Market research plays a big role in the success of a business, so it is crucial to know what the needs of your target market are. Many companies that enter a market fail because of the lack of customer research.
Eric Ries, the author of The Lean Startup, says that startups fail because their product has no demand.
Real client feedback and research are excellent sources of actionable information on how to make a product thrive. Market researchers need to study past and current trends to forecast how the market will shift in the future.
This research is essential for business decisions on future campaigns to stay ahead of the curve and appeal to target audiences.
17 Customer Research Tips
1. Identify the Target Audience
Be aware of the target market’s demographics in order to market to them.
Focus groups, questionnaires, surveys, interviews, and analytical data gathered from online interactions of the business are used to research who the target audience is.
It’s critical to develop a customer profile that considers demographics like age, wealth, and interests, but also unmet needs and potential market shifts over time.
2. Discover new Opportunities
The fact of the matter is that the market is constantly shifting. Due to the ongoing evolution of the industry, researchers must apply their analytical abilities to determine the following:
- Current market trends
- Market size
- Market leaders
- Trend forecasts
- Geographical spread
- Gaps in the market
Understanding the current market and identifying prospects for company strategies, advertising, and goods requires gathering such data, and it also allows for identifying areas for improvement.
3. Leverage Online Reviews from Customers
Online reviews are a rich source of information on how customers feel about different products. Reading customer reviews is an easy and free way to see what people are saying – both good and bad.
Online reviews give business owners direct access to their customers’ thoughts, and they show what the business is doing right and what they’re not doing well. Given that everyone has access to these internet reviews responding to the valuable feedback from bad reviews is critical.
It is also important to remember to validate reviews. If someone mentions something about a product, that doesn’t mean it’s true. As such, recurring feedback is the most important.
Depending on the size of the company’s customer base, there may be too many online reviews to read, and the practice becomes redundant.
The way forward is to employ a software tool to gather all reviews onto a database and perform a keyword search to find recurring feedback on the product. Be sure to notice a pattern and take action to keep customers happy.
4. Use Market Research Tools
Market research tools are the way to go when on a tight budget, when resources do not allow hiring a market researcher, or if the data needs to be available sooner.
There are several market research tools. Like any software tool, some cater to the company’s needs better than others. They gather real-time data on customers, current market trends, demographics, market size, etc.
For its ease of use and accessibility, Google Trends gets the job done most of the time. However, there are more comprehensive market research tools out there that give a more detailed picture of the market.
5. Observe Your Competition
Entering an established market is far from easy. However, it does present an opportunity to learn from the market leader. Performing market research to find the most successful companies in your company’s industry can help to catapult the business to the top.
Now, this doesn’t mean you should copy the model used by others. But, learning their strengths and weaknesses gives customers a clear image of what they want.
Once a few companies have been researched, trends of what they’re doing right and what they’re doing wrong begin to surface. The next step is to adapt the business’ product to provide the perfect solution to its customers. In doing so, the company attracts new customers away from the market leaders.
Research the following about competitors:
- Market position
- Average revenue
- Product range
- Target customers
- Strengths and weaknesses
6. Gather and Analyze Data
Although gathering data is a critical step in the process, it is even more crucial to evaluate and identify trends and changes that affect or may soon affect the business.
Data gathering and analysis must be ongoing processes that occur at every stage. Even if you conduct thorough research before releasing products, follow-ups, collecting client feedback, and market data need to continue.
In addition, make an effort to evaluate the success of marketing campaigns to inform subsequent campaigns.
7. Collect Customer Surveys
Not sure how customers feel about your product? Ask them.
A great way to gather customer feedback is through an online survey. It’s essential to keep these online surveys short and simple; nobody wants to fill out a 30-minute questionnaire about a business or product.
Save time by asking direct, meaningful questions that provide valuable information and will help to better understand customers’ needs. Open-ended questions are more useful for in-person interviews where the interviewer probes for a clear explanation of the customer’s thoughts.
8. See How Customers Use the Product
Watching how customers use products gives valuable insight into the customer’s views. More often than not, this feedback technique helps identify pain points customers face when using the product.
For example, when customers visit a company’s website, watch how they navigate through the site. Ask them to try to purchase something if it’s an e-commerce site and pick out any difficulties that the customer experiences. There’s nothing worse than trying to buy something online with a complicated purchasing process.
Another option is using heat mapping tools to track customers’ navigation of your business’ site. Once again, take action when recurring patterns of bottlenecks occur.
9. Conduct Customer Interviews
Market research involves interacting with people through in-person interviews, online focus groups, telephone surveys, digital questionnaires, etc.
Getting honest client feedback through interviews is a quick and easy way to learn more about their needs.
Participants must be aware of the purpose of the interview and how you will use their data. Be honest and sincere. Failure to do so has adverse effects in the future as it can distort statistics if participants don’t express their genuine opinions.
10. Use Data Available to the Public
Another great source of information is public data. It’s not always necessary to collect data, as government statistics are a wealth of information for market research.
Public records provide information like demographics, location, and behaviors which are vital to researchers looking to identify customer segments. This information then goes to marketing teams, who decide on a strategy for each element, and this is all from public data.
Public records or industry reports give a general overview of a business’s customers and how they behave. To take it a step further, employ market research tools like Google Analytics that pinpoint buyers’ persona.
11. Personalize Your Consumer Research for Each Project
Each project needs to be separate. There is no one-size-fits-all method for finding solutions to issues relating to various market segments.
Consider the company’s goals every time a survey goes out if that’s how the business plans to collect most of the data for market research. Don’t do a single survey and distribute it to everyone.
