Five Steps for Effective Market Research

Advantage Market Intelligence Ltd – 4 February 2019

Source Advantage Market Intelligence Ltd

Email and the internet have enabled us to reach people far easier than ever before and is helping make market research more accessible in the UK and overseas. The Internet is also a fantastic resource for information about different research techniques and example questionnaires, giving both knowledge and confidence.

Market research can be a powerful aid to decision making in any organisation. I am all in favour of companies making use of the resources available and conducting their own research, but with the caveat that it still needs to be done properly.

I believe there are five key steps that underpin successful market research.

Five steps for effective market research
1. Define the critical information need

Commercial market research is only worth doing when the results can be translated into action or directly influence a business decision. This may sound obvious, but it can be easy for market research to ‘miss the point’ without a clear focus on the end goal.

Understanding what you need to know, rather than what would be ‘nice to know’ helps maintain a clear focus that defines the type of research needed. A useful technique is to imagine you have the answer to your questions and then ask yourself how can this answer be used. If it can’t be used, it is either not valuable information or it is not the right question to ask.
2. Design the research around your critical information need

Good market research design involves considering four main elements:

1. What is the financial implication of business decision?
2. Who can give you the critical information?
3. What is the best way to engage with them?
4. How do you make sure they feel their feedback is valued?

The size and scope of a market research project should be relative to the risk and financial implications of the business decision it influences.

How the research will be perceived is another important consideration. For example, conducting a personal interview with a key customer has far greater perceived value than emailing them an e-survey to complete. Participants must always feel their feedback is valued.

‘Thank you’ gifts or a donation to charity made on their behalf can be appreciated by participants. Used properly, an incentive can encourage more people to give feedback. However:

• Any incentives should be seen as a ‘thank you’, rather than payment for their time.
• It should with care to elicit honest feedback and not encourage false responses from people looking for easy money.

3. Focus, focus and more focus

A good design principle is to image a funnel, with questions starting off broad and then become more specific to the key issue. This eases the participant into the research gently and gives you a more considered response to your critical information needs. The participants should be taken through the research in a simple, logical way using language that is clear and easy to understand.

A clear focus helps avoid asking too many questions and ‘switching off’ participants.

The wording of each question needs to be clear and easily understood. Common mistakes can include:

• Assuming knowledge / asking questions that people are unable to answer
• Asking two questions in one
• Asking leading or biased questions
• Assuming customer behaviours, values are motivations are the same, whether this is by gender, ethnicity, in different market or countries.

One process I encourage clients to follow is to imagine the answers that will come back (e.g. when reviewing a questionnaire). Any answers that lead to a 'So what?' response should be replaced with questions of greater interest that will give actionable information.

It is important to keep all your promises. If you say it will take five minutes to complete, make sure it does.

Market research can raise expectations. Therefore, it is not advisable to ask for feedback around issues you are unable or unwilling to change.

Communicating with participants is important to manage expectations throughout the research. It is especially important after, when you tell them what you have done as a result of their feedback. This can help strengthen relationships and increase the chance of people giving feedback next time you ask.

On the other side, it is also important to manage expectations about what research can deliver. Legal implications aside, please don’t expect participants to share commercially sensitive information.

5. Beware of bias

One of the benefits of market research should be its objectivity. It should present the voice of the customer/employee etc in relation to the specific information need. Care needs to be taken throughout to ensure the findings are not biased, either in how the questions are asked or in how the results are interpreted.

In Summary

When to conduct market research

• To answer a specific business need and reduce business risk
• To improve your business
• To resolve internal differences of opinion and achieve a shared way forward
• To help inform PR and thought leadership
• For essential, rather than 'nice to know’ information.
• Not as a sales tool.

Good design principles

• Make it easy and enjoyable for you your participants
• Keep it simple, short and to the point
• Explain why you are doing the research and how it will benefit your participants
• Ask questions in a logical way. Lead people through different topics
• Use clear language
• Show you value their time and views
• Thank your respondents
• Incentives can help, when used properly
• Communicate that you have acted on the feedback

Points to avoid

• Unrealistic expectations from the research or the participants
• Not having a clear focus on the critical information needs
• Asking too many questions
• Asking two questions in one
• Asking questions that are not clear or assume a level of knowledge
• Bias, both in the questions asked and in the interpretation of the findings

We appreciate you taking the time out to read our article and hope it proves useful in making your market research a success. For more information please visit our website. Alternatively, please get in touch and we will be happy to help.