HomeSoftware/BusinessMarket Research: Definition, Types, Functions, and Tips

Market Research: Definition, Types, Functions, and Tips

Market research is an important thing because business is not only about selling and promotion. Businesses need to ensure that their products are well received by consumers. Because this is what can make the life of a business longer.

What is needed to ensure the product is well received by consumers is market research. With this, you will find out whether consumers accept your product well or not and also the reasons consumers buy the product. 

Definition of Market Research

Market research is an evaluation analysis of collecting data related to the target market or consumers. This research can be carried out directly by companies or institutions that have expertise in market research. The process usually takes the form of distributing surveys, interactions with a group of people as a sample, interviews, or other similar processes.

According to American Marketing Association, market research is a function that connects consumers and the public with companies through information on opportunities and problems in marketing. The data will be used to structure and adjust marketing activities as well as determine customer service priorities and requirements if any.

Types of Market Research

Primary market research

Primary market research is a process by a business or company that deals with consumers or employs third parties to conduct research and collect data. The data are in the form of qualitative (non-numeric) and also quantitative (numerical and statistical). Primary research is important because it will get data directly from consumers who use the product. The data can also be in the form of ideas so the product fulfills the consumer’s needs. Usually, there are specific questions such as age, income, lifestyle, occupation, and experience in using the product. These questions will simplify the analysis of research results.

Secondary market research

Secondary market research uses available information from public sources such as government agencies, media, etc. This information is usually found in newspapers, magazines, books, websites of companies, government and non-government agencies, etc. This research is also usually done by reading articles, trend research, or market statistics.

Market Research Function

Market research aims to develop a marketing plan. New year’s marketing planning results are usually influenced by the company’s market research results last year.

Market research has three main functions:

Evaluating

The first function of market research is evaluating. This function means that market research is used to evaluate marketing programs that have been carried out previously. Evaluating in marketing research includes when the company wants to review the brand positioning of competitors’ products. In the evaluation process, market researchers also do problem-solving on the results of the review. You can solve this problem by understanding the points that make the business not run properly.

Also read: How to Successfully Conduct a Year-End Profit Review

Understanding

This research function focuses on the purpose of understanding consumers as an insight for the company. By understanding consumers, companies will know the needs and complaints from consumers. In carrying out this function, market research usually describes consumer habits and behavior as well as consumer expectations and complaints about the product.

Predicting

This function is the most difficult function to do compared to other functions. Due to some uncertainty, predictions are very risky and also very relative. When a company wants to open a new brand or product, this research will be there as a reference to target new target markets.

Controlling

This function happens to see every business process that is running. Usually, this research function aims to see data on ongoing marketing activities. The data can be in the form of products in the eyes of consumers, demographics, market trends, and also the effectiveness of marketing tools.

Tips for Conducting Market Research

Identify your buyer persona

The buyer persona is a representation of the type of consumer in a business. The buyer persona must reflect the real consumer profile. The data is in the form of demographics, personality, to consumer behavior when buying products. By knowing the buyer persona, it will be more precise.

Focus on customer segments

The way to do this is quite easy, you just need to group consumers into several categories. The categories are location, time, price, demographic, and socio-cultural. You can also do this when you want to launch a new product and have a target market with certain segments, such as young people. This means, always do this with a focus on consumer segments according to the business objectives you are doing and what you want to develop.

Prepare questions according to research objectives

Preparing questions according to research objectives is also important to ensure the success of market research. Questions can be complete sentences or main points that can develop later. Make sure the interview flow is systematic. Adjusting the flow and style of the consumer makes you get the information you want. Also, you can also get other information outside the questions you give.

Get to know competitors

It can help you identify competitors. This is important to ensure the competitiveness of your product in the market. Because of the same product, you will have the same target market as competitors. With this, you can learn about the strengths of your competitors’ products and marketing strategies. With this, you can find out why consumers prefer competitors’ products over yours. You can use this information for further research.

Related article: How to Face Business Competition Wisely

Better market research analysis

After doing research, you need to do an analysis of the research. The research can be in the form of notes, statistics, or diagrams. This will make it easier for you to review or discuss it with colleagues in your business. After the results of the analysis are there, you can determine the business strategy that you will run.

Conclusion

Market research is one of the most effective ways to get data about your consumers, competitors, and the market. The goal is that you make the right decision before taking a step in business. This is very important in business when determining whether a new business idea can work, wants to move to a new market, launch a new product or service, or expand the market.

In expanding the market, you need applications that can integrate data and automate your business processes. HashMicro provides ERP software that is capable of integrating data and automation of your business processes. ERP software can be a solution for businesses because it provides benefits such as getting real-time information, increasing interactions within a business, inventory management, and others.

Interest in getting savvy tips for improving your business efficiency?

Muhammad Syahrian
Content Writer Intern at HashMicro. Passionate and hardworking person to develop my marketing skill.

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