This is a 10 part series on creating Market Research Plans.
- Market Research Planning 101
- Why Develop a Market Research Plan? Where’s the benefit?
- The 3 Key Ingredients in Every Market Research Plan
- Market Research For Small Business Owners
- Remember Pink iMacs?
- What Jose Mourinho Taught Me About Market Research
- Kickstart your Market Research
- Rocket Science, duh!
- Using Market Research To Develop Brand Loyalty
Feedback Form and Customer Ratings
Market Research 101
Before we start this course on Market Research, I’d like to share a little story.
A good friend ran an exclusive winery in France. Very successful. As his son was training to be a Winemaster, they sent him on a course to get his credentials. Nothing to worry about, right?
…after a week he came back.
They’d done a blind tasting and asked him to identify the wines.
He tasted four French wines and one German thrown in for good measure. Maybe it would be a Riesling…
After a few minutes, he identified the four French wines and rogue German.
And that’s where things went wrong…
Like most young men, he was slightly over-confident of his abilities.
I’ll spare you the gory details but he mixed up the Red and White wines. For a young man with aspirations to be a Winemaster this was a disaster.
With his eyes open, he could see the wines and make a good ‘guesstimate’. But the blind tasting showed his true abilities or rather lack of them.
He couldn’t tell a Bordeaux from a Sauvignon Blanc. And word got out!
This experiment is interesting for those involved in Market Research as it illustrates several points:
- What you think you know about your product may not be true.
- How you determine your own abilities and skills can surprise even the best of us.
- Our pre-conceived ideas about a brand, product or service may not be correct.
- Our inability to see our own blindspots can be a sever liability unless it’s addressed.
This is where Market Research comes to our rescue.
Instead of making assumptions about a product, we can test that assumption.
Instead of hoping your target customers will pay for a new product, we can gauge their interest.
Instead of adding new features to a product because the Development team thinks it’s cool, we can ask customers what they really want and roll that into the product.
Market Research, as the name implies, is about researching your product’s position in the marketplace.
2. Why Develop a Market Research Plan?
The purpose of a Market Research Plan is to learn what your customers think about your product before you release it. Of course, you may have already released the product but want greater insights into your customer base before you release the next product.
It’s also about where to position it in the market, for example, against the main competitor or to look at new regions that have been under-developed.
There are other ways we can look at this.
How to change customer’s attitude towards our brand?
How to price a product so it doesn’t cannibalize our product line?
How to assess the interest customers would have in a new product. Useful to know before you start developing it!
How to repair our brand if it’s been damaged? BP is a good example here. How do you make customers, the Government, media and partners trust you again?
Why is the product selling more in the West coast than the East?
Or if you offered them a premium version of the product, how much would they pay? Or what’s the one thing that they’d like you to change with the product.
3 Key Ingredients in Every Market Research Plan
There are three key areas in every Market Research Plan.
1. Gather data – what tools and methods do you use to gather the information you need? For example, you might develop surveys, questionnaires, and focus groups.
2. Record data – what tools, software and templates will you use to record the research material? This may include databases, excel Competitor Analysis Worksheet, spreadsheets and MS Word forms.
3. Analyze data – once you have the information in a format you can use, you can then analyze the feedback, look for anomalies, and then clean the data. After the data has been cleanses, you can begin to make chart the results and report on your key findings.
Of course, Market Research is not only to do with launching products.
It can also extend into other areas, for example:
Looking into brand awareness (how many customers know you’re in a specific market?),
Customer satisfaction or
What the public think of a political figure, new policy or current event.
4. Market Research For Small Business Owners
For Small Business owners, you’re probably concerned with questions, such as:
Who are my current customers?
How do I find new potential customers?
What payment method do they prefer? Some may prefer to pay upfront and get a discount, whereas others may prefer to stagger the payments over smaller payments.
Word of Mouth – What makes customers recommend one product over another? How do you get to, ‘Try it, it’s great.’
Instead of investing in expensive marketing campaigns, companies are turning to social media to generate buzz and encourage fans to recommend their products.
