The market research industry in India is thriving, but it is not without its’ own challenges and complexities.

Size of the Market Research industry in India

According to Statista, the size of the market research industry globally is around US$74 billion, with more than half (US$47 billion) coming from within the U.S. At roughly Rs.1500 crore or US$15 billion (2017-18), the Market Research industry in India may be smaller in comparison. Still, it is the fastest-growing market globally, growing by an average of 10 per cent per year, compared to the industry’s global growth of just over 2 per cent in recent years. Most of India’s market research comes from overseas brands.

What makes India a favourable outsourcing destination for Market Research firms?

The overseas demand is mainly due to the enormous cost advantages of conducting market research in India. The processing of data is about 50% cheaper in India than in developed nations. Therefore, the outsourcing business is doubling in value every year.

The rising middle class comprises young people who are very familiar with U.S. brands. India has the second-largest population of English speakers globally, coupled with a relatively stable political backdrop. These factors make India an attractive country for international companies.

India has also developed a pool of trained market research professionals who can provide companies with superior study methodologies, data processing, analysis, and reporting, making India an attractive outsourcing destination. 

What are the high-growth sectors in Market Research in India?

India is evolving into a ‘Service Economy’ with telecom, retail, and financial services as the high-growth market research sectors. Marketing research in India has been focused more on fast-moving consumer goods (FMCG). Besides these, India’s most significant growth area for the market research industry is the media measurement business, followed by the auto, telecom, healthcare sectors, durable goods industries, and the public sector. Market research is mainly focused on customer insights and satisfaction in all industry sectors. 

What are the challenges of conducting Market Research in India?

India faces unique, complex challenges because it can be viewed more as a continent than a country. This is because of many diverse cultures, customs, behaviour, languages, and even regional dialects. 

In India, one size does not fit all. Researchers need to understand the cultural nuances peculiar to different parts of the country when designing surveys and studies and selecting local markets. 

To obtain data for nationwide studies, market research firms in India have to target multiple cities, each with its language and cultural nuances. While Indian market researchers understand and know how to work within the complexities, it becomes challenging to warrant the high costs of conducting national studies to clients. 

On the plus side, this has helped Indian researchers attain higher standards of conducting studies. However, it is also true that it is difficult to attract high-quality research talent in India due to relatively lower salaries. While Indian companies understand the importance of Market Research and use it effectively, they are amongst the most demanding but lowest paying countries for market research.

One of the biggest challenges is the size of the country. In the past, with fewer households having access to phones, it was challenging to conduct market research. In 1997, less than one percent of the population had access to a telephone, and with low literacy rates, telephone and mail surveys were non-existent. However, in recent years, technology has lifted many barriers to market research in India.  

India’s digital journey has been remarkable. The number of internet users grew from 0.62 million in 2010 to 843.06 million in 2021 (the second-largest in the world). Estimates suggest that this figure would reach over 1.5 billion by 2040, and Smartphone usage far surpasses desktop and laptop usage. Today, smartphones are present in 84% of households. (Source: Statista)

These developments are a massive advantage in a country the size of India because the cost savings from using the internet or phone over face-to-face interactions are enormous. The rise in social media usage has also immensely helped the growth of market research in India. 

Face-to-face research was dominant before the pandemic; however, the first wave of COVID-19 pandemic and the lockdown helped speed up digitization, making it easier to use technology and social media for research studies.

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What is the state of market research in Rural India?

Nearly 70% of India’s population lives in rural areas, and the rural market has been growing five times as much as the urban market. However, doing market research in the rural areas of India remains cost-prohibitive due to the size of the country and its hugely diverse population. Additionally, largely rural population groups have not seen the technological breakthroughs and are beyond reach in many ways. 

During the pandemic, there has been an upsurge in digitizing rural India. The government has been pushing the adoption of digital technology in rural areas for many years now, but during the lockdown, it gained momentum. 

During the first pandemic wave, many jobless migrant workers had to go back to their villages from the cities, which triggered a rise in rural digitization. 

Still, market research firms face many challenges when it comes to the evolving, post-pandemic rural population. Furthermore, the complexities of hyper localization in languages, dialects, and traditions are even more pronounced in rural areas than urban centres. 

How did the sudden spike in mobile internet penetration further help the growth of the market research industry in India?

The availability of cheap smartphones in India since 2010 laid the foundation for digital literacy and adoption. Furthermore, the Indian government understood the importance of investments in its telecommunications sector and further deregulated the industry. 

In 2016, Reliance Jio disrupted the Indian telecommunications market by offering cheap 4G, high-speed data plans with free voice calling. This competitive data pricing pushed other telecom providers to drive down their pricing and led to a cumulative growth in affordable mobile internet accessibility amongst the Indian masses. 

