Importance Of Market Research For Product Development

November 6, 2019
November 6, 2019 administrator

Importance Of Market Research For Product Development

You might have a business idea that you are pretty excited about, but the excitement stays as long as you have not done any market research. Today the consumer product market is oversaturated, yet the pursuit of developing new products is on the rise among both established businesses and startups. 

Keeping in view the escalating competition in the product market, businesses need to ensure product development, which is aligned with customer needs; otherwise, there is a higher risk of failure. Companies can minimize the risk of failure by doing first-hand market research. The connection between successful product development and market research is irrefutable. 

To ensure a competitive market advantage, businesses need to do market research. It’s a critical approach to visualize opportunities and minimize the associated risk in releasing a product. Let’s find out what is the core purpose of market research in the product development cycle. 

Great product design services include market research

The market research plays a critical role in recognizing the needs of the customers to testing prototypes to improving performance and then identifying the position of the product in the future. It can help you solidify the product development approach. Market search plays a crucial role at every stage of the product development cycle. 

Due to this fact, companies spend a significant portion of their budget on market research. 

On average electronic companies spend 15% of their sales on research and development. It is because of the rapidly changing nature of the market. 

Popular companies like Boeing, Honda, and Siemens, spend about 2% and 5% of sales on the market research 

More than 90% of the innovative ideas become successful because they have spent a significant amount of money on market research

Market Research for new product development 

Businesses who are trying to upgrade their business products or introduce a new product to the market should never understand the power of the market research. Many startups enjoy durable market visibility because they put in regular efforts in market research that offers insights into market competitors, consumer problems, and overall market structure. 

Although market research can be done at any stage during your business cycle, having a clear understanding of analytics at the start of your business venture will help you establish a viable brand growth strategy. 

Every business must have a specific goal for in-depth market research, which can be but not limited to the following areas: 

Primary Market Research

  • Analyzing service quality offered by the competition
  • Sale effectiveness
  • Measuring active market competition
  • Identifying the communication channels of the competitor 

Secondary Market Research

  • Existing studies or surveys
  • Published company data reports
  • Newspaper reports
  • Government Information

Product design services ensure you implement the following market research process to understand the market analytics better: 

  • Do in-depth research to analyze if any similar study has already been conducted.
  • Thoroughly study the existing data which meets your goals.
  • Understand how you can use existing data and who will use it.
  • Take your time to figure out if your company requires to perform primary market research, and if not, then decide who will conduct it.

Market research assists startups in understanding how a customer feels and acts when he is in contact with your product. It helps you to understand customer behavior so that they can be converted into brand ambassadors. 

Benefits of market research 

Market research benefits businesses in several ways. Apart from sidestepping problems like wasting valuable resources like time and money, your business should need a viable new product development strategy that will minimize the risk of 

  • Great product design services avoid launching a weak product
  • Exposing your company to the competitor threats 
  • Mispricing products 
  • Ineffectively allocating budgets and resources 

How to conduct market research 

To get great results, create some great research tools, including focus group discussions, a questionnaire, or gathering materials for a moderator. Once you collect data using these tools, turn raw data into reports, summaries, and actionable insights that can help define trends and inform decision making. At the final stage, turn the critical insights into meaningful recommendations that can support decision-makers. 

Companies that take market research seriously minimize the risk of failure and ensure durable business and long-lasting success. So why not invest in market research?