Importance of Market Research for New Businesses

Why Market Research is Important?

When starting a new business it is important to understand and assess the market conditions. This means evaluating industry potential, competition, and consumer demand. This is typically carried out by market research.

What is market research?

Market research is a process of collecting and analyzing data. It helps in better understanding the market, competition and consumer behavior. Furthermore, market research supports in identifying market potential, major competitors and target customers a business can target. Market research studies provide businesses with a deeper understanding of the market conditions. The exercise can indicate who is the right target audience and what are their preferences. Additionally, market research can be used to develop a business plan. Accordingly, a successful market entry strategy could be devised hence ensuring risk mitigation. Businesses that do not conduct market research run the risk of being unsuccessful.

Data Collection Methods

Market research is an essential tool to get valuable insights relating to the target audience. Two methods are typically used to collect the data. Both methods are crucial for data analysis and compiling a thorough study.

Primary research

This method involves collecting data through interviews, surveys and focus groups. Due to cost-effectiveness, convenience and ease of analyzing data, surveys are mostly preferred. Meanwhile, interviews and focus groups allow for in-depth discussion but are time-consuming. In addition, it is difficult to analyze from a data perspective.

Secondary research

This method involves scanning existing information available on a specific topic. Usually, published papers, articles, reports and press releases are reviewed to extract insights.

Common Mistakes in Research

Market research is a critical tool for any business to gain valuable insights. A classic mistake many make is to rely solely on secondary research and make decisions based on Google searches.

Harvard Business Review published an interesting article on the same – Ignore Costly Data and Rely on Google Instead? The findings revealed that since the Google data is free however the results are potentially biased and unreliable. Hence, the accuracy and validity of the data is debatable.

Therefore, it is recommended to seek professional advice. It is best to engage with professionals to perform comprehensive market research. Investing in market research enables understanding the market environment and thereby accelerating business growth.

Selecting a Market Research Firm

Researching is a specialized skill and therefore it is better to hire a market research firm. However, it is important to review the credibility of the firm on platforms such as Google and Clutch before finalizing. The profile of the firm plays a crucial role. Hence, it should be assessed whether they are the right fit to support in data and insights or not.

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Research Konnection is a leading market research company in Dubai. We specialize in market feasibility studies and business setup in Dubai. Contact us at hello@researchkonnection.com for research inquiries.
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