Tutorial - Part 1 - 17
This is Part 1 of a 17 part series on creating
Market Research Plans.
Market Research Planning 101
Why Develop a Market Research Plan?
Where's the benefit?
The 3 Key Ingredients in Every Market Research Plan
Market Research For Small Business Owners
Remember Pink iMacs?
Jose Mourinho Taught Me About Market Research
Kickstart your Market Research
Using Market Research To Develop Brand
Mystery of the Seven Sided Market Research Plan
Stage 1 - Why Do You Need a Market Research
Stage 2 - Why Some Customers Are More
Important Than Others
Stage 3 - How To Find The Information You Need
Stage 4 – How To Collect Data
Stage 5 – How To Analyze Data
Stage 6 –
Generate Report Findings
Stage 7 –
Choose Best Strategies
Market Research 101
Before we start this course on
Market Research, I’d like to share a
A good friend ran an exclusive winery in France. Very successful. As his son
was training to be a Winemaster, they sent him on a course to get his
credentials. Nothing to worry about, right?
...after a week he came back.
They’d done a blind tasting and asked him to identify the wines.
He tasted four French wines and one German thrown in for good measure. Maybe
it would be a Riesling...
After a few minutes, he identified the four French wines and rogue
And that's where things went wrong...
Like most young men, he was slightly over-confident of his abilities.
I’ll spare you the gory details but he mixed up the Red and White
wines. For a young man with aspirations to be a Winemaster this was a disaster.
With his eyes open, he could see the wines and make a good
‘guesstimate’. But the blind tasting showed his true abilities or rather lack
He couldn't tell a Bordeaux from a Sauvignon Blanc. And word got out!
This experiment is interesting for those involved in Market Research
as it illustrates several points:
- What you think you know about your product may not be true.
- How you determine your own abilities and skills can surprise even the
best of us.
- Our pre-conceived ideas about a brand, product or service may not be
- Our inability to see our own blindspots can be a sever liability
unless it’s addressed.
This is where Market Research comes to our rescue.
Instead of making assumptions about a product, we can test that
Instead of hoping your
target customers will pay for a new product, we can gauge
Instead of adding new features to a product because the Development
team thinks it’s cool, we can ask customers what they really want and roll that
into the product.
Market Research, as the name implies, is about researching your
product’s position in the marketplace.
2. Why Develop a Market Research Plan?
The purpose of a
Market Research Plan is
to learn what your customers think about your product before you release it. Of
course, you may have already released the product but want greater insights
into your customer base before you release the next product.
It’s also about where to position it in the market, for example,
against the main competitor or to look at new regions that have been
There are other ways we can look at this.
How to change customer’s attitude towards our brand?
How to price a product so it doesn’t cannibalize our product line?
How to assess the interest customers would have in a new product.
Useful to know before you start developing it!
How to repair our brand if it’s been damaged? BP is a good example
here. How do you make customers, the Government, media and partners trust you
Why is the product selling more in the West coast than the East?
Or if you offered them a premium version of the product, how much would they
pay? Or what’s the one thing that they’d like you to change with the product.
3 Key Ingredients in Every Market Research Plan
There are three key areas in every
Market Research Plan.
1. Gather data - what tools and methods do you use to gather the
information you need? For example, you might develop surveys, questionnaires,
and focus groups.
2. Record data - what tools, software and templates will you use to
record the research material? This may include databases, excel
and MS Word forms.
3. Analyze data - once you have the information in a format you can use,
you can then analyze the feedback, look for anomalies, and then clean the data.
After the data has been cleanses, you can begin to make chart the results and
report on your key findings.
Of course, Market Research is not only to do with launching products.
It can also extend into other areas, for example:
Looking into brand awareness (how many customers know you’re in a
Customer satisfaction or
What the public think of a political figure, new policy or current
4. Market Research For Small Business Owners
For Small Business owners, you're probably concerned with questions,
Who are my current customers?
How do I find new potential customers?
What payment method do they prefer? Some may prefer to pay
upfront and get a discount, whereas others may prefer to stagger the payments
over smaller payments.