What challenges do Indian Market Research companies (in particular) face?

In India, market research firms deal with the most demanding but lowest-paying clients in the industry. This makes it very difficult to attract top talent of market research professionals as the salaries are relatively lower. Industry attrition in Indian market research firms is high at about 30%, and people leave due to low salaries. 

The Future of Market Research In India

The growth of Market Research in India is clearly on the rise and shows no signs of stopping, despite the challenges. The market research industry in India is over three decades old. In recent years, there has been a rapid rise in the number of Indian Market Research firms and the interest of U.S. and European firms in outsourcing market research work to India. Companies in developed nations have 40-60% cost savings when they outsource market research to India. 

Telecommunication disruptions, technological developments, the rising middle class, a young country familiar with International brands, and lower research costs in India have led to growth in the market research industry. 

Market research is critical to building a robust business plan, and while many companies understand this, it is costly and time-consuming to undertake market research. Market research firms are more pressed than ever to deliver accurate insights and solutions to help companies make the right decisions while keeping turnaround times shorter and costs lower. 

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Artificial Intelligence (AI), machine learning, and big data are changing how Market Research is carried out.

Organizations use many traditional market research techniques to learn more about their customers. Traditionally, these include interviews, surveys, focus groups, and market reports, which are costly and time-consuming. The Market Research industry in India now has access to and is adopting new technologies to collect, analyze, and present data faster yet accurately. 

Indian market researchers are using social media, advanced analytics, and data collection. 

New developments like Artificial Intelligence, machine learning, and ‘big data‘ offer a viable solution. This also means expanding the skill set of the researchers so they can effectively employ these market research methodologies for streamlining and automating data collection and analysis. AI can also scan market data in any language, which can be invaluable in a multilingual country like India. 

The rapid rise in the number of Indian Market Research firms and the growing demand from international agencies in outsourcing to India show promising potential for the future growth of Market Research in India.

Although many challenges lay ahead, there will always be a need for high-quality, flexible market researchers. While technology and automation may be invading the market researcher’s territory, you still need people to uncover data and insights. The best market research teams of the future will combine techies and problem solvers, who will use technology to streamline and speed up their studies. A good quality, accurate, fast, and lower-cost research workforce will ensure India’s future growth as a market research provider to the western world. 

With the growing global demand for cost-effective and high-quality market research, the rising trust in Indian researchers, and the value of the Indian market, the future of market research in India looks promising.

Selecting an Indian Market Research Agency 
Kadence India

With many providers to choose from, appointing an agency for your next market research project that understands your unique research needs is crucial. If you are looking to conduct market research, selecting an agency with national expertise is a must. 

At Kadence International, we have offices in 10 countries, including India. Our office in India is recognized as one of the leading market research companies in the country.

With a Head Office in New Delhi, our diverse team has hundreds of years of collective market research expertise and speaks 12 different dialects.

We would welcome the chance to discuss your next market research project. Learn more about our Indian Office here or submit your market research project here.

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The pandemic has led to irreversible changes in consumer behavior. As consumers stayed home for the better part of 2020, they have formed a new set of preferences, habits, and F&B expectations. 

Today, what consumers are looking for from the food and beverage industry is very different from pre-pandemic times, and these new expectations are here to stay beyond 2022.  

The “Food & Beverage Trends to Watch in 2022 and Beyond”  report examines the trends that will shape the food and beverage industry in the years to come. In this report, we look at four emerging trends around the globe:

  • Plant-based foods, 
  • Immunity-boosting ingredients, 
  • Tastes of home, and 
  • Transparency, safety, and sustainability.

Trend #1: Plant-based Foods

While there is considerable evidence of people choosing to avoid animal products as far back as 2,000 years ago, today, 4 billion people live primarily on a plant-based diet. 

Globally, the plant-based meat market will be worth $85 billion by 2030. The pandemic has only pushed the meat and dairy substitute product growth. 

Click here to see the extraordinary increase in plant-based meat sales in the USA during the nine weeks ending May 2, 2020, as the pandemic caused meat shortages and price spikes, shutting down meat-packing plants.

Read the full report to find out how the virus caused regular meat-eaters to make the switch, with many becoming permanent converts. 

Beyond Meat and Impossible Foods have become very popular and are a force to reckon with in the plant-based meat industry. While they are not the first in the market, they have created meat substitutes that taste like real meat. 

Plant-based foods such as snacks, dips, sauces, cheese, spreads, and creamers will see a double to triple growth within the following year.

Read the full report to discover plant-based attitudes and trends worldwide, including India, U.K., China, and the U.S. 