Trend Watching – When I grew up, TV was the medium advertisers used to get our attention. Today, we watch less TV than ever. But the web is always on. This is where more consumers go to when they want to research a new product. Where do they hear about new trends?
Looking on the web is a start, but you have to dig deeper and see where on the web they congregate and how they interact.
Status Anxiety – We all want others to respect us. We might deny this in public but in private we’re concerned with what our peers think of us. Note that I said peers not everyone.
Many consumers, especially those that are more brand conscious, invest in products to raise their social status. It’s about positioning themselves within their social bracket.
5. Remember Pink iMacs?
When the iMacs were first released, there was a run on pink.
Not red, blue or green. Pink.
Pink sold out in a flash.
But not to teenage girls like you’d think.
Instead, it was up-market Indian families who bought them in droves. Many were never used but strategically placed as exclusive objects in their living rooms, no doubt to generate envy in less well-off (or more pragmatic) guests.
Status anxiety explains many irrational behaviour in consumer buying habits.
The iPad is another example.
It can’t multi-task and is very expensive.
More expensive than most large size laptops, which can multi-task and come with other great features.
But… such is the strength of Apple’s fanbase that the product is a best seller, regardless of price and limited functionality.
Well, it looks great for one thing and… most people can’t afford it.
In the coming weeks, we’ll look at other physiological triggers that influence the way consumers behave.
6. What Jose Mourinho Taught Me About Market Research
Do you think Jose Mourinho knows much about market research, brand segmentation, and customer profiling?
Spreadsheets, surveys and focus groups may not be his specialty but he does know his market (the opposition) and does endless research. Ask anyone who’s worked with him at Chelsea, Barcelona or Real Madrid.
Mourinho is notorious for gathering informationabout the opposition team, analyzing the data, and briefing his players. The results are impressive.
When interviewed for the Chelsea vacancy, he prepared PowerPoint presentations showing where and how he would develop the team.
Board members were blown away. Mourinho looked at the league table that way a General would a battle field.
He assessed his troops (team), reviewed the enemy(Man United perhaps), and drew up plans to undermine the opposition. And it worked.
And the same can work for you.
Prepare for Battle
Market Research Planning is simple.
People make it complicated. Some make it complicated to make themselves look clever. It’s not.
The key to effective market research is to follow stick to the basics and define your goals.
What do I want to get out of this piece of work?
Write it down. It should be one sentence. No more.
I want to know…
To get to that point develop a Market Research Plan, which is a framework for getting to that answer.
5 Painless Ways to Kickstart your Market Research
Here are five ways to start your Market Research Planning activities.
Assess the Competition – Can you compete against the market leader? How many competitors are there in the marketplace?
Could you partner with other companies and deliver a superior product offering? Mourinho identified three main threats and then went after them. One by one, they were dismantled.
Identify your target market – gather information about the age, location and number of people who’ll be interested in the product. The more you know about your customers, the more you can tailor your product to their needs, spending habits and in relation to emerging trend.
Mourinho said that his midfielders had to be 5’8’ minimum. Why? He was blessed with one of the best midfielders in the world with Claude Makelele (5’5’) and wanted to balance his lack of height with taller, more robust players. Other mid-size players were sold and powerhouses brought in.
Determine Price – how much will the product cost? Will you sell it as part of a bundle? Do you offer discounts? How about international customers? Will the price be the same in the US as in Japan? And if customers find out, what next?
The difficulty with pricing strategies is that what works in one country, or even one city, may be over-priced in another. How do you strike a balance?
Sales channels – What’s best approach to selling the products? Over the web, in the high street, through partners, direct mail? When I started my business, I sold training programs through the post. But I had to stop as shipping fees reduced my profit.
Now I sell all my goods online with eJunkie and Clickbank. While I still get requests for hardcopies, I have to decline the offer as the time and effort would wipe out the profit margin. But, it’s not an easy decision. Who wants to say No to money.
Volume – How many people are looking for this product? How confident are you that this figure is correct? Will this number increase or decrease over the next three years?
Looking for an example of how your luck can change?
