Can a company run on its inventiveness and brilliance alone? We all know that there are multiple facets that make a business dive and thrive– dive into uncharted territory and thrive in its chosen market space.
One of those facets is market research.
Knowing the decisions that customers make and why they make them is vital to a company’s ability to predict profit margins, retain customers, and expand its customer base. There have been some mixed messages regarding market research and what it means for the vitality of business over the past few years.
When multi-billion dollar execs aren’t pro-market research it makes us a little nervous. Could they be right in thinking that too much market research is bad for business?
Who Said Market Research is a Bad Thing?
Jeff Bezos, CEO of Amazon released a letter back in 2018 to Amazon shareholders stating that market research doesn’t hold the weight that it used to.
Bezos’ letter specifically mentions the development of Amazon’s Echo device. He makes the point that consumers would have never asked for an Echo because there wasn’t anything like it on the market at that time. In summary, his point was that market research wouldn’t have pushed them into the direction of innovation, but repetition.
Bezos isn’t the only CEO who doesn’t believe in the utility of market research. Ben & Jerry’s CEO, Matthew McCarthy explains his own discomfort with relying too heavily on research.
“If you did your research it might say what we need is more chocolate, vanilla and strawberry, but at Ben & Jerry’s we try to come up with wacky concoctions that make people go ‘wow I didn’t think that was going to work’.”
Bezos and McCarthy may have a streak of creativity and love for invention, but that doesn’t mean that market research should take the back seat (or get out of the car entirely).
Here’s Why Market Research Matters
CEOs of large multi-million dollar conglomerates are always leading their teams and the wider public with non-traditional business ideas. In a lot of scenarios, these ideas are admirable and inspiring. But supporting the idea that market research can be bad for business is simply outlandish, and could lead those who need it most in the wrong direction.
There are tons of advantages to market research for everyone, from small local businesses to large corporations. Some of the most advantageous benefits of market research are:
- Insight into projected loss and profit margins
- Noticing anticipated fallbacks and opportunities
- Helping to spot upcoming trends
- Helping with strategic planning
Sure, market research may not directly report that your customer base wants an invention that hasn’t hit the market yet, but it can provide you with clear insight into existing whitespace, information that will fuel creativity for innovative products.
Market Research and Possibility
Market research is a front-row view of your customer demographic and what they need, want, and anticipate. For instance, learning that your target demographic has grown weary of your carefully curated marketing plan is a huge piece of helpful information.
Revamping your marketing strategy based on new data gathered from the research will ensure that your company’s resources are being utilized to the fullest potential. If implemented properly, the updates to your marketing strategy will inspire customers to re-engage with your brand, and ultimately lead to greater customer retention.
Market research allows other forms of possibility:
- Increased customer service quality
- New, best-selling products
- More space for creativity and innovation
- Pristine and effective marketing
- Multi-demographic engagement
The list goes on and on.
Companies shouldn’t go blindly into the dark and assume what a customer wants. Doing so isn’t fair to your organization or the customers you serve. The chances of you knowing their desires without researching it are minimal. We whole-heartedly feel that market research will only serve your business well.
To put it into a simple equation: Your Customers = People. And people want to know that their opinions matter.