Marketing research is very important for launching as well as running a business successfully. It can be defined as the systematic process of collecting and analyzing data on the basis of the attributes that a business is looking for in a target market. More often than not, this data involves finding out the marketing competition or consumer behavior.
With the help of market research, businesses can offer services and products that are targeted and focused to the right kind of consumers. Spending resources in market research also helps minimize financial risk and avoid costly mistakes. Understanding the target customers better ensures that businesses communicate better with them and identify more and better opportunities.
Types of Marketing Research
Marketing research is of two types based on the kind of data being collected, namely primary and secondary research. Here’s a quick insight into the types:
- Primary research, which refers to the data collection method that helps in monitoring marketing and sales strategies by directly communicating with the consumers. In other words, primary research is used to get a feedback on the performance of a product soon after its launch in the market.
- Secondary research, which refers to using data that has already be published to conduct a research. The data is collected from various sources, mostly data publishing companies, and then analyzed. Secondary research is less expensive when compared to primary research and is primarily used to target a segment prior to a product release.
Why is Market Research So Important?
To begin with, market research is extremely important to gauge if there will be demand for your service or product at all. Thus with the help of market reserrch findings you’ll be able to decide on the feasibility of your business as well as how much you need to produce and how many people do you need to hire, if there’s a demand for your product. Secondly, having the statistics, figures and findings in hand will help you pitch to your investors in a much better way. Numbers and evidence always add weight to a proposal and help investors gain confidence in your plans.
Thirdly, a well executed market research will help you divide your target market on the basis of their demographics and habits. In case your customers are businesses, you’ll be able to understand how big they are, who are their customers and who is in charge on taking the procurement decisions for them. In other words, using market research you’ll be able to target markets with greater accuracy.
Fourthly, having an insight into your target market and your customers in particular will help increase your ROI by targeting the right customers in the right way. And lastly, market research will help you charge a competitive rate for your product by understanding what your competitors are charging and what buyers are willing to pay for it.
Note: To ensure that you get the best out of the market research, it’s important that you choose the marketing research services well. While there are numerous marketing research agencies in India, few are able to provide understand and give you what you need.
How important do you consider marketing research to be? Post your takes and opinions in the comments below.