Gathering and developing market research is essential for a firm if they intend to increase
their sales of a specific product through one of the four general bases of segmentation.
Without great market research going into the marketing strategy you could expect to find
high-end vehicles sold in low income areas of your city and other things like this occurring.
These kind of marketing strategies would put many companies out of business and shows
the importance of developing strategic market research.One example that comes to mind was
the marketing strategy of Lays potato chips a couple of years back. It was called the "Do Us
A Flavor" contest and it seemed that there was a new flavor on the shelf daily with some
pretty wild ones to boot. This was a very unique way to conduct market research and has
since been copied by other organization's looking to replicate Lay's success. According to
Wireless News, "Lay's is asking fans to also include the location that inspired each potential
million-dollar idea. Later this year, four delicious finalist flavors, representing flavorful
cities and towns across the U.S., will be fully developed, brought to store shelves and voted
on by America. Fans are encouraged to visit DoUsAFlavor.com to submit their flavor ideas."
(Close-up Media, 2015) The primary observational data that Lay's was able to generate from
this strategy would set the company up for years of future marketing success. They would
then be able to identify market segments across the nation with which to target and how to
target those segments. Marketing research is one of the key components in developing
marketing strategies for businesses. It is important because we need to identify marketing
opportunities and problems. We also need to generate, refine, and evaluate potential
marketing actions, and monitor marketing performance. Some main purposes of marketing
research is that it can help a business make important business decisions, secure investments
and funding, determine new business opportunities, and avoid business failures. An example
of marketing research is conducting an online search on a particular product and then
making note of the most recent data published on that product. I will use face cleanser
products as an example, a business can want to find out their competition or what they are
up against and can look up that product and make note of their recent data and sales and
things like that. Another example of marketing research is contacting trade organizations and
asking specific questions about a topic. Some companies even choose to perform market
research by sending questionnaires to their existing customers or users who have shown
interest in their product or services. There are at least seven reasons why marketing research
is important to the development of a marketing strategy. Easily spot business opportunities
by forming partnerships with other businesses, create profitable order upgrades, and find
new locations to sell to. Reason two is lower business risks by testing new designs and
products before launching, find out why customers do not come back, and get insights on the
problem areas. Create relevant promotional materials by talking to the target customers and
already know their wants, needs, and frustrations and you will know exactly what to address
and how to address it when you start creating marketing materials. The fourth reason is
known where to advertise by buying ads on social media, placing flyers and posters, and
targeting ads. Outsell competitors by target dissatisfied customers, find an underserved
customer segment, and identify unaddressed customer needs. Reason sixth is setting better
goals for your business because with market research, you will be able to determine the
specific directions you want to grow your customer base. The last reason is decision making
becomes simple, the need for and importance of marketing research frequently comes up
when making tough business decisions. Instead of having arbitrary criteria for the decisions
you make as a business owner, you can always go back to your market research report.
Based on that report, will this decision lead to more customers? Will you be able to reach
more people who are likely to buy from you? Will it be clear to them that your business can
meet their needs? . Market research is critical in developing a marketing strategy by
providing a fact-based foundation for estimating sales and profitability. It can make the
difference between wise decisions that drive the business forward and poor decisions that
can damage your business.Market research provides critical information about your market
and your business landscape. It can tell how your company is preserved by the target
customers and clients that you want to reach. It helps you understand how to connect to
them, shows how you rate against the competition and how to plan your next step.For
example, It gives you an accurate view of your business and your marketplace. You can see
how you are perceived in comparison to your competitors, and evaluate what your
competitors are doing to attract customers.It helps you to know who and where your
customers are and which ones are most likely to do business with you. This gives you the
opportunity to ask those customers who do not want to do business with you "why not?"
It can help you to determine if customers will find a new idea for a product appealing based
on how similar products have performed in the marketplace. It can also help you make
decisions on product packaging and promotional decisions that will effect the marketing
message. Market research is the very first step that must be taken for the development of a
marketing strategy due to the fact that research helps in making a better and effective
strategy. Some of the advantages of doing a market research are:
• It helps in a better understanding of the customers. Having a detailed information
about the customers like age, gender, income etc. helps in a better profiling and gives
an advantage in effective targeting.
• Doing a market research also helps in getting the required information about the
existing competition in the market. Having performed this analysis gives an
appropriate picture of the major competitors and their weaknesses which can help in
making a better strategy.
• Market research also provides insights about the changing consumer trends. These
trends are crucial for the formulation of product related strategies. Eg: What new
features should be added to the product
• Market research helps in getting the insights about the demand of a product or
service. This can help in making strategies related to the production planning and
stock purchasing.
some disadvantages to market research? It can be expensive, may only target a small
population and need personnel to conduct research. Would you agree to these as well?
Before a company develops a new product for the company’s existing product line,
executives often conduct market research to see if the new product will be profitable, while
examining the direct need for the product. Although market research for new products has
advantages, disadvantages also are associated with the process. Company executives must
decide whether market research is necessary for the new product in question. A company
can determine the types of data they collect by identifying the target or specific market. For
example, a make-up brand might target stay at home moms and develop a TV commercial
that will be shown while soap operas are on. Then they have their full attention as their kids
are probably in school. The company could collect the ratings of how many people are
watching these shows Mon-Fri. Reach the target price by evaluating how much people are
willing to spend, and roughly figure out how much the regular household brings in. Some
people by high end make-up, like MAC for instance. Realistically, not a lot of people can
afford to spend $80 on a single foundation. The consumers then look to a cheaper
alternative. Loreal is one I use and can afford. Not as good quality but effective.
Reference:
Lay's Kicks Off Potato Chip Flavor Contest. (2015, January 23). Wireless News.
https://link.gale.com/apps/doc/A398481673/ITBC?u=uphoenix&sid=bookmark-
ITBC&xid=0cad9346
