What is market research? 12 methods and the process

In marketing, a marketer's most important goal is to clearly understand the preferences and needs of their target customers. That is why target market research has become an indispensable method for businesses to understand what customers want and to identify new business opportunities.

Market research

Social media market research is a form of research in which a business or brand gathers both historical and current data across social media channels in order to better understand its target market. In the past, as in the present, many businesses and brands have built their own research processes and tools.

Sometimes research alone is not enough to create a competitive advantage, since the preferences of target customers can change overnight. Running focus group research with a select group of customers also offers certain advantages before launching a campaign or bringing a new product to market.

That said, focus group research is not especially useful when a business wants to collect customer feedback after a product or service has launched. The same is true of annual survey research, which cannot provide a complete picture of the trends, topics and events that customers are paying attention to at the present moment.

Three main objectives of market research

To research and analyze a market successfully, businesses need to clearly define what their research objectives are. The three main types of objectives in market research and analysis include:

• Management objectives: the data and information gathered from the market help managers plan and set a long-term development direction for the business. This information can help a business grow through proper planning, organization, and control of both human and material resources. As a result, the business can meet market demands at the right moment.
• Social and customer objectives: market information helps businesses understand the strengths and weaknesses of their products from the customer's perspective, viewpoint, and assessment. At the same time, businesses can gain a deeper understanding of customer behavior and desires, and find ways to meet specific customer needs by upgrading and improving their products and services.
• Economic objectives: market research helps businesses assess economic prospects and the likelihood of success or failure when the company enters a new market or introduces new products to the market. From there, businesses can increase their chances of success when launching new products or services and meet market demand.

When should a business conduct market research?

Market research and analysis is an activity that requires businesses to invest time, effort, money, and human resources. Therefore, the timing of the research is an important factor that businesses need to consider. The four "golden" moments to conduct research include:

Before starting a business venture

When preparing to launch a new business project or joint venture, businesses should take the time to research market conditions, social needs, and legal regulations and policies. In addition, information about competitors and partners, including their strengths and weaknesses, pricing, marketing strategies, and distribution, also needs to be thoroughly researched and analyzed. All of this information will help businesses make the right decisions when launching a new business project or joint venture.

Before entering a new business market

A new market offers many growth opportunities, but it also carries hidden risks if a business does not understand the nature and characteristics of that market. Businesses will face many challenges and situations they have never encountered before. In such circumstances, researching and gathering information about economic conditions, market requirements, legal regulations, competitors, and target customers is extremely important. Market research helps businesses avoid unnecessary mistakes and minimize risks throughout their operations.

Before launching a new product

Before bringing a product to market, a clear understanding of the market and of the target customer profile is essential. In this way, businesses can assess whether their products and services meet customers' needs and desires, and determine what should be improved, upgraded, or added in order to better meet their expectations.

For companies that manufacture or supply tangible products, market surveys using methods such as focus group interviews or individual interviews, questionnaires, and product trials are a way to evaluate their products. This information helps the R&D department continue improving products to meet the requirements of target customers, increasing the likelihood of success in the market.

Measuring the effectiveness of Brand communication campaigns

Brand communication plays an important role in building Brand image, helping the public and customers understand the Business correctly and clearly. Therefore, Businesses can use market research to assess Brand health and the effectiveness of their communication campaigns.

For example, after rolling out advertising campaigns, market surveys help determine how frequently target customers recognize and remember the Brand and its advertisement. This helps evaluate the effectiveness of advertising and Brand-building activities. In addition, Businesses can assess consumer behavior and the Brand's influence in the market by conducting random surveys to measure the number of people who are aware of the product or the number of people who use the product in daily life.

Types of market research

There are two forms of market research and analysis: primary and secondary. Each form has its own advantages and disadvantages:

Primary market research

Primary market research is the process of gathering information directly from consumers to address current needs, and it can include both qualitative and quantitative data. The advantage of primary market research is its high specificity, and businesses often use it to resolve issues as they arise.

Businesses can conduct primary market research and analysis through a variety of methods, including: group interviews, individual interviews, observational research (either in person or via video), buyer persona research, and market segment research.

The most common method in primary market research is the interview, which involves asking a range of different questions and recording participants' answers. However, this process must be planned and analyzed carefully, with resources allocated to collecting and analyzing the data effectively.

Secondary market research

Secondary market research is a type of research that has already been conducted by another company or organization and published publicly in journals or online data sources. Secondary research includes research findings, analyses, and statistics produced by others on the same topic or market. Although secondary research may not fully meet your research needs, it still provides valuable information and data to use in your own research, particularly when you are constrained by limited resources or time.

