Planning and conducting market and customer researchConducting market and customer research gives you insight and data on local and global market trends that will help you make decisions when starting or growing a business. Show
Market research is a broad term covering:
Customer research will help you develop profiles of specific target customer groups and forms part of your market research. On this pageWhen you should do market or customer researchWhen developing and changing aspects of your business, including offerings to customers, it's important to do thorough research to have confidence in the actions you're taking, including research into:
There are several methods you can use to do research, including:
Understanding market research and customer researchMarket research is a methodology used to gain reliable data about specific markets and target customers. Market research organisations and industry associations provide data and statistical reports on markets and future trends. Data and statistics can also be taken from the Australian Census and by using search engines and social media to explore trends in the market and discover what customers are searching for. A subset of market research is customer research. Customer research tools help you target and understand your buyer's behaviour and demographics. The differences between market research and customer research are:
By exploring customer profiles and motivations, you can gain insight into demographics such as geographical populations, buying habits, preferences and the projected growth or decline of targeted groups. Using a combination of market and customer research helps you to keep up to date with market trends and build reliable customer profiles to target. It is important to build more than 1 customer profile to prevent marketing too broadly. The value of market researchMarket research is valuable at the start-up stage of your business, and you should conduct research regularly to ensure you adapt your business to changes in the market. Planning and conducting your market research involves using methods and tools to ensure your marketing activities will be:
Market research toolsRead about the tools to use when planning your market research and their benefits below. Research can be undertaken yourself or outsourced to professional market research organisations. Industry report databases are useful if you are looking for an overview of an Australian industry. These reports include:
Data from industry reports is gathered regularly and provides insight into the strengths, weaknesses, opportunities and threats (SWOT) to the market, products and services customers are buying and those that are trending downwards. The results can help you discover potential markets for your products and services. You can access industry reports from IBIS World Research with free State Library of Queensland membership. Search engine trends tools find data and provide statistics about trends in what customers are searching for and questions they are asking. Data sources include common web, image, news, social media and video services. Search engines provide this trend data on various online platforms (e.g. identifying shopping trends by products, services, countries over a certain time using Google Trends). You may wish to work with a professional market research organisation to conduct research for you. Rates vary for this type of service, but you can expect a report that is targeted to your business, which will help with your business direction and marketing plans. For a list of research service providers, use the Company directory from The Research Society. The value of customer researchCustomer research gives you insight into why customers are currently buying or not buying from you, and what they may want to purchase from you in the future. You can also research current customers by identifying what they are purchasing from you and investigating why—for example, you could ask your customers how often they shop online versus purchasing from a physical store, then ask why they choose their methods of purchase. Customer research is beneficial to your business for:
As your business grows, regularly researching your current customers will help you refine your knowledge of them and expand to more customer types. Set your objectives, collect data and analyseResearch should be conducted over multiple periods and segmented into focus areas for improving and growing your business (e.g. increasing your sales, adding new products and services, or improving customer service). To conduct effective research, you need to complete each of the following steps.
Understand your buying benefitUse our customer research tool to consider your customers' reasons for buying a product or service (the buying benefit) from your business and categorise the customer types these benefits target. Planning research methods and activitiesCustomer research can involve different elements to cover key aspects of your business or marketing planning, such as:
Use our market research kit for help with planning your research. Types of market and customer researchMarket and customer research methods you can use for your own business fall into 2 main categories.
The type of information gathered is also categorised into 2 types of research.
Common customer research methods and activitiesYou should use various research methods to get accurate and reliable data. The following is a list of methods and activities you could try, the research type and the benefits. Primary researchConsider using the following primary research methods to understand your customers and your business's place in the market. Use customer feedback to understand how your products and services suit your target market (e.g. when you are adding a new product or service or when sales are dropping). Gauge the level of interest in the product and the expected price with focus-group testing to help you decide if you should sell it. This is useful when starting your business or when adding new products and services. Attending expos or interviewing prospective customers will help you find out about your reputation in the market, understand more about your customers' needs and wants, lifestyle, beliefs and attitudes. Read reviews about your business to find out more about how well you are meeting customer needs and expectations. Position your products and services better by visiting your competitors' locations or online stores and seeing their prices and sales techniques. You can also look at their advertising and social media. Use online polls to understand simple customer preferences (e.g. preferred colours or delivery options). Understand what your customers are buying and when, will help you to decide on the best products to stock. Secondary researchConsider using the following secondary research methods to review information sources to supplement your own business data. Understand overall market demand for the type of products or services you sell to know if your market is growing or declining. Review data that has been gathered from various sources and gives general information and analysis for your industry, which is helpful for reducing your risk. Note that your business situation may not be identical to the general industry and the analysis may not fit all your needs. Reading market research reports helps to identify competitors, industry trends and consumer sentiment. Search engines gather customer queries, search terms and data from local and global sources. Analysing this data show interests, lifestyle and market channels used by consumers (e.g. websites, social media). Government provides data that has been verified and collected using sets of standards and is analysed (e.g. Queensland ABS statistical data, Regional Development Australia, local government reports, import-exports). It is helpful for choosing locations and reducing your risk. You can also access business regulations and demographics, including age, level of schooling, income and language spoken. Tips for conducting surveys, focus groups and interviewsFollow these tips to learn how to design questions for customers and how to make the most of their responses. Surveys are questions used to collect information (e.g. people's opinions on a particular product) and are usually:
Use the following best practice methods when gathering information:
There are commercial software options (e.g. SurveyMonkey, Google Forms) that can provide various survey design and analysis tools as an alternative to developing your own. A larger sample size is ideal for surveys to help gather reliable conclusions from the data you collect. Remember that you are conducting customer research, so make sure the people you choose represent your ideal customer profile that you previously identified. Focus groups and interviews involve a set of questions or discussion that allows you to explore people's opinions and attitudes (e.g. how they feel about your products and what improvements they would like to see in your business). Focus groups and interviews can be conducted face to face or online using meeting software (e.g. Teams, Zoom), and they might include visual concepts and even product samples to trial. To ensure your conversations with participants are productive, make sure you are prepared by developing a list of questions and key discussion points beforehand. To get the most out of a focus group or interview:
A typical focus group may consist of 6–8 people but you may need to conduct many focus groups to get the ideal mix of data you need. Analysing and reaching conclusionsAs you conduct your primary and secondary research, you should prepare a document or spreadsheet to capture your data. This document can keep all findings in 1 place and allow you to see data correlations. Your research on the objectives should be used as part of your business plan. Research and analysis exampleThis is an example of using both primary and secondary research. You have secondary research in a local government area profile report that identifies the number of new houses and increasing numbers of parents with children. Your primary research survey (undertaken at a local shopping centre) finds that this demographic group of new parents cannot get the children's play facilities they need and want in the new housing area. You see this correlation in your spreadsheet and conclude there may be a market opportunity for your children's play centre business in this area. You then do more research around the location, competition and household incomes to identify the best types of play centre activities for these customers. You prepare interview questions and invite parents to focus groups where you ask:
Research resources for businessVisit the following resources and learn about how they might be useful for your research.
Industry-specific research resources
Industry associationsMost industries in Australia are represented by industry associations, which are typically not-for-profit organisations that provide member services and lobby on their behalf. Industry associations can help with your research by:
They may offer some information and services for free, but it's possible you will need to become a member and pay a fee to access their full range of information, resources and services. Search online to find industry associations relevant to your business. Learn more about industry associations from the Australian Competition and Consumer Commission. Also consider...
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