What is Market Research?
October 6, 2011 Leave a comment
- Product: What is it you are trying to sell (whether it is a physical product or a service) and its features and attributes?
- Place: Where will you be selling the product and how will it be delivered?
- Price: Ummm…really need to be explained? However, this can get very complicated.
- Promotion: How are potential buyers going to find out about the goods or services you are offering?
This is referred to the Marketing Mix, which was developed in the 1940’s by Heil H. Borden and become popular after he published The Concept of the Marketing Mix in 1964. This is also referred to as the 4 P’s. I have always liked the graphical display of this in the chart below from the Internet Center for Management and Business Center, Inc.
The Marketing Mix
Now that there is an understanding of what marketing is, we can move onto market research. According to the American Marketing Association, market research is the systematic gathering, recording, and analyzing of data with respect to a particular market. Although it is, again, a little academic, I like this definition for a number of reasons:
- Systematic: You’ve heard the expression “Failing to plan is planning to fail.” This is especially true in research. Doing research haphazardly will no give you the insights you are looking for.
- Gathering, recording, and analyzing of data: All three need to be accomplished. Obviously, gathering leads to recording, which leads to analyzing. Analyzing would seem to be the most important. However, without a quality approach to gathering and recording, analyzing cannot be done to a high degree of quality. You might be surprised that the lack of quality placed into the first two sometimes.
- With respect to a particular market: Here a market refers to a specific customer group in a specific geographic area. Customers vary. Period. Understanding nuances in relation to these customers in different geographic areas is key.
By doing market research on your target market, you can specifically gather, record, and analyze the information you are receiving in relation to any or all of the 4 P’s.
Market research can be done through a number of avenues based on what you are trying to accomplish in your research. Working with an experienced market researcher will help you understand not only the types of research, but also what each type can accomplish.
Why would an organization do market research? Well, that can be a blog post all by its self, but the answer is simple…To better understand their customer. That leads to lower customer turnover, higher customer retention and repeat purchases, customer satisfaction, and (by the way) increased higher profitability. Now that’s what we all want. Right?
What do you think?