Demystifying Market Research and Customer Discovery

By Catherine Campbell, Guest Contributor

Market Research. Those words often leave small business owners with questions. For some people the words themselves make them want to go to sleep or glaze over, because it sounds like a really overwhelming and somewhat boring topic if you’re not in marketing. But we break down the ins and outs of market research and go over the 5 basic market research ideas and how they can help you hone your marketing strategy to make your business boom.

A lot of small business owners pressed for time or with limited budgets don’t know how to get started and what they should be prioritizing. There are 5 basic methods of market research.

  • Surveys
  • Focus Groups
  • Personal Interviews
  • Observation
  • Field Trials

But why is it so important?

  • It provides clarity on brand awareness.
  • It shows you how well people know your brand in the marketplace
  • It provides insight into your competition, in your field, in your local area, and online
  • It can tell you if your target market will like new products being rolled out, or if they have issues with current products
  • You can learn the reasons behind a sales slow-down

Studies have shown that 19 out of every 20 products that are launched fail. Most often, it’s because the company or manufacturer didn’t do their market research, and the assumptions they made surrounding the product proved mistaken. Today, we’ll talk specifically about surveys, focus groups, and personal interviews.

SURVEYS

Why do surveys?

Many people use surveys as a means to reach people they haven’t met yet. Or maybe they have a huge audience already, and they want to survey them without the sheer time and energy required to get these people in a room or on the phone. The marketing survey is a great, cost-effective way to reach your customers all at once.

Marketing Survey tips

  1. Keep surveys very short. A general rule of thumb is no more than 10 questions. Avoid open-ended questions. The data is harder to quantify, but if you need to ask them, no more than three and place them at the end or in a bonus section. You can get more personalized insight through them, but they can quickly overwhelm, and be confusing to categorize.
  2. If you’re asking more than 10 questions, avoid putting them on a single page unless they’re very short. For a multi-page survey, use a progress bar so respondents how much more of a time commitment they’re making.
  3. Consider an incentive within your budget, such as a discount or giveaway. Doing a giveaway instead of spreading the wealth over a lot of respondents gives you room to make the incentive really worth the clients’ while.
  4. Spread the word. Promote everywhere, in a newsletter, on social media, boosted posts on Facebook. Whatever you need to do to get the word out by the deadline. Deadlines can be a week, two weeks even. But try not to extend it beyond that.
  5. Don’t bug people too much. It may be important to you, but it’s not critical for them. If you’re emailing your customers to entice them to respond to a survey, send them one email. You can send a couple follow up emails, depending on the length of your deadline, but keep them minimal. Mention it once on social media every few days. No more frequently or you risk annoying people. You don’t want them thinking, “Enough with the survey already.”

Focus Groups

Why do a group instead of a survey?

Here, you’re asking a small subset of your target market to focus on one aspect of your company. You don’t need that many people to participate. You’re just looking for a good sample with real-time, personalized feedback. It’s interactive.

This is a more expensive option. You need to host the group away from your company’s headquarters on neutral, objective ground, and that will cost money. A co-working conference room is an option for renting just a few hours. Hotels are also great, especially during the week and in daytime.

