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The ABCs of Marketing Research… and one milkshake, please



Kirjoittanut: Irene Lai - tiimistä SYNTRE.

Esseen tyyppi: Akateeminen essee / 3 esseepistettä.
Esseen arvioitu lukuaika on 7 minuuttia.

Introduction 

 

Many companies underestimate the importance of a well-done marketing research or they do not even think about it. The first though usually goes immediately straight to the advertisement of a product or a service and it is quite natural to focus on that instead on people who are going to purchase that product. The fact is that investing money only on promoting may be counter-productive because it might jeopardize the success of the sales. Advertising is good and important, but putting efforts only on that part is wrong because focusing simply on marketing is not the right way to reach the client. In fact, it is important to know who the company is reaching out to better understand how to get to that customer. The success of a marketing campaign does not depend on how much creative the advertisement is, but on the ability to observe and to reach the customers in the best way and at the right time. Taking a step back, should we focus now on what the marketing research actually is? The success of a product is not only all about customer segments, pricing strategies or psychological triggers. Let’s compare for a minute this to medical research: if a doctor did not read studies about treatments and medicines, s(he) would not understand how they would react differently to people. The success of the treatment can be really varied from person to person, depending on age, lifestyle, daily habits, among a lot of other things. The doctor would wrongly only assume that the medicine in question works indiscrimately for everyone in the same way. Similarly, marketing research is an essential process for companies to gather information and better understand a company’s target market. Businesses use this information to design better products and improve user experience. Through marketing research, it is sure enough possible to understand in a deeper way company’s users and craft a marketing strategy that attracts quality leads and improves conversion rates. It is a way to verify the success of a new product and to understand brand perception to ensure that the team is effectively communicating company’s value effectively. Market researchers investigate several areas of the market, and it can take weeks or even months to paint an accurate picture of the business general view. Of course, the marketing department may have a rough idea of who company’s potential customers are and what they need, but to win their loyalty, the bottom line is to dig deep into them. The real turning point for a company is to offer a service or a product that customers find irresistible and impossible not to buy. This can guarantee the success of the company itself. What makes a product irresistible so? It is duty of the market researcher understanding why a person chooses that specific service, what someone is willing to pay something for and why in that moment of his/her day. That’s why it is particularly crucial understanding also customers’ habits, so to get to know them better and to offer accordingly a better service. Understanding customers’ problems, pains, and desired solutions, is the way how it can be possible to design a product or a service tempting for them. Let’s now dive into the necessary steps that helps a company to do all of what discussed. 

 

 

 

Types of marketing research data

 

There are two types of market research data that are possible to be collected by a market research: 

  • Primary research data: they are first-hand information that comes from original sources. No data about specific research has been collected before. 
    This method allows to control the process completely from A to Z. 
  • Secondary research data: they are information and data that has been collected by others before and is publicly available either online or offline. This can be data that has been published in newspapers, reports, magazines, etc., or information that is freely available online. The downside is that everyone has access to this information and you had no control over the collection methods. 

Then research can be divided by the information is going to gather: 

  • Qualitative research collects information that helps you better understand how people think about certain topics: what customers think and how/why they make the decisions they do. The best sources for gathering qualitative information include in-depth interviews, focus groups, and direct observations. 
  • Quantitative research collects information is statistical data that is usually more structured. Questionnaires with closed-ended questions and surveys fall under this type of information. 

After a brief analysis of the kind of information, let’s see now the different methods how it is possible to gather all the data. 

 

 

 

Market research methods

 

There are different ways to conduct marketing research but it would be wrong to limit the process to only one research method. Four common market research techniques include surveys, interviews, focus groups, and customer observation. Since different companies may reasonably have different goals, it is usually recommended to combine these methods depending on the area of interest and on the information the company is ready to collect. 

