Market research allows organizations to acquire, analyze, and interpret data to better understand consumer behavior, industry trends, and competitive landscapes. It helps businesses gather and analyze information in a systematic way that facilitates data-driven decision-making and business growth. Overall, it tells you if your business aligns with consumers or your own customers, and makes sure it’s competitive in your target market.
You can use market research to your own advantage to grow your business. Whether it’s assessing customer needs or gauging market potential among consumers, systematic research helps businesses make decisions backed by robust, reliable data. This ultimately leads to improved product development and a competitive edge in the market.
Companies have used market research for decades to gain a competitive edge. For example, McDonald’s used market research to guide the innovation of the McFlurry. In the early 2000s, McDonald’s offered a limited selection of McFlurry flavors. They conducted customer surveys, analyzed sales data, and learned that people were interested in more unique flavors. In response, McDonald’s introduced flavors like Oreo, M&M’s, and seasonal options.
McDonald’s closely monitored the performance of these new flavors through sales data and customer feedback. They used this information to determine which flavors resonated most with their target audience and made decisions based on that data, and the McFlurry became one of its most popular menu offerings.
7 Types of Market Research
Market research can be categorized into two main groups: primary market research and secondary market research. Primary research involves collecting the research from consumers or customers to meet a specific objective. Companies either do this in-house or outsource the process. In contrast to primary research, secondary research involves reviewing and analyzing data that has already been gathered to potentially shed additional light on the primary research.
Primary market research is useful for pinpointing specific needs and opportunities, while secondary research provides insights into overarching market trends.
Keep in mind there are many types of market research – this article will give you a brief introduction to seven primary types of research. We will examine the purpose and benefits of each type, which will help you consider the best approach for your specific research goals, resources, and the depth of insight required for your business decisions.
- Product/Service Use Research helps you learn how consumers engage with your offerings. It uncovers usage patterns, preferences, and pain points, providing a detailed map of the customer journey. This type of research helps businesses enhance their products or services, fine-tune marketing strategies, and boost customer loyalty by aligning their offerings with customer needs and expectations. Benefits: Provides detailed insights into consumer behavior and usage patterns. Guides product improvement/development and targeted marketing efforts.
- Competitive Analysis Research is a strategic tool to assess and understand competitors within your industry. It involves a thorough examination of rivals’ products, pricing, positioning, and customer perceptions. This research equips businesses with insights to identify gaps in the market, develop differentiation strategies, and make informed decisions regarding product development and marketing. Benefits: Offers a comprehensive view of competitors and their strategies. Helps identify market opportunities and refine strategy.
- Customer Satisfaction and Loyalty Research (CSat) Research measures customer satisfaction and loyalty levels, offering a quantitative understanding of how customers perceive your business. It uncovers satisfaction ratings, loyalty levels, reasons for dissatisfaction, and areas for improvement. Businesses can use this data to refine customer experiences, improve product or service quality, and foster long-term customer loyalty. Benefits: Quantifies customer satisfaction, loyalty, and areas for improvement. Supports the development of stronger customer relationships and advocacy.
- Brand Awareness Research assesses the awareness and perception of your brand among your target audience. It gauges brand recall, image, and competitive positioning. This research aids in crafting effective branding strategies, strengthening brand identity, and evaluating the effectiveness of branding efforts to ensure that your brand remains top-of-mind among consumers. Benefits: Measures brand awareness and perception. Informs branding and marketing strategies. Provides direction into brand positioning based on perceptions regarding the brand’s strengths and weaknesses.
- Voice of the Customer Research involves gathering direct feedback from customers. It’s a quantitative assessment of customer opinions, preferences, and suggestions. This research guides service improvements and can spark innovation by aligning business strategies with customer feedback and expectations. Benefits: Gathers projectable, quantifiable data directly from customers. Drives customer-centric strategies.
- Net Promoter Score (NPS) Research is your advocacy and loyalty meter. It quantifies customer advocacy and loyalty by asking a simple question: “How likely are you to recommend our product/service to others?” This research categorizes customers as Promoters, Passives, or Detractors and reveals the reasons behind their ratings. It aids in identifying loyal customers, measuring advocacy, and refining strategies to boost customer referrals. Benefits: Provides a simple and easy-to-understand metric of customer loyalty and advocacy. Enables benchmarking and tracking over time.
- Ad Testing, Perceptions & Recall Research involves gathering information from consumers regarding advertising recall, sponsorship recall, and perceptions of your business based on its advertising. Research can also be conducted prior to the launch of a campaign to help determine the most effective ad among consumers. Benefits: The effectiveness of the advertising can be tracked after the campaign launch or during the campaign. Assessing whether potential advertising will resonate with consumers or the target market can also be determined during the development stages before full investments are made.
Want to learn more? We wrote an introduction to market research for leaders interested in using market research data to gain a competitive advantage.
The preceding types of research described are just some of the many ways to obtain business objectives through market research. Custom research for your specific business needs can be designed by CSP. A conversation with market research experts at CSP can be an invaluable next step in determining the best market research approach for your business goals, objectives, and challenges. Our expertise can help assess your needs and recommend a tailored research strategy that aligns with your objectives.
