The first mistake people do when launching a new product is neglecting market research. It’s common for most of them to first build the product (the most expensive part of the whole process) before tracing the right target market (the cheapest part of the process).
What’s Market Research?
Market research is where you gather as much information as you possibly can on your potential customers. It refers to the systematic gathering and analysis of consumers’ data.
A business may conduct market research to stay competitive and innovate better by trying to understand the following:
- Their market Environment
- Their Competitive landscape
- Customer needs, beliefs, and wants.
Why Should You do Market Research?
The most important part of starting a new business is dedicating part of the time to knowing and understanding your customers. You need to understand your target market to be able to:
- Solve your customers’ problems
- Know what marketing messages to send to them
- Figure out how to best advertise to them
- Determine if your customers will be willing to spend money on your products or services
Benefits of Market Research
Market research is the tool you use to understand your customers better. It’s meant to give you hard data that will help you drive your marketing strategy and make the sales process easier.
Here are the benefits of doing market research in Singapore:
Improve Communication
Market research will help you drive communication with customers and prospects. It will point out where to reach your customers, and what language and mode of communication best resonate with them.
Identify Opportunities
Market research will open your eyes to new opportunities. It will help you identify accessible opportunities for targeting new customers, besides helping you discover new advertising platforms, as well as how to address consumer concerns and the market gaps you can fill.
Reduces Risks
Concrete data will help you focus on real opportunities instead of wasting your effort on things that don’t matter. Understanding your customers means you can utilise your resources much better while reaching them. There’s less risk of wasting your time, money, and marketing effort on initiatives that don’t generate results.
Increased Sales
Market research exposes you to valuable insights that you can use to identify new ways to generate more sales for your products. It will help you determine what’s the best price to sell your products, which segment of the market you should target, and how to best get your customers interested.
Better Customer Management
Market research tools such as questionnaires, discussions, meetings, and messages will help you reach an even bigger audience. At the same time, they’ll help you reduce the amount of time it takes for your products to reach your customers. Also, with the tools, you can investigate consumer needs and expectations, and use the information you collect to improve on customer experience.
Business Growth
As your sales increase and your market expands, your company gets the opportunity to grow and become even bigger.
How Much Market Research Should You do?
If your market research process is taking too long, then the odds are high that you’re doing it all wrong.
The amount of market research you do for your business depends on the type of business and how risky it is.
In other words, you don’t necessarily need detailed market research. For example, if you’re opening a restaurant. You don’t have to bother yourself with too much research. Just focus on producing quality food and services, and your business will thrive on referrals.
The only other thing you’ll have to worry about is what food to serve and if the restaurant’s location is strategic enough to attract more customers.
How to Find Out if Your Business Needs Market Research
You can find out if your business needs market research by answering the following questions:
- Are you primarily serving the local market?
- Does your business category already exist?
- Do you plan to differentiate yourself from your competitors?
- Do customers spend enough on your type of product? Is the amount they spend enough to sustain you or your competitors’ business?
- Do you feel like you know your business well enough, judging from your past experience?
If the answer to, at least, three of these questions is yes, then you don’t need further confirmation on whether your business needs market research.
How to do Market Research
Now that you’ve established that your business needs market research, you can proceed by doing the following:
Identify Your Target Market
You identify your target market by painting a clear picture of how your ideal customers would look like. Imagine a customer walking into your store or office, or picking up the phone to call you. This is your perfect customer or someone with a problem whose solution you’re offering.
Now try to flesh out these customers by imagining all the details about them. What do they like? Where do they hang out? You’re simply trying to describe them.
Your Ideal Customers and What’s Their Common Traits
Now that you’ve painted a mental picture of how your customers look like, the next thing you want to do is list down their common traits.
What do all these customers have in common?
Your business will, of course, have several target markets. But it’s a great idea to narrow down your list to two or three target markets. You can’t target everyone, remember.
A list of common traits to list for each target market:
- Demographical Traits: Find out about their age group, income levels, locations, and gender.
