THE IMPORTANCE OF MARKET RESEARCH IN BUSINESS MODELS AND FRAMEWORKS
In this article, I will be discussing briefly the importance of market research in business models and frameworks.
It is important to understand what market research is meant for – why it is carried out and the role of market research in decision making.
Managers usually make decisions based on their experience, the facts known to the internally and their intuition. Perhaps the way forward is obvious or the size of the decision does not merit a huge spend on fact finding, or maybe action is required ASAP (as soon as possible) and there is no time for formalized research. Yes! There is nothing wrong with intuition and common sense which is a natural part of decision making in business. However, what happens in the event where the decision requires large financial resources and where the costs of failure are high, there is a need for decision making based on robust and reliable data. Hence, the purpose of market research is to reduce business risk.
Market research is an important tool when launching a product, improving an existing service, or when you’re just looking to be a step ahead of your competitors. It ultimately provides you with all the necessary information you need to make a better business decision.
It is therefore a vital component in marketing paradigms and has a role in all four situations;
1. New Products (Existing Markets): It can show the likelihood of adoption of new products.
2. New Products (New Markets): It can show unmet needs and provide an understanding of unfamiliar markets.
3. Existing Products (Existing Markets): It can measure customer satisfaction to find out how to maintain a competitive edge.
4. Existing Products (New Markets): It can find new territories for products or services.
In conclusion, conducting market research means finding out information such as the industry as a whole, your competitors, where you stand in the market, product or service, pricing and more. It also help companies in making better decisions when developing and marketing their products and services, as well as achieving business growth. However, market research can also be used in other areas such as opinion polls (for political marketing), social issues & policy making and personnel management (for example, employee attitude surveys).
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