Focus Group Tips

  1. The focus group environment matters. You need a room that’s not going to influence the way they already feel about your company.
  2. Snacks are good, but tricky. You don’t want to sugar up your focus group at the beginning if they’re going to be there longer than 90 minutes. They’ll crash before the group is finished. Also, weirdly enough, beverage temperature matters. Cold beverages are refreshing, especially if the room is hot. Hot coffee or cocoa will warm them up if the room’s cold, and contribute to more honest feedback.
  3. Focus groups need incentives, too. Don’t give them the product they’re assessing as an incentive either. If they hate it, they’re going to feel cheated. You actually want to pay people for their time. Start around the $20 mark, if not more. It would be great to compensate each person a couple hundred dollars, but that entirely depends on your budget.
  4. Never run a focus group for longer than 2 hours, and you’ll need to ensure they stretch and move around, but those 2 hours matter in their day.
  5. Who do you invite? Current customers, as well as target audience members, are ideal participants in your focus group.
  6. Consider passing out forms. It’s possible to answer those anonymously, which might open participants up more.
  7. Guide the discussion with questions, but stay neutral. Don’t ask, “Does this candy taste tart?” Ask instead, “What flavors or impressions are you getting from your first taste of this candy?”
  8. Prevent any one individual in the group from dominating the conversation or influencing the rest of the group. You need to be on the ball controlling the neutrality of the environment and the conversation.
  9. Lastly, provide structured bathroom breaks. Allow people to go to the bathroom one at a time, which sounds crazy, but it’s like letting a jury go out together. They’ll run the risk of forming opinions with others involved, and when they return, their honest, personalized feedback could have changed. You want to discourage people from influencing each other outside your controlled environment.

Customer Conversations

One of the easier things to do—if you don’t mind talking on the phone or face-to-face—is have customer conversations. This one is fairly inexpensive. You don’t need software or to rent space, but it does have a time cost. Don’t outsource customer conversations to a phone bank of people that don’t know your company, because you’ll lose an element of authenticity, which will make it harder to get people to agree to the conversation.

Client Conversation Tips

  1. Generate a spreadsheet and start going down the list. If you want to call one person a day, that’s fine. Whatever fits your schedule. There’s no wrong way to do this except for how the conversation is conducted.
  2. Once on the phone, you want them to get to know you a little better, but don’t take too long. Say, “Hi, my name is Catherine. I’m the agency director at Bright Planning. I started my company in 2014 because I wanted to help ethical companies market better and be better. We’re about to roll out a new service, and because you worked with us in the past, I’d really value your feedback, if you can spare five minutes.”
  3. You don’t need to offer incentives, but if they are past or current customers, you can absolutely give them one, or a thank-you gift for participating. If you have trouble arranging phone calls, then maybe an incentive would help.
  4. Try to keep them to less than 10 minutes, if possible. Sometimes, if you get someone talking, they can give you fantastic feedback. Ignore the 10-minute rule and stay on the phone with them as long as they’re comfortable speaking with you.
  5. You can record the conversation through conference call software (but check the laws in your state surrounding two-party recordings), or you can just listen. Absorb. Hear what they’re saying to you.
  6. Ask good questions. Try asking “what” and “how.” Or you can try the Goldilocks technique: provide them with choice A, B, or C.
  7. If you ask “why” questions, they’re open-ended, and just like with surveys, people can get tripped up. As with surveys, try to keep those to a minimum, and toward the end, after the customer is warmed up.
  8. Thank them for their time. This is very important. If you’re going to be sending them a little thank you gift, mention that at the end of the call. Then make sure you send it. Don’t fall through with a promise like that. These are your customers, not cold calls. They’re people who already like you. Failing to send the thank-you gift could change that.

Market Research doesn’t have to be daunting

It sounds overwhelming, and the sheer number of options available to conduct the research can stress even experienced marketers, so small business owners should take heart in knowing that one, you don’t have to conduct every possible market research method out there. Do a couple or three, and do them well with the tips we’ve provided here, on your schedule and at your pace. Stretching the data out over time can also show you long-term patterns in your customers, both past and present. You can see if your efforts to improve are successful as the survey feedback, or customer conversation feedback crosses the months. On the flip side, you’ll know quickly from a focus group if your new product has the legs it needs to take off.

 

Catherine Campbell is the director of Bright Planning, a marketing and PR agency for ethical, pioneering brands in Asheville and around the U.S. Since 2006, she has consulted for  companies of various sizes, from fast-growth startups to Fortune 500 brands, and has served as a marketing strategist to bestselling authors and several of the country’s top sales and social influencers. She is a native of western North Carolina and has lived in Asheville since 2000. Learn more at www.brightplanning.com.