Products that do not satisfy customer needs and wants fail to perform well in market dynamics, affecting your sales revenue. However, market research and analytics help you estimate consumer behavior. Corporate leaders also create competitive strategies using customer insights discovered by market research consulting partners. So, this post will explain how to do market research and competitive analysis.
What is Market Research?
Market research involves interviews, surveys, social listening, and media coverage analytics to acquire valuable customer insights. Therefore, businesses employ market research consulting firms to improve their understanding of consumer preferences.
The obtained insights allow companies to revise their pricing strategies and marketing efforts to attract new customers and retain existing ones. Besides, such data-driven pricing, marketing, and innovation strategies are less vulnerable to human errors, a significant drawback of empirical business development methods.
Enterprises use market research to minimize product launch risks. A marketing analytics company also delivers transparent and flexible reports to research what promotional strategies drive the most engagement from target customer profiles.
What is Competitive Analytics?
Competitive analytics leverages statistical modeling and automation technologies to identify methods to help you overcome your competition and increase your market share. For example, marketing research and analytics firms can guide you in optimizing your internal operations to compete more aggressively.
Consider how inefficient allocation of resources affects all enterprises. If two companies target the same customer segment, the more efficient company will succeed. After all, corporate competitiveness improves when a business reduces the irresponsible use of company resources. Later, it can transfer the related financial benefits to the customers, i.e., rationalizing prices.
Simultaneously, you want to know how your competitors plan to increase their market position. However, they will not share such confidential intelligence on public platforms.
Therefore, market research consulting teams will develop machine learning (ML) models to process your competitors’ press releases. ML facilitates modern predictive analytics and helps companies forecast how competitors plan to grow their business.
How to Conduct Market Research and Competitive Analysis?
Goal determination is the first step in conducting market research or competitive analysis. If a business invests in market research consulting without clearly communicating its envisioned objectives, it will experience disappointment due to directionless competitive analysis or macroeconomic surveys.
Later, study the available technologies and how implementing them will affect the company financially. For example, standard marketing analytics tools benefit a regional company. Similarly, a global business firm will require scalable, automated analytics software to generate high-quality reports.
Finally, you want to specify a timeframe. Otherwise, monitoring the progress of your market research efforts will become daunting. Moreover, the risk of scheduling conflicts increases without time-bound activities. Financial planning also depends on the time factor for interest estimations associated with borrowed capital resources.
Organizations have distinct business objectives, risk dynamics, and data processing requirements. Therefore, study the following market research and competitive analysis techniques.
Part 1 – Types of Market Research Services
1| Primary Research
It is primary market research when a marketing analytics company interviews customers, suppliers, and employees. After all, the collected customer insights originate at the source, enhancing the quality of your competitive analytics operations in market research. You also get ownership rights to the resulting databases.
Such original research helps you create thought leadership content, establish authority, and acquire unique strategic foresight. Sometimes, primary research integrates into whitepapers, case studies, and investment relations (IR) disclosures, increasing the trust in the brand among stakeholders.
2| Secondary Research
Finding customer insights through social listening and media coverage analytics for secondary research primarily concentrates on publicly available intelligence gathered by somebody else. Also, the scope of market research consulting teams revolves around magazines, social media platforms, consumer discussion forums, and global news publications.
Secondary market research relies on already available intelligence resources. Therefore, most data in a secondary research project will have third-party owners. The hired marketing analytics company might use the editorial reproduction freedoms often governed by fair use or educational intent principles to help you in your marketing efforts.
Still, organizations must practice proper caution since different secondary data sources can be prone to manipulative content and misinterpreted perspectives on business-critical ideas. Assessing the authoritative qualities and historical reputation of each data source can become easier with the help of a market research consulting firm.
3| Manual Research
Small businesses and young social media accounts can evaluate their growth, revenue, and competitiveness using simple analytics for customer insights. Remember, they generate fewer data points, eliminating any necessity for extensive database processing.
Nevertheless, manual market research suffers from a more prominent risk of exposure to human errors. For example, psychological issues and physical limits often prevent your team members from developing holistic data models efficiently. So, manual research efforts are no longer relevant. Besides, enterprises have adopted advanced marketing analytics.
4| Automated Research
Machine learning allows for self-learning software applications, i.e., they can learn multiple tasks that usually require human intervention. Likewise, artificial intelligence (AI) enables automated marketing research and analytics through abilities similar to idea synthesis.
Market research consulting will offer data gathering, validation, and cleaning automation. You will have access to more extensive data throughout the day and night.