Word of Mouth - What makes
customers recommend one product over another? How do you get to, ‘Try it, it’s
Instead of investing in expensive
marketing campaigns, companies are
turning to social media to generate buzz and encourage fans to recommend their
Trend Watching - When I grew up, TV was the medium advertisers used to
get our attention. Today, we watch less TV than ever. But the web is always on.
This is where more consumers go to when they want to research a new product.
Where do they hear about new trends?
Looking on the web is a start, but you
have to dig deeper and see where on the web they congregate and how they
Status Anxiety - We all want others to respect us. We might deny this
in public but in private we’re concerned with what our peers think of us. Note
that I said peers not everyone.
Many consumers, especially those that are more
brand conscious, invest in products to raise their social status. It’s about
positioning themselves within their social bracket.
5. Remember Pink iMacs?
When the iMacs were first released, there was a run on pink.
Not red, blue or green. Pink.
Pink sold out in a flash.
But not to teenage girls like you'd think.
Instead, it was up-market Indian families who bought them in droves. Many
were never used but strategically placed as exclusive objects in their living
rooms, no doubt to generate envy in less well-off (or more pragmatic) guests.
Status anxiety explains many irrational behaviour in
consumer buying habits.
The iPad is another example.
It can’t multi-task and is very expensive.
More expensive than most large size laptops, which can multi-task and
come with other great features.
But… such is the strength of Apple’s fanbase that the product is a
best seller, regardless of price and limited functionality.
Well, it looks great for one thing and… most people can’t afford it.
In the coming weeks, we’ll look at other physiological triggers that
influence the way consumers behave.
Jose Mourinho Taught Me About Market Research
Do you think Jose Mourinho knows much about
market research, brand
segmentation, and customer profiling?
Spreadsheets, surveys and focus groups may not be his specialty but he
does know his market (the opposition) and does endless research. Ask anyone
who’s worked with him at Chelsea, Barcelona or Real Madrid.
Mourinho is notorious for gathering information about the opposition
team, analyzing the data, and briefing his players. The results are impressive.
When interviewed for the Chelsea vacancy, he prepared PowerPoint
presentations showing where and how he would develop the team.
Board members were blown away. Mourinho looked at the league table
that way a General would a battle field.
He assessed his troops (team), reviewed the enemy (Man United
perhaps), and drew up plans to undermine the opposition. And it worked.
And the same can work for you.
Market Research Planning is simple.
People make it complicated. Some make it
complicated to make themselves look clever. It’s not.
The key to effective market research is to follow stick to the basics
and define your goals.
What do I want to get out of this piece of work?
Write it down. It should be one sentence. No more.
I want to know…
To get to that point develop a Market Research Plan,
which is a framework for getting to that answer.
5 Painless Ways to Kickstart your Market Research
Here are five ways to start your
Market Research Planning activities.
Assess the Competition - Can you compete against the
market leader? How many competitors are there in the marketplace?
partner with other companies and deliver a superior product offering? Mourinho
identified three main threats and then went after them. One by one, they were
Identify your target market – gather information about the
age, location and number of people who’ll be interested in the product. The
more you know about your
customers, the more you can tailor your product to
their needs, spending habits and in relation to emerging trend.
that his midfielders had to be 5’8’ minimum. Why? He was blessed with one of
the best midfielders in the world with Claude Makelele (5’5’) and wanted to
balance his lack of height with taller, more robust players. Other mid-size
players were sold and powerhouses brought in.
Determine Price – how much will the product cost? Will you sell it
as part of a bundle? Do you offer discounts? How about international customers?
Will the price be the same in the US as in Japan? And if customers find out,
The difficulty with pricing strategies is that what works in one
country, or even one city, may be over-priced in another. How do you strike a
Sales channels - What’s best approach to
selling the products? Over the web, in the high street, through partners, direct mail? When
I started my business, I sold training programs through the post. But I had to
stop as shipping fees reduced my profit.
Now I sell all my goods online with
eJunkie and Clickbank. While I still get requests for hardcopies, I have to
decline the offer as the time and effort would wipe out the profit margin. But,
it’s not an easy decision. Who wants to say No to money.
