How to Conduct and
Use Market Research
Effective business owners use market analysis to make informed decisions and develop a sound marketing strategy resulting in their company’s sustained sales and development.
It is important to understand the intensely competitive marketplace and it is done by comprehensive and well-considered market research.
WHAT IS MARKET RESEARCH?
In order to gain an understanding of the evolving environment in which your product competes, market research is a method of collecting and analyzing knowledge.
The process includes four main steps:
Step 1: Set market research objectives. Step 2: Gather information.
Step 3: Analyze the information.
Step 4: Use market research.
Market research provides insight to:
- Understand your target market;
- Identify opportunities;
- Recognize market shifts;
- Monitor the competition; and
- Mitigate risk in business decision-making.
STEP 1: SET MARKET RESEARCH OBJECTIVES
Make sure your targets are achievable; for example, focusing a new company’s research on competitive products in local markets could be more practical than products from across North America.
Key areas of research may include:
- What are the market trends?
- What is the size of the market?
- What are the competitive products?
- Who are the consumers?
- What key benefits do consumers want? Where do consumers buy these products?
- How do consumers expect to receive product information?
- What kind of packaging is required to make the product stand out on the shelf?
- What are the retailer requirements?
Understanding the Marketplace is Critical
Make sure the targets are achievable; it might be more practical for a new business , for example, to concentrate its research on competitive goods in local markets rather than products from all over North America.
STEP 2: GATHER INFORMATION
Next phase is collecting information. It can take a great deal of time to perform market research. Focus on the aims of your research so that you stay on track.
This move involves collecting secondary and primary data.
Secondary data is already established information that has been produced for other purposes and provides the business with unique data and knowledge that is useful.
Examples of secondary information include: current population data or business information; smartphone use by grocery shoppers; and studies on market research.
First of all, start your secondary market research as it can help lead more research and is typically less costly than primary research. Staying concentrated on the mission at hand is the secret to doing research.
Sources of secondary market information:
- Industry Publications: Food in Canada, Euromonitor, NewHope, Prepared Foods, FoodNavigator, e-Commerce Foundation
- Product and Sales Tracking Organizations: Mintel, Innova Market Insights, SPINS
- Industry Associations: Food Processors Association, Small Scale Food Processor Association, Food Exporters Association, Associations in countries of interestIf you are looking to enter an export market the availability of information can vary considerably depending on the market of interest.
Primary knowledge is new data obtained directly from a single source to meet research goals.
Examples of primary details include: findings of an online survey conducted to assess target consumer purchasing patterns; documentation of prospective customer interviews.
After at least some secondary research has been done, primary market research should begin. Via secondary research, what is learned will help direct primary research and save time and money.
For example, once the demographic target is determined based on secondary research interviews can be set up to collect information on particular needs. The spectrum of primary research will first be narrowed down by doing secondary research.
The main benefits of collecting primary information are that it is current information, addressing the unique research goals of the organization. The drawbacks are that it can be expensive and take time to complete.
There are several methods for the processing of primary data. An summary of the benefits and drawbacks of many approaches is presented in the following table:
For companies interested in pursuing export prospects, a business visit to the country of interest should be included in the primary research.
STEP 3: ANALYZE THE INFORMATION
To review the information collected, summarize key findings and decide whether the original goals were reached.
By comparing them with other study findings and discussing them with industry experts: researchers, consumers, customers, consultants, distributors and/or government employees, verify conclusions. You will need to perform more research if the research does not provide sufficient information to respond to the original goals.Once research goals are answered, the next question to ask is: What are the consequences of research on my business? For instance, if you set out to identify the size of your product ‘s market, the next question is: how much of the market can I expect to capture? Be rational, you have to take this into account when deciding how much of the demand you can supply if your production capacity is limited.
Set milestones to aim towards; a certain percentage would be reached in a given period of time, for example , a higher percentage in a longer time frame. Measure success, and decide why not, and find a solution if milestones are not reached. For instance, a contingency plan might be to find more or different retailers or broaden the target market if the goal was to capture a 5 percent market share and only 1 percent was captured.
STEP 4: USE MARKETING RESEARCH
A organization now applies the details to its marketing strategy. The findings can be used to construct the value proposition, to better define the target market or to recognize the best opportunities for sales.
Market research is on-going. Effective businesses have set up a mechanism to control market analysis and developments that are continuously happening in the market. This approach can be as simple as setting up an excellent spreadsheet to keep track of current and new rivals: their business strengths and weaknesses; their communication; and their multi-channel presence (different locations and methods of selling the product).
Just as you conduct research on the market, you will be researched by the market and particularly by consumers!
Today, unprecedented access to knowledge allows customers to perform their own market research on food and its origins; in other words, they will be researching your goods and business. Make sure your website is mobile-friendly, easy to find and share to ensure customers can find you. For more information, refer to the guide on “How to Develop and Use a Social Media Marketing Plan”.
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