Market Research helps companies understand and
analyze their customers. Market
research mostly focuses on the following four types of information:
characteristics. Research in
consumer markets would include the age, race, sex, education, marital
status, housing, income, and number of children. Research in business markets would include the type of
industry, annual sales, number of employees and locations, and years in
behaviors. Research is
done to see how customers buy products such as in a retail store or
online. Also, the frequency of
purchases and the type of advertising or influence that motivated them to
or psychographics. Research
on the type of hobbies, sports, and vacations, TV shows, magazines,
religion, frequency of fine dining, frequency of fast food, and even
personality traits and sexual orientation.
Satisfaction. Research through
surveys on the perceived value for the price, ease of use, useful
features, what they would like to see in the future, and whether they are
likely to purchase more product.
Most often, it is the larger companies who invest in market
research. Small companies feel they
already know their customer base pretty well.
Companies that sell commodity products such as gold, coal, grain,
oil, rice and paper do not really need much market research as these products
have characteristics that are indistinguishable across the companies that sell
it. With commodities, customers
are mostly concerned about low prices and fast service. Companies, like a phone manufacturer that
only sells to one type of customer, is considered to be in a homogenous
market. These customers share most
characteristics. However, with a focus
on product differentiation, companies can emphasize the quality of their
products such as, “their coal burns longer,” or “their phones sound better,”
than that of their competitors.
There are basically two types of market research; primary
market research, which involves asking questions through a survey, an
observational approach, or experimental approach, and secondary market
research, which involves checking articles in newspapers, magazines, and
books. Good secondary sources to help
research your industry are: www.census.gov/eos/www/naics/,
Secondary research is less expensive and quickest to
perform, however, you get much more detail with a primary market research
customer survey. For example, with
primary research you can get a good feel from prospects on the value of a
potential product release, and whether or not they would buy it. It can then be narrowed down to the type of
prospect who would buy the product based on items such as age, location, and gender.
It is important to make sure the primary research survey
questionnaire gives you the exact data you need or else you will be wasting
everyone’s time. By following these 7
steps, you should have all areas covered:
are the goals of the survey?
Think about exactly what it is you want to understand from your
will you survey? You want to
make sure you are surveying the right clientele. For example, if your company has two distinct areas with two
distinct customers, you would not want to survey the wrong customers on a
particular product release. You
also might just want to ask a sample of your customer base to get an
will you perform the survey?
Will this be done via a web site, through an e-mail blast, over
the phone, or in person? Also,
will you or someone within the company perform these surveys, or will you
get an unobjectionable outside source?
People tend to be more honest with an outside source rather than
someone within your company. There
are pros and cons to all of these methods. For example, an e-mail blast is quick and easy, but people
tend to ignore them or might be too dissatisfied to even want to
participate. The telephone
requires more time and effort, and sometimes people hate answering these
types of calls, however, you can get a personal verbal response. You need to determine what method your
customers are most willing to participate in, and if the costs outweigh
the questionnaire. Be
sure to brainstorm with people within your organization to create the most
effective and pertinent questions.
Keep the survey as short as possible and test it out before you
give it to your customers. The
questions can be developed with a quantitative or qualitative response:
Quantitative information involves questions that
have a numerical answer, which can then give you a percentage base. For example, you can have a question that
has an answer of “yes” or “no” which you can then express data like, “76% of all
females are likely to buy the product.”
These are considered closed-ended questions, which are easy to compile
and compare. Ratings such as 1 – 5 or
excellent, good, average, poor, and very poor are great to use for customer
satisfaction surveys. You should be
concerned with a rating of 3 or average as in most cases, it is a customer who
is truly dissatisfied, however, does not want to come off too cruel. Poor and very poor are obviously big alarms
that need immediate attention.
Qualitative information involves a verbal
statement which can be used to study suggestions or comments, not just “yes” or
“no” type of answers. These are
considered open-ended questions that truly capture the customer’s attitude and
opinion. You should allow at least one
open-ended question on the customer satisfaction survey.
the survey. If you followed
steps 1 through 4 properly, getting the survey out to the customers should
be straightforward. Make sure you
have up-to-date contact information.
If you run into snags, just make the necessary adjustments and
carry on until your targeted numbers of surveys are completed.
the data. This is the anxious
part of the project. Be careful
not to analyze the surveys until all of the data is compiled, or else you
might get a false sense of success or failure. Your heart wants a desired outcome and you might tend to
analyze the data in an unobjective way.
Be as objective as possible and look for trends, both positive and
negative. This is an important
aspect of being a strong manager and leader. This goes for any type of survey including customer
satisfaction. There might be some
surveys that are questionable that need attention, however, do not pertain
to the questions asked. For
example, you might want to know if a product is easy to use, however, the
customer is upset at a salesperson for not returning a call and thus gives
all “very poor” answers or a vulgar opinion. Make sure you keep the data in simple terms so that everyone
can fully understand the results and what actions need to be taken. Report on the most important and major
findings, and do not clutter the data with too much unimportant
on the results. The most
important aspect of the completed survey is what you do with the information
given. Decide on the
recommendations or evaluations and then determine what action needs to be
taken. If, for example,
improvements need to be made, address those issues immediately and after a
period of a few months, send out a follow up survey with the pertinent
questions to be sure all has been corrected. If the research was done to support a decision on a new
product release, immediately start the process on determining the
production, cost, and release dates.