Market research: crucial or a waste of time and money?
In this tutorial, we explain what role market research plays in every company
Any business is a system in which there is you, your target audience and the product that you create for them, plus its marketing.
In essence, you are creating a product that satisfies the needs of people. People pay you money, which in turn can be invested in product development or spent in other areas of business growth. Or you have a product that is free of charge, but you earn money through this product in some other way, such as advertising.
How do you know what you’re doing is worthwhile? One way to look at it is the money you are making from the product in question. A clear sign that you are meeting people’s needs is if they are buying it.
Error get alias
And of course, the more money you make, the more products you can produce, which means the more products you can sell to earn even more money… and so on. That should be the best feedback you can get, right?
However, such "monetary" (revenue, sales, subscriptions, users ...) feedback has its drawbacks. This is why.
Monetary feedback often comes too late. You need to launch your product first. That means you invest the money into that product first. You need to come up with the product idea, develop the product, come up with a name, claim etc. All of this costs money, and if your product does not work, you just unwisely invested it.
The same rule applies to marketing: you can run an ad and see how it affects sales. But to do so, it needs to be produced and launched across certain media. If it does not work because your target audience uses a different media channel or dislikes the ad, you wasted a lot of money, peoples' efforts and time.
Monetary feedback doesn't answer the question 'Why?'. 'Why' is a critical question. For example, why do sales numbers begin to decline? Is it a problem with the product, pricing, marketing or has the target audience changed? Is there a new competitor selling a similar product?
If you do not know what the problem is, then you cannot effectively solve it.
Research is an effective way to help you solve business problems by getting timely feedback from your target audience. By getting feedback from your target audience at all product and advertising development stages, you identify problems early and can adapt your product immediately.
Market Research (observation, interviews, polls and surveys) can be used at every stage when working on a product or advertisement, including the very first product idea when you start from scratch.
With information gained from research, you are more likely to create a successful product or ad in less time.
Research is feedback from the target audience at all stages of the product life cycle. That regular feedback will increase the likelihood of product success.
Summary:
- The money earned and other hard metrics are reliable indicators of the quality of the product and advertising. Still, that only starts working after the launch, when the money and efforts have already been invested.
- Money and other hard metrics do not answer the questions: why, where is the exact problem, what can we do better? To gain a deeper understanding, you need to get answers to these questions from your target audience.
- Research can and should be done at all stages of product or advertising development.
Now that we are clear on the importance of market research let’s look at 'How to brainstorm and sharpen your new product ideas using the 'Surprise Framework'.
Request Free Demo
Fastuna is an agile market research platform for getting consumer feedback on your product and advertising ideas within 24 hours.