Trend #2: Immunity Boosting Ingredients

The market for functional foods has been growing for years. However, demand has boosted since the onset of the COVID-19 pandemic.

As COVID-19 made the immunocompromised population more vulnerable, consumers became more interested in healthy foods that boost their immune systems.

Known as “functional foods,” these ingredients claim to possess an additional function. For gut health, examples include probiotic foods that contain beneficial microbiota, including fermented foods like kefir, yogurt with live active cultures, pickled vegetables, tempeh, kombucha tea, kimchi, miso, and sauerkraut. For inflammation, ingredients like turmeric, honey, green tea extract, fish oil, and ginger provide relief.

According to Beneo, an estimated 75% of consumers plan to eat and drink healthier due to the pandemic. The global market for these ingredients is expected to grow to $117 million by 2021.

Read the report to learn more about the demand for functional foods or nutraceuticals around the globe, specifically in the E.U., USA, and India. 

Trend #3: Tastes of Home

During times of unease, unrest, and uncertainty, consumers seek comfort in foods that remind them of happier, less turbulent times.

According to The International Food Information Council, many consumers are re-creating the restaurant experience at home by using meal kits, restaurant-branded products, and more sophisticated or flavorful ingredients from artisan food producers. 

  • Meal-kit service: In 2017, the industry was valued at US$4.65 billion, representing a 300 percent growth over the previous year. Read the full report to discover the estimated growth potential of this market by the year 2022. 
  • Speedy appliances: Another popular trend reveals many consumers purchased in-home appliances to make meal preparation easier.

The dinner with the family trend seems cemented in our behaviors and habits. Before the pandemic, 18% of households ate dinner together at home every day. Read the report to see the percentage of households that eat dinner together now, post-pandemic. 

Trend #4: Transparency, Safety, and Sustainability

According to a 2020 Innova Consumer Survey, three in five global consumers say they are interested in “learning more about where their food comes from and how it is made.” The term ‘clean label,’ therefore, goes beyond ingredients. There is a need for transparency around the food being organic or additive-free, and companies need to show consumers they produced the food sustainably and humanely.

An increasing number of technologies are emerging to improve transparency, including radio-frequency I.D. tracking of ingredients throughout the supply chain and wireless/ smart technologies such as invisible barcodes.

Read the report to find out how food producers increasingly use blockchain and Internet of Things (IoT) technologies to provide information to consumers.  

Now that F&B producers and consumers are more experienced living with the pandemic, the focus is expected to shift toward sustainability. 

ADM, a food technology company, observed that nearly two-thirds of consumers want their food choices to impact the environment positively. Lux Research’s report The Food Company of 2050 also lists “increasing sustainability” as a critical factor for increasing brand awareness and market share.

Read the full report for critical insights and consumer trends impacting the Food & Beverage industry in 2022 and beyond.  

When launching a new product to market, it’s imperative to be prepared with relevant information. You need a deep understanding of your market, how your products will benefit that market, the potential challenges you might run into, and much more.

This is why it’s so important to write an in-depth, professional, and relevant market research report. Not only to gather and display all the right information but also so that you can share that information clearly and easily with people within and outside your organization. This is important for a wide range of different reasons.

In this article, we’ll look at why market research reports for product launches are so important and show you how to do it as effectively as possible.

Why market research reports are important

Conducting a detailed and relevant market research report before you launch your new product is a good idea for all kinds of reasons. Here are some of the main ones:

  • Get buy-in from senior decision-makers. When launching any product, you’ll always want the full support of the top decision-makers at your organization. This can be a tricky thing to acquire, especially if your team is relatively unproven. A detailed and informative market research report can be the deciding factor in winning their support, convincing them that your product is well-placed to succeed, and making it much easier to achieve your goals.
  • Learn more about your customers and target audience. One of the main reasons to conduct market research is to understand your prospective customers in more detail. The work you do to compile a report will give you a clear and detailed understanding of what your customers want, what they already like, where they conduct their own research, and much more. This will arm you with the insights and knowledge you need to launch your product confidently and successfully.

Discover ideas for new products and how to improve existing ones. When you research your target market, you’ll likely stumble upon inspiration for new products in addition to the one you’re planning to launch. The feedback you get from your research will also be laced with ideas for improving and tweaking existing products

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How to write a market research report effectively

In the rest of this guide, we’ll show you what you need to do to ensure your market research report is as detailed, relevant, and valuable as it possibly can be. Let’s start with the type of information you need to include.

What you need to include:

Buyer personas

This is a crucial part of getting to know your customers and the different groups they fall into. You should start by researching your target market members as much as possible through a range of channels — interviews, social media research, email surveys, and more. Then, divide them into demographics and create a detailed persona to represent each one.

