Importance of Market Research

Market research is very important; it helps companies to tailor their messages to their targeted audience and helps the organisation to perform better. Research can measure the reputation of a company among consumers, governmental officials and the academic community. Mathematical models are used to estimate the failure or success of a product. Research helps in getting consumer reaction to products that are already being sold by the company or even a product that is at a conceptual stage. Research can tell a marketing company what flavour or colour the appeals most to the consumer. Target audiences can be set accurately and positioned in the right market. Research can prove whether your advertisement communicates what it was intended to be.

The major steps involved in market research are:

• Defining the market research problem
• Formulation of Research design
• Analysis of secondary data
• Development of a questionnaire
• Collection of primary data
• Data Analysis
• Preparation and Presentation of report

Phases of Global Market Research

These is in general for global market analysis with more steps. International Marketing Research design has 5 major phases

• Phase 1: Deciding whether to internationalise- Assessing the demand for the company’s products or services
• Phase 2: Deciding on markets to enter- Understanding their local competition and the potential of the product
• Phase 3: Market entry strategies- Understanding the competitors strategy
• Phase 4: Designing the international marketing mix, the 7 Ps- Understanding the behaviour of the consumer, SWOT analysis, and deciding on the media mix
• Phase 5: Implementation of plan in international market- Final implementation and analysis of performance.

Acquiring secondary data is a must; this gives a clear background as to how the process of research takes place. Other companies would have also done market research in these global markets. By reading these works of market researchers can design their analysis work. At the end of the research work, companies usually list out the drawbacks of the research or the challenges they faced during the implementation phase.

Primary research must be done when the agency is not able to acquire enough or reliable information. Collecting primary data takes more time and money consuming. Designing a primary data collection is a must and the right collection technique to collect data. Some of the popular methods of data collection for global market analysis include:

• Observational and Tracking Methods
• Focus Group Interviews
• In-depth Interviews
• Action Research
• Survey and Questionnaires
• Experiment
• Psychological or Psychographic approach2

Global market analysis is very important and companies which have knowledge about global markets must be selected, so that data obtained is accurate. Market research allows marketing agencies to tailor their message or product accurately in the right country at the right time. Geographical boundaries have more differences, in terms of weather, culture, religion and language. The product or service should be positioned in a market where it is profitable.

Definition

As stated above, there are many different definitions of the term market research and the differences can results in a business understanding and using only one aspect of this instead of the large field and limiting its methods. Below are some of its more common definitions.

As per Wikipedia:

Marketing research is “the function that links the consumers, customers, and public to the marketer through information-information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection process, analyzes the results, and communicates the findings and their implications.”

As per the American Marketing Association:

“Marketing research is the function that links the consumer, customer, and public to the marketer through information–information used to identify and define marketing opportunities and problems; generate, refine, and evaluate marketing actions; monitor marketing performance; and improve understanding of marketing as a process. Marketing research specifies the information required to address these issues, designs the method for collecting information, manages and implements the data collection the data collection process, analyzes the results, and communicates the findings and their implications.”

As per BusinessDirectory.com:

Market Research: “identification of a specific market and measurement of its size and other characteristics.”

As per MarketResearchWorld.net:

“Market Research is a systematic, objective collection and analysis of data about a particular target market, competition, and/or environment. It always incorporates some form of data collection whether it is secondary research (often referred to as desk research) or primary research which is collected direct from a respondent.”

The purpose of any research project is to achieve an increased understanding of the market. With businesses throughout the world becoming increasingly competitive, market research is now on the agenda of many organizations — large and small.”

Common threads in every definition:

No matter the definition that you choose to use, there can be found a few common thoughts in the different definitions:

• It is about the information that is gathered with a specific objective in mind
• It is about studying the market without influencing it
• The customer is the center of the research
• There are no assumptions made, however information is gathered to help data-driven decision making
• There is no definition of the channel of research and is free of the tools and techniques that are used to conduct it

The Steps involved

When done in a scientific and structured way, that is unbiased and is without assumptions, market research can provide many different benefits to an organization. In order for it to have meaning, research should encompass the following steps:

• Collect and analyze data on the market
• Identify and prioritize markets
• Quantify and communicate goals and results to stakeholders
• Measure and track customer relationships

Importance

Market research can be very important to several different aspects of a business. Research that is done right can help a business develop products and services that the target market needs; develop marketing plans based on the information that is gathered in order to reach all potential customers in the most effective way. Market research that is well executed can provide useful information that can help a business have an advantage over the competitors and ensure customer happiness.

Vicky Edwards is a staff writer at Hudson Management Services (HMS), a BB

- Product Position- The position they have in the market favourable, unfavourable or neutral? Primary Research answers these question, so that the marketing efforts can be designed based on the position to brand, product or service.

- Market segmentation- Understanding the market segment is a must, the product or service needs to be positioned accurately in the dynamic market. Research finds out if the product should be marketed to seniors, working professionals or teenagers. This also helps in tailoring the message.

- Consumer Behaviour- Understanding a consumer’s behaviour is a must, their personality, their attitude, motivation and other intrinsic factors. Primary Market research is one on one research.

Management consultants help with primary market research. As a type of research primary market research takes a lot of time, by hiring a management consultant they would be able to conduct an in-depth research which would provide conclusive and empirical results.

Primary market research has several steps, this steps need to be clearly defined at demarcated, the following are the six major steps-

- Defining the problem statement- The problem must be clearly stated i.e. what are you trying to find out or prove. An example could be finding out the sales forecast for a period of a month. The time and place needs to be clearly defined.

- Method of data collection- The method needs to be defined and followed spot on. Whether the method adopted is going to be a survey or an interview. If a survey is selected, is going to be a telephonic interview or an online survey. The method needs to be defined in the beginning, so that the questions can be devised.

- Sampling technique- Defining the sampling technique is a must, random, stratified, cluster or some other technique. A mix of techniques must be avoided, for primary market research the company must use stratified sampling. As a technique for data collection, stratified sampling the researcher divides the entire target population into different subgroups, then selects the final group or sample. This method is adopted when the population size is vast, complete enumeration cannot be possible when the sample size is large.

- Analysis of data- After the process of data collection, the data must be interpreted through statistics. The researcher must define the software they are using to interpret the data. The statistical measures they are going to use to prove the problem statement.

- Error checking: This step is very crucial, the researcher must check if the data is entered accurately, if a hypothesis is stated it needs to be proved or disproved at this stage. The data or evidence must be corroborated at this stage.

- Research Report Writing- All the chapters of the research must be combined, the charts, tables and other forms of pictorial representation must be written at this stage. The Interpretation of the research findings is finished at this stage.

Management consultants can conduct in-depth works of research. Market analysis in general takes time and primary market research is more tedious, companies must hire management consultants to carry on this task. The steps are many and each step takes a lot of time, the end result is that market research answers many questions that companies are asking.