Online market research: how to use it to your advantage
Market research provides valuable insights into how the consumer’s mind works. Having an insight into how people think and feel when they make purchasing decisions will help businesses market their goods and services to the people who are likely to buy them and so sell more.. Online market research is a convenient way to gather consumer insights for highly effective, highly targeted marketing strategies.
So why are the most successful companies about twice as likely to do market research than those performing poorly in the market? What does it give them?
- Understanding the target customer: knowing how the target audience thinks, what they feel, and what they value can be the difference between success and failure when it comes to new product ideas, developing a marketing strategy, or converting visitors into customers
- Understanding customer behaviour: learning the factors that influence buying patterns, how customers shop and why they choose a product or service can help provide a better customer experience
- Finding new opportunities: with market research, analysing buying patterns in the market can help create a more successful strategy for brand positioning
Market research do’s and don’ts
Some companies, however, make costly mistakes by either conducting the wrong type of market research, asking the wrong questions, or not doing enough research altogether.
Here are some examples of how some well-known marketing disasters could have been avoided:
1. Get specific
In 2004, Coca-Cola launched a new sub-brand called ‘C2’, a mid-calorie, low-carb beverage. Despite a $50 million marketing budget, the product launch failed miserably.
C2 was backed by a lot of market data about diet trends and target audience preferences. So where did the product go wrong? Coca-Cola failed to ask the right questions of the right audience.
Asking the right questions — ones that identify not only what people like, but also what they don’t like — helps to create a more accurate picture of who the target audience is and exactly what they are looking for.
2. Consider the competition
Capturing information about competitors is just as important to a product strategy as gathering data from customers — particularly when it comes to identifying how a product will sustainably differentiate itself in the market.
Zune, Microsoft’s attempt at competing with the iPod, targeted a very narrow market and appeared to have very little difference to their competitor’s product. Microsoft discontinued the failed product in 2011 after losing hundreds of millions in investments.
3. Cultural differences
Tesco’s attempt to win over America with their new supermarket “Fresh & Easy” unfortunately flunked.
From the misleading name (their products were apparently less than fresh), to their unwillingness to embrace the essential American “coupon culture”, Tesco clearly didn’t use the right kind of research methodology. It is essential, especially when branching out to other countries, to fully research the target market, including researching any cultural differences.
4. The right type of research
Many companies often rely on quick and easy surveys and focus groups which are low effort and inexpensive.
However, the issue with focus groups is that they cannot always provide reliable insights into whether a new development becomes profitable. For example, the group dynamics can create a bias, as some participants may be louder than others, usually the brand’s critics. Often, people do not express their true views as they try to fit in with the majority, so tend to keep their views to themselves.
Some participants may be overly sceptical, rejecting new products unless they have been tried and tested by others already. Emotions also play a huge role in purchasing decisions, which the traditional ways of asking questions cannot address.
Finally, the focus group moderators may have intentional interviewer bias, leaving these explicit research methods less useful.
What are the benefits of online market research?
Online research can reach almost anyone in the world through either a desktop computer or a smartphone and can include qualitative, quantitative or neuro-implicit questions. Some other advantages:
1. Quick data collection
With the current technology, the process of collecting data online has become much faster. Results can start arriving in a matter of minutes and it is very common to fill quotas within a day or so.
2. Analysis in real-time
When the research survey is in the field, it’s possible to follow the data in real-time, through the preview of quotas and charts. This means the analysis can start as soon as the target sample is reached.
3. Screen the target group
Market research is nearly always aimed at a specific target audience. In online surveys, it is possible to select which respondents are wanted and should qualify and which should be screened-out. The use of respondent panel providers can speed it up as they can often provide pre-screening.
4. Affordable costs
Since online market research eliminates the need for lengthy face-to-face interviews, the cost per respondent is considerably less. Even for a large sample size, the costs are still much less.
5. Response quality control
There are many techniques that help identify low quality, unreliable responses in online market research. Techniques can be used to detect lying, inattention, and poor engagement and in real time so that they are screened-out as soon as they are detected. Where necessary such respondents can be reported to the panel provider who can then disqualify them from the panel.
6. Digital Possibilities
Current rapid download speeds mean that respondents can assess a wide variety of formats, such as images and promotional video materials from their own home. Other possibilities include simulating online behaviour, simulating the shopping experience, and even simulating walking down the street and noticing (or not) ads on billboards or bus-stops etc.
What is the process of doing market research? How does it work?
The steps involved in conducting online market research are not much different from traditional methods:
- Define the problem: market research serves the purpose of solving a business problem. Those questions or problems can become the research objectives. “Are our clients satisfied with our service?”, “How can I increase sales?”, “What does the public really think about my brand?”
- Define the target group: direct research towards the right people, the target group, by thinking about what type of profile should be researched. There should be some feature or demographic that they have in common
- Write the questionnaire: the questions should be dynamic, clear and objective, with a range of appropriate alternatives. The survey should indicate at the start what the expected duration of the survey is (the length of interview or LOI). Only ask questions if the answers are going to be analysed. It’s very tempting to ask lots of questions without thinking about how the responses could be used in a meaningful way. Make sure to test the survey and edit it thoroughly before launching it
- Data collection: respondents can be recruited from a marketing list or from a recruitment agency/panel provider. Marketing lists are a good option when a client has such a list, while panel providers are better at reaching a large number of respondents.
About Split Second
The team at Split Second Research has years of experience conducting online market research for many well-known brands. If you want to find out how we can help your business, get in contact with our experts.