Market research through social media

Alongside the dizzying pace of advances in information technology, social media platforms continue to grow at a relentless rate. This makes it difficult for many corporate research processes to keep up. As a result, in order to stay abreast of the latest trends and maintain a market research process that is fast, responsive and accurate, businesses have been integrating social media research into their business strategies.

10 Benefits of Market Research

A deeper understanding of your customers

Researching and exploring the market helps businesses better understand their target customers, which in turn allows them to offer the products or services best suited to those customers. Market information helps businesses identify the factors that influence customers' purchasing decisions, such as price, product quality, brand and other considerations. Understanding your customers more deeply helps you develop more relevant products or services and increases your sales opportunities.

Understanding your competitors

Market research helps you study and analyse the competitors operating in your market. By analysing market data, businesses can learn about competing products and services, their characteristics, and how they are marketed to customers. A clearer understanding of the competition helps you build a suitable marketing strategy.

Identifying new opportunities

Market research helps businesses uncover new opportunities to develop their products or services. For example, gaps in the market or customer needs that are unmet or poorly served are opportunities you can capitalize on. Identifying new opportunities allows you to expand your market and increase sales.

Make well-founded decisions

By collecting and analyzing data from market research, you can assess how successful a product or service is, measure the effectiveness of marketing campaigns and other business activities. Making decisions based on facts helps optimize business strategy and minimize risk. Moreover, this data also helps businesses attract investors' attention far more effectively than information based on intuition or guesswork.

Reduce costs and increase marketing effectiveness

Market research identifies the marketing channels best suited to a business's products and services. Not all products use the same marketing strategies and distribution channels. Understanding the market and customers therefore leads to smarter business decisions. This helps businesses maximize their marketing budget while still achieving strong business results.

Strengthen competitive capability

If a business does not continuously study and research its products, market, and customers, it can easily be overtaken by competitors. This is especially true today, when competitors are multiplying and customers have ever more options to choose from. Market research and analysis therefore give businesses a panoramic view of the market and help them build the right strategies to improve products, raise service quality, and secure a competitive advantage in a volatile economy.

Sharpening business vision

Through market data, businesses can learn about market trends, shifts in customer needs, potential risks, and other factors affecting their operations. Sharpening your business vision helps you make sound decisions to grow and expand your business.

Measuring customer satisfaction

Businesses can assess how satisfied customers are with their products or services, and from there make improvements and optimize those products or services to meet customer needs. Measuring customer satisfaction is an important step in maintaining and developing customer relationships, contributing to higher sales and greater profits for the business.

Developing new products

By analyzing customer needs and the current issues with their products or services, businesses can identify ideas for improving the customer experience or developing entirely new products. Developing new products not only helps businesses meet customer needs but also strengthens their competitive position in the market.

Setting a long-term development direction

Market analysis helps businesses build a long-term development direction. Establishing that direction gives businesses a clear, concrete growth roadmap, allowing them to achieve sustainable operations and grow more successfully in the future.

12 common market research methods

Track how customers use your products/services

Customers will not hesitate to share how they use the products and services a business provides. They quickly post their thoughts on social media to catch the attention of friends and family. When customers are looking for information, they will readily tag a business's name in the hope of getting that business's attention. For this reason, businesses should search for their brand and product/service names on platforms such as Instagram and Twitter to understand how customers are actually using their products/services. Reddit is also a treasure trove of conversations among customers and communities.

Understanding why customers dislike the brand

It is certain that across all social media platforms, there will be some customers or communities who feel dissatisfied with some aspect of the product or service a business provides. Take, for example, the customer below, who was frustrated by the feature that automatically skips the "credits" — the information about directors, actors and so on — of films on Netflix.

Customer feedback and complaints can sometimes seem contradictory and hard to understand, but they are precisely one of the opportunities for a business to quickly identify which aspects of its products and services need improvement.

Discover why customers love your brand

Just as customers can be quick to criticize and call out a brand they dislike, they can be equally quick to offer kind words and praise for the brands that win their affection. Take coffee as an example: customers will often share on social media why they and their friends go to the coffee shop they frequent instead of other places. These are opportunities for a business to learn what makes its brand more appealing to customers than others. If customers stop praising you and shift their praise toward a competitor on social media, that is the moment a business needs to review and reassess its own products and services. Businesses can look into brand-related keywords and phrases appearing on Facebook, Twitter, TripAdvisor (travel), Google and more.

