Market research is an area that enables businesses to understand consumer needs, design products as per consumers’ specification and advertise those products to the consumers.
The companies take up the market research initiatives not to comprehend what the consumers are thinking at present; instead it can identify what they will want in future.
Therefore, in some respect market research helps business to make informed choices. This increases the chance of accepting a product when it is launched.
Why it is essential to carry out market research?
Product oriented organisations at first develop a product and look for a market to sell it. Contrary to that a market oriented organisations focuses on the needs of the consumers.
If they anticipate a change in the consumer needs, they develop a new product to satisfy their emerging requirements.
Tarot cards cannot predict consumer behaviours. The company has to take resort to the market research to understand its consumers.
There are some organisations, which in order to improve competitive advantage, consider designing new products.
Launching a new product involve considerable costs. Hundreds of products launched every year, achieve a significant market share in consumer goods market.
If the product is not accepted well by the consumers, the entire effort and the money will be in vain. In this competitive market, a business can hardly afford to do so.
Therefore, it becomes crucial to perform market research before launching a new product or adding new features to existing brand portfolio.
The research procedure
All the market research projects do not start with collection of primary data. There are many who worked on already collected data or secondary data.
But, most of the companies want to work on the first hand information collected directly from the consumers. There are several ways to collect primary data.
Sometimes organisations employ agencies to collect data on the basis of questionnaire or street interviews. Even the approaches for data collection may also differ. It may be either qualitative or quantitative.
Though, there is a traditional war in marketing research field between these two methods, in reality both types of approaches are important for understanding the consumers’ wants and needs.
The qualitative data focus more on attitudes, feelings and opinions. On the other hand, quantitative research is purely based on numbers accumulated after studying large sample of respondents.
Qualitative research is obtained from Focus groups, guided by moderators. The feedback of six or seven consumers is captured.
The outcome of the research
It solely depends upon the company how they will comprehend the result obtained from research and implement in their marketing initiatives.
However, most of the companies before unveiling the new product infront of the market always go for a trial.
Few consumers are given the product and it is recorded how they interact. The survey is carried out to obtain a complete report regarding what the consumers thought about the product and what are the chances that they will purchase the product.
A business in this way tries to forecast sales of the new product and how it will perform in market in its first few years.
If every result is conducive from business perspective, the organisation shows green signal to production department for mass production of new product.
A detailed market research is invaluable. Equipped with the research overview and correct planning a company hardly faces any difficulties in launching the new product.
Since business market research services are so imperative for making strategic planning and decisions, a company needs to decide whether it will maintain an in-house research initiative or outsource the entire work to professionals. In case of small and medium organisations, hiring specialists is no doubt beneficial.
Sometimes large firms having their own house research department depend on agencies for data collection.