Conducting target market research early will help you to start making the right decisions when your business is still young. Because every business decision you make today has to be tied to your customers.
And you will be wrong to think that yesterday’s customer is the same as today’s.
Today, consumer behavior, market conditions, and emerging trends change in a blink of an eye. Today, people may like a product, but their affection for that product may not be as much tomorrow.
One minute you enjoy your favorite TV show, and the next day you hear it will not be renewed for another season because of poor fan rating. And you are like, “how the hell doesn’t no one enjoy such a great show?”
That’s how consumer tastes changes. And if the “fans” can be so ruthless on your favorite TV show, then, as a person in business, you need to understand the behavior of the people you’re going to sell to.
What is Target Market Research, and Is It Important In your Business?
Target market research is the process of gathering information about your target customers and the market as a whole to determine the viability of your products and services.
Market research focuses on understanding your potential customers, determining how well your products and services satisfy their needs and how your products and services compare to your competitors in meeting their needs.
You can use the information you gather from your marketing research to improve your products and service offerings, improve customer experience, or even develop better marketing strategies.
Most importantly, market research is vital for your business as it helps you get answers to the following questions related to your business.
Is there a demand for the products and services you are providing?
Who buys your products and services?
What are the interests and buying habits of people who buy your products and services?
How best can you relate with your customers?
What are your competitors doing differently?
How big is your market?
What is the socio-economic status of people who buy your products and services?
When Should You Conduct Your Market Research?
Honestly, the best time to conduct your market research is always. However, there are those times when conducting market research is a must.
Before investing your money in a given venture, it is wise to understand the market you are about to join before launching a new business. Your focus will be on the prices in the market, the competitors you will face, and the customers present in the market.
Before entering a new market - markets are full of uncertainties. It is best to be prepared by researching a target market you will venture into soon.
Before developing/launching a new product or service, you should remember that you are not developing a new product or service for yourself. Therefore, you have to conduct target market research on how your target customers would react to your new product or service.
And now, follow these steps to conduct target market research properly:
Define Your Research Problem / Opportunity
Defining your problem is an important part of the marketing research problem. It indicates you understand where you are right now and that you know where you want to be after implementing your market strategies.
How you define your research problem will influence all the other aspects of your research. It also provides enough justification for engaging in market research.
The same principle applies when a business opportunity arises. You need the information to determine how best to take advantage of the business opportunity.
Define Your Research Objectives
Before engaging in any target market research, you must plan how you will do it. The plan is evident in your market research objectives.
The objectives you develop should define the plan and reasons for doing research. They should also highlight the business problem you hope to resolve with the data gathered.
Your research objectives define the type of research you will be engaging in and the information you hope to have gathered by the end of the study. For example, the information you collect in market research before launching a new product or service cannot be the same as before entering a new market, even if you collect it from the same study population.
Your research objectives will also influence the data you will collect. For example, if your target market research goal is understanding your competition, you are better off using secondary data.
Developing research objectives is easy once you have a clearly defined research problem. The research objectives will be dissecting the problem into simpler, smaller puzzles.
Finalize Your Plans for Gathering Data
At this stage, you have your research problem and objectives you hope to accomplish. Now it is time to decide what data you need to accomplish these objectives and how you will collect it.
You can collect two types of data in your target market research.
Primary data – this is original data you collect firsthand.
It requires data collection methods like surveys, research questionnaires, interviews, focus groups, or online surveys.
Secondary data – this is data previously collected by other people and published for use in other studies.
You can obtain such data from research reports, industry reports, government files, websites, and journals.
It would be best to prepare data collection instruments to collect primary data. You will need a questionnaire containing questions you will ask your research participants.
Make sure that the research questions capture the following essential aspects of your business:
The level of customer brand awareness
The buyer consideration process
What factors influence the customer’s purchase decision?
How the customers relate to your brand
Any suggestions they may have about your products and services
Define Your Buyer Persona
Target market research isn’t random. Not unless you want to find yourself collecting general data. To collect refined data to aid your decision-making, you must fine-tune where and from whom you collect the data.
That means first defining and understanding who your target customers are. Create a fictional representation of the ideal customer you want to obtain your research data.
Creating a buyer persona entails defining demographic attributes like age, gender, interests, needs, locations, income levels, and professional capacity. The buyer persona you portray will serve as a guide for how to reach your actual target audience.
Moreover, a buyer persona will simplify the data collection instrument preparation. You already know the type of questions your target customers will likely respond to and the maximum number of questions to include.
Identify the Persona Group for Your Data Collection
Now that you know your buyer personas, you can use the representation to identify the ideal target group for your market research. The group will form a representative sample of your target customers.
Such a group will help you collect relevant data for your target market research. You can use these tips when selecting the study groups:
Customers who have recently purchased your product
Customers who frequently interact with your social media pages
Customers who have recently purchased from your competitors
Brainstorm on the perfect incentive that will make the target group want to participate in your study
Collect the Data You Need
All of the previous steps lead to this moment. When you finally collect the data after going through all the hassle of the research process.
Not to heap pressure on you, but all this effort can be in vain if you don’t collect quality data. The characteristics of quality data are accuracy, relevance, completeness, consistency, and timeliness.
You can collect quality data for your target market research using the following methods:
Surveys - ensure that you prepare quality questionnaires and provide your respondents with any assistance they need to complete the surveys.
Interviews – you can prepare face-to-face or phone interviews with your selected persona groups. When conducting interviews, please remember to promise your target customer that you will not take much of their time. And then honor that promise
Focus groups – you can target focus groups that contain many of your ideal target customers. Focus groups help you collect unbiased primary data because you mainly use a third party to help you collect the data you need.
Social media polls- It is an ideal way to collect crucial customer data without the customer knowing they are part of a study, which increases the likelihood of collecting unbiased data. It is also affordable.
Analyze Data and Report Findings
With the data you got, you can develop patterns and reports that will amount to solutions to your market research problem. The secret is using your research objectives as a guide in your data analysis.
Use the research objectives as puzzles. That effectively makes the data you have collected the pieces you need to fill the puzzle. And now, the fun part of the data analysis process is fitting each piece to its rightful place.
Let’s Help You Research and Define Your Target Market
Engaging in targeted market research is vital for your business. And it’s fun too. However, it is time-consuming, and time is a luxury resource for you as a business owner. But you can resolve your dilemma. Hire us to perform your market research and define your target market.