An investment, not an expense. Why marketing research and market analysis are essential for a company’s success.
Market research is often underestimated in Polish companies. In foreign companies, as well as their Polish branches, they are a standard practice – but some Polish companies continue to take a sceptical stance. But without independent market data, is there really room for development?
As PMR research study indicates, PR and marketing departments in companies operating in the private sector are focused on building company and brand image, expanding the company’s offer, constructing a development strategy and generating sales. They’re active in all the key areas, but can any company reach its full potential without independent outside information? A mere 32% of companies use benchmarking, and over two thirds of the companies don’t measure their effectiveness at all.
Conversations with our clients revealed that often the final decision about conducting a market study is made by the management – PR and marketing department don’t always have the clout. So how do you convince the unconvinced?
Market research and analysis are an investment that doesn’t bring a company profits immediately. Most importantly, it allows the company to gain unique information, unavailable to others because of laws and confidentiality agreements. None of the competitors get their hands on the data and analysis. Price is one of the key hurdles in commissioning market research, especially in the case of smaller companies. Professionally conducted interviews, an in-depth statistical analysis and gathering outside data – solid and reliable research is an expense. But it’s an investment that provides a company with that crucial competitive edge. If a company has any financial concerns, the research can be divided up into stages, which allows to spread the costs over a period of time.
When a company has a marketing department or a research and analysis department, the management doesn’t often see a need to commission additional research. However, research carried out by outside agencies is an independent, invaluable source of information that complements the company’s own data. Research agencies listen to the consumer and gather market data in a professional and objective way. They can verify the information gathered by the company, but most importantly, they can supplement it with data from sources unavailable to the client – nationwide surveys conducted on a random sample, interviews with competitors, or an analysis of the entire market. Research is a key part of knowledge management, an idea that’s somewhat underestimated in Polish companies, but one that is slowly but steadily gaining a foothold within the market. Even research project commissioned a few years back can make a significant contribution to the company’s know-how. Comprehensive surveys give results which can constitute an encyclopaedia of clients and their needs, the competition, and development opportunities.
A large variety of research and consulting services gives a company free choice, depending on their needs. PMR divides them into four groups:
1. Consumer research, which is focused on the customer, their satisfaction, loyalty, and opinions on the quality of service. Consumer behaviour research is a very wide subject – purchasing habits and strategies are all taken into account. Target group research is an in-depth analysis of behaviours and preferences, focused on the target group of a particular product or service.
2. Market research is a broad and comprehensive consulting analysis and research study, which gives the client information on the market’s size, the major players and their strengths and weaknesses. This can provide a company with useful business insight into growing market segments, and can help build a market entry strategy.
3. Product research applies to the concept and functionality of a product. Thanks to concept testing (e.g. packaging) and product testing (e.g. taste tests), the client gains unique knowledge of the perception of their products, which are also compared with competing products. Another broad category are various price tests, which help to determine the pricing strategy and maximize profit. In the B2B market the key thing is to research distribution channels.
4. Marketing research includes researching image, brand, advertising or websites, therefore providing knowledge which is crucial for the marketing department’s day-to-day operations.
An argument often heard against research is their low usability. Companies which have commissioned a project and were not satisfied with it remain sceptical as to the entire idea of surveys. However, one has to keep in mind that after the study has been completed the client is entitled to a critical approach, and can ask the research agency to verify the findings (if they seem dubious), but most of all, to request that the agency supplement the final report with any information they find is missing or unclear. When choosing an agency in the future, it might be a good idea to shop around – many agencies place great importance on high usability of their research and compiling the findings in a way that allows many different departments to benefit from them.
Another objection to research reports is that they sometimes include inadequate or vague recommendations. Both sides often contribute to this – ineffective research agencies and companies which are unwilling to share information. The agency has to have a full understanding of the problem at hand in order to provide the client with successful, tailor-made surveys. This requires learning about the company’s intricacies, their difficulties and barriers to market success. Research agencies guarantee complete confidentiality, that’s why it’s worth providing them with information on the problem the company is facing, as well being upfront about what kind of changes the company is willing to make. This ensured detailed and accurate recommendations.
Marketing research and market analysis can support the managing of a business, boost the level of services and, crucially, allow the company to be more aware of their position in the market, and therefore to manage risk more effectively and enter new markets with full confidence.
The nationwide B2B survey was conducted on a sample of 400 of large and mid-size companies operating in the private sector, which carry out marketing and PR operations. The companies’ structure corresponded to the structure of private companies in selected industries.
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