Should your business conduct market research? Absolutely! We have plenty of reasons why you should take market research very seriously. Keep reading below to find out what these reasons are.
Is your business not right on the track you want it to be? Maybe your competitors are doing better than you. Or maybe your customers don’t keep coming back. Or maybe there is just something off about how business is going, but you can’t really tell what. No matter the issue for your business, the answer lies in market research.
Market research helps understand the market your business is in. This is the first step in creating a successful business.
Think about it: how can you provide your customers just what they are looking for when you don’t know what that is? Or, how can you do better than your competitors when you have no idea what your competitors are doing?
Well, market research is exactly about finding out what’s going on in the market and understanding what your business can do better to stand out from the crowd.
Keep reading below to learn more about what a competitive advantage is and how market research can help you gain a competitive edge.
Competitive advantage: What is it?
First things first, let’s see why competitive advantages are so desirable.
Well, the term is pretty self-explanatory. It means having an advantage, a factor or attribute, over your industry competitors. Such an advantage allows a given business to be better than its competitors, whether that means producing more affordable or higher quality products or services or winning at attracting customers.
That being said, a more detailed definition of competitive advantage is that it represents an advantage that makes a company’s goods or services and marketing strategies superior to all of the customers’ other choices.
Now, this term is commonly used among businesses. However, competitive advantages can also exist for any type of organization, country, or even individual in a competitive environment.
To gain a competitive advantage, one of the things you need to do is to understand the target market, which takes us to the importance of market research.
But first…what is market research?
Before we move forward to what competitive advantages a business can gain through market research, let’s understand exactly what market research is.
In short, market research represents the process of gathering all data on your target audience, including and especially their needs and wants.
Market research typically includes both secondary and primary sources of information. For example, primary sources of information can incorporate research techniques such as surveys, interviews, or focus groups. In contrast, secondary sources of information include research techniques that don’t involve direct contact with the customers but rather focus on observing and gathering data from public information.
Market research can be conducted by companies that sell to average customers and companies that sell to other businesses. In other words, there can be B2C or B2B market research, with both types including the same research techniques and the same goal: understanding the market and customers better.
Now, market research inevitably gives businesses a leg up over their industry competitors.
What competitive advantages can market research give you?
You know what they say, “knowledge is power.” And, in the business environment, no matter the industry, that couldn’t be any truer. The more you know about your industry, customers, competition, and trends, the better you perform and keep ahead of your competition. Market research helps to:
Better understand competitors
Do you know who your market competitors are? If not, it’s time to find out because these competitors may be stealing your customers.
Now, understanding your competition through market research isn’t just about taking your customers back. It’s also about learning the dos and don’ts from your rivals. As Savanta Market Research specialists explain, “Market research can help you understand what your competitors are doing right or what they are doing wrong. You can learn from your competitors’ mistakes or successes.”
Besides that, through market research, you’ll find out why customers prefer your rivals over your business. Is it the pricing? Is it the better quality products or services? Is it their more trained staff? You can find out by conducting market research.
Better understand customers
Customers are the heart of your business. No business can be successful without paying customers. So, your target audience should be your focus at all times.
What do your potential customers want? Or, what do your existing customers like about your business? What don’t they like?
Through market research, you can find the answers to all the questions related to how to improve your business to attract more customers and keep them loyal.
Market research is the best way to find out exactly who buys or can buy from you and how your business can make their life better.
Identify new market opportunities
What if your customers would love a new product or service, but your competitors aren’t listening to them? You could be the first in your industry to make that product or service happen and bring it on the market.
When getting in touch with your target audience and hear out their needs and wants, and when you know exactly what your competitors are doing and aren’t doing, you can identify new market opportunities that will make you stand out from the crowd.
Better understand brand reputation and awareness
How does your target audience perceive your business? Do you have a good reputation, or is there some bad news circulating about your brand? More importantly, how many people actually know about your business and what you are selling?
You can find the answers to all these questions by conducting market research.
Identify potential problems
If you feel like there’s something off about how business is going, it means that there’s an underlying problem you need to identify. When you hear out your target audience and compare your business with your industry competitors, you’ll most likely find out what the problem is.