- Psychographic Traits: Find out about their common interest. Also, try to group them according to the list of things that they like,
- Where they’re employed: Your target audience might be employees of another company, serving as CTOs, head of marketing, or in any other capacity.
Often, target markets are a blend of different psychographic and demographic groups. For instance, the new shoe brand you’re developing might be targeted at female triathletes. Or maybe you’re opening a new hair salon targeted at urban hipster men.
Market Segmentation
This is where you create a series of target markets targeted at different market groups. It may sound complex, but what you’re basically doing is dividing your market into different groups that you plan to sell to.
- Different Characteristics for Each Group: Each market segment should have different characteristics, and should be motivated to buy from you for reasons that are entirely different from the next group.
- Different Market Campaigns for each Group: That also demands that you come up with different marketing campaigns for each group. You might also want to customise your products and services for each group or market segment.
Talk to Your Prospects
After you’ve identified your ideal market and made a good guess at how they behave and a list of all the things they might be interested in, the next thing you want to do is to go ahead and talk to them. This is your chance to step out of your home or business and go meet with individual customers. Ask them relevant questions and use the information you gather to collaborate on what you had already figured out on your own.
Run an Online Survey
This is no substitute for hitting the street to talk to your customers directly. There’s more you’ll learn by seeing the home or work environment of your target audience. Also, by interviewing them, you’ll get a deeper understanding of how they actually make their buying decisions.
Doing all this will place you one step ahead of the competition you have
The chances are high that your competition skipped this process. Come to think about it: no one has it easy talking to strangers. What if they have absolutely no interest in what you’re trying to sell to them?
Don’t Too much of a Chicken to Miss on This Important Opportunity
Talking to your target customers isn’t another task or chore to clear off your to-do list. It’s an opportunity that you wouldn’t want to miss or a critical step that could mean the difference between failing and succeeding.
How to Approach Your Prospects
The best way to approach your prospects is to assume you’re selling them your products. Talk to them as if the product already exists and see how many of them are actually interested in buying it. The more you talk to your potential customers, the more you’ll begin to see what’s common among them.
Good for Redefining Your Target Audience
Some of your assumptions will turn out to be wrong, and that’s okay. You can always use the information you collect from customers to make necessary adjustments where possible. Plus, it’s better when you make these mistakes early on before you’re in too deep.
Learn How to Price Your Products and Services
While talking to your customers, use that chance to figure out how to best price your products or services. Find out what aspect of your product features and benefits piques their interest the most. What features are they most interested in?
Use all the information you gather to refine your marketing strategy and business model and position yourself to have a clear impact on the future success of your business.
How Big is Your Target Market?
After you’ve identified your target market and validated everything by talking to some of your potential customers, the next thing you want to do is determine its size and find out if Its capacity can sustain your business.
- For a Target Market that Isn’t Big Enough: If your target market isn’t big enough, then you should consider changing your products or services or lowering your price to increase the number of sales
- For a Target Market that is Big Enough: do some research. Find out how many prospects meet your psychographic, demographic, and location criteria.
- If you’re targeting the same Market with Well-Established Competitors: Do industry research. Find out how many people should buy your existing offerings to give you the best sense of your potential market size.
Check industry reports and dig through traditional publications to gather more information on your industry. The information you collect will summarise your market size.
Document Your Findings
All of your research findings should be documented and analysed. The formality involved in the documentation process will depend on how you intend to use it.
If you plan to share your research findings with your partners, then there’s no harm in communicating to them casually. However, if you’re hunting for investors, then you need to do a thorough market analysis and forecast before you sit down for any meeting.
How to Present Your Market Research
Your competitive market analysis must contain the following:
- Direct Competitors: A list of all the companies offering the same product or services as you. Assuming you’re out of the picture, which companies would your prospects be buying from?
- Indirect Competitors: Your competition isn’t limited to companies producing the same product or offering the same services as you. What alternate solutions can your prospects opt for? An automotive dealer might be facing stiff competition from walking or horses, though indirectly.