Corporations save a lot of time and human effort when ML models extract customer insights via analytics. Additionally, such technologies eliminate ambiguity in competitive analysis and market research by facilitating accelerated data validation.
5| Qualitative Research
Customers might complain about a product feature in their social media posts or consumer discussion forums. Some users will also give you meaningful feedback using highly descriptive texts. Additionally, you want to analyze product ratings and reviews if you operate an e-commerce business division.
However, software applications need more help understanding meaning and emotions when processing qualitative consumer responses. Qualitative marketing research implements natural language processing (NLP) algorithms for sentiment analytics. Therefore, categorizing unstructured data becomes seamless.
6| Quantitative Research
The customer rating system varies from website to website. Still, it contains numerical data manageable using straightforward mathematical programs. So, quantitative market research gathers more structured data.
Analyzing properly structured data does not require extensive computing resources. Businesses utilize quantitative research in financial modeling and total quality management (TQM) instead of sentiment analytics. They prioritize the quantitative methods for these two operations because the core reporting systems are well-structured and standardized.
Moreover, it does not make any business sense to use a lot of computing power when the marginal gains in performance contribute little to ultimate goals, like revenue enhancement and market share increment. Therefore, professional consulting firms specializing in market research technologies assist enterprises in deciding when to use quantitative or qualitative analytics for customer insights.
Part 2 – Types of Competitive Analytics
1| Internal Competitive Research and Analysis
Every established marketing analytics company treats an organization’s competitiveness using a systems approach. So, internal competitive analytics investigates how an enterprise manages its supply chain, professional networks, business units, and investor relations.
For example, a business might suffer above-average employee attrition during a specific financial year. It can ask a competitive analytics company to inspect how such problematic events in retaining talent affect its performance.
The consulting analysts will then reveal the impact on the company through statistical modeling. Later, the business can revise its talent acquisition processes, employment contracts, and workplace environment to counter the adverse effect of employee attention using the consultants’ insights.
2| External Competitive Analytics
A company’s performance relies on factors outside its direct control, and consulting firms research these external market forces. It is external competitive analytics with a broad scope of data gathering, validation, modeling, and reporting global customer insights.
Consider how currency fluctuations influence the financial planning done by import-export businesses. Likewise, natural disasters introduce systemic issues across transportation, communication, and healthcare infrastructure.
How can an organization become more resilient against the losses resulting from earthquakes, avalanches, tsunamis, landslides, or other catastrophes caused by malicious actors? Competitive analysis and market research can give you the data necessary to evaluate such business queries.
Most market research consulting teams consider the socioeconomic and political stability indicators for such inquiries. After all, enterprises of all scales must be attentive to external competitive risks.
3| Competitor Analytics
Competitor analysis has a narrower scope since it concentrates all the marketing research and analytics activities on your top business rivals. It is a subset of a more holistic competitive analysis. Therefore, it takes less time, consumes a few computing resources, and delivers reports fast.
You can utilize computer analytics for peer benchmarking in a target industry. This activity allows enterprises to compare their performance with how their business rivals perform in the same industry. However, computer analytics becomes more complex if a company serves multiple customer segments, leading to the application of advanced tools to acquire insights.
5| Descriptive and Diagnostic Analysis for Competitive Intelligence
Descriptive analytics explains a company’s past performance so that the leadership, management, marketing, and sales teams can learn how their strategies have contributed to business objectives.
Diagnostic analytics adds value to historical performance records by identifying methods to improve productivity, capital efficiency, and risk assessment. It helps companies solve the problems encountered in the preceding business quarters.
6| Predictive and Prescriptive Analytics
Predictive analytics utilizes machine learning to estimate how market forces, consumer preferences, regulatory policies, and competitor strategies will evolve. Corporations also use it to eliminate the gaps in market research and competitive analysis databases.
Prescriptive analytics offers practical solutions to combat business risks identified by predictive ML models. It is vital to preventing or mitigating the potential losses attributed to market volatility, the introduction of new laws, and macroeconomic events.
Conclusion
Leveraging analytics to identify customer insights is the most prominent advantage of marketing research. Besides, enterprises utilize primary research in authoritative content. Additionally, secondary market research finds valuable trends across social media platforms and review sites.
Qualitative research differs from quantitative analytics since the raw datasets vary in structure. Meanwhile, automated aggregation tools have replaced manual data collection procedures. If you want to do market research and competitive analysis, consider these developments before hiring a consultant.
A leader in market research consulting, SG Analytics supports enterprises in extracting customer insights by performing analytics on primary and secondary data sources. Contact us today if you want outcome-oriented technological assistance with automated aggregation capabilities.
