Use Market Research To Grow Your Business

The more you understand about your customers, prospects and the marketplace you operate in the more likely you are to succeed. This is where market research helps. While it does not guarantee success it is a key component of any successful business.

Market research can help maximise customer satisfaction, profits, competitive advantages and help to identify the risks to your business. It can help you to build customer loyalty, identify new opportunities, and to identify and reduce business risks.

You may already be undertaking market research. Every time you talk to a customer or a supplier you are doing some form of research. Sometimes, however, you need to formalise this process. Market research is the collection and analysing of information about people, markets and organisations. The aim is to help you make better more informed decisions for your business.

Traditionally market research is divided into quantitative (numerical) and qualitative research. Quantitative can be collected by postal surveys, telephone surveys and face-to-face interviews etc. Qualitative data is about discovering how people feel about a topic or subject. Typically this uses interviews and focus groups to find out more about customers and their views.

Then just to complete the picture there is primary and secondary data. Primary is firsthand information. When you survey your customers you are gathering information straight from the horse’s mouth so to speak. It is more time consuming and costly but can also be the most useful because it is specific to your business. Secondary data is information that has already been collected by someone else. Market research organisations like Mintel. Keynote etc undertake many market studies, the government has a mass of information on population and expenditure on products, companies house has the accounts of registered companies, even telephone books are a secondary data source.

What should you research?

Your market: What is the total market size by sector both in the UK and overseas? What seasonal or fashion factors influence the market? Where are the big players? What are the trends?

Your environment: This is about the political, social and economic factors that influence your market; everything from a change in interest rates, the closure of a local business, to new government regulations can affect your business.

Your competition: Who are they and what are their services? What marketing activities do they use? What is their pricing policy? What are their strengths and weaknesses? Where is their appeal? Where do you have a competitive advantage? Also check out their financial performance.

Your product: Who uses? How often do they purchase? Is your product branded? What stage of the product life cycle is it at? Is your pricing and trading policy right? What are the returns? What new products are planned? How do they fit in with existing products? How can existing products be improved?

Your customers: How many are there? Where are they? What is their profile? What are their needs? How can you reach them?

Your performance: Regularly ask customers for their feedback on your performance. What do they like/dislike? What could you improve? Would they recommend you?

For personal help to research your business or new product idea contact me on 01226 290288 or email Gareth@gapmanagement.co.uk

Avoid these common pitfalls

I don’t need research. I know everything. Typical comments from business owners who go on to say things like I have spent years in the industry, I know my customers. This is dangerous, as you have preconceived ideas and perceptions about your customers and their needs. You need to test your assumptions and remember the market and customer expectations are always changing.

“I like it.” Some times inventors and business owners get stuck on an idea because it appeals to them. You need to be careful when developing new products and services that they compliment what you already do and match the profile of your customers. Similarly you need market research to identify if there are enough customers for your product.

Using only secondary research. The published studies of your market place are useful and widely available from the Internet and libraries. They can only go so far and primary research with your customers can help you more effectively target customers and your marketing activities.

Friends and family. Asking people close to you for their opinion is fraught with danger. They will not want to hurt your feelings. Talk to real prospects and customers.

Try casually showing your product to people. Do they say “wow”. If so tell them you have one in your car available now, do they get their wallets out?

Market Research can help position your business for success. It can help you save time and money on ideas that will not work to concentrate on those that will. Market Research is not a one-off activity only to be used when developing new products or services it should be a key part of the marketing plan for your business.

Suggestions for a future article?

If there is a subject you would like covered send an email to gareth@gapmanagement.co.uk

About GAP Management

GAP Management helps business owners and managers to focus their sales and marketing efforts to be more effective and to find win and keep customers, to grow their businesses and be successful whether they market in person, in print or on the web.

For personal help with marketing and sales to grow your business contact me on 01226 290288 or email Gareth@gapmanagement.co.uk