Importance of Doing Market Research

Importance of Doing Market Research

              Brian Fletcher’s article on MarketingProfs.com titles “Five Reasons Why Market Research Matters (and Five Tips for Using It)” is a great look at why it is crucial for new and existing businesses looking for success to conduct market research. This will be an overview of the first part of his article, the five reasons why market research matters.

              Fletcher’s first reason is that market research centers your business on your consumers. He indicates that the customer should be driving your brand, not internal politics and agenda. One way that a business can keep communication open between their customers (which Fletcher calls the “boss”) is through research. “Even if you purchase your company’s products, you are not your consumer, and therefore, focusing on your consumers and their perspective is critical,” Fletcher says. The next tip he calls out is that market research keeps you focused. He recognizes that marketers have a tough job multitasking with all the objective/goals/deadlines they must meet. Brian says that marketing research should help prioritize these objectives and use time efficiently. The third reason he lists is that it allows you to pursue the most lucrative growth opportunities. “Marketing research can help you weigh and quantify opportunities to prioritize those with the highest revenue potential for your brand.” Next, Fletcher also indicates that it helps keep you relevant and future oriented. He says that it is very important to adapt and evolve our brands to meet long-term goals. He expressed that although short term results are easy, focusing on brand longevity will prove most successful. Lastly, Brian’s last reason is that it improves your decision-making capabilities and reduces your risk. His implication for this is that the decisions can be made with much more clarity and confidence. “By having research to back up your marketing decisions, you can optimize your brand strategy choices and minimize your risk for failure.”

              According to the Bureau for Labor Statistics, only about 50% of all new businesses survive 5 years or more and only a third survive one 10 years or more. Based on Fletcher’s reasons to conduct market research, it is evident that this number could be greatly reduced by doing research instead of relying on your own heuristics. Especially in larger companies, it can be easy to build your brand based on company “politics” like Fletcher says, as well as longer decision making times. Although it may sound cliché, your customer is the center and should be influencing all your decisions. Based on your research, it also should give you an accurate “roadmap” of the types of objectives you should achieve and tell you what is most important in your marketing plan. Feasibility testing of a market research project should also be conducted, especially when creating a new product. The profitability is what is driving your success, and is ultimately the reason some new businesses fail. Working in the field of marketing, we also know that society, technology, and peoples wants and needs are ever changing. Market research helps tackle this issue as well for new businesses, giving you relevant information to start up in the industry effectively. In addition, using market research to reduce your risk is essential. If you can back up your decision and projects based on facts, it minimizes the problems you could encounter in the long run. I think one tip I would add in is to make sure you are doing research that can both help you in the short run as well as in the long run. Doing this, you can optimize your objectives for now and for the future and measure success from it at any point in time.

Stay tuned for a review of the second part of his article “The best ways to use marketing research”.

Article referenced: http://www.marketingprofs.com/opinions/2013/23874/five-reasons-why-market-research-matters-and-five-tips-for-using-it