This is an incredibly valuable step because it allows you to break down your market and make broad predictions about each group’s preferences, pain points, habits, and desires. If done right, this helps you target your future marketing much more accurately and effectively.

Understand your competitors

Getting to know your competitors is a key element of market research. It allows you to understand what you will be up against when launching your product and what segments of your market might be easier or more difficult to sway from their loyalty to your competitors.

Your research report should contain detailed information about each of your competitors and what they offer. What do their products lack that yours can provide? Why do your customers go to them? How dominant are they in your market? What kind of loyalty do they command? What are some of the keys to their success? All this will help you understand what you’re up against and strengthen your chances of success.

Who did you talk to?

Much of your market research will involve talking to various people and groups of people in situations like focus groups, interviews, and surveys. It’s important to document this side of your research carefully and include it in your market research report. Be sure to break down the people you spoke to into demographics and be as specific as possible — try to align this with your buyer personas.

This will help you understand what different demographics want, identify any areas you may have missed, and see any opportunities for segmentation or expansion, as well as providing clear visibility into your research process and allowing you to justify your findings and decisions to other company members carefully.

Clearly show what will happen next — how will you use your findings? 

When you present your market research report to decision-makers in your organization, their primary concern will be what you want to do with it. Research is only valuable if it has a practical application, which should be a key element of your report.

It’s best to be specific — create plans and roadmaps for campaigns, build strategies, and include timelines and carefully researched cost estimates. If you can present a clear and viable plan for your product launch, it will be much easier to gain the support and buy-in of the higher-ups in your company. Be ready to defend and justify these plans.

Primary vs Secondary Market Research

There are two main types of research you’ll need to do when preparing your market research report: primary and secondary. Here is the difference:

  • Primary research. This refers to the first-hand information you have gathered during your research — straight from the primary source. Examples include interviews with individuals, focus groups, surveys, and information from sales teams. It helps add a human touch to your research, incorporating real people’s distinct voices and opinions.
  • Secondary research. This is data that your company didn’t personally collect but is available in the form of things like public records, trend reports, and market statistics. While it lacks the specific human element of primary research, it’s a great way to gain valuable overall insights about your target market without having to conduct huge research projects yourself.

Convincing company decision-makers with your market research report

One of the most essential functions of a market research report is to convince your company’s key stakeholders that you are prepared for a product launch and have everything in place to begin the process successfully.

When creating your report, you should always have this goal in mind. Here are some ways to do that:

  • Always clearly tie your research for business outcomes. For every conclusion your report reaches, explain what this means for the business and what concrete actions you will take as a result.
  • Use as many stats and as much hard data as possible. Clearly express this data in the form of graphs and other visual aids. Show where your data came from, how you collected it, and how your findings will impact your product launch.
  • Consider using Porter’s 5 Forces Model. This business model is aimed at understanding and explaining the fundamental market forces at work in any given industry. It can be illuminating to tie your research into this model.

A well-researched and detailed market research report is an essential part of a successful product launch strategy. It allows you to clearly understand your market, formulate concrete plans and strategies, and gain the support of your organization’s decision-makers.

Without one, you’ll be plunged into the dark, facing the monumentally challenging task of launching a product without the support of extensive research and data.
To find out more about how Kadence can help you prepare a market research report and launch your product with confidence, contact us.

Food packaging is a vital and growing industry. The global food packaging market size was $304.98 billion in 2019 and is projected to reach $463.65 billion by 2027 — this is an area that no Consumer Packaged Goods business can afford to overlook.

There are many reasons why your choice of packaging is so important. Increasingly demanding customers, regulatory concerns, and the need to stand out in crowded and competitive marketplaces are just some examples.

This article will look at why it’s so important to get food packaging right, explore some of the challenges facing companies, and show you how to package your food as effectively as possible.

Why it’s so important to get food packaging right

The growing consumption of packaged food

People are eating more packaged food — the U.S. packaged food market is predicted to grow at a CAGR of 4.1% from 2021 to 2028. There are many reasons for this continued growth — e-commerce, the rise of packaged vegan alternatives, and increasingly hectic lifestyles that keep millions of consumers on the go and forced to rely on store-bought, convenient food.

All this means that packaging is increasingly important. Packaging manufacturers need to keep abreast with trends and ensure their packaging does enough to stand out.

Increasing environmental concerns and pressures

Consumers are more concerned about the environment, and their impact on it, than ever before. This has led people to be more mindful about their packaged food and to gravitate towards packaging that is more eco-friendly, recyclable, and which can prove this to them.

