Market research plays a critical role in product marketing. It helps teams understand market trends, build new products, and improve existing products, while competitive intelligence supports companies in differentiating their products from rivals within the industry.
In this article, we'll discuss:
- What market research is;
- The benefits of market research;
- How to choose relevant data;
- Primary and secondary research;
- Recommended research tools.
What is market research?
Market research is the process whereby product marketers collect information about the preferences of the market and their users. Companies spend time, money, and effort in conducting market research - and with good reason.
The benefits of conducting market research
It helps you identify your customer base
It’s impossible to build a successful product unless you communicate with prospective customers. Market research provides a set of definitive answers to key questions, including:
- Who is your product aimed at?
- Who are your customer personas?
- What features do they want from your product?
- How much are they willing to spend?
The market research process allows you to clearly paint an image of:
a) your ideal customer - gender, age, location, income, etc.
b) the product you’re going to create, as dictated by the needs of the customer.
When you’ve identified who and what you’re creating, you’re able to successfully tailor your marketing strategy and pricing plans, accordingly.
It can prevent sloppy mistakes
Before launching a product, it’s important to conduct rigorous research and testing, to avoid silly (and expensive) errors.
Let prospective buyers test it out beforehand, so you can iron out any imperfections by conducting market research.
While your hunch may tell you your product will resonate with consumers, it’s not recommended to make a decision based on gut instinct; if things go wrong, you’ll be left rueing your choice not to conduct simple testing.
Focus groups are a great source of customer and market feedback. If things go swimmingly, you’ve got the peace of mind you need and you can push on with the launch. If there are areas for improvement, just go back to the drawing board and make your service even better.
You can protect your business
Market research not only indicates what the market is like now, it allows you to forecast how your industry could shape up in the future.
Proactivity helps you exploit potential gaps in the market other companies may not have spotted, so always stay on your toes and keep your eyes peeled for market opportunities.
Take HMV, for example. While they continued to channel their efforts into the sales of CDs and DVDs, Spotify and Netflix researched the market and developed mobile platforms offering music and film on demand, in line with emerging trends. In 2019, Netflix’s assets were $34.9bn, Spotify was being heralded as ‘the savior of the music industry’, while HMV called in administrators for the second time in 6-years.
Winner: Market research, by knockout.
Surpass rivals with competitive intelligence
Competitive intelligence can help you and your product marketing team understand the methods being used by your competitors, how their products work, key features and USPs, and pricing strategies, to name a few.
Business is cut-throat, and when a rival poaches customers, it’s often because they’re better prepared and have completed more in-depth research.
Preparation is key for any company, and this remains the same as far as market research is concerned. Don’t get caught in the shadow of your rivals - make them chase you. Seek valuable insights and use your findings to create an innovative strategy that’ll not only generate new leads but also improve customer retention and reduce customer churn.
How to share competitive intelligence findings
To make the most of competitive intelligence, you need to communicate your findings so your teams can use the information to develop and evolve your product.
Results are useless if you keep them to yourself - you need to share the knowledge. Our Competitive Intelligence Trends Report 2020 revealed 87% of product marketers share their findings with Sales teams, closely followed by Product (83%).
Previously, it’s been suggested there’s room for improvement in relations between product marketers and leadership teams. However, it was encouraging to see a significant proportion of people taking part (77%) saying they discuss their findings with executives and leaders.
When we dug a little deeper and explored the preferred methods for sharing competitor intel findings, we found knowledge was shared in-person on a team-by-team basis, and by segmented emails to each relevant team.
Both of these areas accounted for 34% of responses, while a further quarter indicated they send blanket emails to relevant teams within the organization.
Of the 25% of people who fell into the ‘Other’ category, the likes of battle cards, Slack channels, and tools such as Klue were identified as the chosen method of communication. With so many different ways of sharing information, we spoke with Matt Powell, Product Marketing Manager at Docebo, to get an insight into how competitor intel findings are shared at his company:
“I don’t think there is a silver bullet for effectively sharing competitive intel - it’s completely dependent on the realities of your business. I do, however, think that it’s all about creating a culture internally in which everyone is as actively involved in gathering and sharing competitive intel as possible.
“That’s a big behavioral change when it becomes less about having one or a few people gathering and sharing intel, and instead extending it as a responsibility of everyone in the revenue organization. That’s when good things start to happen - the activity becomes more collaborative and is focused on problem-solving rather than just information sharing.
“We share our intel on a team-to-team basis leveraging our competitive intelligence platform to develop regularly cadenced newsletters. They’re good and they’re actionable, but we find the juicy stuff is the intel that happens in real-time. But, I’ve found the most effective way to share intel and have great conversations in the flow of work around competitive intel is through Slack.
“Our company is a big-time Slack shop - everything happens there. However, there was a lot of good intel being lost in the scroll of conversations. To combat that, we turned it into an opportunity by installing a two-way integration that allows us to send competitive intel to our CI platform directly from Slack.
“This has been a bit of a game-changer in making sure that as much information as possible isn’t lost. The great thing about these kinds of Slack channels is that the intel is only the tipping point, the conversations that happen in the threads afterward generally end up being the context you need to make the intel actionable.”
Competitive intelligence tips
When we surveyed product marketers for the Competitive Intelligence Trends 2020 report, we unearthed a variety of competitive intelligence tips to consider when conducting the process.
“Don’t be afraid to get help from other parts of your organization. Being able to get help from a sales engineer or a developer while you’re reading technical documentation can save a ton of time and help you better understand different personas.”
