Introduction
The modern economy is extremely volatile, with fluctuations depending on a wide range of influential factors such as market trends defined by customer demand. Most successful businesses maintain and invest in extensive research of the market, customers, and competitors. Market research is the collection of information that allows an organization to be aware of how consumers will react to ongoing or future products or services. It is a challenging process that consists of several steps and encompasses a multifaceted approach which is outlined in this report.
What is Market Research
Market research is inherently the process of assessing the viability of new products through a research procedure aimed at the consumer. Market research holds several purposes such as identifying a target market, determining interest in a product, and collecting other relevant information or opinions. It is conducted by companies and third-party contractors as well. The primary purposes of market research include deriving information necessary for an informed business decision regarding the opportunity, innovation, and growth.
The key components that market research seeks to identify are the 4 Ps. Product is the object that customers need and desire, with an identification of its optimal function and appearance. Price includes determining profit markings, competitor pricing, and the money that customers are willing to pay. Placement seeks to research the distribution of the product which may include locations, digital retailers, and value points of sale.
Finally, promotion identifies the best marketing strategies to reach relevant market segments for the products and the most effective methods of advertisement (Government of Canada, 2018). Marketing research should be conducted on a regular basis in order to profile customers and identify business opportunities. This type of research allows tracking economic dynamics such as market trends, demographics, regulations, and industry shifts. This allows to significantly mitigate risk in business decision-making.
Defining Problem
Taking into account the purposes of market research described above, for the first step, it is vital to define the problem which needs to be investigated through the process. The research problem is one of the most vital stages since an accurately and competently defined issue can help guide the process and ultimately fulfill the needs of the organization in authorizing marketing research. If the problem is inherently misunderstood or not properly defined, it will lead to invalid or poorly applicable results which have little use in the real-world economy. A clear and direct problem statement allows for the market research to be focused and guided towards identifying necessary parameters.
A problem should define specific objectives that can be distinctly studied as part of the market investigation (Bell, Bryman, & Harley, 2018). The hypothesis, research design, methodology, and recommendation all ultimately depend on the problem statement. The research problem is competently defined through communication that must be developed between market researchers and its decision-makers.
Developing Research Design
The next step is to develop an efficient plan for gathering the necessary information and the resources or costs it may require. Developing a research design needs to consider data sources. There is primary data which is first-hand information collected, and secondary data which is already in existence and exists elsewhere. Research approaches are the way that data is collected. This can be observation, focus groups, surveying, behavioral data, and experiments.
Research instruments must be selected, which can range from questionnaires to qualitative observations using technology. Furthermore, a sampling plan needs to be determined to identify the population demographic as well as the sample size and selection criteria. Finally, contact methods with the sample groups should be developed (Kotler & Keller, 2016). The research design stage is vital in selecting the correct approaches and tools for conducting marketing research. While some methods may be viable in particular industries, they fail in others. Certain instruments may lose appeal or validity with the sample over time. All these aspects must be considered for efficient design going forward.
Collecting Data
The contact aspect of research design is important in the collection of data process. Research participants are contacted through a specific method. A survey questionnaire is one of the most popular methods of data collection, sent out via postal or electronic mail. Telephone interviews are also possible, directly establishing contact with the consumer. The human factor is critical in data collection as market researchers should be aware of shifting trends and intelligently design models which can simulate behavioral patterns. This allows predicting trends and reactions and then structuring data collection to confirm it rather than using a general methodology (Malhotra, 2015).
Unless it is a specific focus group meant for hands-on experience or face-to-face interviews, most organizations resort to data collection via some form of a questionnaire. When collecting data from real consumers, it is possible to have a high rate of people not wishing to participate as well as other potential research flaws. A shift to electronic devices has significantly simplified data collection and subsequent analysis, allowing for centralized input from digital surveys as well as support from internet traffic data on search engines and websites.
Analysis and Presenting Findings
The collected data is coded and carefully analyzed through computer models. A wide variety of support tools can be used such as multiple regression as well as discriminant, factor, conjoint, and cluster analyses, statistical tests which seek to derive value and separate the data objectively in a manner that is comprehensible and outlines patterns. Findings are presentable in a variety of ways, such as quantitative that displays data in charts and figures or qualitative which may also have tables but has more subjective conclusions.
Findings should be presented in an audience-appropriate method that would understand the findings in accordance with their needs. While the analysis may benefit from quantitative data, executives tend to focus on qualitative trends and consumer demands (Babin & Zikmund, 2016). The presentation should highlight significant findings as well as provide relevant context. Findings should always include evidence-based recommendations for policy or practice that can be transformed into actionable insights.
Application
This is the conclusion and critical part of the marketing research process as it allows translating expensive and prolonged research into business decisions. Findings should be considered within the context of available funding, market trends, and timing. Sometimes data may be inconclusive or irrelevant by the time that research is concluded. Often, managers rely on intuition for decision-making. However, marketing research is an exploratory mechanism that produces empirical research which can directly guide managerial decision and information adaptation (Tarka, 2018).
Conclusion
Market research is the process of understanding consumer demands and market trends, commonly attempting to determine whether a product or service will be well-received. This is a standard procedure for successful businesses and can provide a myriad of information, such as customer satisfaction, pricing, and product placement. This comprehensive information is gathered through a step-by-step process that resembles scientific inquiries. Market research findings are applicable to a variety of business needs and can guide executives in decision-making.
References
Babin, B. J., & Zikmund, W. G. (2016). Exploring marketing research (11th ed.). Boston, MA: Cengage Learning.
Bell, E., Bryman, A., & Harley, B. (2018). Business research methods (5th ed.). Oxford, UK: Oxford University Press.
Government of Canada. (2018). Guide to market research and analysis. Web.
Kotler, P., & Keller, K. L. (2016). Marketing management (15th ed.). London, England: Pearson.
Malhotra, N. K. (2015). Essentials of marketing research: A hands-on orientation (1st ed.). London, England: Pearson.
Tarka, P. (2018). The views and perceptions of managers on the role of marketing research in decision making. International Journal of Market Research, 60(1), 67–87. Web.