A plastics manufacturer thought that its customers were mostly interested in environment-friendly products. The company spent much of its financial resources and product development funds to manufacture a superior environment-friendly product. In addition, it also spent its resources on a creative marketing campaign. The company promoted its product’s environment-friendly attributes. While the advertising was creative, unfortunately the product failed miserably.
Turns out, its customers were not looking for an environment-friendly product. Instead, they wanted a product that is durable and affordable. If only the company had undertaken a market research initiative and understood what its customers really wanted, it could have saved itself a lot of trouble. Besides, it could have saved a whole lot of money which could have been better spent elsewhere.
Failure to do market research and understand what customers are seeking is a recipe for disaster.
Market research is commonly misunderstood and sometimes maligned by businesses. But to those who are disciplined enough and think strategically, market research data is an extremely important function of any business organisation.
Whether you are collating information for a new product launch or merely finding out if people are satisfied with your level of service, market research plays a major role in business and product strategy.
Generally, businesses have two major goals – to return profits and to grow. In both these goals of any business, market research plays a key role in ensuring that the business remains focused on its goals. Failure to study the market and your customers could lead to more wasted time, effort and money. Sometimes, it could even cause the collapse of a product line or service.
But why do people shy away from market research?
Below are some reasons commonly given to wave market research away and why they are just another red herring.
1.Market research is too costly
Contrary to common perception, the cost of a market research is relative. In fact, it is dependent on the scope of research. If what you seek is lots of information, the cost will surely be higher. In this sense, one needs to be pragmatic.
The trick is to first determine how much your budget is. Then scope the research project according to your budget. This saves a lot of time and frustration.
2.Market research is too time consuming
“We don’t have time for market research. We need solutions now!” is a commonly heard quip in the corporate boardroom. However, it is another misunderstanding on market research stemming largely from over generalisation.
Not all market research initiatives are time consuming. Some research projects can be completed in as little as four weeks. Others take longer, perhaps spanning a few months. Again, the trick is to scope the project well. Start planning early and determine from the outset when you need the results. If you need the results for presentation purposes for an event happening next week, then market research will not cut it.
3.Market research is for those who can’t sell their product or services
Actually, market research goes beyond mere insights to make the next sale. In fact, with the right approach, research data can potentially identify new groups of customers whom you may have missed. This could translate into a new line of customers for your business.
In addition, research can also yield new insights into reasons why customers choose your product or services. This could yield some unique insights on how you can continue to keep your customers happy and delighting them further.
4.Market researchers don’t know our business enough!
This could be partially true. But it is better for the market researchers not to know your business too well initially. This way, they would not be influenced by preconceived opinions and perceptions on how the industry segment or your customers behave.
Starting on a clean slate, market researchers remain independent and look at various perspectives to solve the problem. Eventually, they will gather enough data and amass sufficient knowledge about your business by talking to customers and competitors to give valuable feedback you would otherwise miss.
Running business is not just about making a sale and keeping the customer happy. One should also watch for competitive developments to stay ahead of the curve. Or else one could easily lose customers to a competitor.
5.What about the ROI on market research?
Market research is the beginning of a process. When done well by capable analysts, it yields great financial benefits. Without research data, one will be second guessing what customers really want. While trial and error may work for some, it is not the norm.
Market data gives interesting insights into your business, competitors and most importantly your customers. Eventually, with the right marketing messages, the return on investment (ROI) will be convincing.
If you have Netflix, check out the documentary titled "The Toys That Made Us", on Season 1, Episode 3: He-Man and 4: G.I. Joe. In it, they explain how market research lead to the discovery of the boys market for action figures.
So the next time you have an idea, spend some time doing market research before you jump into it. After all, if there's a girl or boy that you like I'm sure you'll be doing some research about he/she likes first!
What are the critical success factors of an internet entrepreneur in Malaysia? 1 always keep up with the trends. 2 never be afraid to try new technologies, new media such as TikTok. 3 be data driven - it is key to understanding customer behaviour. 4 learn to automate. 5 have the eagerness to experiment new methods, validate before going big. 6 be customer centric - great customer experience is what drives recurring revenue. 7 start small, but be ready to scale. 8 don't be afraid to ask and pay it forward. 9 invest in technology, because the technology will keep you ahead of customers. 10 look out for niches, because there riches is in the niches. Key challenges by internet entrepreneurs in Malaysia. 1. limited access to tech talent pool: both developers and digital media specialists. 2. poor internet infrastructure = inconsistent speed. 3. differences in purchasing power, lifestyle and standard of living among consumers from different states of Malaysia. 4. Malaysian consumers digital savviness is rather poor. they are not keen to try new things and depend on others to educate them, ie not early adopters. 5. lack of internet education, like how payment gateways function. 6. low credit card penetration limits spending. 7. too much fraud, making consumers too cautious and wary about new things. 8. difficult and expensive to market to 3 different language groups in Malaysia. 9. over reliant of facebook. 10. local SMEs are slow to adapt to embrace new technology.