Much like Neo slows down his perception of time to dodge bullets in The Matrix, market research can help you slow down and assess your own product launch situation, which will help you dodge some bullets of your own.
What bullets am I talking about? Everything from delays and rework before a product launch to disastrous product launches, and even in some cases, the failure of the entire business if too many assumptions were made without the research and data to back them up.
History is filled with hundreds, if not thousands, of examples of failed product launches, and those are just the ones that people have deemed worth writing about. Even established companies like Google and Apple fall into this trap. Amazon is slowly conquering the planet, but they’re not immune either. And let’s be clear, it happens every day to thousands of other businesses that you’ll never hear of. While the Googles, Apples, and Amazons of the world can afford to take that loss on the chin, you may not be able to.
Why is this such a common and pervasive problem?
Everyone from seasoned marketers to founders and CEOs have made the mistake of forgetting that they are not their customers. It’s all too tempting to think about product development from your own point-of-view – what appeals to you, what problems you would like to solve, how much you value an idea – rather than understanding the viewpoint of your future customers. This is where market research can help.
What are the benefits of performing market research?
1. You save yourself time and money.
Creating and launching a new product is inherently risky.
Market research can help you identify risks in developing and marketing a product or service that you might not have seen until much later in the process. You really want to have as much information as possible up front rather than finding yourself learning about a major hurdle when you are too far down the road to turn back.. It’s difficult to learn if you’re not trying new things, testing, and iterating. However, that doesn’t mean you should dive headfirst into the process without first assessing potential challenges and risks and creating a plan to address them ahead of time..
2. You build products that your customers want to buy.
As marketing strategists, we specialize in helping you tailor your message in the right way and getting it in front of the right people at the right time. We take a strategic approach to your marketing needs because doing so is more cost effective and delivers better results.
With market research, you can take a similar approach in your own product development. By having a solid understanding of who your target audience is, you set yourself up for success with a North Star to guide your decisions. Every choice you make during product development can be influenced by your understanding of the customer.
This results in a product that appeals to the audience you’ll eventually market to, and you can be confident that your product will meet the needs of your future customers.
3. You identify problems early in the process.
Market research provides you with an opportunity to get feedback from customers on factors like features, packaging, pricing, potential advertising copy and creative, and much more.
This “dry run” of your product launch can help identify a potential problem before you launch your product. You don’t want to assume that your product has proper market fit based on your own opinion or a gut feeling. You need to understand the problems your customers are facing, whether your product solves them, and even more importantly, whether your potential buyers feel your product is valuable to them.
4. You secure funding for your idea.
Whether it’s investors or your board, you will likely find yourself needing to convince someone to help fund your new product development. Having data that demonstrates a demand in the market for your idea, as well as interest and feedback from real potential customers, can bolster your investor pitch and demonstrate that you’ve done your homework and know what you’re doing.
5. You know your competitors.
Knowing your future customer is core to your success, but you also need to get acquainted with your new competitors as well. You would be remiss to move ahead with product development without understanding where your brand and product fit into the existing market you’re about to enter.
What market share do your competitors have? How much of that market share can you reasonably expect to take? Are there any gaps in the market that competitors haven’t already filled? If so, why haven’t others jumped on that opportunity already, and would you be opening a door or stepping on a landmine by trying to fill that gap?
These are all questions you’ll want to know the answer to as you are in development.
If you’re developing a product that caters to an existing vertical, you may already be – familiar with your competitors. However, don’t assume that just because you aren’t entering a completely new vertical that you can skip examining your competitors through the lens of your new product. You may be amazed at what you see.
When should you conduct market research?
By this point, it should be pretty clear that you always want to conduct market research when launching new products. This way, you can enter your product launch armed with a full understanding of your challenges and opportunities rather than being faced with them suddenly and unexpectedly on launch day. But there are several other situations where market research should be a priority.
When you have an existing product
Market research doesn’t just benefit you when you’re launching a new product. It can also help you identify opportunities for new features or needed improvement in your current products.
When you’re expanding your business
Growth changes a lot about your business. New customers, new employees, culture shifts, many opportunities.
Having the proper data to understand your new place in the market, how this growth has shifted the way your existing and potential customers see you, and what opportunities and risks are being presented by new growth will give you the tools you need to navigate your expansion successfully.
When you’re rebranding
Your brand is the bedrock of your business. Everything else you create – your products, website, marketing collateral, your business cards – is an extension of your brand.
You don’t want to change your brand without understanding how it will be perceived by your customers, the market, job seekers, and even by your competitors.
While market research can help you dodge some pretty serious bullets, it won’t make you bulletproof. You’re always taking a risk when you launch a new product. With market research, you are going to enter your product launch with an understanding of those risks, and you’ll show up prepared to face them rather than find yourself getting sucker-punched on launch day.