Supply-demand decisions need insight

  • By Andrew Ballard Growth Strategies
  • Wednesday, February 24, 2016 4:47pm
  • Business
Andrew Ballard

Andrew Ballard

This article is not about supply chain management; rather, how marketing research data can improve your company’s market position.

When you bring the “demand” side of the marketing equation into the “supply” side of business decision making, you produce better revenue results.

It doesn’t matter what life stage your business or product is in, research data is the genesis of strategy. Because marketing research is such a critical business and marketing function, this is the first of a two-part series.

This series will outline a basic “how to” guide on properly planning, designing, collecting and analyzing a marketing research study. Part one covers planning and design.

Plan: The first step in conducting an accurate study is to analyze your business situation and marketing problem or opportunity. The purpose of marketing research is to solve problems, seize opportunities and answer key questions about how to best market your products and services. After you’ve analyzed your business situation (I recommend a SWOT Analysis — catalogue your internal Strengths, Weaknesses, and external Opportunities and Threats), identify the data gaps and define the objectives of your research project.

Example: If the problem is that you are losing share to a key competitor, the objective could be stated, “Determine why we are losing market share by identifying how our customers perceive our products vs. those of brand ‘X.’”

It is important that your study remain focused on solving one problem or marketing situation at a time.

Attempting to address more than one issue (or objective) may cause problems in the design and collection phases of your study.

Design: Guided by your research objective, design your study by considering data sources and methodology.

First determine which of your marketing questions can be answered by secondary sources, e.g. your database or syndicated data (research you can purchase from aggregators or resellers, like Nielson).

An effective and free secondary source on market data is through the Sno-Isle Library that can be found here.

The questions that can’t be answered through a secondary source are the ones that will constitute your survey.

Short surveys produce the best results. In the example above (losing market share), you’d query customers about their attitudes toward your products and those of brand “X.” Your questions should be sequenced in a way that won’t lead or bias the respondents’ answers.

There are many ways to glean customer insights: focus groups, telephone interviews, online, mail, packaging and point-of-sale surveys.

While online surveys through vendors like SurveyMonkey and KwikSurvey have free versions, phone interviews produce far better results because you can probe answers.

Finally, you’ll design your sample (identify respondents).

The two fundamentals of sampling are size and segment. Your sample size should be large enough to deliver a high confidence level in the data, but not so large that the study becomes time and cost prohibitive. It is easy to find “sample calculators” online. I recommend qualitative, small sample interviews.

You’d be surprised how much information you can gather from only two to 30 interviews.

I’ll address tabulating the data in the second article.

In terms of segment, be sure that your sample accurately represents the segment population you are researching, e.g. if 70 percent of your customers are middle-income women between 35 and 54, then 70 percent of your sample should statistically represent that profile.

Developing marketing strategy based on customers’ preferences and perceptions is always a good business decision.

Be sure to check out March column for part two of this series: collecting and analyzing your marketing research data.

Andrew Ballard is president of Marketing Solutions, an agency specializing in growth strategies. For more information, call 425-337-1100 or go to www.mktg-solutions.com.

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