Is market research the answer to your problems?

Here's a rule of thumb. Whenever a business lacks focus in researching and responding to its markets’ needs; i.e. proper market research, its results are always average – or less than average. Yet the fact remains that the majority of businesses spend comparatively little time and energy in systematically identifying and understanding what their customers really want. This explains why in every market there are the majority of firms that are market-followers. And then the few that are market-leaders. It’s the business world’s best kept secret; market research pays!

Of all the thousands of books describing marketing tools and techniques, all boil down to one core issue; the importance of identifying and understanding what the customer wants. There are many ways to go about researching your market; surveys on the phone or internet, face-to face interviews, focus groups, trial offers, the list goes on… But with all the market research methods available, it’s amazing how many companies, and large ones at that, operate on assumptions about their market, rather than knowledge.

Take any industry sector and the rule holds true. Industries are invariably made up by companies which make assumptions about their customers’ needs, and as a result they dedicate their efforts to selling. And at the forefront of every industry, there are a handful of highly profitable businesses which best understand their market, that design their products or services to fit their customers’ needs, and which as a result dedicate their efforts to marketing.

The point is worth repeating because it’s so fundamental, and yet so often completely overlooked. The most successful businesses focus on what the customer wants to buy; rather than what the business wants to sell. Success really does start by understanding the customer. Done properly, market research is an unglamorous and painstaking task – rather like good detective work. It’s so much easier to make assumptions; albeit costly ones.

Because of its importance, a focus on understanding what my client’s customer really wants has become fundamental to my approach to business consulting. And over the years I have developed an approach to market research based on ‘insight finding’ – particularly suited to ‘Business to Business’ (B2B) Market Research, although it can be used effectively with general consumers too.

When I undertake a research project, the first thing I do is to spend a good deal of time in understanding exactly what a business needs to know, and considering the best way of finding this out. You’d probably be surprised to know - in the standard approach to market research - how little focus is given to a thorough preliminarily analysis of the information required.

Then, armed with the right questions, I undertake a series of personal interviews with senior persons in a B2B (Business to Business) setting; or typical buyers in a B2C (Business to Consumer) environment. Over time I’ve developed a knack, call it luck if you will, of getting to see the right people; and more importantly, getting them to pinpoint the key issues. The output is a set of focused insights, which in B2B is used to directly inform business planning and strategy. In a B2C environment, such key consumer insights are invaluable as strategic early-warning signs; and not least for designing much better focused mass market research if indicated.

With market research, you really do get what you ask for. The knack is asking the right questions – and appreciating and communicating to the client, what you’re really looking at.

“Elementary my dear Watson”.