5 Reasons Why Market Research Is Important For Brands
People are often told before making a decision, big or small, to “do your research”. Research is important for business, as well, and it comes in the form of market research.
However, not all brands bother with market research and who’s to blame them? Market research is a time-consuming endeavor that not everyone is up for. Then, there are some who do conduct market research but do so sporadically.
In this article, I’ll make a case for doing market research regularly. You’ll understand the benefits of market research to your business’ long-term goals and what you’re leaving on the table when you neglect this process.
The Benefits of Market Research For Business
- 5 Reasons Why Market Research Is Important
- Market research gets you into a customer-centric mindset
- Market research allows you to communicate more effectively with your customers
- Market research minimizes risk
- Market research ensures your business decisions are backed by data
- Market research allows you to stay competitive
- Frequently Asked Questions
- What are the four main purposes of market research?
- What is the main point of market research?
- Why is research important to business?
5 Reasons Why Market Research Is Important
Market research gets you into a customer-centric mindset
Businesses benefit a lot from knowing and understanding their customers. Market research tells you what your existing and potential customers look like, what they want, and what motivates them to buy.
It can also help you pinpoint where your customers are and why they would or wouldn’t want to buy from your brand.
Personalization is powerful. When you craft personalized messages aided by market research, your audience feels seen as individuals, not as part of a general public that you’re trying to address.
Ultimately, market research is one of the best tools to build a customer-centric business, which has been proven to yield more profits.
Here’s what else marketing research can tell you about your customers.
Customer Demographic
Firstly, market research uncovers details like your customers’ age, gender, education, income, and employment. You can get this information through surveys, which will let you hone in on crafting copy and creatives that will resonate with your target audience.
Customer Behavior
Market research also showcases the mindset of buyers–why they buy, when they buy, how and what they're buying, among others.
When you get ahold of this information, you can take advantage of customer behavior for maximum conversions.
Prospective Customer Profiles
Market research identifies and elaborates on the characteristics and actions of potential buyers at the top of your funnel. Similar to the previous points, understanding the profiles of prospective customers can inform your strategies so you can boost clicks and conversions.
Market research allows you to communicate more effectively with your customers
There’s no shortcut to engaging your customers long term. Market research is key to effective communication strategies because with a deeper understanding of your customers’ tastes and preferences, you can change your products and messaging to best resonate with them.
Personalization is powerful. When you craft personalized messages aided by market research, your audience feels seen as individuals, not as part of a general public that you’re trying to address.
Market research minimizes risk.
Risk mitigation is crucial when you’re running a business and market research helps a lot in this aspect.
Risk is a normal part of business endeavors but it still has to be managed. For example, you wouldn’t want to introduce a new product to the market before concluding that there’s sufficient demand for it.
This goes for pricing, brand messaging, and customer issues, too.
Before you sink time and resources into an idea, you first need to test it out and see if it holds water out in the real world. Market research is the tool that does that for you.
Market research ensures your business decisions are backed by data
Good businesses don’t make decisions in a bubble; they do it based on data and facts. This entails market research, of course.
Market research gathers data that you can analyze and use to make business-altering decisions. This research can come in the form of focus groups, surveys, and interviews to gauge customer sentiment.
When you utilize market research, you can avoid the mistake of using feelings and assumptions to make a decision (e.g. raising prices, improving features, changing customer service protocols).
Therefore, you’re more likely to implement changes that contribute to your business’ success.
Market research keeps you competitive
If you want to keep up with your competitors, market research is not an option–it’s a must. How does it keep you competitive?
Firstly, it gives you a good grasp on your target audience and that in itself will set you apart. You become a brand in tune with what your customers want and what the market looks like.
Similarly, you can identify what customers don’t want so you can snag them from competitors are lagging or not fulfilling your target audience’s needs. Market research uncovers the gaps in the industry that you can then fill.
Other ways market research can keep you competitive include:
It helps you identify and anticipate trends and patterns
Trendspotting or identifying patterns in the industry is important if you want to be ahead of the curve and jump on the bandwagon before it gets saturated. You always want to innovate lest you get left behind.
Market research is crucial to producing timely products and new features that the market actually wants. Other trends you need to spot include ad channels, purchasing behaviour, packaging, and brand messaging.
It can benchmark competitors
Benchmarking your competition is helpful if you want to see how you’re performing relative to your industry and competitors. With this knowledge, you can adjust your tactics accordingly and make tweaks if you’re behind.
You can also use benchmarks to determine if the problems your business is facing is unique to you or are indicative of an industry-wide pattern.
Stay Ahead of the Curve with Market Research
Market research is worth the effort and reaps many benefits that might not be obvious. When you invest in it, you can stay competitive and engage your target audience more effectively. Closely monitoring your market and basing your decisions on facts will go a long way for business success.
Frequently Asked Questions
What are the four main purposes of market research?
Market research helps businesses identify opportunities, understand their target audience, evaluate competition, and make informed decisions.
By gathering insights in these areas, businesses can tailor their strategies to better meet customer needs and stay ahead of the competition.
What is the main point of market research?
The main point of market research is to gather actionable insights that guide business decisions. This ensures that products, marketing strategies, and customer experiences are aligned with market demands and trends, ultimately driving growth and success.
Why is research important to business?
Research is crucial because it reduces uncertainty and helps businesses make data-driven decisions.
By understanding market trends, customer behavior, and competitive dynamics, companies can innovate effectively, optimize their marketing efforts, and enhance customer satisfaction, leading to better business outcomes.
