There are millions of businesses competing for the attention of your ideal customer. So, it’s vital to keep conducting market research and keep your ear to the ground. Many think doing market research for their ecommerce brand is purely an academic exercise. But It’s not.
By gathering and analyzing information about a market, you can use these insights to make better business decisions. You’ll understand what products to sell, how to price them, and where to best spend your marketing budget.
If you’re not actively researching your market, you’ll miss opportunities, fail to see potential threats on the horizon, and spot trends too late. So, market research is an essential tool that ecommerce brands should use.
Collecting market research for your ecommerce brand is simple and something you can do weekly with amazing results. Plus, your competitors are probably busy with other tasks, and the insights you gather could be a competitive advantage!
Here’s a simple process to do market research for your ecommerce brand.
What Is Market Research?
Let’s start with the fundamental question: what is market research?
It’s the process of gathering and analyzing information about a group of consumers. You can use the insights gathered from this information to improve your business decisions.
There are 3 main types of market research: Primary, Secondary, and Competitive. And we can use all three to better understand the customers we serve and how our offering fits within the competitive landscape.
Why Is Market Research Important For Ecommerce Brands?
I often tell our clients, your customers will tell you what problems they think you can solve; if only you’d ask them! They’ll talk about the other solutions they’ve tried that didn’t completely work.
Market research will help you identify new opportunities to grow sales, develop new products, and spot new trends before every other business jumps on them.
By talking to your customers, you’ll better understand their needs, wants, and preferences, which can help you improve your business and customer experience.
Another reason we conduct market research is to test ideas and reduce the risk of poor decision-making. You might find there’s no demand for a product you’ve been thinking about for 6 months, and so can avoid wasting time, money, and effort developing it.
Types Of Market Research
You’ll want to use a few different types of market research to help you build a better understanding of your customers and the competitive landscape. Don’t just rely on a single method.
Primary research is information you collect through surveys, interviews, or focus groups. This type of research can be very valuable as it gives you direct insights into your target market. However, it can also be expensive and time-consuming.
I recommend talking with your customers as much as possible. You don’t need to set up a formal interview or have an extensive list of questions. But you do need to actively listen and use what you learn.
If someone else collects the research, we call it secondary research. You could find data and insights from government reports, academic journals, and industry publications, for example.
Secondary research is a good way to get a general overview of a market, but it is important to be aware of its limitations. Secondary research may not be up-to-date or may not be specific to your target market.
You could think of secondary research as big picture stuff that gives a great context to your primary research.
You should study your competitors, not ignore them as much advice states! Competitive analysis can help you understand your competitors’ strengths and weaknesses, their products and services, and their marketing strategies.
Competitive analysis can help you develop strategies to compete more effectively. So don’t snooze on monitoring the other businesses that are directly competing for your customer’s attention, or they might eat your lunch.
How To Conduct Market Research
What stops many founders and marketers from conducting market research is they lack a clear process. If you’re unsure where to start, here are the basic steps you should follow:
Define your goals
Start with the basics: why, what, how, etc. type questions. By knowing your goals, you can be more focused on what research you do and the type of data you collect.
If you’re considering offering a personal shopping service, you might want to talk to current customers to see if they’d use it and what they’d expect to pay.
Say you’re trying to improve your brand awareness, you might want to gather information on how your target market perceives your brand.
Identify your target market
Talking to everyone will lead to poor results. So, you need to define who your target market is and talk to people in it to gather data and insights.
If your audience uses Reddit, go hang out there. But if your market is welders in their 40s and 50s, you might find calling them is a better way to engage.
The data you’ll want to collect will depend on your goals and budgets. You could email out a simple survey to people active on your email list or call a selection of customers. However, you might gather a few customers or people in your target market and hold a focus group.
Collecting data alone won’t help you make better business decisions. You need to carefully analyze the data you collect to identify trends and patterns that can inform your decision-making.
There are many different tools and techniques that you can use to analyze data. So, you’ll need to choose the ones that are right for you.
Once you have analyzed your data, the next step is to draw conclusions. This means summarizing the key findings of your research and explaining how they relate to your goals.
Tips For Conducting Market Research
If you’re new to market research, you could feel slightly overwhelmed. Here are some tips that will help you conduct market research for your ecommerce brand.
Use a variety of research methods
Don’t rely on just one method of data collection. Instead, use several methods, as they’ll allow you to build up a more complete picture of your target market. For example, you could use surveys, interviews, focus groups, and observational research.
Ask the right questions
The quality of your research is determined by the questions you ask. You’ll want to ensure your questions are clear, concise, and relevant to your goals.
It’s vital you’re objective when conducting market research. Try to avoid bias when carrying out the research. When it comes to presenting the findings of your research, do so in a fair and unbiased way.
Keep your research confidential
You might collect personal information during the process. You should anonymize all data to ensure it remains confidential.
Budget for market research
Market research can be expensive. So, you need a budget and resources. It doesn’t have to be a massive amount of money but a pot you can use to help you create a better business.
Market research takes time. Don’t expect to get all the answers you need overnight. It can take a while to collect and analyze data before you can begin to draw insights from it.
Be open to feedback
Market research is a team sport. You need to talk to others to gather data. It’s also worth sharing what you learn with others to get feedback. You can use other people’s opinions and viewpoints to improve your research and make better decisions.
The Importance Of Market Research For Ecommerce Brands
Carrying out market research for your ecommerce brand can be the difference between success and failure. Just like with marketing, it’s a continual process that requires dedication.
If you don’t take the time to understand your customer, your competitor will, and they’ll eat your lunch. You also can’t ignore your competition, as you’re trying to capture the same customer’s attention. You’ll be able to do some things better than them, which could be highly profitable.
As your brand grows, you can employ a market research firm to help you but nothing beats the basics of understanding how to conduct it yourself.
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