Mark Dengler, president of Research & Marketing Strategies, Inc. (RMS), prepared this article. RMS is a full service marketing and market research firm located in Syracuse, New York.
Far too often in today’s business environment, companies conduct marketing activities that are not effective and do not provide the expected return on investment (ROI). Management is not impressed and there is a general perception that these marketing activities do not work. In reality, the problem may be that the company has not properly identified its market segments and may be using a marketing approach that does not target its “true customer” market.
Every company must conduct marketing to promote its product(s) and service(s). Marketing is geared to drive business strategy. Therefore, it is critical that market research is done to identify the appropriate customer market segment(s); to understand the targeted market needs and proper approach(es) to that market to establish clear, measurable marketing position objectives. Unfortunately, this critical work is often not fully completed. CEOs are understandably growing impatient with their existing marketing efforts. They are frustrated at being unable to see what their marketing dollar investment is achieving. Cost and timing issues consistently surface as the key barriers to conducting appropriate market research. However, many companies learn after the fact that it would have been well worth their time and financial resources to conduct market research in advance of launching unsuccessful marketing activities.
Market research can help companies provide focus in their marketing activities. In particular, market research can identify target market segments that are most suited to a company’s product(s) and/or service(s). Once these proper market segments have been identified, companies can design measurable, specific tactics and initiatives directed at these potential customers. No longer is a “cookie cutter” marketing strategy acceptable. When asked the question, “Who are you trying to sell to?,” an answer that implies “everyone” is not acceptable. Companies need to know who their most likely market-segmented customers are and then conduct specific marketing efforts to build Awareness, Interest, Desire, and Action (AIDA) among them. Any general marketing activities need to be augmented with specific strategies that are proven to be effective among the target customer segments. For example, you might continue to build brand awareness through a public relations campaign, but then develop specific marketing activities around potential customers most likely to be interested in one of your specific products and/or services.
Market research can involve both “primary” and “secondary” data sources. Primary market research is the most expensive since it requires going directly to the customer for data input. It can be done through both “qualitative” and “quantitative” approaches. A qualitative approach is one that obtains customer opinions and perspectives that do not necessarily have a high degree of statistical reliability. An example is a focus group or executive interview. Quantitative primary market research offers a high degree of statistical reliability and involves a sampling of a customer segment. Many quantitative studies are done using paper, telephone or electronic survey instruments. Primary market research is often the most preferred since it reflects the actual feedback of the existing or targeted customer segment.
Market research using secondary data involves the analysis and interpretation of data that has already been obtained from another source (e.g. U.S. Census, NYS Department of Labor). It is less expensive, but does not allow for much flexibility in analysis or applicability to a company’s specific questions.
Both primary and secondary market research is valuable to companies. Companies will face increasing challenges in trying to preserve their margins and hit company profit targets. Marketing inefficiency and ineffectiveness only increases the challenges and frustrations. Companies should look to conduct regular market research to better understand their customers and provide focus for their efforts.
Are you interested in learning more about market research or Research & Marketing Strategies (RMS)? Contact our Business Development Director Sandy Baker at SandyB@RMSresults.com or by calling 1-866-567-5422.