Market research serves many valuable purposes for a business. It helps you find targeted customers for your products and services. However, it also has more far-reaching benefits. When done in the right way, it can lead to innovative and creative ideas that help your business grow. Such ideas can also lead to new products and disruptions that can help you lead your industry. Let’s look at some of the best ways VPs of market research can generate change-inducing ideas.
1. Social Media Listening
Social media listening or social media monitoring is another powerful source of information on your customers and market. This isn’t necessarily about what your followers are saying on your Facebook or other social pages (though it could be). It encompasses discussions all over social media on issues related to your products and industry.
An example of social media listening driving innovation can be found in how Gillette developed a razor for caregivers. It turned out that millions of caregivers, including children with elderly parents as well as professional caregivers, needed a special type of razor to safely shave the people in their care. This was something that no one in the industry had thought of. Yet Gillette, by paying attention to social media posts, discovered this gap in the marketplace.
With this type of innovation, you really have to pay attention to your audience. While things like surveys, polls, and direct questions can yield information, these methods can’t tell you about something that hasn’t yet been offered. For this, you need to dig deeper and look at the kinds of problems and needs people are talking about online.
2. Identify Problems and Criticism
Business leaders often like to project a positive attitude and this is generally a good practice to follow. When it comes to innovation, however, the driving force is often dissatisfaction, complaints, and problems. This includes criticism directed at your own products as well as general problems and pain points that your audience is dealing with.
Monitor Customer Support
Your customer support reps can provide valuable insights into the current health as well as the future direction of your business. Don’t look at this aspect of your business as a secondary area that’s there to patch up minor difficulties so you can move on. In some cases, customer support does indeed fix small glitches and provide easy answers to common questions. However, it can also point to essential areas that you need to focus on.
Watch Your Reviews
Reviews are another extremely informative source of information that can help lead to creative directions. Once again, don’t simply look at reviews as a place to practice damage control. The area of reputation management is quite important and you should do everything you can to set the record straight and patch things up with dissatisfied customers. However, recurring patterns in reviews often point to larger issues that need addressing. If dozens of people complain of long wait times at a medical practice, this is a clue that the practice needs to look closely at its scheduling practices. Perhaps a new time management software could solve this problem and improve customer satisfaction.
Look For General Complaints
Aside from criticism of your business or your competitors, be sure to identify key problems that your customers are seeking to overcome. Pay particular attention to problems that could, at least in theory, be solved by an innovative product or service. Whether you’re looking at social media, news stories (remember that reporters and columnists are also consumers), product reviews, or anything else, the language people use provides clues to problems worth addressing. For example, when you hear words like “expensive,” “slow,” “hard to use,” “confusing,” or “ugly,” consider if there’s a way you could make something cheaper, faster, simpler, or more attractive.
This overlaps with social media listening, of course, as people certainly love to voice their complaints online. Twitter can be especially instructive here as customers are often quite skilled at summing up their complaints in a succinct tweet. Other places to find problems and complaints include Facebook groups, forums, and everyday conversations.
Look for Weaknesses in Your Competition
Most business leaders would prefer to hear criticism about their competitors than about themselves. It turns out, both can be valuable. When you look at social media, reviews (by industry professionals as well as customers), be sure to take note of what they’re doing wrong as well as areas in which they excel. If people are complaining, this could be a warning about something to avoid in your own business. On the other hand, if it’s an area in which you’re already doing a great job, you might push forward even harder as you see how much people care about it. This also provides clues for points to emphasize in your marketing. You can draw extra attention to those areas in which you leave the competition behind.
3. Contests and Crowdsourcing
Many of the most innovative ideas are generated by customers. They are, after all, the people who will actually be using your products and services. You can often get new perspectives from your audience if you ask the right questions. While social media monitoring can help you find innovative products and solutions, contests and crowdsourcing are more direct ways to elicit your followers’ participation in the creative process. Starbucks, for example, created My Starbucks Idea, where customers were invited to submit their own ideas for new products (and improvements for existing ones). Although the program was discontinued, Starbucks ultimately collected over 150,000 product ideas.
While Starbucks used crowdsourcing, companies that aren’t as famous can’t as easily use that type of method. However, contests, where you reward the most promising ideas, are always an option. One company (in this case, another well-known one) that does this is Oreo. In its MyOreaCreation Contest, the cookie brand turned to customers to help them devise their next product (the winning entry was Cherry Cola).
Aside from contests and crowdsourcing, you can also invite your customers to share their ideas and opinions. Ending your social media posts and other content with open-ended questions can motivate valuable feedback.
4. Research Indirect Competitors and Industries
You’re probably very aware of your direct competitors. These are businesses that sell products and services that are very similar to yours. Popular examples of direct competitors are Coke vs. Pepsi and McDonald’s vs. Burger King. However, you can also learn quite a bit by studying your indirect competitors. These are businesses that sell items in a different category than yours and that are alternative choices for consumers. While Pepsi is a direct Coke competitor, indirect competitors might sell juice, energy drinks, or even bottled water. That’s one reason why larger companies, including Coca Cola (which owns Dasani, a bottled water brand) often buy brands that sell such products.
Indirect competition can even include products and services in completely different industries. This is sometimes called parallel competition. For example, if you’re selling exercise equipment, your direct competitors are people selling similar equipment. Your indirect and parallel competitors, however, include sellers of dietary supplements. Some consumers consider dieting and alternative to exercise for losing weight. Meal delivery services are indirect restaurant competitors that make eating at home more attractive to busy professions.
The lesson here is to research not only your obvious competition but products and companies that are possible alternatives to what you’re offering. When polling your audience, ask questions that provide insight into people’s needs and preferences. You can also gather evidence that shows the advantage of your products. For example, research might indicate that people prefer the convenience of taking pills rather than taking the time to work out. If you own a gym or sell exercise equipment, you can emphasize research showing that people achieve far better results when they combine dieting with exercise.
5. Leverage New Technology and Industry Disruptions
Technological innovation and new business models are disrupting entire industries. Today, you need to be flexible and ready to pivot in response to new technology and consumer trends. For example, ride-sharing services such as Uber and Lyft dealt a major blow to taxi services in many cities. The growth of streaming services mostly wiped out the entire video rental business. Most businesses aren’t disrupted in quite so dramatic a fashion. However, new developments can still present major challenges to many industries. They also present opportunities, though.
- Stay current with the latest developments. In addition to researching your customers and competitors, stay informed on new technology, products, and trends. Don’t overlook global trends, which can quickly spread. Look for ways to lead change rather than simply reacting to it.
- Be part of the disruption. The best way to handle new trends is to get out in front of them. For example, if online retail is cutting into your brick and mortar business, set up your own online storefront. If you’re in a food-related business, embrace the latest foodie trends. Market research can help you disrupt your own industry rather than having to react when others beat you to it.
- Develop and test new products. Don’t get into a rut with your existing product line. Use your research to develop new products and services. Of course, it’s crucial to test new products before releasing them.
Market Research and Innovation are Closely Linked
Market research and innovation are often considered separate realms but they are actually intimately connected. Today, even small and midsize businesses have access to incredible quantities of data. This allows you to study all kinds of information about your customers, competitors, and industry. If you want to use this information to drive innovation, you may need to rethink your approach and go beyond traditional ideas of market research. Look at your customers biggest challenges and complaints, both in general and relative to your products. Ask them to contribute their own ideas through contests. Keep a close eye on your own industry and even other industries that might pose disruptions. When you make creative use of your research, it can drive innovation in your business.
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