Market research is learning about customer needs, preferences, and discovering the target market for a product or service. The process involves collecting, recording, and analysis of quantitative data and qualitative data. Researching the market environment and competitor analysis are also included in market research.
Why do market research before web development?
Doing market research for eCommerce websites is vital as every business has a retail website today while more and more people are shifting to online shopping as it is convenient. This elevates the competition, which cannot be successfully dealt with without thorough market research.
Market research helps a business identify and assess customer behavior, market environment, and how the changing elements of the marketing mix influence consumer behavior. It helps recognize the gaps in customer expectations. So, a business gets to understand
– Consumers’ pain points and preferences
– Buyers purchase pattern
– Identify competitors
– Strengths and weaknesses of the competitors
– And the latest marketing tools.
The thoroughly analyzed information helps determine the best ways to market a product or service. To price them right, and minimizing risks when making key business decisions. Therefore, it is invaluable that an online business makes informed decisions by utilizing updated information from the market.
How To Do Market Research For eCommerce Website?
eCommerce market research includes the following steps:
Define Your Market Research Objectives
First thing first, a business must define its research objectives. There can be many reasons to conduct market research, such as assessing business risks, creating new opportunities to increase ROI, or cost-effective online marketing. The purpose can be internal, external, or both, which is the first step of defining research objectives.
Knowing the purpose of research is vital as the entire analysis plan depends on it. It ensures that the findings are relevant. The research objectives, drive all aspects of market research, such as methodology, because they narrow and focus the research.
In simple words, a set of well-defined research objectives is the first step towards a successful eCommerce business plan.
Sources And Types Of Information
There is a wide variety of sources to get data to research the competitors, industry, and consumers, etc. Here are a few to name;
– Consumer Spending – The US BE or Bureau of Economics has personal consumption expenditures resources that you can utilize for learning about pricing the business products.
– American FactFinder – The US Census Bureau comes with an extensive collection of facts that are particularly helpful in finding the targeted clients’ demographics.
– FedStats – It is another resource based in the US for finding out statistics and the trends that cover a diversity of findings and topics from trustworthy sources.
– Nielsen: Nielsen is a well-known name for studies and research reports on customer behavior across more than 100 countries.
– D&B Hoovers: D&B is a company that has researched and 1,000 industries, 100 million people, and 85 million corporations. A business can purchase reports from them and expect to find insights ranging from industry trends to consumer behavior to competitive analysis.
– Consumer Price Index: This program generates monthly data on variations in the prices paid by urban shoppers for a representative basket of services and goods. This is an excellent way to learn how to fix prices for products.
When it comes to information type, the data a business can get can be primary, secondary, and tertiary, depending on the study objectives. No matter the information type, the data can be in the form of factual, subjective, or analytical information.
Read about the Market
Concerning the specific market industry, a business must get to know all about trending marketing trends.
In the analysis, the company must outline the industry’s present state. This includes the direction in which the industry is heading through utilizing metrics such as trends, size, and projected growth. The company also needs to make sure that they have relevant data for backing up the claims.
It would help with convincing the investors (if any) and allow the company to really understand the essence of the industry, including expectations, demands, and competition.
Perform Customer Research
Consumer research revolves around efforts to identify attitudes, motivations, preferences, and customers’ buying behaviors.
Knowing how to perform excellent consumer research is therefore vital for a retail website’s survival and success. A company can do it itself or hire professionals to do it. Usually, secondary research is more manageable, and all a company needs to do is collect research reports, leading publications, and case studies in the specific industry.
Some of the ways a company can carry out primary consumer research include:
– Conduct online surveys through email or polls.
– Appoint an agency to carry out in-depth research through focus groups.
– Consumer interviews.
Interview Potential Consumers
Surveying and gathering factual data through primary research is excellent to help a website drive in a positive direction when it comes to getting more information about the clients.
However, for more in-depth information, an interview is the strongest weapon. Identify at least a dozen of consumers the company could interview from every segment within the market. These individuals should be the ones who are already using similar products. This will help get qualitative data concerning customer preferences, pain points, and expectations.
Understand the Competition
Understanding the competition requires one to have a deeper analysis of the competitive environment. Competitor analysis gives insight into competitors’ services or products, how these are marketed to the customers, the prices charged, how these are distributed and delivered, the strategies employed for enhancing consumer loyalty and backup services that are offered, and others. In order to do that, the company can make a list of their competitors and go through the list, determining their competitors’ strengths and weaknesses. This is called SWOT analysis which will help to see the gaps and the threats so that a company can develop a responsive eCommerce business plan.
Collect, Analyze, and Act on the Results
The last step of market research is collecting, analyzing, and acting on the results in the form of an excellent eCommerce business plan, distribution strategy, and investment plans.
Doing market research is vital for an eCommerce website for growing the parameters of growth. For that matter, consumer research, competitor analysis, and market information are necessary to develop the right business strategy.
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