Consumer marketing research is market research in which the preferences, motivations, and buying behavior of the targeted customer are identified through direct observation, mail surveys, telephone or face to face interviews, and from published sources (such as demographic data). It is the systematic collection of data regarding customers’ preferences for actual and potential products / services. It establishes questions about your intended market and finds relevant answers. Consumer marketing research is needed to ensure that we produce what customers really want and not what we think they want.
The consumer market in the United States is the largest consumer market in the world, and is made up of approximately 300 million consumers and these consumers spend more money than any other country. In South Africa the consumer market constituted R1857 815 Million in the second quarter of 2016.
Consumer marketing is all about creating and selling products, goods and services to individual buyers. These items are usually used for personal use and household consumption. Consumer markets today are experiencing rapid changes and are flooded with new opportunities and new challenges. The significant changes in the consumers’ buying behavior, urbanized lifestyle and growth of service sector are the main reasons behind the importance of conducting consumer marketing research. Markets are dominated by products and services designed for the general consumer and industries in the consumer markets often have to deal with shifting brand loyalties and uncertainty about the future popularity of products and services.
The ultimate goal of consumer research is to serve as the voice of the consumer. Marketing research focuses on understanding the consumer as a person by focusing on exploring his or her attitudes, needs, motivations, and behaviour as it relates to a product or service. More broadly, consumer research helps to provide a company with relevant, reliable, valid, and current information on their target buyer. Consumer market research aims to identify, understand, and analyze customers and their needs. It is also important to note that consumer market research is not directly synonymous with marketing research. Marketing research is actually comprised of both consumer and business-to-business research and examines all aspects of a business environment, whereas consumer research is solely focused on the consumer.
The purpose of consumer research:
- To help companies make better business decisions and gain advantages against their competitors.
- To help marketing managers or executives make numerous strategic and tactical decisions in the process of identifying and satisfying customer needs.
- To remove some of the uncertainty by providing relevant information about the marketing variables, environment, and consumers. In the absence of relevant information, the consumer response to marketing programs cannot be predicted reliably or accurately
- To provide insights that help guide the creation of a business plan, launch a new product or service, optimize existing products and services, and guide expansion into new markets
- To determine which portion of the population will be most likely to purchase a product or service, based on variables such as age, gender, location, and income level
- To reveal characteristics of a target market
- To understand how consumers talk about the products in the market
- To identify which consumer needs are important and whether these needs are being met by current products
- With effective market research, your company can gain invaluable information about your competitors, economic shifts, demographics, the current market trends and the spending traits of your customers.
With the economy becoming more and more competitive, having appropriate knowledge about the concerns and preferences of your customers has become integral for any business to succeed. Research is the best way to increase customer satisfaction, understand the factors that affect your business and to elevate your performance. Consumer research not only helps in serving your current customers better, it identifies new business opportunities, helps designs marketing campaigns that will target the interest of your potential consumers and helps increase your sales. Consumer research provides valuable information about the potential of a particular market segment, specific time and age group. To better understand where you are going, you need to understand who you are competing against, consumer research helps you keep an eye on your competitors and helps you devise business strategies that will keep you ahead of your business. It also helps you reduce your chances of loss, by launching products that your customers actually want and also helps to find loopholes and areas for improvement in your product.