Instead, make inquiries specific and address them to particular individuals. Customers taking part in a brand awareness survey mustn’t receive a duplicate of a customer satisfaction survey. It is also best to avoid sending out a single study to both groups that include questions about both subjects.
Market research is more accurate if it approaches each project independently and uses individualized problem-solving techniques.
12. Offer Incentives When Gathering Information
Consider the driving forces behind the respondents who supply the data when looking for strategies to improve market research. Offering incentives is a great way to attract more participants for data collection. Examples of incentives are discounts on their next purchase, the chance to win a prize or even the possibility to test out a product’s beta version.
Remember that the people giving the data value their time just as much as the business does. Think about the audience and the most effective incentives to encourage maximum involvement. For example, rewards intended for an older age group won’t be as attractive to younger age groups, and vice versa.
13. Research the Target Audience on Google Search
It’s as easy as that! Googling competitors is one of the most effective ways of researching the target audience.
Performing a Google search allows businesses to:
- read competitor’s customer reviews
- find out what customers say about their brand and product or service
- shape their online content to answer customer questions and difficulties
Google is an inexpensive tool for gathering customer data. It’s also important to see how customers find the product online because it’s never straightforward organic website traffic. Instead, using Google shows if customers arrived at your site via a link or social media post.
14. Try Social Listening
Most customers are on social media. The average person spends 2 hours and 25 minutes on social media a day, where they are free to be themselves.
This is a goldmine for consumer research because, besides being free, it’s a place where consumers feel comfortable speaking their minds.
Customers tend to feel pressured to answer questions during an online survey and thus aren’t always being honest to avoid insulting the company conducting it.
Therefore, reading what customers say on social media via a poll or throughout the comments section helps to paint a better picture of how they feel.
15. Ask for Feedback on Product Features
Product feature research must be a part of customer research before committing to expensive costs like large-scale production and advertising.
If practical, consumer input on concepts and prototypes discloses design defects, packaging problems, and other concerns that save time and money.
The easiest way to collect information from beta testers is through qualitative data research methods like usability testing, a focus group, interviews, and open-ended survey questions.
16. Ask Customers to Rate Their Experience with Your Product
Many customer researchers gain valuable customer feedback through continuous rating bars as they navigate their website or tool.
For instance, after every Zoom call, the online video-call platform asks to rate the quality of the call. If the call is not up to standard and receives a low rating, they can take a short survey to fill out what went wrong, like a “low sound quality.” If the rating is high, the customer can thank you for your time and move on.
This data collection technique finds faults in products and services since the information presents as real-time customer feedback.
17. Make Use of Email Subscribers
Reaching out to email subscribers helps get feedback from multiple sources of existing customers. Whether they’ve been with the company for years or subscribed a week ago, these customers support and want to help the business.
Ask customer-focused questions regarding the product which aims to benefit them. Post a survey and offer incentives.
Make sure that the subscribers have a valid email address.
Customer Research Example
Suppose you want to start a company that manufactures natural chemical-free cleaning products. The first step is to identify buyer personas and separate them into different segments. Then determine the following:
- New mothers who need to clean baby bottles
- Homeowners looking for an alternative cleaning solution
- Businesses/factories who worry about harsh chemicals getting into their water supply
Next, conduct consumer research and attempt to answer the following questions:
- What characteristics best describe this persona?
- What values does this persona hold dear?
- How does this persona purchase something?
- How does the consumer experience look?
- What are the main goals of this persona?
- What is the size of the market?
- What are this persona’s demographics?
- Where does this customer live?
- What expenses does this persona have?
- How often does this persona engage with you?
- Whose viewpoint does this persona value?
- Which media are appropriate for contacting this persona?
- What factors does this persona value while making a decision?
- Why does this persona select a specific product or brand?
- How do you affect this persona?
- What alternatives does this persona take into account?
- What kind of budget does the individual have for a solution?
- What difficulty does this persona have?
Once most of those questions have been answered, you can begin to form a clear image of the buyer persona of each segment.
The company’s marketing team then takes the information from the consumer research and develops marketing strategies to appeal to each segment.
Market Research FAQs
How long does it take to conduct customer research?
The primary market research gives an idea of what potential customers look for. Are there gaps in an untapped market that everyone else overlooks?
While market research answers many concerns concerning an industry’s state, it may take weeks or even months for researchers to portray the commercial environment after looking into several aspects of the industry.
Why is marketing strategy necessary?
Having a marketing strategy is a vital part of any business’s plan. A marketing strategy enables the company to produce goods and services with the highest likelihood of turning a profit.
The ideal marketing strategy begins with market research, which considers the perfect target market, what competitors do, and potential future trends.
Market research is the process of obtaining data on target audiences and customers to confirm the success of a new product. It assists the team in refining an already-existing product or understanding brand perception that expresses the value of the organization.
With the help of this data, businesses can work out the benefits customers and clients seek, the price range at which they’re ready to spend, and how they set their product apart from the competitors.
How do primary and secondary market research differ?
Primary research involves performing analysis or hiring someone to do it for the company. It entails going to a source, such as current and potential clients in the target market, to gather information.
Primary research often costs more, takes longer to complete, and produces definitive results.
Primary research examples include:
- Focus groups
Gathered, organized, and published research by others is secondary research. It comprises research and reports from government organizations, industry trade groups, and other companies.
Most research is often secondary for small businesses because it is faster and cheaper to obtain than primary research.
Secondary research examples include:
- Government statistics
- Public records
- Industry reports
Conducting market and consumer research is worth it as it gives invaluable insight into a business’s customers and their needs. Their feedback drives the product; without it, it won’t sell.
After all, the product’s goal is to satisfy the target market’s needs and desires.