Why Market Research is Critical for Product Development
Are you getting ready to launch a new product? If so, market research should be your very first stop. Why is market research so important? After all, aren’t you an expert in your field? You probably even have sold countless products on your own. Why would you need to invest time, money, and energy into more market research?
There are several ways to answer that. Custom development relies on business analysis for long-term success. Bringing your product to the market is a long process, but if you do market research you can secure your investment. Let’s dig deeper into the advantages of market research and how to do market research for your idea launch.
What Does Market Research for Product Development Look Like?
Before we talk to the benefits of market research, let’s discuss what product development market research looks like. For most organizations, product development is a lengthy and expensive process. They cannot afford to release a product that fails.
Market research also provides organizations with the ability to make informed decisions that are based on evidence and customer insight. The information attained from research helps you understand your target audience and what they are looking for. But what you learn from conducting research goes beyond just customer profiles. For most businesses and product developers, research identifies not only who their audience is but also the best ways to communicate with them and identifying new opportunities. Minimizing the risk of failures at your launch is also dependent on quality market research.
There are several methods of conducting market research. Each method is designed to meet the objectives of the organization in the best possible way. Some forms of market research can help measure a reputation, help spot branding or service issues, or aid in developing a stronger product that your market actually wants. All of this equates to planning. Nothing is more important than planning your product with your audience in mind. With an unpredictable market, failing to plan is essentially planning to fail. Learning what might lie ahead for your product and organization, you can prepare a product that fits an ever-changing marketplace. With the right attention to detail, focus, and business analysis processes, a product might even help you stay ahead of your competition. But it does take time to properly analyze the market and pull together a viable product based on thorough market research. To do so, you have to develop a strategy. That strategy starts with a few questions.
Important Questions to Ask
One of the first and perhaps most important questions you can ask is, who are your competitors? You likely believe you have a good understanding of who your direct competitors are. What you may not recognize that those direct competitors may not be who you are actually competition with. While established companies might seem like the greatest threat, it could newly launched companies and products who represent the greatest threat to your product.
Next, ask how your competitors are gaining customers. Competitive analysis reveals what branding your competitors are using to gain customers. This puts you in a better position to see how you can maximize your product for any market. The ultimate goal is to provide the best ROI for your business and customers. How does your audience perceive your competitors? This is another great question. It helps you see where there are potential flaws in your product and how you can maximize on the flaws of your competitors. This is particularly important in the product development stage.
When we fully understand what is on the market, we can develop a stronger product that outshines the competition, but more importantly one that your audience will love. It can be done. But it must be done through research.
Analyzing Market Opportunities & Defining Objectives
Defining objectives is an important component of market research. You likely have limited resources for conducting market research. If that is the case, you will want to define objectives for your market opportunities. Ask yourself what is it that you want to glean from your research? What factors might influence your product development? What might you want to factor in to your marketing decisions?
These questions can help you define the objectives of your research. It also helps you analyze what type of strategies are best for developing a product that will be successful. Basic market research includes the following.
Analyzing the quality of products in competition with your products
Isolating the communication channels that competitors maximize
Exploring the effectiveness of sales of a particular product
Once you complete the primary market research, secondary research is required. It includes the following.
Searching government data
Scrutinizing studies and surveys
Looking at newspaper reports for market information
These two types of market research are defined by the way you conduct them. They can be used to improve existing products or help you develop stronger first phase products. By utilizing information that is already available you can save time and money on a failed product launch.
Factors for Successful Market Research
Of course, just because you know how to do market research does not mean that you will use it successfully. So what makes for successful market research? Multiple factors. These include the following:
Right out the gate, define your target market as clearly as possible. Why? Because you don’t want to waste time researching people that ultimately will never want your products. If you want early market success, this is a step you can’t miss. Good market research cannot be conducted if you are driven by your own biases. The only factor that should matter is the truth. Don’t do research to validate your thoughts. Research to find the truth behind your product development, not only what you want to find.
Long before you set your team on the task of building production code, you should have a plan in place for market research. Technology based startups tend to be driven by technical capability, not necessarily market research. That can be a big problem. While technical skills are important, avoiding a failure to launch story is equally important. You need both to be successful.
If you are attempting to build something that is fresh and new, then you won’t be able to use existing products for benchmarks. But if you are trying to build on existing products, then you can use this information for product research. Comparing your product with another is a great stepping stone for research.
- Market research should always be your first stop in product development
- Understanding your competition is a key method for building stronger products
- Technology is important but not the only factor to consider
Business analysis is a critical component of product development and a successful idea launch. Use these strategies to maximize your product development.
Have you completed market research and are ready for professional software consulting? Do you need product development support? Or maybe you’re looking for business analysis, whatever you need, we can help.
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