Why and How Organizations Carry Out Market Research
- Market research helps businesses avoid launching a new product without knowing if anyone wants it.
- This uncertainty is avoided by providing insights into customer preferences, market trends, and competitive landscapes.
Definition
Market research
Market research is the process of gathering, analysing, and interpreting information about a market, including its customers, competitors, and trends.
Why Organizations Conduct Market Research
1. Identifying Customer Preferences
- Businesses need to understand what their customers want and need.
- This includes preferences for product features, pricing, and even marketing channels.
A smartphone company might conduct surveys to learn which features (e.g., camera quality, battery life) are most important to its target audience.
2. Evaluating Market Opportunities
- Market research helps identify gaps in the market or emerging trends that a business can capitalize on.
- This could involve discovering an underserved customer segment or a rising demand for a specific product type.
A food company might use market research to identify a growing interest in plant-based diets, prompting it to develop new vegan products.
3. Monitoring Competitors
- Understanding what competitors are doing such as their pricing strategies, product offerings, and marketing tactics, helps businesses stay competitive.
- This insight allows businesses to anticipate market trends, identify gaps in the industry, and develop strategies to differentiate their offerings effectively.
A retail store might analyze competitors' promotions during holiday seasons to adjust its own discount strategies.