Gain deep insight into what customers will expect from your brand in the future

Consumers also frequently use social media to share the areas that brands and businesses need to improve in the future. A regular customer at a restaurant might notice that their favorite dish is no longer on the menu. They may leave a few comments on the restaurant's fanpage in the hope that the restaurant will bring their favorite dish back.

Knowing which trends customers care about

Trends have a significant impact on a business's strategy and on how it connects with its target customers. Conducting market research by studying the trends gaining attention on social media gives businesses a distinct advantage. A business can quickly join in and respond to current social media trends, building brand awareness among customers.

To do this, businesses need to regularly monitor platforms such as Twitter or YouTube to see which trends are attracting the most customer interest, or they can apply Google Trends to their social media market research process.

Understanding customers better through two-way interaction

One of the advantages of social media is that it encourages two-way interaction between brands and customers, creating the conditions for brands and businesses to understand their customers more deeply. For example, groups or communities on Facebook managed by a business can create a space where customers talk with one another, discuss products and services, share memories, or mark a memorable milestone.

Observation method

Observational market research is a method of studying how consumers actually behave when they shop. Observation is typically carried out by recording shoppers' behavior while they shop — in a store or supermarket, for example — and analyzing their habits or the way they shop. If customers are unaware that they are being observed, this method can reveal how they behave naturally. For instance, observation can help researchers identify which in-store factors influence a shopper's purchases: which products attract the most buyers, and how packaging or display affects purchase decisions.

Product trial method

With this method, the business lets users try the product under normal conditions and then collects data from the participants. This data helps the business measure and evaluate initial reactions, assessments, and comments about the product. As a result, the business can improve the product to better meet customer needs.

In addition, a company can place a new product in a store to track shopper responses. The purpose of this activity may be to analyze how shoppers react to advertising or to gauge how appealing the product is to ordinary shoppers.

Analyzing the competitive landscape in the market

This is a method focused on collecting and analyzing information about competitors in the market. It involves identifying all of a business's direct and indirect competitors, evaluating their products, sales and marketing strategies, and other factors related to their business operations. The information gathered from this analysis helps you recognize your competitors' strengths and weaknesses as well as your own position in the market. It also provides deep insight into successful business models and consumer trends, helping you plan more effective strategies.

Using existing data sources available in the market

Public data is a secondary market research method in which market-related data is sourced and analyzed, and is readily available for businesses to use. This research is usually provided free of charge on the internet or at libraries, with information sources including research centers, market survey firms, opinion polls, and government databases.

Using the services of market research and analysis firms

Businesses can purchase market data from a variety of sources if they lack the time or resources to conduct research themselves. Many market research firms sell data to buyers for a subscription fee that grants access to their data systems. This option is especially useful for small and medium-sized businesses that lack the financial resources to carry out primary market research and analysis on their own. In addition, businesses can also contact these firms to have them conduct market surveys tailored to the business's requirements.

Applying Social Listening tools to market research

The relentless growth of social media calls for tools capable of collecting data for rapid research, analysis and reporting. This research method helps businesses:

• Save on research costs: Survey-based research and focus group sessions can cost tens of millions of dong depending on their scale, whereas social media research comes at a lower cost.
• Deliver faster results: While traditional research methods consume a considerable amount of time, social media research delivers real-time results more quickly. Businesses can extract and collect data that is continuously updated.
• More comprehensive information gathering. According to research from Statista.com, the number of social media users has reached 4.26 billion. Along with the emergence of social listening tools, businesses can now research data and information on the trends of an entire industry, not just information about the business itself.

Many Social Listening tools have been launched by partner companies that provide communications solutions for businesses.

Kompa is a company that applies data technology (AI, machine learning) on a big data platform to deliver data analytics solutions and equip clients with valuable "insights" to optimize their business operations across many areas such as Marketing, Finance, Operations and other fields. Kompa works alongside small, medium and large businesses in Vietnam such as: Vingroup, Masterise Homes, Vinamilk, SSI, MB Bank, Tân Hiệp Phát, Shopee and Vietjet Air. With the ability to collect, analyze and process information quickly and fully automatically, Kompa has become a powerful partner for businesses and an excellent companion for many media teams.

The market research process

Step 1: Define the business's objective or problem

Before conducting research, businesses need to define the objective or problem to be researched. For example: identifying customer needs, assessing the market, or learning about competitors. This objective or problem helps the business focus on the information that matters and keeps market research and exploration on target so it achieves the desired results.

Step 2: Choose a suitable research method

There are many different methods for researching and exploring a market, such as in-person surveys, telephone surveys, direct consultations, online research, and direct observation. However, not every method suits the objective or problem a business needs to research. Businesses need to weigh factors such as budget, time, and the level of accuracy required in order to choose the most appropriate method for researching and analyzing the market.

