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Market research is critical to the growth and success of any business. Without it, there is no other way to know what your customers want or need.
The insights from the research will also let you know what is happening in the market. The information will help with decision-making so the business can better adapt.
The market research industry is on an upward trajectory, as per Statista reports. This illustrates the importance of the process for businesses. As of 2021, market research generated over $76.4 billion. That signified a two-fold increase since 2008.
In types of market research, online surveys were the leading quantitative method. They took up 80% of the work. Phone use during interviews was 31%, while face-to-face was 33%. With qualitative research, mobile surveys were the most common.
So, what does the future of market research look like? Here are some predictions on trends we can expect. All while taking into consideration changing consumer behaviors.
Artificial Intelligence Will Have a Larger Contribution in Market Research
Many industries already realize the benefits of artificial intelligence. You would find it hard to find one that does not use artificial intelligence. And that includes the market research sector.
Machine Learning in Market Research
Machine learning is helping in the analysis of large datasets. It can identify patterns and trends in consumer behavior. The algorithm goes into so much depth to even uncover what human researchers cannot see.
The application of the algorithms, for instance, can analyze social media data. It can reveal market insights on emerging trends and areas that interest consumers.
Task Automation with AI
Artificial intelligence automates many of the research processes. Tasks like data collection and analysis will take hours if human researchers do them.
But technologies like chatbots are providing efficiency in data collection. Natural language processing analyzes open-ended survey questions and social media data.
Predictive Modeling
Predictive modeling utilizes machine learning algorithms to make market predictions. It can provide essential insights into future trends or changing consumer behavior. It does this by analyzing historical data to see what to expect going forward.
The benefits for the businesses are many, including:-
- Better decision-making based on data
- Ability to tailor marketing strategies that respond to individual consumers
- Increased effectiveness in marketing efforts with an understanding of what customers will want
Companies have a chance to be proactive in implementing business processes. If you can predict the future, it becomes easy to know how to adapt to the changes.
Higher Personalization with Artificial Intelligence
Market data on individual consumers allows for the personalization of services. Take the example of chatbots that can recommend products to specific customers. They do this by looking at past purchasing behaviors or preferences.
Deep Learning
Deep learning is a subset of artificial intelligence. It provides the perfect tool to train deep learning models to predict the output. Businesses can find out what customers want. This provides an opportunity for personalization. The same applies to better targeting and overall enhanced customer experience.
Greater Adoption of Mobile Market Research
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We talked about mobile as a leading market research tool. And that could be a result of the massive adoption of mobile technology by customers. And with rapid advancements in the sector, we do not see the trend going anywhere.
Market research facilities will continue to embrace mobile research because it is effective. Mobile research allows you to get respondents at their point of convenience. It is easy to send survey questions on mobile and receive instantaneous results.
There is also an opportunity to get to more people during market research. Remember one important point. People carry their mobile devices like phones and tablets everywhere they go.
For researchers, there is another advantage. There is no need to invest in physical recruitment or other data collection tools.
Smartphones allow for the collection of a wide range of data. This includes visual, audio, sensor, and location data. The advantage is the ability to glean richer information about consumers.
And finally, real-time data collection is possible using mobile technology.
It will be hard to imagine a future without mobile technology as an integral part of market research.
Increased computing power and other advancements will improve data collection and analysis. Take the example of mobile devices to collect biometric data. Researchers can monitor facial expressions, heart rate, and elevated blood levels. All these could give insights into customers’ emotional reactions to a product.
Increasing Complexity Due to Changing Consumer Behavior
Market researchers have to deal with very complex demographics. Millennials and Gen Z are difficult to decipher or predict.
These demographics have attitudes and behaviors that older generations may not understand. They have values and lifestyles that do not fit into the typical mold.
Take a look at the attitude of Gen Z to money as an example. A world forum report shows they are very pragmatic about finances. This could be from watching millennials struggle with money issues.
Millennials grew up in market conditions characterized by uncertain economic situations. And that included stagnating wage growth. Many ended up making financial mistakes that impact them to date. So Gen Z wants stability, which comes from good jobs and savings.
Social media and its impact on consumer behavior increase the complexity. Market research is critical if companies hope to be more responsive.
Predictive modeling, for example, will be a critical tool for determining future trends. Yet, the researchers must take into account factors that can disrupt market conditions.
The best predictions, for instance, could not have seen the devastation of the 2020 Covid outbreak. But now, consumers are more aware that such scenarios can happen. That has led to a mindset of ensuring constant readiness for ‘what if’ situations. People are more careful about spending money. There is also a noticeable shift to sustainability.
Companies must stay a step ahead at all times to cope with the market and consumer complexities.
Increasing Adoption of Virtual and Augmented Reality in Market Research
Virtual and augmented reality create immersive experiences for customers. Companies have a more realistic way to test products in simulated conditions.
Research insights are vital at every stage of the development cycle. Companies need to understand customer reactions to products. And one way to do it is through experience-driven marketing.
Take the case of augmented reality (AR). A company can superimpose a digital existence in the real world. They can then see how customers will react to and use the products they are pushing. The insights make it easy to see how to improve or market the products.
Virtual reality (VR) allows customers to interact with products in a realistic way. For instance, car companies are now using VR to allow customers to test-drive vehicles.
BMW has the ‘mixed reality experience‘ where you can drive their cars via a VR headset. The tons of insights from these types of market research are very valuable to the business. It gives room for adjustments or improvements. We can expect plenty of exciting applications of AR and VR in market research.
Micro Data Will Get More Dominance
The buzzword in market research has for a long time been big data. But therein lies a challenge. Aggregate data provides an overview that brings in a level of assumptions. It can be challenging to identify trends and patterns. The same applies to knowing how they impact individual customers.
Yet, the most relevant insights will come from individual customers. And this ties in with the point on market complexities.
Future market research will focus on collecting detailed individual-level data. All with the aim of getting a better understanding of consumers.
For companies, the benefits are obvious. It becomes easier to tailor-make marketing strategies, products, or services to individual customers. That will result in higher personalization and improved customer experiences. But there are extra benefits, including better targeting of research with microdata. Also, expect improved experimenting and hypothesis testing.
The challenge for market researchers is sticking to ethical practices when collecting data. Privacy is a crucial concern for both the company and the research respondents. Researchers must ensure the security of whatever information they collect at all times.
Agile Vs. Real-Time Market Research
Do we see a future where people have to choose between real-time and agile market research? No, what we see is a situation where the two complement each other.
- Agile research is the use of short cycles when testing or learning from different hypotheses.
- Real-time market research is the collection and analysis of the data in real-time. Tracking customer sentiments, online reviews, and social media channels are good examples.
Agile or primary research and real-time research must work hand-in-hand. It is, for example, easy to get data when customers are looking for a product. Survey data will provide insights into what triggers preferences or needs in customers. All these are critical for getting a better understanding of customers.
Final Thoughts
Market research is critical for any business that hopes to succeed. You cannot run a company without having a pulse on market conditions. And understanding future trends and changing customer behaviors is critical.
What we see as the future for market research is one that improves upon most of what is already in use. Trends like AI, mobile research, agile research and real time research will only get better.
There may not be any significant trend shocks. But, we can expect plenty of innovation and advancements in processes.