Audible.com was facing bankruptcy a few years ago. No one was buying digital downloads. Then the internet gained traction. Mp3 players spread like wildfire. Suddenly the demand was there.
The next problem was how to keep up with demand.
Nice problem if you can get it.
6. Rocket Science
As you can see, there are many factors to consider when launching a product. Interviewing, running surveys and polls are different ways to get inside the head of your customers (or prospective customers) and see what they think.
Remember, Market Research is not an exact science.
What works in one area, may not work in another.
Likewise, you may have to run different surveys or workshop until you begin to see specific trends emerging, for example, that the price is too high for customers in France but fine for those in Seattle.
Or the user interface confuses customers and makes them leave the site.
Did you know?
More than 55% of customers who start the buying process (i.e. Click the Buy button) leave the site before they get to the Confirm button.
Wouldn’t you like to know why?
That’s where a discrete survey will help.
‘What’s the one thing on my Shopping Cart that you’d change?’
Or a poll. Or a focus group. Or a questionnaire.
It depends, doesn’t it?
SAD TUT aka USA TDT
I’ve made up a new buzzword to address this. SAD TUT. Or USA TDT. Whichever you prefer!
For small projects, you should be fine with Competitor Analysis Worksheets, spreadsheets, forms and checklists. You can use these to run surveys, ask questions, and gather feedback.
If you need more detailed information, then you’ll need to develop a Market Research Plan. This is ideal when you want a 360 understanding of how customers perceive your company, brand or customer service. It depends on your needs, budget and resources.
Assess the current marketplace.
Determine if there is a real need for your product or service. While you may feel that people MUST want to buy this, the research may show otherwise.
Size up the competition. Who are your main competitors? How can you beat them? Price, Innovation, and Customer Service are three starting points.
Understand your Customers. Learn more about their shopping habits. What triggers them to make decisions? How much they usually spend on these types of products? What is their weekly disposable income, i.e. what’s left over when they pay the bills?
Monitor Trends – understand how the market is shaping up. Are there new trends you need to watch? What has become passé?
Define Achievable Targets – and, of course, you need to define your sales targets. How many of these do I need to sell in the next 12, 24 or 36 months to justify the decision to launch this product?
The over-arching goal is to learn more about your customers and how their spending habits, preferences and knowledge of your brand will impact your company’s progress.
In a nutshell
After you have completed the Market Research planning phase, you will have the answer to the question you identified at the start of the project.
For most of us, this is: who will buy my product, for how much, and why?
9. The Mystery of the Seven Sided Market Research Plan
Market Research is like a heptagon. Ok, that’s a bit pretentious. But, it is actually and here’s why.
The seven stages in the Market Research Plan look at:
- Why are you doing this?
- Who are you researching?
- What tools will you use to gather the information?
- Where will you collect the data?
- When and how will you analyze it?
- How to Report your findings?
- What Decisions will follow from this?
Market Research Templates, Forms and Tutorials
This Market Research Template pack includes 19 templates (5 Word + 14 Excel). You can use these templates, forms, checklists, and questionnaires to gather, record, and analyze data so you have the information you need to drive your Business Plan and Marketing strategies forward. This template pack includes:
- 4 x Market Research Templates (16 pages) Use these template to capture Why You Need Market Research, Who You Want to Target, How to Plan, Collect Data, Analyze Data, Report Findings, and Make Decisions.
- Market Research Brief Template (6 pages) Use this document to brief Consultants on your Market Research requirements.
- 14 Free Excel Templates: including Brand Loyalty Survey, Competitor Analysis, Demographic Comparison, Demographic Profile, Industry Analysis Checklist, Market Planning Checklist, Cost Analysis, Market Research Spreadsheet, Market Survey.
MS Word Screenshots
Here are screenshots of the MS Word templates.
Standard cover page
Executive Summary to Market Research Plan
Instructions on how to write the Market Research Plan
Further details of the market research plan
Market Research Project Plan
Market Survey Form
Here are screenshots of the Excel templates.
Market Planning Checklist with conditional formatting
Competitor Assessment spreadsheets with different charts
Competitive Analysis spreadsheet
Feedback Form and Customer Ratings