The importance of market research for your business

Market research provides the necessary data-backed evidence to help your business make confident decisions. Instead of building a company based solely on gut decisions, market research provides direct insight into what your audience wants to see.

Here are 10 reasons why market research is so important.

Do customers need three colour options? Do they want a new feature or would they prefer product optimisation?

Understanding your customers is the foundation of a successful business. Market research uncovers consumer attitudes, needs and expectations that go beyond assumptions or surface-level observations.

Conducting market research can yield deep insights into customers’ motivations, preferences and pain points through primary research methods such as customer feedback surveys, interviews and behavioural data analysis.

These insights enable you to tailor your products, messaging and customer experience so that they are more closely aligned with actual demand.

Rather than reacting to change, trend-focused market research empowers you to lead it, ensuring that your brand remains relevant, future-ready and aligned with what your audience will want next.

You can use primary and secondary research methods to analyse customer behaviours, industry reports and market signals. Early awareness allows you to proactively adapt your strategies, innovate your offerings or enter new markets.

Is the customer complaint that you have just received a one-off annoyance or a warning sign of future challenges?

Without long-term data tracking of ongoing buying behaviours and customer satisfaction, either scenario could be true. However, wouldn’t it be nice to know for sure and then be able to respond to the complaint?

After all, while 49% of customer experience (CX) professionals believe that customer satisfaction has improved in the past six months, only 18% of consumers agree.

Market research enables you to identify trends, such as customer dissatisfaction, that indicate potential issues or opportunities to address customer concerns.

For example, if a single Net Promoter Score® (NPS®) survey reveals poor results, this may not actually be anything out of the ordinary, especially if industry benchmarks indicate normality. However, a sustained dramatic drop in NPS could be the red flag you’re looking for to act.

Market research helps you to uncover gaps in the market that may not be immediately obvious.

Analysing customer feedback, competitor activity and broader market trends can help you to identify areas for expansion, differentiation or innovation. These insights can also help you to prioritise initiatives with the highest potential impact.

Spotting and acting on opportunities at an early stage can give you a first-mover advantage, increase your market share and drive sustainable growth in a way that’s aligned with actual customer needs.

Risk is an inherent part of business. However, instead of adopting a high-risk, high-reward mentality, it might be better to take a different approach: data-driven risk and projected reward.

Only 23% of survey users conduct product development surveys, meaning you have a unique opportunity to gain a competitive edge by incorporating market research.

For example, as a product manager, your innovative idea for luxury, organic, freeze-dried, insect protein-based dog food may make sense to you. However, for the executives holding the purse strings, a hitherto-unseen product means risk.

You can use a product survey to validate your ambitious idea with data, build a business case and reduce business risks with market research.

Every brand has a voice. Nike is inspirational, Burberry is regal and Innocent Drinks is playful. Brand voice communicates your company’s identity and influences how you interact with your audience, including the language and media used.

In the same way as market research informs your brand voice, it can also help you to develop promotional materials that resonate with your audience.

Market research data uncovers your target market’s demographics, preferences and behaviours. This data enables you to craft relevant and engaging messages that align with your customers’ values.

Additionally, you can create more relevant marketing campaigns by understanding which media your audience engages with, such as social media, video and blogs.

Which type of marketing will result in the greatest ROI? Instagram? Hoarding? Email? Influencer? It’s a struggle that 89% of marketers have to contend with, especially with limited resources. 

Market research helps you to pinpoint where your target audience spends their time and which channels have the most influence on their decisions. By testing messaging across platforms, you can identify the most effective touchpoints for engagement and conversion.

With these insights, you can allocate your resources more strategically, focus on high-impact channels and avoid wasting resources on ineffective tactics, and this will ultimately drive better results with less guesswork.

Every business operates in an ecosystem of partners and competitors. The more information a business has about its competitors and audience, the more ready it is to disrupt the market. Market research can help you to investigate your competitor’s success metrics, strategy gaps and trends.

Market research surveys, such as competitive differentiation surveys, provide data that businesses can use to gain a better understanding of their competitors’ strategies. Using this information, your company can craft high-impact campaigns in order to stand out from your competitors, improve interactions and win potential customers.

You need to push boundaries and innovate new solutions. But which direction should you go in? And how far is too far?

Market research equips businesses with the insights they need to set strategic, achievable goals. For example, understanding which features customers value most can help businesses to set product development priorities, while insights into price sensitivity can inform their revenue and pricing goals.

This reduces the risk of setting goals based on guesswork and increases the likelihood of achieving meaningful growth.

Ultimately, using data from market research ensures that business goals are ambitious and grounded in reality, making them more actionable and measurable.

With 45% of marketing leaders citing business growth as their top priority this year, data-informed decision-making is critical.

Since market research is based on genuine customer insights and market trends, it clears up uncertainties by revealing what is likely to succeed.

Whether you’re deciding on a new product launch, pricing strategy or campaign direction, research equips you with the evidence you need to support your choices. This leads to greater confidence among stakeholders and more efficient resource allocation.

In a fast-moving environment, simplifying decision-making with reliable data gives you a competitive edge. It helps you to act quickly, reduce risk and meet customer needs.

Say goodbye to guesswork and merely hoping for the best. Market research can provide valuable data to support business-critical decisions such as those relating to product development, marketing strategy and customer experience. SurveyMonkey offers extensive support and fully managed market research tools. Whether you’re sending out market research surveys to identify potential challenges or explore new opportunities, we have a solution for you.

Net Promoter, Net Promoter Score and NPS are trademarks of Satmetrix Systems, Inc., Bain & Company, Inc. and Fred Reichheld.