You need to do your research because you need to ensure that business decisions are based on good intelligence – you will be able to reduce or manage risk and meet the needs of you current customers and/or potential customers.
Research should be at the centre of your business – and it probably is – because you probably know your business and the market already. Your knowledge is a benefit and a potential risk – you may think you know but without confirming this with research, you might be fooling yourself.
So research needs to be at the centre – and constantly renewed because markets, customers and business environments change.
What can you get out of research? Just a warm glow from customers who say they are satisfied with services? Or something more?
Research can provide you with information and intelligence that will help you run a better business. Research can focus on:
- Communications (and your current customers will be able to give you valuable feedback about your current and previous communications). Asking your customers for feedback will assure them that you take their experiences seriously and are actively seeking to improve your offer.
- Identifying opportunities – both in terms of new markets and new products. You can tailor your products and services to meet the needs of new customers and ensure that your supply will respond to demand.
- Benchmarking: comparing the way you do things with the way other businesses (including competitors) operate. Can you do it better? Keeping an eye on your competitors will help to do just that.
So you could focus your research on getting new customers or you could focus on getting more from your existing customers. Which is the best strategy to follow? Only you can make that decision, but your strategy should be informed by research.
What can you get out of research that you don’t already know? What do you want to know? Do you know what you don’t know? It’s all in the specification
You can drive yourself to distraction by trying to work out how to guarantee that your research will be cost effective – and driving to distraction is not very cost effective in itself.
So be smart. Limit your research to particular areas or issues that you can identify where there is a gap in your knowledge. Your research might indicate that further research is necessary – but cross that bridge when you come to it.
Specify tightly and you will make sensible first steps.
What types of research are there?
You can use information gained from your own monitoring (e.g. sales and marketing data) and feedback you get from direct communication with your customers.
There are two main types – often referred to as primary data and secondary data.
- Primary data you collect yourself (or is collected on your behalf) through surveys and group discussions (such as focus groups). Primary Data is gathered to solve a particular problem.
- Secondary data is previously gathered data. It can include things like published official statistics (such as census data, trade and industry data and demographic statistics) as well as non official material such as internet, newspapers, magazines, reference books, trade directories, trade associations, banks, universities, technical colleges, research institutions and publications from market research organisations.
Both can be useful to you and your business – but which type is best depends on what you want to know. If you want research about how to increase spend per transaction, for example, you might find collecting and analysing primary data most useful.
If you want to break into new markets, you will probably rely much more on secondary data.