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Have you ever heard about Market Research?
Let us untangle this high-priority element for your business marketing strategy, starting with the basics.
At first instance, we should define what it is:
Market research is a systematic process of collecting, analyzing, and interpreting information. This data could be about a target market, consumers, competitors, and the industry as a whole or a specific niche.
One of the most important outcomes the research has is providing powerful information that can help you make educated key decisions around your business, which diminishes the risks that might come into view when investing budget and time into new ventures. The research can have multiple purposes, the reasons can change with the stage that the product or service a company is selling is in, but it should be treated as an ongoing activity. It is always beneficial to learn about your business environment, customers, and competitors, especially because the commerce scene is constantly changing, and brands must adapt to efficiently face the challenges that emerge.
When a product is due to be introduced, a company uses research to determine the necessities of the targeted customers. Once the actual selling commences, the company can examine the market to discover how to generate hype about a new output. Once finished, it becomes about improving performance. The final step is for the company to use further research to determine the product’s direction.
Don't mistakenly think this kind of analysis is reserved only for new and small businesses trying to position themselves, virtually all successful and well-known companies have made it so far by using market research. One of the most standout examples of a company being transformed by market research is the beloved toy brand Lego.
While the building blocks and figurines might seem quite inclusive and unisex this company, for a long time, pointed to one single market: young boys.
In a study done by the company, Lego discovered that only 9% of its users were female. They saw in this an opportunity to increase revenue by expanding their reach with their brand and also to empower young girls, Lego made the high-profile decision to go back to research and development and create products that would appeal to the young female audience.
Before disclosing a new line of toys targeted for girls, Lego performed long-winded market research, that consisted of 4 years of studying the play habits of 3,500 girls and their mothers. Researchers were assigned to compile data regarding the answers to critical questions about what would make Legos more interesting and appealing for young girls.
Upon the outcome of the market research, in 2012 Lego created a product line called “Friends”. The colors of this line were more vibrant and diverse. Lego ensured that the packaging was more inviting to young girls, and the figures were also altered to cater to the new audience. They increased the size of the figures so they could now hold accessories such as hairbrushes and purses.
All the adjustments made by Lego to enter this new market niche were a response to the information obtained from the market research trial. As a result, this massive toymaker became a success with girls and continues to increase its market share. Lego told the Wall Street Journal the share of girls among Lego players has increased since. But that's not all. Lego Friends is also believed to be the reason girls’ construction toys in the U.S. and the larger European countries tripled to $900 million in 2014 (up from $300 million in 2011) according to research firm NPD Group.
After seeing this case of success generated via market research is hard not to believe in its magnitude. In order to keep on the outstanding edge of the industry, businesses should listen to their customers, and constantly examine the changes in their field. By performing this type of studies businesses can now know rigorously which of their services or products are valuable for their audiences and why.
At Trifecta, we consider market research as part of a marketing strategy foundation. If you are interested in making more educated determinations for your business, based on data, don't hesitate to schedule a meeting with us so we can help you investigate everything you need to know about your interests and target market.
We’re Trifecta Content Studio, a 360º communications agency focused on helping e-commerce companies and small-to-medium businesses build effective and engaging communication strategies that range from branding and influencer marketing to crisis prevention, to Amazon A+ Content and storefront design.