Why is market research important for entrepreneurs today?
Market research indicates the various means and processes by which businesses identify the needs, nature, and preferences of their target market and customers. Think back to the time when you loved Oreo cookies just so much that you wanted them for desserts? Also, remember how Oreo launched its frozen desserts soon enough, and you were so quick to grab them from the grocery stores? That was the result of nothing but the effective market research undertaken by Mondelez International, the confectionery group that owns the brand Oreo. Thus, market research is not a term alien to businesses or customers in any way. Indeed, market research, owing to its unbound benefits, has grown up to be an inexcusable part of companies in today’s market.
For one, any business, even to recognise the relevance of their upcoming product or service in the market, needs to conduct market research. Without the basic data informing them of their target market and customers, the business might as well run on a hunch, which is nothing but a gamble involving heavy capital investments. In such scenarios, it is imperative that the company makes informed decisions, assisted by thorough market research and with its emphasis on the nature of the customers.
Clearly, the success or failure of a business depends on the ways by which it caters to the demands of the consumers and overcomes their censure. While market research does not let the company meet those in a direct fashion, it informs the researcher on what constitutes these needs, preferences and criticisms. For instance, a research held after the release of a product or service will equip one company to recognise the dissatisfaction faced by the product or service, customers’ assessment of it, the expected improvements and more. In effect, market research becomes the bridge connecting the producers to the consumers.
The market research also furthers the researcher’s knowledge of the competitors in the market, which in turn acts as an aid in outrunning them.
For example, consider if, before looking to extend its services in Punjab, Jio conducted market research in Punjab to understand the customer satisfaction of existing network providers. In case the analysis indicates lower satisfaction among rural consumers, Jio will probably seek to increase its strength among the same, where consumers are more likely to change their service provider than the urban consumers. In the same line, the promotional materials such as advertisements and billboards of the Jio network will also focus more on the rural areas of Punjab. More importantly, however, market research on the competitors can become particularly essential when the value of the product is subjected to methods such as competitive pricing. For example, when Jio lowered its prices so much below those offered by its competitors, the mobile network provider created an ample space for itself in the market, outrunning its rivals. All of these actions will find their origin in the data derived from some form of market research held by Reliance, proving the significance of the same once again.
For the same reasons and more, market research is greatly relevant to the well-being of entrepreneurs in today’s economic environment. While customers are seeking better and newer versions of these products, competitors are striving to recreate themselves as those. Therefore, even as innovative ideas and passion remain the fundamental structure over which entrepreneurship is built, it requires them much more than that to sustain themselves amidst the cut-throat competition of the world. They need to surpass the ability of the established companies to meet the customer’s needs. This feat is difficult to achieve with regard to the capital since entrepreneurs are less likely to have better capital than their established pioneers. In such a scenario, market research becomes an essential companion for entrepreneurs in their attempt to understand the market, the consumers as well as their competitors. More bluntly, without the capital that other companies enjoy, entrepreneurs are- at least, in need of data and the adeptness to use it to their advantage. So, dear entrepreneurs, this might be the right time to invest your time, efforts and money in market research. Remember that knowing the beats and moves of the market in real-time is essentially what good business is all about and will ever be.