The Importance of A Market Research in Developing a Successful Business Strategy
by Abdul Aziz Mondal Business Development 29 March 2023
A business needs a game plan to be successful in the industry they are in. For a business to survive in its market, it should have a business strategy and conduct market research.
You conduct a business by running it for a long time as a mindset. Market research is crucial for a business especially when it begins to expand physically and digitally. A consumer can see an ad by your business and that ad will either make or break the thoughts of your customer in buying your products.
Market research would help you reach your target market. How will you be able to do that? By using market research and strategies we will be diving into them as we progress. The right research and strategy would help your business grow. Let us start learning by defining what marketing research is.
What Is Marketing Research?
Before we dive into the importance of marketing research, let us first define what marketing research is.
In simple terms, a marketing strategy is a way for the company or a business to know its target market. This is usually done when a company wants to launch a new product.
For example, a skincare brand wants to launch a new moisturizer. Before the launch, they would need to know the market condition first
For them to know their market condition, they can conduct market research through the following techniques:
- Interviews – This involves asking your target market open-ended questions in a face-to-face setting. You would be able to get their opinion and feedback firsthand through interviews.
- Survey – If interviews have open-ended questions, surveys have definite answers in them. Through the answers of the respondents, the business will have an idea of how the market perceives its product.
- Market Segmentation – Businesses have customers from different demographics. Grouping them would allow the business to meet the demands of each age group and would make their experience more personalized.
- Observation – Through this, you would get an idea of how your business handles its customers during operations. During the observation, you can take notes on what to improve to enhance the customer’s experience
Through market research, they would be able to know what their target market thinks of the product and they would be able to make changes through the feedback they received before making the product public.
What Are the Types of Marketing Research?
To do research, you must first know the kinds of market research and what kind of market data you can get from them. There are mainly 2 types of market research.
Primary Research – Primary research gets the data firsthand. It involves data that has not been gathered or collected before. This is ideal if you want to get in-depth feedback from your customers regarding their experiences with your brand. Data would come from the target market.
Secondary Research – This is the opposite of primary research. This involves conducting market research on data that has been available. Examples of data that are already available are textbooks, past research in the industry, government research, and many more.
Whatever type of research you want to do, would benefit your business in making its business strategy.
How Do I Conduct Market Research for My Business?
Establish Your Goals
You need to know first what you are conducting the research for. It can be for the introduction of a new product or gathering feedback about existing products. Knowing what you want to research will help outline the rest of your market research.
Choose the Appropriate Research Method
You need to choose the right research method for you to obtain the information that you need to answer your market research questions. If you are using primary, invite your respondents and for secondary, establish from which sources you would take your information. You can also take help from a market research agency to do the same.
Interpret Data and Take Relevant Action
After you have gathered the relevant data and analyzed it, you will need to derive a conclusion from it. After filtering and analyzing data, you can now perform decision-making and take the needed action from your findings.
Seek Help From Market Research Facilities
If you think that you cannot handle doing market research on your own, you could always ask for assistance. Understandably, you may find it difficult as market research is extensive. You do not need to worry. There are market research facilities that can help your business gather market data.
Market research facilities can help you gather market data for the purpose you need it, may it be for a new product or a development of an existing product.
The data gathered by these research facilities can help your business plan future strategies and decide on what actions would benefit the business in the long run.
Aside from helping you conduct market research, these research facilities can also conduct webinars that can guide you on how you can conduct market research on your own. You can have the guidance of professionals to help your business grow and prosper.
What Is the Importance of Conducting a Marketing Research in Developing a Business Strategy?
Since we have equipped ourselves with what a marketing strategy is and its primary types, let us now correlate conducting marketing research with developing an effective marketing strategy.
It may seem at first that these two are not connected but as we go along the topic, we would have an understanding of how thoroughly conducted market research can help the business create and develop a successful marketing strategy.
It Helps the Business Have an Understanding of its Market
Market research can give you market insights. It can give data regarding opportunities that the market can penetrate.
Let us use a skincare company again as an example to better understand the concept.
For example, a skincare product found out through its online market research that the majority of its customers are into anti-aging products. What the business would do is they can add anti-aging products or release a product line that focuses on anti-aging.
Marketing Research Can Help the Business Gain a Competitive Advantage
Conducting market research can help in developing a business strategy in a way that helps the business gain an advantage.
Market research does not only focus on the business but also considers outside factors such as your competitors.
