Benefits of market research

What is a Market Research?

If you are on this blog and you are reading this post, you certainly already know the answer, but you may also be a curious reader who has just shown up here through a Google search and needs a definition that clarifies the concept in a few words. And we are here for this too.

Market research is nothing but a collection carried out in a systematic and orderly way, with subsequent cataloguing and analysis of information about consumer behavior in relation to a marketing action, which may be the launch of a new product but also the study of behaviors towards goods or services offered by the competition. It is now easy to understand how market research are an indispensable tool to ensure the perfect development of a business decision.

What are the benefits of Market Research?

Certainly the first one is by being able to obtain in almost all cases useful information for a company to understand if the business it wants to take has actually real margins of success or even more frequently to understand the performance of a brand, product, or service. Because, of course, the euphoria for a brilliant idea is wonderful, it is exciting to imagine exactly the product that no one has ever thought about, but is it really what consumers want? We want to place the best we can do on the market, but does it really represent all wishes of who should buy it? How are the values of a brand perceived? What is the rank of a brand in its own reference universe?

The second benefit of a market research may be the consequence or the evolution of the first one: the company that has decided to rely on us, needs to understand if the changes brand wants to make to a product which has been placed on the market by the competition, really represent consumer’s needs, tastes or expectations. In short, would they buy an orange juice that would change its color if you serve it with ice, or not? Would they buy a jeans that has a thermo-adhesive hem? Would they eat a salad grown in a jar left inside the fridge from March to September? Already existing and widely consumed products, orange juice, jeans or salad, but that our client company has decided to change by offering the consumer a different experience.

Proceeding in our analysis of the benefits of a market research, we can not forget the one about the risk reduction. Every company not only needs to know as precisely as possible if its action has actual margins of success, but it also needs to face the risks of this same action and try to minimize them. An orange juice is always an orange juice, basically, but if mine changes its color when it comes into contact with ice, can it really be preferred compared to a standard orange juice? Will I run a big risk if I’ll produce it?

Another benefit of a market research is being able to get closer to the competition: consumers to whom we will ask our questions will, inevitably, even if not expressly, tell us something about the competition. Some sort of process that works to exclude information, and is definitely not a factor to underestimate.

Let’s conclude this brief study about benefits of market research by focusing on an essential aspect: what is the segment we must achieve? We have talked so far about imagined, done and completed goods and services, that our client company has decided to propose on the market. But did the company identify the ideal market slice? It is often not the product to be wrong, it is just the segment that is not right. Maybe it doesn’t need that product, maybe it no longer has the right age to use it, or maybe there is already a too much offer for it. Maybe in that country temperatures do not allow to wear jeans or maybe some countries don’t like orange juice while others do, where there is a large slice of cool teenagers who buy this kind of products.

Market research is an extremely fascinating journey where you can be able to understand and discover more and more about human being’s most common wishes and this is maybe the most exciting benefit.

If you need help, write me e.armato@iff-international.com

Ennio Armato (Branch Manager, Italy)