Every successful business understands the importance of a growing customer base. The bigger the audience for a product or service, the greater the likelihood of generating more sales. But bigger audiences do not simply fall from the sky. They aren’t conjured up out of thin air by some magical sales wand. To develop a growing customer list, companies require a great customer acquisition plan. And that plan starts with a market research strategy.
So, what exactly is a market research strategy? Well, it is the act of collecting information about the typical buyer personas, customers, and target audience of any business or order to determine how successful a product or service will be among these people.
Let’s discuss the importance of a market research strategy, what to consider when crafting the ideal market research plan, and a few typical ways of conducting the research.
Doing your homework
Here’s an interesting fact: According to recent surveys, more than 80% of consumers research a product online before going to the store. Judging by this statistic, it is clear that people want to have a better understanding of a product or service offering before deciding whether or not to buy it.
Market research allows businesses to do the same thing: it provides the necessary information needed to make decisions about potential customers. The ultimate purpose of a marketing research strategy is to enable businesses to better understand the customers that they are looking to attract.
Without a good understanding of its customers, a business cannot hope to effectively reach and connect with their desired audience. Sure, the scattergun approach may work at times. But, in most cases, this strategy leaves businesses with few hits, many misses, and hefty ammunition expenditure.
In addition to understanding the customer, market research is valuable for the following reasons:
- It allows companies to improve the customer experience.
- It offers invaluable insights into why consumers make the buying choices they do.
- Carrying out market research means that companies don’t have to make assumptions about their customers’ preferences, they have hard and fast facts.
- Research can prevent a company from sending an inferior or flawed product to the market, saving them time, money, and reputation.
- Market research doesn’t only help a business understand its customers; it also allows them to better comprehend their competitors’ strengths and weaknesses.
In business, as in school, it pays to do your homework!
The marketing research strategy recipe
Now that we’ve discussed the why, let’s take a look at the how. The perfect research marketing plan can be crafted using six simple steps.
- Imagine your ideal customer: Many companies start their market research strategy by developing a buyer persona – a generalised version of their ideal customer. This buyer persona may include various characteristics such as age, gender, location, income, etc.
- Select a group that matches your buyer persona: Once you’ve identified your business’ buyer personas, you need to select a group of participants that are representative of that persona.
- Recruit research participants: Companies have several outlets from which they can pull market research participants, including CRM Lists, social media following, and even their own business and employee networks.
- Have your questions ready: To effectively collect the information that they are seeking, companies need to know what questions to ask their research participants in order to gather the material needed to make better decisions.
- Understand the competition: Businesses need to know who they’re competing against for the affections of their customers. They need to know who their main rivals are and what their appeal is to consumers.
- Collate all of the data: Once all the relevant data has been collected, the findings need to be summarised. The data collected can offer great insights into the mind of the consumer and can be used to shape a product or service to better fit the customer’s needs. This data can also be used to tailor marketing campaigns to connect with the desired target market.
What are the popular kids doing?
There are several market research techniques that companies employ today. The technique chosen is largely based on the type of company and the size of their budget, so businesses need to consider which options work best for them:
- Online surveys: Online surveys are currently the most popular method of conducting market research. Surveys are inexpensive and allow businesses to collect tons of information. If done correctly, they can be used to great effect as part of any digital marketing strategy.
- One-on-one interviews: One-on-one interviews can often give companies the best insight into customer thinking and, as a result, may yield the best information. But interviews can be time-consuming and costly.
- Focus groups: Focus groups are a very popular method of market research. Companies create focus groups by bringing together a select group of people who closely represent their target market. While focus groups can provide good information, there is a danger that the information provided is not always the most accurate. Sometimes, the results may be skewed because the group is steered by one or two dominant people.
- Loyalty programs: Businesses are starting to rely on loyalty programs as a viable method of market research. Loyalty programs collect huge amounts of customer data; data that can be used to better understand when, how, and why different consumers purchase different products. This data can help companies adapt their products and services to more consistently hit their target market, even when the market’s preferences shift.
Creating a solid market research strategy is critical to any customer acquisition plan. It helps a business better understand the customers that they hope to serve. The better the understanding, the easier it is to meet the customers’ needs with the right kind of products and services.
As with most things, a market research strategy needs to be carefully planned. While spontaneity may be great for your next family getaway, it shouldn’t apply to your research strategy.
Once you have your market research done and dusted, it’s time to really unpack and plan your customer acquisition strategy. Here’s a look at some timeless customer acquisition strategies that could work for your business.