Winning Companies Do Their Research; Four Tips To Get You Started
Winning Companies Do Their Research
The survival and growth of every company is dependant on remaining relevant and competitive within a fast-evolving marketplace. A sustainable business constantly needs new ideas and strategic planning to satisfy the evolving demands of consumers, but too often new ideas fail as a result of inadequate market research. Therefore, access to insights that can optimize your current and future product offering and assist in connecting your brands to the right consumers in the right way is critical. Most family offices will agree that swift decision-making is essential to success, but generally not enough is being invested into insight-generation to drive informed and effective decision-making. As W. Edwards Deming once said: “Without data, you’re just another person with an opinion.”
Primary vs. Secondary Research
We categorize market research into two main types: Primary and Secondary. Primary research is research that you conduct yourself (or by a hired agency) to gather new information on current or potential customers, commonly through focus groups and surveys. This form of research gathers two kinds of information: Exploratory and Specific. Exploratory research is open-ended and qualitative, helping businesses to identify trends and opportunities that they were not aware of. According to Rune Toldam, a partner at Bespoke: “Exploratory research is an important starting point for innovation. Innovation is about connecting the dots, yet to do so, you need those dots in place and you need to be exposed to the things you did not know existed.” Specific research, on the other hand, is more precise and focused on solving a particular problem or testing a new idea. Often this form of research is conducted to drill deeper into an outcome of the exploratory research or to assess the most appropriate intervention. Secondary research is information that has already been published by others, typical examples being reports compiled by the government, trade associations and other businesses.
Research Drives Strategy
Combining Primary and Secondary research with internal data and industry performance statistics provides an excellent platform for decision-makers to understand current and past performance and trends, to prioritize focus areas and to build and test plans capitalizing on emerging consumer in order to form well rounded strategic planning. However, for this decision-making process to be efficient, there needs to be a framework in place which clearly defines the metrics that are to be tracked and reported on an ongoing basis. Such a framework should also provide guidelines for insight generation to support both short-term and long-term strategic planning. Insights must form the foundation of any effective strategic planning process, whether defining the 2-3 year company plan or defining the specific priorities and programs for the next 12 months. According to Toldam: “Combining historical company knowledge with research on the future landscape supports an informed and future-centric strategy.”
Four Considerations When Initiating Research:
– Establish clear goals and objectives for the research. Basic questions that you will try to answer include: Who are your customers? What do they buy now? Why do they buy? What will make them buy your product? For more specific research, you may want to test a new idea or campaign. Be specific about what it is that you want to know, and how this information will drive decision-making.
– Prioritize the research. You cannot research everything, so make sure that you focus first on the critical information requirements that give you the quickest payback.
– Consider less expensive research alternatives. Often, a lot of insights can be generated in-house by engaging consumers telephonically, analyzing numbers through published sources, and utilizing social media, like Facebook, to research consumer likes, dislikes and preferences. It is also a good idea to connect with Trade Associations to access research that already exists.
– If you are going to employ an external agency, make sure that they understand your business and work closely with your decision-makers to ensure that the burning business platforms receive attention.
Establish Strategic Partnerships
Whether exploring consumer trends to uncover opportunities, testing innovative ideas or building a marketing strategy, research is going to play a significant role in the strategic planning. The trick is to define how and when to integrate research into your workstreams, and to ensure that there are useful tools and processes in place to support knowledge sharing. Often, external agencies are employed to assist with research and strategic planning, due to the specialist nature of the work. This route can be very effective if companies form an open and transparent relationship with their strategic partner, to foster a good understanding of the business challenges and capabilities. By doing this, research becomes a collaborative effort with a higher likelihood of actionable insights as an outcome.