Customers are the foundation of your business. In order for your company to succeed, you need to understand them and their relationship to your products and services. That is where market research comes into play.
According to the Small Business Administration, market research is “the process of analyzing data to help you understand which products and services are in demand, and how to be competitive.” That data can include valuable intelligence about your marketplace, your industry, your competition – but especially and most importantly, about your customers and how they feel about your company and its offerings.
In short, market research helps you understand three things: your industry, your competition, and your target market. You can use it to:
- Identify customers’ (and potential customers’) habits, trends, plans, opinions, needs and wants
- Determine if your company and/or its offerings meets customer needs
- Find potential new customers based on demographic traits such as age, gender, income, education level, and even geography
- Determine the best ways to market and advertise to different types of customers
With the above insights, market research can yield numerous business benefits, including:
- Reducing business risks
- Spotting current and upcoming problems in your industry
- Identifying new sales and profit opportunities