Volume - How many people are looking for this product? How
confident are you that this figure is correct? Will this number increase or
decrease over the next three years?
Looking for an example of how your luck
Audible.com was facing bankruptcy a few
years ago. No one was buying digital downloads. Then the internet gained
traction. Mp3 players spread like wildfire. Suddenly the demand was there.
The next problem was how to keep up with
Nice problem if you can get it.
As you can see, there are many factors to consider when launching a
product. Interviewing, running surveys and polls are different ways to get
inside the head of your
customers (or prospective customers) and see what they
is not an exact science.
What works in one area, may not work in another.
Likewise, you may have to run different surveys or workshop until you
begin to see specific trends emerging, for example, that the price is too high
for customers in France but fine for those in Seattle.
Or the user interface confuses customers and makes them leave the
Did you know?
More than 55% of customers who start the buying process (i.e. Click
the Buy button) leave the site before they get to the Confirm button.
Wouldn’t you like to know why?
That’s where a discrete survey will help.
‘What’s the one thing on my Shopping Cart that you’d change?’
Or a poll. Or a focus group. Or a questionnaire.
It depends, doesn’t it?
SAD TUT aka USA TDT
I’ve made up a new buzzword to address this. SAD TUT. Or USA TDT. Whichever
For small projects, you should be fine with
Worksheets, spreadsheets, forms and
checklists. You can use these to run surveys, ask questions, and gather
If you need more detailed information, then you'll need to develop a
Market Research Plan. This is ideal when you want a 360 understanding of how
customers perceive your company, brand or customer service. It depends on your
needs, budget and resources.
Assess the current marketplace.
Determine if there is a real need for your product or
service. While you may feel that people MUST want to buy this, the research may
Size up the
competition. Who are your main competitors? How
can you beat them? Price, Innovation, and Customer Service are three starting
Understand your Customers. Learn more about their shopping
habits. What triggers them to make decisions? How much they usually spend on
these types of products? What is their
weekly disposable income, i.e. what’s left
over when they pay the bills?
Monitor Trends – understand how the market is shaping up. Are
there new trends you need to watch? What has become passé?
Define Achievable Targets – and, of course, you need to define your sales
targets. How many of these do I need to sell in the next 12, 24 or 36 months to
justify the decision to launch this product?
The over-arching goal is to learn more about your customers and how
their spending habits, preferences and knowledge of your brand will impact your
In a nutshell
After you have completed the Market Research planning phase, you will
have the answer to the question you identified at the start of the project.
For most of us, this is: who will buy my product, for how much, and
Mystery of the Seven Sided Market Research Plan
Market Research is like a heptagon. Ok, that’s a bit pretentious. But,
it is actually and here’s why.
The seven stages in the Market Research Plan look at:
- Why are you doing
- Who are you researching?
- What tools will
you use to gather the information?
Where will you
collect the data?
When and how will
you analyze it?
How to Report
- What Decisions
will follow from this?
Stage 1 - Why?
The first side of my heptagon (ok, work with me here. I needed a
useful analogy with 7 in it and Heptagon fitted the bill. It was that or the
Seven Gods of Chaos. Heptagon won the toss...) is Why.
Why are you really doing this?
I know this seems obvious but… there are rational, easy to justify
explanations and there are ‘other things’.
For instance, knowing why your product is underselling is a good
thing. Your focus is clear. Armed with the results you can adjust the product’s
price, features or other attributes.
If customer service tells you that callers are frustrated with the IT booking
system, then the priority is to fix the booking system. The Market Research can
wait until afterwards.
Developing a Market Research
plan when you
already know that there is a problem is getting priorities mixed up. The
priority is to fix the system.
Of course, if you need to know why the system is difficult to use,
then ask why.
The point is… before you start your
Market Research Planning activities, be very clear what you want to get from it.
The more you can clarify your goals, the closer you’ll get to that
When others ask what you’re trying to achieve, instead of feeling that
you have to justify this project in some way, you’ll have more confidence in
In turn, this will be reflected in how they respond and respect your
work. Because Market Research is often seen as a ‘grey area’ or dismissed as a
‘nice to have, but not essential right now’, make sure you are clear on why
this needs to be done.