Mindy Regnell, Market Insights Manager at BigCommerce
“Job postings can detail info about their tech stack. For example, if they say ‘looking for an IT manager with experience in Oracle, Kronos’, then you know the company uses these tools.”
Laura Massingham, Senior Director of Global Product Marketing at HotSchedules
“Make sure to leverage your entire company and look for a way to integrate information-sharing into your teams' daily tools (be it Slack, or a Sales Enablement tool, etc).
“Whenever someone new starts at Showpad, we hold a session dedicated to Competitive Intel and how each Showpadder plays a part in gathering and sharing that information. Our Product Marketing team is not big enough to do all the research ourselves so we've set up a system to source info gathered by BDRs, AEs, CSMs, etc.”
Lara Verlinden, Senior Product Marketing Manager at Showpad
“Spend time getting to know the competitor from all angles: explore their website and gated assets as if you were a prospect, but also understand from their existing customers if the true product experience matches the initial marketing.”
Megan Magee, Product Marketing Manager at ServiceNow
“Start with your value proposition not mentioned by you, but by your customer. From there understand why you don’t live up to that value prop and where you can improve. Know your segment, know your buyer and persona.”
Hien Phan, Director of Product Marketing at Formation
Lawrence Chapman
How to select appropriate research data
If you’re not using the correct data or conducting the right research, you could miss market opportunities. Therefore, it’s important to understand the difference between the types of research data that are available and make an appropriate selection.
Primary vs secondary research
There are two forms of data PMMs can collect when researching: primary and secondary.
Primary data
Primary information is collected yourself or by a specialist who has been hired to collect the data on your behalf.
For example, the PMA team collected primary data for our State of Product Marketing report, while we’re asking questions to the 1000s of product marketers who are members of our Slack community, daily.
Primary research is based on two types of information: exploratory or specific.
Exploratory research is open-ended, with respondents usually providing their views in an unstructured interview scenario.
On the other hand, specific research tends to be more structured, to solve a particular problem highlighted during the exploratory phase.
When arranging primary research, it’s important to identify the preferred method of communication, whether this is direct mail, phone, or interviews.
These should be considered carefully, given the response rate for each method varies. For example, people tend to prefer a quick chat on the phone, rather than taking more time to respond via direct mail.
Social media is also a widely used tool for conducting market research. Features such as Instagram stories allow companies to gather opinions from 1,000s of followers in a short space of time.
Secondary data
Secondary data has been completed for you and is organized for reference. This data includes things like:
- Reports
- Books
- Journals
- Newspapers
- Letters
- Government websites.
Information for secondary data is often available to the public and can be found in libraries, educational institutions, etc.
Media outlets such as newspaper publishers and TV stations host a breadth of information that can be used when gathering secondary data. This includes demographic information outlining income, age, gender, etc.
What is quantitative data?
Quantitative research includes cold, hard facts that can be easily converted into graphs and charts. The research is usually carried out using surveys and questionnaires with closed-ended questions, yes or no questions, checkbox or multiple-choice questions, and questions with intervals or ratios. It’s structured, statistical, and number-based.
What are the benefits of quantitative data?
Quantitative data is useful for conclusive answers, it’s easy to analyze and can help prove or disprove hypotheses. The questions are also quicker and easier to answer, so you’re likely to get more responses.
What is qualitative data?
Qualitative data is non-statistical and consists of impressions, opinions, and views. It’s generally used to answer ‘why’ questions. It’s investigative in nature and asks open-ended questions. Qualitative data can be generated through:
- Texts and documents
- Audio and video recordings
- Images and symbols
- Interview transcripts and focus groups
- Observations and notes
What are the benefits of qualitative data?
Qualitative research gives you a deeper insight into the motivations behind the statistics. It’s used to theorize and interpret, and instead of asking how many people buy your product, it asks why they buy or why they’re not buying it.
Which data is better for research?
Whether or not you decide to use qualitative or quantitative data will depend on the results you’re looking for.
If, for example, your product was an app that maps bike routes, using qualitative questions like “What do you think of our app?” will lead to many, many different answers, they might focus on speed, responsiveness, and price, which could actually be really invaluable information for you to look at.
However, if you want a specific question answering, like: “How responsive is this app?”
- Super responsive
- Sometimes responsive
- Not at all
Then, quantitative data is your best bet.
Recommended research tools
There’s very little margin for error for product marketers when it comes to market research. Thankfully, there's a whole bunch of customer and market research tools you can use to make the process seamless and reduce the likelihood of any mistakes.
Emma Bilardi
Want to learn more?
Market research is an invaluable part of not just product marketing, but the overall organizational function. It helps us to understand what prompts the customer to purchase products within the market and, ultimately, identify how we can position our products in such a way that they stand out from the crowd.
Our Market Research Certified: Masters course has been designed to help you streamline your approach for success. By the end of this course you’ll:
🧠 Understand the importance and benefits of research for making the most impactful and strategic decisions.
🧐 Know about the different types of data and where best to source it.
🔬 Be aware of the best research methods available for conducting valuable data for your company.
✌️ Be able to consider the ethical implications of market research and data collection.
So what are you waiting for?
Sign up
Product marketing insider
Thank you for subscribing
Level up your product marketing career & network with product marketing experts.
An email has been successfully sent to confirm your subscription.
Follow us on LinkedIn
.svg?v=4c3fd8523e)