Nowadays, price is all that worries consumers. More and more factors affect purchasing decisions, including brand positioning, reputation, and the flexibility of return policies.
But it is difficult to read the minds of customers, and merchants also struggle to know where they stand in relation to their competitors.
This is all the more true for new e-merchants who must trust their instincts and base their initial decisions on assumptions.
Market research can minimize these uncertainties by helping you identify your niche, your target customer, your competition, and your product. It will maximize your chances of success.
While you can hire professional marketers to help you do your market research, if you’re on a budget, there are ways you can go about it on your own.
In short, market research refers to the process of collecting data about consumers’ needs and preferences. But the interest in the initiative does not stop there.
Studying a niche helps you understand why consumers want to buy your items.
This information in turn allows you to create products that provide solutions, optimize your marketing, and maximize your chances of success.
It is by studying your niche that you will be able to paint a picture of your target customers on the cultural, societal, socioeconomic, geographic, and personal levels.
You will know if there is a demand for your product, you will assess the extent of that demand, and you will know who is generating it. Studying a niche will also give you an idea of the competitive landscape.
There are two types of market research: primary and secondary. Let’s take a closer look.
Primary market research refers to the direct study of the niche using different initiatives; focus groups, customer surveys, analysis of your own sales data, and so on. To do primary market research, you will need to research the market yourself.
Secondary market research refers to the study of the considered niche through third party data.
You don’t do the research yourself – you rely on data collected by third parties to make informed decisions about your products and customers.
Secondary market research is based, among other things, on the analysis of reports, market trends, and case studies.
Market research is basically used to validate your product idea. It also gives you the information you need to maximize the appeal of your products and optimize your marketing, pricing, and brand positioning.
Without market research, you won’t have enough data to determine who your target customers are, what they buy, why they buy, when they buy, and how to sell your products to them.
It is by doing market research that you will know where and how to find your customers and determine the best way to present your product and your brand.
By studying your competition as part of your study, you can also develop a unique selling proposition to differentiate your e-commerce site and attract more customers.
There are two ways to do market research: do it yourself, or hire someone to do it.
It is usually easier to do secondary market research when considering going it alone. In this case, you will need to look for reports, case studies, and reputable publications in your niche.
To do primary market research, you have to take a different approach to collect data. There are several ways to collect information:
For both types of market research, here are some elements to consider as part of your approach:
Data relating to consumer behavior:
The positioning of your company:
There are many tools and resources that you can use to research your niche. Here are some of them:
You will have access to data such as their age, income, lifestyle category (according to Facebook), and even their consumption habits. Geographic location information is particularly useful for owners of physical stores.
It is by understanding that the research process never stops that you can be successful in your market research. You should be continually studying your niche. As the market changes, follow-up work is needed to stay ahead of the game.