Real confidence is contagious.
Work with your team and map out the reasons why this project will
This is how you’ll convert the skeptics. Show them what they have to
benefit. Then reinforce the
benefits with examples.
The first step is to clarify why are you doing this?
What’s your objective? Define you over-arching goal in one
What do you hope to get out of it? Identify the one piece
of information the company does not currently possess.
What’s your objective? When you have this information, how
can you use it to drive other projects onwards?
What questions do you want answered? Identify all the
questions that need to be addressed and then prioritize the high priorities.
How level of detail do you want the research to go into?
Is this the first wave of a large marketing initiative or do you need to drill
down into greater detail?
How will you analyze the data? What factors will you use
to examine the data and extract meaning from the feedback. Otherwise, it’s just
a mass of data, right?
What success criteria, if any, need to be established? For
example, if you determine that 80% of
customers would pay $49 for a new product
- and you interviewed a large sample - then this may be enough to launch the
product. No more data gathering may be required.
What will you do with the findings? Are you looking for a
budget for further development, to release a product, or for marketing
activities? Does this plan tie in with other marketing activities?
Are others depending on you before they can make a
decision, such as to release a new product?
Be clear with your
goals. Ensure that your team
understands your objectives and how the research will benefit drive other
For example, a mobile phone company wants to:
‘Offer customers free roaming calls in Europe help sell enough phones
to justify this cost and allow us to upsell other products to new
This means that the main questions to be answered will be:
Are customers interested in free roaming calls?
Is Europe a more attractive market to them than the US?
(Let’s say you're targeting business travelers.)
Can you upsell products to new customers?
How would you price the new products?
Is there opportunities for partner tie ins?
Notice that this is a very narrow focus. Essentially, we want to know
if business travelers (a small but lucrative segment of our customer base)
would buy new products from us if we offered them free roaming across Europe.
Once you are clear on your objective - and how it assists other
business units - you can develop your
Market Research plan with more confidence.
That’s the first side of our Market Research heptagon. Let’s more it
around and see what’s next.
Stage 2 – Who are your Customers?
Yesterday, we introduced the idea of a heptagon into this series of
tutorials. It seemed a bit crazy the time but it does make sense.
Instead of seeing your Market Research project as one single activity with
definite Start and End points, step back and look at it more holistically.
Rather than seeing it as one long road you need to travel, look at the
side roads that feed into it.
This approach helps me when I get maxed out. I hit a wall in one area.
Rather than forcing myself to complete this task (now a soul-destroying chore,
tbh), I look at the plan for another side and find new energy there.
Did you ever notice that moving your attention from one to another
suddenly releases new energy? It’s a bit like that.
So, if you reach your limit with one area in your plan, leave it aside
for a day. Work on another area. Then come back to the first one when you’re
Which brings us back to...
Some Customers are More Important Than Others
If you’ve read Animal Farm, you’ll know what happened to Snowball.
‘All animals are equal, but some are more equal than others.’
And it’s the same with
Think of it like this. One guy buys from you every time you put a new
ebook online. He snaps them up and posts great recommendations on the web. This
guy is gold.
Another buys once. You never hear from the again.
It’s a no-brainer, right?
This means that part of the market research plan is defining your real
Or, put it another way. We need to scratch the surface and learn more
target customers than we think we do, especially those of most value to us.
Don’t Make This Mistake
One common mistake in marketing is to assume that your customers don’t
Of course they do.
So, your research is to challenge what you think you know of your
And then look at ‘prospective’ customers.
You may have no ‘hard data' on them – so you need to get moving,
So, using the goals we defined in the Why section, we can examine our
target customers and see how we can ‘reach’ them.
Reach is one of those buzzwords used in
Market Research to cover how
you will contact customers, the media channels you will use, and the different
ways to gather data.
A sample of 100 may give one set of results, whereas a larger number may
give you richer feedback. Cost is usually a factor here as the price per head
adds up, especially if you're doing the research for your own company.
