Market research, for a marketing oriented organization, is critical to success.
The marketing oriented organization is focused on the customer. They tend to be long-term focused – repeat business, retention, loyalty, lifetime value – rather than short-term focused (how many units did we sell). And they integrate marketing across the organization’s functions in order to increase the potential for delivering a unique, valuable customer experience.
For a marketing oriented organization, market research is all about staying on top of their audience. What are their needs, wants and expectations? How can we do a better job of meeting, if not exceeding that needs, wants and expectations? How are their needs, wants and expectations changing over time, due to external factors (economy, politics, technology, etc.) and what should we be doing to stay ahead of those changes with new and/or improved offerings?
With the focus on long-term profitability on both the organization and the relationship with the individual customer, you will encounter some product offerings launched as a loss leader in order to capture market share. In these scenarios, the objective is to find ways to make the customers profitable – either through cross-selling or up-selling them to other products over time or by raising the price and making the product profitable. Obviously this requires a great deal of insight into the customer – are they willing and able to spend more on this or other replacement products or are they price sensitive (unwilling or incapable of spending more) which would prevent the achievement of long-term profitability?
Having that insight going into a product launch can help save a tremendous amount of valuable, limited resources for the organization – and the investment of a much smaller amount of money, time and effort into market research that answers some of these key questions is a very wise move.
Also, for the marketing oriented organization, the collection, storage, access to quality, relevant data is key. As is the ability to analyze that data in order to drive decision making. Think of it this way – your organization is marketing oriented but data is either not captured or stored or is stored in a way that prevents [ex] customer service data to be shared with marketing and/or sales data. Suddenly your organization is promoting to an organization that has a high incidence of customer service issues (complaints, returns, allowances).
Oh, and the information from those complaints/returns are focused on a product flaw – but since that information is stored in customer service, and manufacturing/product management doesn’t have access to it, that product flaw remains as more and more of the product is produced and shipped off to more and more customers.
So in the marketing oriented organization, everyone wants fast, simple access to quality data that is relevant to the situation in order to make better informed decisions that help strengthen customer relationships, drive retention and loyalty…and increase lifetime value.
Let me share a recent example of the importance of market research and data sharing across the organization. This leans more to competitive intelligence but you will see the value.
The field sales person noted in the client’s CRM record that there had been some talk about management changes which could mean a re-evaluation of all vendor relationships. Marketing saw the note and the research team made a few upgrades to the competitive intelligence process with the hope of verifying the rumors and staying on top of the story. Customer service made extra efforts to reach out and make sure everyone was happy.
Then the news broke and we discovered that the CEO and COO had been replaced – by two people that had worked at another firm that was a large client of a competitor of ours. We immediately met to discuss options – and a plan was put together across the organization. Orders were prioritized for faster shipping. Customer service and sales worked closely together in order to ensure an even higher quality experience.
Over time, we were able to prove to the new leadership team that we were a valuable partner – something many firms fail to do because they lack the data, the knowledge of the change in leadership. But that’s the thing about being marketing focused – your organization understands that they are all playing a key role in marketing the firm and they all need to be aware of what’s going on so they can share that data across the organization and the organization can respond appropriately.
It’s not “I just deal with customer issues” or “I just process the invoices” or “I just sell to the buyer” – it’s an entire organization working together, gathering and sharing relevant data that drives informed decision making.
And that’s why market research is so important…it’s not a report in a binder. It’s data driving your business forward.