Through market surveys, you can look at your competitors from a customer’s point of view. You can know what your competitors did wrong and you can avoid making the same mistake.
You can make improvements and maintain an edge over your competitors through market research.
For example, you have found out through market research that your competitors in the skincare industry lack skin care for teens.
Aside from knowing what competitors are doing wrong, market research can also identify why your competitors are doing well. You can learn from them and make improvements on your own.
For example, you found out through market research that the reason why your business is doing well is that it gives excellent customer service. You can make improvements to the experience of your customers through this.
With this information, your business can now create products and tap into the market for teens. It can make the business venture into a new market and allow for more revenue to flow in.
Market Research Can Help Find Opportunities for Partnerships
Part of a strategy is finding out other businesses you can venture into a partnership with. Being in a partnership can help you reach a wider market and tap customers you never get to tap before.
Some way you can find a partnership is by finding a common ground. Make sure that their vision aligns with yours so that your partnership would be a perfect fit. Another way is to Consider the reputation of the brand and look for alternatives. If you partner with a reputable brand, it would be easier for you to reach a wider market because they already established themselves.
As for alternatives, let us suppose that you are providing lunch as a business. One way of gathering partners is making sure you complement one another. You can partner with a dessert place where people can chill after having heavy meals at your business.
If you have a partnership with another business, your combined strength can be a way to reach a wider audience allowing for increased awareness and more revenue for your business.
Market Research Helps Businesses Reduce Risks and Losses
Market research helps you keep track of trends and identify potential trends in your market. By being two steps ahead of the trend, you can better plan out your resources and how you would introduce them to the market. This can reduce costs as it would make a small room for errors and adjustments because you already know what you can expect from the get-go.
In developing a business strategy, it is also important to keep risks at a minimum because the company should not waste any resources and funds.
To do that, marketing research can help the business gauge the profitability of a new product. They could have limited testing before the launch of a new product.
By doing this testing, the company would be able to gauge if they should release the product or not. They would be able to save resources and funds by doing market research before deciding on a product.
It Can Guide the Business Stakeholders
A successful business strategy starts with understanding. The stakeholders should have a clear understanding of the market to make sound decisions.
This is because venturing into a new market is not an easy feat as a lot of factors need to be considered and market research would make those factors clearer.
Market research would also make the stakeholders an idea of the role of the mission, vision, and goals of the business. When stakeholders have an understanding of them, they would be able to come out with strategies that align with the business.
For example, a manufacturer has a mission of creating goods that have affordable parts but the quality can still be on par with other leading industries.
When stakeholders are aware of this mission through market research, they would create or improve existing products revolving around the mission.
It Makes Obtaining Financial Support Easier
A business needs financial support to meet its financial support. If a business ever needs support from financial support such as banks, presenting to the bank their market research would make financial support come easier
This is because when your market research is thoroughly done, it would raise the trust of the bank. They have a clear understanding of what you want to achieve and would give you the financial support you need.
Wrapping It Up
A business needs a strategy to keep up with the changing demands and trends of the industry it is in. For the company to know what trends are, they can conduct market research.
Market research would give you an idea of your target market. Through market research, you would get to know what interests your customers and what improvements you could make to your product.
Another thing is that you would know your competitors through this research. You could have a competitive advantage because you could avoid the mistakes they made.
It could help you develop a successful marketing strategy because when you have a better understanding of your market, it could help you strategize on how you can penetrate the market with your new product.
A thoroughly researched market would mean a better strategy. Make sure to do market research and a successful business strategy and of course, the business would benefit in the long run.
Frequently Asked Questions
What Is a Marketing Strategy?
A marketing strategy gives the business an idea of the target market it wants to penetrate. It can give the business an idea if the product they want would be profitable or not.
What Is a Business Strategy?
It is the game plan of the business. A business strategy guides the business on what actions would be best for the business. It can help the business meet its organizational goals.
What Are the Main Types of Marketing Strategies?
The two main types of marketing strategies are primary and secondary. From the word itself, we can already have an idea of what they are.
Primary research aims to collect data that have not been collected before while secondary research conducts the research through readily available data.
What Is the Importance of a Marketing Strategy for Developing a Successful Business Strategy?
- helps the business have an understanding of its target market
- it helps the business have a competitive advantage
- it can make financial support come easier
- opportunities for partnerships can be found
- with market research, risks, and losses can be reduced
- it serves as a guide for the stakeholders