For example, sharing the report findings
and/or vouchers to your products may work. Again, it depends on your
target audience and what’s most valuable to them.
Another example... my email software lets me
segment my list and target emails at different user groups. This means I can
match my market research to the user group most likely to respond and avoid
You can also rent email lists but you need to do this with caution.
Many of these lists have been harvested without the user’s consent. As well as
offending the users, the ISP may block your email account if there are a high
number of complaints or bounces.
What incentives will you offer?
I use a variety of approaches to encourage folks to help with the market
research. Some of these are typical offerings such as free offers, vouchers,
instant downloads, reports, and other teasers.
This is the classic, ‘you scratch my back and I’ll scratch your back’.
And it works.
There are other ways.
For example, we identified a group of high earners for a banking
project. We told them – and this was true – that there were in the top 3% of
all earners on our books.
‘Would you like to test run the new Wealth Management System before it
There was no shorter of takers. Many high-earners wanted to use the
system because of their privileged status. They were capitalizing on their
You can do the same thing with any line of professionals by appealing
to their status, vanity or greed. There’s different ways of persuading folks to
engage. Sometimes it’s more about how you ‘position’ the market research to
Consider dropping the phrase ‘market research’ and use something that
triggers different emotional buttons.
Stage 3 - How Are Find The Information You Need
Now that you know Why you need this information, Who you will target,
the next step is to see How will get it.
Let’s step back.
There are different ways you can get this
market research data: email, phone,
web, even in the shopping mall.
But you have a budget, right?
This means that you need to consider which approaches worked best the
last time. Look at the returns. Based on these results, use the channels that
give you the best return. And, if there is money left over, try the next
Sometimes it’s not that simple.
Maybe you can contact 10 on the phone for the same cost as 100 on the
web. But the quality of data from the phone calls is substantially better than
what you get on the web.
Trained interviewers can probe the person over the phone and extract
information that will not be captured in Multiple Choice questionnaire.
Likewise, the phone caller may volunteer information that you hadn’t thought
For this reason, evaluate the best approach to gathering quality
You have different options, such as:
- Focus groups
- Observational research
- Interview by Telephone
- Interviews in person
Next, you need to create a Schedule (like a
Project Plan) to put all
these tasks against target dates. The key is successful market research is
getting the right information but also staying within budget. Keep your line
manager up-to-date with your progress and show him the time line for your
Stage 4 – How To Collect Data
The next stage involves collecting the data. While this sounds easy at
first – you just collect it, right? – it can be problematic when the data is
corrupted, conflicts with earlier reports, is received in file formats that are
not compatible with your software, or there are gaps in the data making it hard
for the analysts to draw conclusions.
Here are a few suggestions to collect data:
Before you start collecting data, train, educate, and supervise your
own team. If this is the first time engaging in
Market Research Planning at your
company, consider hiring a Consultant to create a framework for your
project One of their tasks will be to
show your team how to collect data in an impartial manner and to avoid
Think of the end goal. You want all the data to be merged into a
single database. Whether this is Microsoft Excel, Access or another tool, it
doesn’t matter. But the data needs to be designed so it can be shared. If you
can’t share the data, it’s harder, it not impossible, to crunch the numbers.
Marketing Plan Template Guide
Fix Corrupt Data
Reduce the likelihood of corrupt data by a) designing simple user
interfaces, b) helping the subject understand what’s expected of them, and c)
creating software that doesn’t crash or timeout during a session.
Other areas where data gets corrupt are simple things such as when
users enter dates. For some 0503 means May the third whereas for others it
means the fifth of March.
Asking folks for their ‘Christian’ name can be both confusing and
offensive. They meant first name.
Microsoft Word templates so they are easy to read, ensure
the web forms that are easy to populate, and that the data can be captured
For example, some surveys I've taken demand that I enter my zip code.
But we don’t use zip codes where I live. So, I’m forced to enter incorrect data.
Imagine the confusion that causes?
Stage 5 – Analyze Data
This is where the ‘rubber hits the road.’ You now have the data;
you’ve gathered it from multiple sources, removed corrupt data and looked for
Next up - Analyze This!