- Your Competitors’ Strengths and Weaknesses: Find out what your competition excels at and what’s their biggest drag. Be creative enough to spot the opportunities to shine where your competition happens to fall far behind.
- Barriers to Entry: What’s barring you from entering a particular market? Find out about the entry cost – if it’s prohibitively high or if it’s favourable enough for anyone to enter. Again, this is where you closely examine your weakness and be honest to both yourself and the investors that you’re trying to lock-in.
- Your Window of Opportunity: Is your entry time-sensitive? Do you have to get in within a certain time limit to take advantage of a certain technology or emerging market trend? You have to determine all this before making any major move.
When Should You do Market Research?
There comes a time in a business’s lifecycle when marketing. Here are a few such incidences:
To Test a New Business Idea
Every new business idea must be tested and analysed for viability. Is there a ready market for it? Don’t guess or assume anything. Instead, research the market to test and confirm everything.
When Expanding to a New Market
Planning to expand your market? Or perhaps you’re looking to start selling overseas. Different countries have different cultures and markets. What works in a particular country might not work with another country. It’s through market research that you uncover these differences and make necessary adjustments.
When Adding a New Product or Service
Your product may come off as perfect to you, but your target customers might have a different opinion from you. It may prove useful to dig around for their feedback and make necessary changes as quickly as possible.
When Meeting with Investors or Applying for Funding
You have to figure out how to convince investors that investing with you can be the best decision they ever made. You have to begin by identifying the gaps in the existing market, and at the same time, be able to show them how your company plans to fill them.
5 Common Market Research Pitfalls You Should Avoid
We were all once rookies. But that’s not to say that’s the path for every beginning marketer.
Before you jump on the next project, we’ve compiled a list of rookie mistakes you might want to avoid:
- Getting a Small Sample Size: You can’t interview five people and expect to draw a meaningful conclusion from the information you collect from them. You sample size must be statistically significant, large enough to represent the views and opinions of your target market.
- Last-minute changes: Changes are almost inevitable. It’s better when you’re able to adapt and make quick changes right before the deployment date. It’s to be however noted that last-minute changes rob you the opportunity to retest your survey, and may consequently affect your data.
- Complicating Results: The success of your study or project is determined by the impact it generates. But all too often, these results are discarded simply because they’re too complex for other people in the organisation to comprehend.
- Error in Setting the Questions and Scale: The questions you ask during the interviews and surveys, altogether with the scales used, are the foundation of a good research. So make sure you ask the right questions, questions that have a purpose, and are directly or indirectly linked to your goals.
- Long Surveys: Long surveys are one of the primary causes of a drop in response rates. The last thing you want is to overwhelm your respondents with unnecessary questions. 15 minutes is the upper limit, anything above that will result in poor-quality responses (leave alone drop-offs).
Top Market Research Firms in Singapore
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Joshua Research Consultant |
| About | Joshua Research is an award-winning market research centre founded by Frank Boey and Carol Goh in 1994. They offer a wide range of market research solutions, including door-to-door interviews, mystery shopping, telephone interviews, and so on. |
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Space Doctors |
| About | Space Doctors is an internationally known brand consultancy firm fuelled by cultural and semiotic insights. Their focus is on helping brands connect with culture more deeply so they can become more relevant, meaningful, and impactful. They inspire brands and shape up the image that these brands convey to the outside world using insights they have uncovered through cultural analysis, semiotics, trends, ethnography, and consumer research. |
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Flamingo Asia Pacific |
| About | Flamingo Group is a cultural strategy firm, brand consultancy, and market research centre. The agency has four sales offices (Singapore, London, Tokyo, and San Francisco), and is part of the larger Omnicom group. The agency uses the latest research methodologies to help out organisations with strategic brand thinking and communication studies. |
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QPA Singapore |
| About | QPA (Quality People Asia) is an agency dedicated to connecting businesses with customers in Singapore, Malaysia, and Indonesia. They have one of the most experienced, and talented team of marketer researchers, consisting of ethnographers, UX researchers, interview experts, and usability testers, to name a few. |
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GMO Research |
| About | GMO Research is a premier technology firm providing research solutions to businesses from all across the APAC region. The agency offers an online research solution that allows you to access their multi-country and multi-panel network, Asia Cloud Panel. The agency is always expanding their reach, and at the time if this publication, they have more than 29 million online panels spread across the Asia-Pacific region. |