 

  • Customer surveys.
    Online survey softwares such as Typeform or SurveyMonkey can be really useful, but surveys can be conducted by phone, in person, on paper too and they are extremely informative. They are a list of necessary questions to give you the best possible insight into a customer’s opinion of a product or a service, the company’s brand, and the experience that the company is going to provide. Depending of the information the survey is going to collect, questions can be as much detailed and specific as the company prefers. 
  • Interviews.
    In-depth interviews, conducted either by phone or in person, can give the opportunity to dig deeper into the topic and to ask more specific questions.  
  • Focus groups.
    A focus group is an organized session with a group of six-eight people who share some common characteristics. These characteristics include age, place of residence, buying habits, etc. They participate in a discussion on a pre-determined topic led by a moderator. Even though slower and more expensive way, it is effective indeed to get feedback on major upgrades, product features or new products. 
  • Observation.
    This method involves observing or videotaping how consumers interact with a product or service in a natural environment. While this method is time-consuming, it has the advantage of allowing unbiased research. This is because consumers are not under pressure and would most probably behave naturally. 

 

 

 

The “Jobs-to-be-done” customer strategy

 

Recognizing and understanding the job to be done are the first steps in creating products that customers want. It’s also important to create the right experiences for buying and using the product, and then to integrate those experiences into the company’s processes. “It [the jobs-to-be-done theory] transforms our understanding of customer choice in a way that no amount of data ever could, because it gets at the causal driver behind a purchase” (C. Christensen, Know your customers’ “Jobs to be done”). Innovating a new way to serve a product or the product itself can help people to solve their problems.  The bottom line is taking in consideration the experience that the customer is looking for. Of course, it has to be related to the whole emotional sphere as well. The job to be done has other dimensions that are strictly linked to personal life to take in consideration. How many times we buy something just because we have someone else’s problems on our mind? Or again how often we purchase something because it let us feel better. Understanding the circumstances is critical and absolutely essential to make the market research successful. 

 

 

 

The Milkshake Marketing example

 

Remarkable is the example that Clayton Christensen brings in one of his courses about a fast-food chain that wanted to improve its milkshake sales. The company began by analyzing the product (milkshakes in this particular case) and demographic profile of a typical milkshake drinker. Then, the marketing department listed the characteristics of an ideal milkshake (thick, thin, sweeter, smooth, fruity, chocolatey, etc.) and asked potential customers who responded as honestly as they could. Even though the company responded to the feedback changing the milkshake recipe, the sales didn’t improve.
As a result, the company changed the way of working trying to figure out what customers that were buying a milkshake had in common. The researcher documented when and who bought milkshakes, and whether they drank them on the premises. He found out that 40 percent of the milkshakes were bought first thing in the morning by commuters who ordered them to go. Interviewing customers who purchased a milkshake and asking them why they chose it over something else was a crucial point for the research. As Christensen said: “Most of them, it turned out, bought [the milkshake] to do a similar job,” he writes. “They faced a long, boring commute and needed something to keep that extra hand busy and to make the commute more interesting. They weren’t yet hungry, but knew that they’d be hungry by 10 a.m.; they wanted to consume something now that would stave off hunger until noon. And they faced constraints: They were in a hurry, they were wearing work clothes, and they had (at most) one free hand” (Clay Christensen). Once the company understands what needs to be done, it could respond by creating a more original product (adding pieces of fruit) and a fatter one (to give more energies to people who commutes). The chain could also respond offering customers another kind of thinner milkshakes more suitable for children. This is a really great example on how a little more of background history could actually help companies to define their products better. Knowing your customer means having more probabilities that they are going to find your specific product more attractive so they are going to buy it, most probably not only once but even more frequently. 

 

 

Conclusion

 

Many companies may unknowingly develop valid innovation processes that lead to inconsistent results, spending time and money building marketing models that disappoints all the expectations.
Instead, companies should put more efforts on a kind of innovation by identifying the tasks the customers struggle to do and this would be much more predictable and profitable. Of course, it is a very important tool but it cannot predict the future and it cannot say how much a product will be sold. Why is it anyway worth doing it so? Marketing research gives important insight into a variety of things that may impact long-term the company’s productivity though. It allows the company to get information from a larger sample of your target audience and knowing the big picture can lead to better business decisions and assumptions, causing a potential early development of the offered product. Moreover, focusing on the human side of the task, it allows to know the customers’ attitude toward a particular topic, pricing a particular service, the product itself or brand and consequently whether there is demand for business initiatives and whether it is worthy investing money on. Last but not least, it adds more values to the innovation process by challenging it and showing unexpected implications and other possible sales opportunities. Properly conducted, research can improve marketing strategy and its execution. 

 

 

 

 

References 

 

 

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