Here’s the mistake to avoid. Don’t use the data to confirm what you
want to believe.
Data is data. 1s and 0s. Oceans of letters.
And it has no meaning until you shape it.
The question is: How do you shape it and avoid your own subjectivity?
The technical term for this is ‘data cleansing’. In other words,
you're going to look at the data and remove any ambiguities, errors or other
unknowns that have crept into the results.
Marketing Plan Template Guides
A good example of this was the US Presidential election between George
Bush and Al Gore.
Small details like this can have immense impact on the final results.
You need to allow for unknowns creeping into your research results and take
steps so they don’t influence the final results.
Cleaning data involves editing, coding, and tabulating results. To do
this, start with a simply designed
(or a similar tool) and:
- Subjective - Rely on subjective information to support general
- Objective - Gather objective information to support more specific
findings. Objective data gives you a neutral view of how others see your
product. If you ask your team – or even your current customers – what they
think of a new product, more than likely then will tell you what you want to
hear. Those outside the organization will be more impartial.
- Look for anomalies and inconsistencies – if there is a sudden change
in the results, look at what triggered the shift. Likewise, if results from one
team conflict with another team, sit down with them and see how they’re
gathering the data. They may have made some errors in crunching the numbers or
interpreted the results incorrectly.
- Compare – Look at the results of different data collection methods.
For example, if you run polls online and offline about the same subject, for
example, the customer’s favorite brand on designer shoes, look at the results
and see if they agree.
If you're targeting the same age group and demographics,
they should agree, right? If not, dig deeper and see why 20 something’s online
give different than 20 something’s offline. Hint: people tend to be more
‘creative with the truth’ online than when interviewed face to face.
- Use other sources of information – For example, you can use U.S.
Census Bureau statistics on median income levels for a specific city/state and
other official research findings to give your findings more balance.
Stage 6 – Generate Report Findings
At this point, you should have all the data gathered in
Microsoft Excel spreadsheets and other formats you can share.
Remember your initial goals?
Break out the findings so it answers the questions you had at project
kickoff. You can show this in, for example, Demographic Comparison or
Use what’s appropriate and make it easy for the reader, especially those
further up the line, to extract the key findings.
Data Analysis usually falls into two categories:
This is where you describe the collected data usually by summarizing
the findings. For example, you can highlight how many liked or disliked your
new product. Use charts and tables to illustrate the data. Provide legends that
explain different categories, volumes or amounts.
While Descriptive Data Analysis focused on describing the findings,
these are of limited use until placed in context. That means you try to use
information taken from a small group to ‘infer’ what a larger group would do,
compare groups and see where/how they behaved differently, and forecast what
may happen based on the information you have gathered.
For example, let’s say you want to know how customers from London,
Paris, and Dallas rate different products. You prepare a survey with ten
questions asking customers from all three cities to rate customer satisfaction
on a scale of 1 to 5.
Once the survey is completed, you can compare each group using statistical
software and test if differences exist.
Microsoft Excel has some very powerful functions, such as pivot tables
that are very effective at analyzing data.
This type of
marketing analysis offers richer information than simply showing
how many customers from each city responded to each question.
Stage 7 – Choose Best Strategies
Now you have to make a decision.
In some companies your findings will be handed over to other teams,
for example Product Development or the
Marketing Department, for them to decide. It depends on
how you're it structured.
One thing to consider is that the market research should shed light on
new areas. If the findings confirm what you already know, look at how you're
gathering the data, where it comes from, and who compiles the information.
In a dynamic world, findings should rarely stay the same.
‘Were the findings good?’
You may be asked this during your presentation. Findings are neither
good nor bad. They’re a snapshot of how customers see your product, for
How people interpret data is up to them. Your job isn’t – or shouldn’t
be – to skew the data so management hears what they want to hear. If customers
are dissatisfied, it’s their job to remedy it, not yours.
One final tip.
Close on a positive note.
Even if the information is down-beat, look for some positives in the
information you gleaned. Don’t fudge the issues but remind the audience that we
now know more than yesterday.