By Neha Sodhi on Sep 16, 2021 2:00:00 PM
Market research is the process of gathering information about your business's buyers personas, target audience, and customers to determine how viable and successful your product or service would be among these people.
Why do market research?
Market research provides insight into a wide variety of things that impact your bottom line including:
- Where your target audience and current customers conduct their product or service research
- Which of your competitors your target audience looks to for information, options, or purchases
- What's trending in your industry and in the eyes of your buyer
- Who makes up your market and what their challenges are
- What influences purchases and conversions among your target audience
Different types of market research:
- Primary Research
Primary research is the pursuit of first-hand information about your market and the customers within your market. It's useful when segmenting your market and establishing your buyer personas. Primary market research consists of 2 types of research: exploratory and specific research.
Exploratory Primary Research
This kind of primary market research is less concerned with measurable customer trends and more about potential problems that would be worth tackling as a team. It may involve open-ended interviews or surveys with small numbers of people.
Specific Primary Research
Specific primary market research often follows exploratory research and is used to dive into issues or opportunities the business has already identified as important. In specific research, the business can take a smaller or more precise segment of their audience and ask questions aimed at solving a suspected problem.
- Secondary Research
Secondary research is all the data and public records you have at your disposal to draw conclusions from(e.g. trend reports, market statistics, industry content, and sales data you already have on your business). The main buckets your secondary market research will fall into include:
These sources are your first and most-accessible layer of material when conducting secondary market research. They're often free to find and review.
These sources often come in the form of market reports, consisting of industry insight compiled by a research agency like Pew, Gartner, or Forrester.
Internal sources deserve more credit for supporting market research than they generally get. Why? This is the market data your organization already has!
Average revenue per sale, customer retention rates, and other historical data on the health of old and new accounts can all help you draw conclusions on what your buyers might want right now.
How To Do Market Research
- Define your buyer persona.
Before you dive into how customers in your industry make buying decisions, you must first understand who they are.
This is where your buyer personas come in handy. Buyer personas are fictional, generalized representations of your ideal customers. They help you visualize your audience, streamline your communications, and inform your strategy. Some key characteristics you should be keen on including in your buyer persona are:
- Job title
- Job titles
- Family size
- Major challenges
- Identify a persona group to engage.
Now that you know who your buyer personas are, use that information to help you identify a group to engage to conduct your market research with — this should be a representative sample of your target customers so you can better understand their actual characteristics, challenges, and buying habits.
The group you identify to engage should also be made of people who recently made a purchase or purposefully decided not to make one.
- Prepare research questions for your market research participants.
The best way to make sure you get the most out of your conversations is to be prepared. You should always create a discussion guide — whether it's for a focus group, online survey, or a phone interview — to make sure you cover all of the top-of-mind questions and use your time wisely.
Your discussion guide should be in an outline format, with a time allotment and open-ended questions for each section.
Wait, all open-ended questions?
Yes — this is a golden rule of market research. You never want to "lead the witness" by asking yes and no questions, as that puts you at risk of unintentionally swaying their thoughts by leading with your own hypothesis. Asking open-ended questions also helps you avoid one-word answers.
- List your primary competitors.
List your primary competitors — keep in mind listing the competition isn't always as simple as Company X versus Company Y.
Sometimes, a division of a company might compete with your main product or service, even though that company's brand might put more effort in another area.
From a content standpoint, you might compete with a blog, YouTube channel, or similar publication for inbound website visitors — even though their products don't overlap with yours at all.
- Summarize your findings.
Feeling overwhelmed by the notes you took? We suggest looking for common themes that will help you tell a story and create a list of action items.
To make the process easier, try using your favorite presentation software to make a report, as it will make it easy to add in quotes, diagrams, or call clips.
Feel free to add your own flair, but the following outline should help you craft a clear summary:
- Background: Your goals and why you conducted this study.
- Participants: Who you talked to. A table works well so you can break groups down by persona and customer/prospect.
- Executive Summary: What were the most interesting things you learned? What do you plan to do about it?
- Awareness: Describe the common triggers that lead someone to enter into an evaluation. (Quotes can be very powerful.)
- Consideration: Provide the main themes you uncovered, as well as the detailed sources buyers use when conducting their evaluation.
- Decision: Paint the picture of how a decision is really made by including the people at the center of influence and any product features or information that can make or break a deal.
- Action Plan: Your analysis probably uncovered a few campaigns you can run to get your brand in front of buyers earlier and/or more effectively. Provide your list of priorities, a timeline, and the impact it will have on your business.
Conduct Market Research to Grow Better
Conducting market research can be a very eye-opening experience. Even if you think you know your buyers pretty well, completing the study will likely uncover new channels and messaging tips to help improve your interactions.