Market Research – has a strategic role in building and developing a business. In this aspect, market research is the key to understand the market situation so it will be easier to identify any business opportunity. The absence can cause short-term and long-term damage to the business. Due to its significant it should be conducted and managed regularly. Therefore, what is market research? How does is work? Let’s find out.
This activity of designing, collecting, analyzing and systematically reporting on data and any findings from a particular situation or business case faced by a company. This activity is usually done to measure the quality and feasibility of existing or newly developed products and services. The result will affect the business direction, business planning, product development, and determining marketing strategy. Thus, everything must be done correctly in order for a company to make the right business decision.
There are various types. Based on data sources is divided into 2.
Primary research is a type of research which the researcher collects the data directly from the source. This can be done by going directly to the target market through a range of methods such as interview, survey or focus group discussion.
Secondary research is research activity which utilize data which has previously been collected, analysed and published by government agencies, mass media, research agencies, industrial chambers of commerce, and other accredited third parties.
As previously mentioned, market research is vital for a business to understand specific insights regarding the market, competitors, and consumers. But how does market research work? Generally, there are 4 steps of doing market research, which are the following.
Before conducting the market research, it is vital to design the structure of the market research. In the design process, the company needs to address specific questions such as,
This step is important to guarantee that the result of the market research will be useful in the decision-making process.
The data collection is the first step and one of the most important in the market research. Data collection will determine the analysis process, thus any errors in the data could lead to wrong conclusion which can be dangerous to the entire decision-making process.
As mentioned before, market research can utilize primary and secondary data. The company should choose what are the parameters they want to measure, types of data they want to collect and the availability of the data before choosing whether to utilize the primary or secondary data.
Once all data have been collected, then team will organize and careful study the data by doing statistical calculation in order to see any pattern, anomaly and observe the magnitude of the parameters measured in the data.
Once the analysis has been done, the entire result should be documented in a written report that include the detail of the research process, the result and all major findings. This report should be a comprehensive in order to be used in the decision-making process.
By conducting, the company will have a better perspective and understanding of the market and its consumer. Also, by doing the that, the company should gain knowledge of its competitor, thus be able to formulate better strategy and decision to ensure the company performance stays ahead of the competition.
The company will better understand the characteristic of the customer and the demand of the service or products, thus providing them with better knowledge to avoid unnecessary investment in a product or service that is not suitable in the market.
By doing that, company will understand which market is the best for them and how to maximize it. This will aid company to set the target and increasing the sales of the product or service thus influencing the business growth.
Market research is not limited only for large enterprise or small-scale businesses. In fact, any business, regardless of its size should conduct one. When it comes to reaching the sales target, developing new customer based, or even improving existing business portfolio, a team is needed to build and improve the business.