Market Research as a Lifeblood of Any Business

Markets are a combination of several factors and elements that work together to influence the outcome of a firm’s or an individual’s performance. Understanding how these elements and factors interact with a company’s processes is, therefore, important to advising decision-making and strategy development especially in the long-term. Firms and individuals come up with these insights through market research that results in the development of a market outlook.

Market outlooks outline all the factors in a business’s environment that can help it in achieving its set goals and objectives. They also take into account the internal resources, processes and structures that are available for the accomplishment of set objectives. With both these classes of factors and elements clearly defined, market research then helps management to establish the relationships between them, therefore, increasing their ability and capacity to forecast changes in their operating environment. They play an especially important role in start ups because of their ability to show financial projections and rationales for various levels of performance which is a key requirement when sourcing for funding and investors. For more established companies, market research comes in handy in enhancing a firm’s flexibility to respond to changes in their operating environment.

Important Areas of a Market Research

First, it conceptualizes the gap in the market that the company seeks to bridge. Conceptualization is the most important part because it forms the basis for the rest of the process. It also sets the tone for the approaches the analysis will take in establishing the relationships between the different components of the firm and its environment. For example, a company can only look at changes in its environment as opportunities only if its conceptualization is based on growth, therefore, allowing it a higher bandwidth with which to anticipate change.

Second, it identifies a firm’s internal abilities and capacity to achieve its set goals and objectives set in the first phase. Taking stock of the resources available is critical to ensuring that the company’s processes are sustainable and practical especially in the long-term. It also gives a company enough information to help it in the scaling of its operations and structures in such a way as to mitigate any challenges and problems to its productivity while ensuring that it experiences increased performance. Last, it outlines the market forces that the company will have to contend with and overcome in its quest for higher performance and sustainability. The understanding of market forces is also instrumental in enhancing a firm’s flexibility because it improves its ability and capacity to respond to changes organically. In conclusion, understanding the basics of market research is an important tool for any growth and strategy enthusiast.