture consumer attention. From Dr Pepper and Coffee Mate’s “Dirty Soda” concoction to Häagen-Dazs and Oreo’s ice cream collaboration, these partnerships have resulted in some of the most buzz-worthy products on the market.

Before diving headfirst into a new product launch, successful companies know the importance of conducting thorough consumer research. While the idea of two trendy brands teaming up might seem like a surefire recipe for success, the key to a genuinely impactful partnership is a deep understanding of the target audience and perceptions of the synergy between the two brands.

In-context consumer research is often the missing ingredient in many brand collabs. You must gain valuable insights into consumer preferences, purchase drivers, and brand perceptions through qualitative and quantitative research. This data can then be used to inform and optimize your collaboration strategy to ensure that your co-branded product resonates with your target market.

Let’s consider the following questions that consumer research can help answer:

• Brand Alignment:  Do the brands involved in the collaboration complement each other’s strengths and fill gaps in their respective portfolios?
• A Natural Connection: Is there a logical connection between the two brands that consumers will understand and appreciate?  If not, how do they feel about this juxtaposition?
• Consumer Needs:  Does the potential co-branded product address a gap in the market and fulfill a need for consumers? What are their expectations for this type of collaboration?
• Product Ideation:  What kind of co-branded product would resonate most with your target audience? What flavors, ingredients, or functionalities would pique their interest and create buzz to drive sales?
• Pricing:  How should the co-branded product be priced to appeal to consumers and generate healthy margins for both brands?
• Positioning: How should the product and collaboration be positioned in the market to maximize its impact? What’s the balance of the brands in the naming convention to bring credibility to the product and appropriately set expectations?

Consumer research provides valuable guidance on everything from selecting the right collab partner to developing a product that consumers will love. By investing in this research up front, brands can greatly increase their chances of success when collaborating on a new product launch.

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How Financial Frictions Hinder Innovation

May 7, 2024 • 5 min read.

A recent study co-authored by Wharton’s Thomas Winberry reveals that financially constrained firms face a trade-off between investing in existing ideas and pursuing new ones.

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When it comes to funding, existing projects tend to take precedence over innovative ideas, according to a study by Wharton and University of Maryland experts. The researchers analyzed project funding patterns at publicly listed U.S. firms between 1975 and 2018 and developed a model to explain their findings. In their paper, “ Capital, Ideas, and the Costs of Financial Frictions ,” they delve deeper into this discovery.

“Financial markets tend to fund the implementation of existing ideas or investment-intensive projects but often fail to adequately fund the discovery of new ideas,” said Wharton finance professor Thomas Winberry , who co-authored the paper with Pablo Ottonello, an economics professor at the University of Maryland.

While innovative ideas are abundant, securing funding for them can be challenging. “If you have a revolutionary new product idea, it’s relatively easy to attract investors and scale up,” Winberry explained. “However, if you’re still exploring ideas and don’t have a tangible product to showcase, you’ll need to rely on internal resources or alternative financing sources, which can be harder to come by and more costly.”

Making the Case for Business Innovation

In the long run, economic growth is driven by new ideas that push the technological frontier, the paper noted. While new firms bring many of these ideas, existing firms also play a significant role. However, they face a trade-off when choosing between scaling up production using existing ideas and innovating with new ideas. As these two spheres compete for funds, firms must make choices based on their financial constraints, shaped by internal resources and the frictions they encounter when raising money from banks or public markets.

According to Winberry, the distinctive feature of their study is its exploration of the competition between investment and innovation within firms. Most growth models focus on innovation financing in isolation, without considering the competition for funds from other activities, he noted.

“There hasn’t been enough focus on how imperfections in financial markets can hinder growth,” Winberry continued. “We’re trying to make the case that financial markets do indeed impede growth significantly. If we can identify ways to address these imperfections, it could have a pro-growth effect on the economy.”

Firms balance the trade-off between investing in tried-and-tested projects and innovative ideas based on the financial frictions they face. Financial frictions can take various forms; the paper focuses on the limits of firm borrowing against collateral. Other frictions might include debt-equity ratios guiding bank lending, the creditworthiness of a firm’s management, or psychological biases against specific industries or types of firms.

“We’re trying to make the case that financial markets do indeed impede growth significantly. If we can identify ways to address these imperfections, it could have a pro-growth effect on the economy.” — Thomas Winberry

The study examined how financial frictions distort the mix of investment and innovation at both the firm and economy levels. It tracked investment-intensive activity in physical assets like plant and equipment, and innovation-intensive activity using R&D expenditure and patenting activity as proxies.

Firms attempt to overcome financial frictions with internal resources; the paper uses net worth as a measure of these resources. “Firms with low net worth are more likely to be affected by financial frictions, as they need to borrow more to finance their investments than firms with higher net worth,” Winberry explained.

The Pecking Order of Growth

The authors found evidence of this in their empirical study of publicly held firms. “Empirically, we find a pecking order of firm growth: Firms are investment-intensive when small and have low net worth but become more innovation-intensive as they grow and accumulate net worth,” Winberry said. The paper’s model supported this finding.

In addition to studying the effects of financial frictions on firms, the authors also assess the macroeconomic impact. Without financial frictions, the economy’s growth rate would be about 40 basis points higher per year, or approximately 0.4%, according to their model. Assuming a 2% annual GDP growth rate, the absence of financial frictions would increase it to around 2.4%.

“That’s because more firms are innovating, more new ideas are being discovered, and more new technologies are emerging. Ultimately, that’s what drives long-term growth,” Winberry said. “If you accumulate 2% growth versus 2.4% growth over 20, 30, or 40 years, those are significant differences in terms of GDP.”

Winberry traced the evolution of small firms with low net worth into a state where they are ready for innovation-intensive investments. “Over time, they build up their productive capacity and eventually reach a natural scale. Then it makes sense for them to start looking for their next idea.”

The paper does not offer specific policy recommendations, but Winberry suggested that removing or reducing financial constraints can spur innovation. Policymakers can achieve this by subsidizing innovation expenditure or enabling innovation by requiring fewer financial resources from firms, he said.

He noted that over the past five or six decades, the U.S. has made it easier for firms to invest with increases in investment tax credits and depreciation allowances. “We’ve changed a lot through the tax code to provide an implicit subsidy to investment. The more you do things like that, the more innovation you’ll get, and ultimately, higher growth.”

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