In the B2C space, the importance of smart and effective business strategies cannot be underestimated. However, despite this axiom, many businesses — especially smaller firms — struggle at times to generate the quality, reliable information they need to develop and optimize their strategies. As a result, they are forced to react to events after they’ve happened rather than responding to them in real time or engineering the events that change the industry.
Unfortunately, this response-oriented approach is neither safe nor sustainable. Yes, at times it is necessary to press the pause button on strategy and pivot — not necessarily to avoid an unforeseen pitfall or problem, but to exploit an unanticipated opportunity or possibility. However, just as airplanes have a flight plan, businesses need a strategic plan. And without the right inputs, the plan cannot be reliable. In fact, it may point in the completely wrong direction.
Fortunately, that is where consumer market research enters the picture, and provides businesses with the accurate, data-driven information, insights and intelligence they need to drive smart, reliable strategies — and ultimately, generate more marketplace visibility, mind share, competitive advantage, customers, sales and profits.
While each business has its own strategic profile and there is no one-size-fits-all template, generally speaking here are some of the key ways that consumer market research improves business strategies:
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Identifying Buyer Personas
Just like their B2B counterparts, businesses in the B2C space do not have a single customer — they have multiple buyer personas, such as “stay-at-home mothers” or “digitally-connected students.” Consumer market research helps businesses identify these key customer groups, and then build robust, realistic profiles that guide marketing and sales efforts. This is valuable for serving existing customers and increasing lifetime customer value (i.e. selling more to existing customers who will happily buy more), as well as identifying profitable new customer groups.
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Identifying Product/Service Lines
In the B2C space, one of the most critical strategies is identifying the right product and/or service lines — because today’s best seller can quickly become tomorrow’s low (or no) profit item. Consumer market research helps businesses understand what customers want and need, and often more valuably, what motivates and influences their buying decisions. This intelligence can be leveraged to choose the right mix of product and service lines that balances current revenue generation targets, with future growth objectives.
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Identifying Competitive Advantage
Barriers to entry in the B2C space can be low — especially if ecommerce is an option. Indeed, a business that has been operational for decades can find itself losing customers to a competitor that launched last month. As business history has proven countless time, the only effective way to deal with this threat is by establishing and deepening competitive advantage. Otherwise, a business can be perceived as selling commodities, which means that customers focus entirely on getting the lowest price: and that is a race to the bottom. Consumer market research helps businesses avoid that catastrophic one-way trip by understanding both what they do best relative to the competition, and even more importantly, how those strengths align (and how they do not align) with what profitable customers want and expect.
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Identifying Brand Definition
Just as people have personalities, businesses have brands — which can either be an asset or a liability. Consumer market research helps businesses understand how they are perceived in the marketplace, and what they need to emphasize in their marketing and advertising messages to resonate with their target audience, and stay relevant.
The Bottom Line
Consumer market research is essential for B2C business success, because it uses reliable data to inform strategy, and ultimately drive smarter, faster and more profitable decisions. To learn more, download our free eBook “How to Communicate the Value of Market Research to Your Clients” to see the many reasons why marketing agencies suggest market research to improve your business strategy.
