Market Research

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Product Managers must understand and use market research if they want to gather information from actual customers in order to make a decision. Market research is conducted by Product Managers to learn more about customer needs and the market.

Market research refers to any set of techniques used to gather information in order to better understand a product’s target market. Market research is the process of gathering information about your product’s customer personas, target audiences etc. Market research also helps to improve understanding of various market factors such as market nature, user challenges, and so on.

This market research findings can be used to improve products, improve the user experience, and develop a marketing strategy that attracts quality leads and increases conversion rates.

How Does Market Research Help?

Understanding the market is crucial when developing your product strategy, along with outlining your goals and your proposed course of action. Market research takes into account external factors. This is significant in determining whether a product is market-fit. If you want your product to be successful, you must have a thorough understanding of your target market, audience, and any potential alternatives. As a Product Manager, market research impacts your decisions. Here are some of the decisions that Product Managers make using market research.

1. Probing business wins — Product Managers can measure and improve customer satisfaction, learn about competitors, and improve their products. Analytics can tell you what users do at scale, but only research can inform you what they’re thinking and why they do what they’re doing. Analytics provides the ‘what,’ but research provides the ‘why.’ For example, analytics can tell you that customers do not complete their onboarding, but only research can tell you why.
2. Discovering markets — Market research is a method that can help you learn more about your customers, both obvious and obscure. It aids in clearly identifying actual customers’ needs and problems, as well as in documenting user journeys and correctly segmenting the market. The only way to win is to obsess over your users. If you aren’t passionate about them, you will lose potential customers to someone who is.

Whoever gets closer to the customer wins. — Bernadette Jiwa

3. Exploring the best marketing options — Product managers can discover the best way to reach out to their customers, as well as measure and analyze the results of their marketing and campaigns.

4. Assessing products — Market research assists Product Managers in making informed decisions about which features to prioritize and release, new product concepts to test, and how to set the price a product or feature. In other words, using your instincts alone won’t cut it. Even if you have a distinct vision for your product and a wealth of industry knowledge, routine market research frequently reveals fresh, unanticipated ways to enhance your product offerings. Additionally, it might increase your organization’s resilience. Bad ideas are frequently the result of guesswork, emotional reasoning, death by standard practices, and relying on the opinion of the highest paid person (HiPPO). You are less likely to be pulled in the wrong direction if you listen to your users and focus on their customer experience.

Some Common Market Research Methods?

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You don’t have to stick with just one research technique; there are a variety of ways you can gather customer data and do market research. Surveys, interviews, focus groups, and consumer observation are common forms of market research methodologies.

Depending on the type of products you have, you might utilize a different approach. For example, SaaS products have different aims than e-commerce products, therefore it’s usually a good idea to combine some of these approaches.

1. Interviews: the insightful — Speaking with a customer directly will help you understand their perspective better. Any kind of in-depth interview will be quite beneficial in knowing your target audience, regardless of how it is conducted. Individual talks with users in your target market take place during interviews. Nothing beats a face-to-face interview for probing deeper (and picking up on non-verbal clues), but video conferencing is a good fallback if an in-person meeting is not an option.
2. Focus groups: the dangerous — Focus groups are not a good place to start if you are new to market research. It costs money to do it well, and if you skimp, your study may contain a variety of mistakes. Your focus group data may be distorted in a variety of ways, including dominance bias (when a participant exerts undue pressure on the group) and moderator style bias (when various moderator personalities produce divergent results in the same study). Focus groups assemble a carefully chosen group of individuals who correspond to a company’s target market. To get deeper insights, a qualified moderator guides a discussion about the product, user experience, and/or marketing message.
3. Surveys: the popular — They are simple and affordable to carry out, and you can get a lot of data rapidly. Additionally, even when you have to examine open-ended questions whose responses initially seem challenging to categorize, the data is rather simple to analyze. In surveys, which can be given as an on-screen questionnaire or by email, participants are asked a brief sequence of open- or closed-ended questions.
4. Observation: the powerful — In place of focus groups, observation is a fantastic strategy. In addition to being less expensive, you’ll observe customers interacting with your product naturally and independently of one another. The only drawback is that observation cannot replace customer surveys and interviews since you cannot see inside their minds. During a customer observation session, a representative observes how a user interacts with their product and makes notes (or a similar product from a competitor).

Conducting Market Research

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The three core components of market research include- Market Landscape, Competitive analysis, and Customer research.

Here are steps you can follow as a product manager to effectively research your market.

Problem Definition — You could use your role as a Product Manager to define these issues by conducting the observation research method (such as observing competitors’ websites products or relevant statistical data) into the issues. You could also implement the focus group research method, to better understand your users’ problems and how to solve them.

Because, sometimes the issues you need to address in your market are unseen. This could include existing inefficiencies, inconvenient workflows, or subpar solutions.

By clearly defining the problem, you increase your chances of solving the right problem and improving the user’s experience with your product.

Create Your Strategy and Conduct Research — Identifying where to look for the information you require, you can use a combination of research methods. You can research what strategy is best by using focus groups to gain a better understanding of how clients want the problem solved or survey research methods such as questionnaires or forms to collect qualitative data on the market you are attempting to fill.

This would allow you, as a Product Manager, to tailor your strategy to achieve the best results and solutions to the problem.

Once you’ve identified and defined the problem, you must determine the most efficient solution. It is your responsibility as a Product Manager to ensure that the solution to the problem is optimal for both the company and its users. By developing an effective strategy, you can better organize your market research and gain a better understanding of how customers want their solutions met.

Analyze Research Data — Once you’ve gathered your data, go over it carefully to look for trends and other insights. Make your findings accessible to your team by summarizing them. You could even make a presentation to show off what you learned.

Plan Next Action — Market research should be used to guide action. Use your newfound knowledge to create user personas, develop a comprehensive product strategy, or prioritize product decisions that will add more value to the market.

The key to conducting effective Market Research is to act on the information gathered. Planning and organizing your research is meaningless unless you take action.

Market Research alone cannot impact a business, but the effectiveness of the research is determined by whether or not relevant action is taken.

Some of the most influential brands, such as Coca-Cola, Pepsi, Coors, and McDonald’s, have been harmed by insufficient or poorly planned market research. Other companies, such as Kodak, did many things correctly but failed to recognize the reality of the research.

As a Product Manager, you can help you establish a solid product strategy that will position your product to win in the market by formulating a good strategy based on good Market Research, why it can work, and how you’ll communicate that strategy to your team and stakeholders.