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Agility Research and Strategy |
| About | Agility is a market research and strategy firm that provides organisations with an affluent suite of research tools and processes that they have been developing over the years. They’re a household name, having worked with some of the giant brands that you know, including Star Cruises in launching their cruise travel. |
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Labbrand Singapore |
| About | Labbrand is an innovative agency that blends branding with market research. Labbrand utilizes focus groups, semiotics, surveys, in-depth interviews, video ethnography, and other comprehensive research methodologies to provide original and insightful solutions for our client. … |
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Axanteus Research |
| About | Axanteus is a leading, full-service market research firm specialised in providing syndicated research, customised research, and info databases. The firm was established more than a decade ago, and has grown to be one of the most sought after research agencies in Singapore. |
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D’Well Research |
| About | D’Well is an all-rounded market research firm specialised in product development. The agency uses prototype testing, ethnographic studies, interviewing, social media analysis, group discussions, and desk research to understand your target market and position your products better. |
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B2B International |
| About | B2B is a global B2B market research and consultancy form specialised in intelligence studies, segmentation, and PR research services for B2B businesses in Singapore. |
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Kadence International |
| About | Kadence is an internationally known independent market research centre with its headquarters in Singapore. Established in 1992, the company has experienced dramatic growth to become one if the leading research centres in the country, with extension offices in China, Indonesia, Malaysia, and India. |
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Crugar Haus Singapore |
| About | Crugar was started in 2009, as a full-service market research and data processing firm providing useful, accurate, and reliable data on the latest marketing trends. That’s besides collecting useful and specific information that your company or organisation can use to grow, scale, or target a particular market segment. |
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Blackbox Research |
| About | Blackbox Research boasts more than 10 years of market research experience. They’re a strategy analysis and advisory firm that uses research solutions to offer the much-needed guidance to businesses and agencies that want to scale up or capture a particular market segment. |
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Nexus Link |
| About | Nexus Link are the experts in both quantitative and qualitative research methodologies. They have one of the most experienced and qualified teams of research consultants and specialists offering both syndicated and customised market research services to businesses and organisations that reach out to them. |
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Cataliz Singapore |
| About | Cataliz is a global market research centre that works in close association with some of the leading research organisations in the world in offering an array of research solutions to businesses and organisation. They have more than forty research offices distributed in different parts of Europe, the Latin America, Africa, and the Asia-Pacific region. |
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Media Research Consultant |
| About | Media Research is an all-rounded, ISO-certified consumer research firm with a proven track record. In their 30 years of operation, the agency has worked with some of the leading brands and government agencies in Singapore in helping them develop deeper insights of their target market and customer-base. |
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GFK Asia |
| About | GFK Asia is one of the leading and trusted source of market information. It’s a daughter company to the larger GFK Group, dedicated to providing retail-based marketing tracking services. It’s a globally recognized marketing research firm, with its headquarters in Singapore and sales offices in fourteen different regions. |
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Asia Insight |
| About | Asia Insight is a full-service market research firm offering a wide range of research solutions to businesses and organisations in Asia. The agency has worked with giant brands such as Volvo, PayPal, UBS, and so on. |
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DD |
| About | DD is a consumer insight and brand consultancy firm from Asia but targeted for the world. They’re an agency dedicated to providing answers to businesses and their research questions. The firm stands out because their solutions are tailored to match your business objectives and the local market. |
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Join the Dots |
| About | Join the Dots bridges the gap between businesses and consumers. It’s a market research centre dedicated to bringing businesses closer to the customers they’re targeting. This is achieved by blending the latest thinking in behavioural economics, consumer trends, and psychology with primary research. It’s a globally recognised firm, with offices in Europe and Asia. |
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