Step 3: Design and prepare the survey

Once a suitable market research method has been selected, the business needs to design and prepare the survey. The survey design must ensure the information gathered is accurate and complete. Preparing the survey requires a clear plan and schedule so that data collection proceeds as planned and the research stays on track.

Step 4: Collect information

This step is the process of gathering information using the research method chosen and designed in the previous steps. The data collected may include statistics, customer opinions, and information about the market and competitors. Businesses need to pay attention to ensuring that the data collected is accurate and complete.

Step 5: Consolidate and analyze the data

Once the data has been collected, businesses need to consolidate and analyze it to identify key trends and insights. Analytical methods may include SWOT analysis, PESTEL analysis, competitor analysis, and analysis of market demand and trends. Analyzing the data helps businesses gain a clearer understanding of the market and make sound business decisions.

Step 6: Visualize the data and present the findings

Finally, businesses need to visualize the data and present the results of the market research process. Tables, charts, and reports can all be used to present market research findings. Presenting these findings helps businesses gain a clearer understanding of the market and make sound business decisions.

4 common misconceptions about market research

Researching and understanding the market is critically important for identifying customer needs and preferences, and for building effective business strategies on that basis. Even so, a number of misconceptions about market research are still widely believed and acted upon. Below are 4 misconceptions that businesses should know in order to avoid them:

Market research is an academic exercise

Some people believe that market research is a simple and relatively unimportant task. In reality, it is a complex undertaking that requires substantial knowledge of business, marketing, statistics, data analysis and machine learning. Market research and analysis is a professional discipline, and it plays a vital role in identifying customer needs and creating products and services that match them.

Your partner will carry out the necessary market research

Many people assume that once they engage a partner, that partner will conduct market research on its own and deliver the analysis. In reality, this is not entirely true. Market research and analysis is a shared responsibility between both parties and requires close collaboration. You need to ensure that you have a clear research plan and that your partner fully understands it and is committed to supporting you throughout the process.

It is costly and time-consuming

Some people believe that market research and analysis is costly and time-consuming. In reality, market research can save you both time and money by helping you identify customer needs and develop products or services that meet them. If you do not conduct market research before launching a new product or service, you expose yourself to risk and may face the steep cost of fixing or rebuilding the product.

Large volumes of information are difficult to manage

Many people believe that market research and analysis is hard to keep under control because there is simply too much information to process. In reality, this can happen if you lack a clear research and market intelligence plan and fail to set specific objectives for your research. If you define specific objectives and focus on the information that matters most, you can stay in control of your market research and analysis process and gather the most important information for making sound business decisions.

In summary, market research and market intelligence are essential work that cannot be overlooked when developing products and services. You need a clear understanding of the common misconceptions about market research so you can avoid them, and you need to apply accurate, effective market research plans in order to make sound business decisions.

Kompa's multi-channel market outreach solution

If your business lacks the resources and experience to conduct market research on its own, seeking support from a management solutions provider such as Kompa is a smart choice. Kompa offers businesses a multi-channel market outreach solution. This is a comprehensive solution that helps businesses reach customers across a wide range of channels, from media to social networks and online sales channels:

• One of the benefits of this solution is its ability to optimize the conversations that mention your Brand. Kompa helps businesses clearly identify every mention related to their Brand, creating fresh, high-potential opportunities for Brand growth. Using the insights gathered from social media data research, Kompa supports businesses in building the right product and service development strategy.
• In addition, Kompa's solution helps businesses gain a more comprehensive understanding of the market. Kompa's experts help businesses continuously listen to customers and tap into new potential, while also tracking competitors' business activities throughout the consumer journey. By analyzing media channel performance, competitors, and market consumption trends, Kompa collects, aggregates, and verifies thousands of data sources to deliver strategic, in-depth insights for every step your Brand takes.
• Finally, Kompa's omnichannel market approach solution also helps businesses analyze customer touchpoints. The company helps businesses collect, aggregate, and analyze data from every customer touchpoint in real time to improve the experience and gain a clear understanding of what customers want.

With Kompa's omnichannel market approach solution, businesses can reach and better understand their market and their customers, and in turn create products and services that fit and meet customer needs quickly and effectively.

Conclusion

Thanks to social media market research, businesses and brands can gather information more quickly and accurately. This allows for a deeper understanding of their target customers. Market research is a necessary and important task that helps businesses make accurate decisions in their operations.

See also: 24 Social Listening tools for businesses