Companies that fail to take this into account, and persist with packaging which is obviously bad for the environment, will struggle to hold onto their more eco-aware customers as their competitors embrace greener packaging.

New technologies like Augmented Reality

Emerging technologies like augmented reality bring a whole host of compelling use cases for food packaging. Companies who can weave this technology into their packaging stand to get a major head start over their competition, wowing their customers with never-before-seen tricks and features and standing out in an entirely new way.

Protection

In the wake of the COVID-19 pandemic, people are more concerned than ever about hygiene and food safety. The right packaging is necessary to guarantee fresh, high-quality food for customers. Companies that fail to do this stand to face big reputational hits and high-profile incidents. In addition, the right packaging also helps to extend the shelf life of products, widening the window of time in which they can be bought.

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Marketing challenges and things to keep in mind

Meeting these challenges around food packaging can be tough. Companies today are faced with a wide range of challenges and things to consider when packaging their food. Here are some examples.

Standing out

As the food packaging market continues to grow, you’ll need to focus harder on grabbing your customers’ attention and competing with other brands and their packaging on the supermarket shelves. It’s no longer enough to go with basic, unimaginative packaging — even recognised and established brands now have to work hard to seize and maintain the spotlight.

Including all relevant information

Today’s consumers want to be informed. They are more environmentally conscious, health-conscious, and demanding than ever before. This means they are hungry for detailed information about where your product comes from, how it was made, exactly what it contains, and more.

Costs

As packaging becomes more advanced, sustainable, and detailed, it also often becomes more expensive. As you evolve your food packaging, you also need to consider the impact on your bottom line. Figuring out how to create the best packaging possible without taking an unacceptable financial hit can be a major challenge.

Preserving food

Ensuring your packaging keeps food as fresh as possible to prolong its shelf life has always been a big challenge for manufacturers. Developments in packaging technology have made this easier and more effective than ever before, but you have to balance this with using sustainable materials, saving costs, and promoting your brand.

How to do market research for food packaging effectively

The only way to ensure you succeed with food packaging is to conduct extensive market research in all the right areas. This helps you establish what your customers want, how feasible it would be to deliver, what your competitors are doing, and much more. Here are some guidelines for conducting effective market research for food packaging.

Get familiar with emerging technology

New technologies can provide impressive benefits for packaging. For example, Kadence partnered with Asahi to test augmented technology in packaging market research. We showed a group of customers an augmented reality model of Asahi’s packaging design, allowing them to get a real, lifelike feel for the beer from their own homes. As a result, they were able to provide more detailed and useful feedback compared to customers who only saw a 2D image.

Be rigorous with costs

Packaging costs can quickly mount up and seriously eat into your budget. It’s essential to be clear on how much your packaging will cost and ensure this is affordable. Advanced packaging can be expensive, and sometimes the extra cost isn’t worth the additional benefits.

Get to know your customers and what they want

As with all market research, the most critical step is understanding your customers and getting familiar with their pain points and what they want. Talk to them extensively through surveys, focus groups, online interactions, and use secondary research on existing market trends.

For example, if you find that your customers are particularly concerned about the environment, it’s a sign to focus more on eco-friendly packaging and to promote this in your marketing. If your customers are concerned with nutrition, be sure to highlight the health benefits of your product in your packaging.

Identify opportunities for upselling

Market research can be an excellent way to discover opportunities for upselling existing products and even find ideas for entirely new products. Your packaging, if done right, can be used to promote other products in your range and be a marketing channel in its own right.

However, the only way to achieve this is to conduct proper research, ensuring you understand all possible opportunities and identify demand in the right areas.

Today’s customers have high demands for brands. People want eco-friendly packaging, detailed information about nutrition and health, and the latest in smart packaging.

Some of your market research should focus on identifying these trends and learning more about what your specific customer base is passionate about and considers essential. This way, you’ll be able to create packaging that satisfies their demands and signals that you’re the kind of company they want to support.

Develop a strong brand voice and personality

Your packaging is the first thing your customers see about your brand. It should boldly state who you are and what sets you apart from everyone else, and clearly embody your brand’s personality.

Developing a voice for your brand takes time, but market research is a central component of that process. Your research will shed light on who your customers are, what niche you occupy, and what makes your brand and products unique. This way, you’ll be able to establish a strong and distinctive brand voice and let it shine through in your packaging.

Market research is a long and incredibly important process for all kinds of reasons, and food packaging is just one area of this. 
At Kadence, we help consumer goods companies with market research and packaging solutions, enabling them to succeed and use their resources as effectively as possible. To find out more about how we can help you do the same, contact us.

Understanding your customers is key to business success. Learn how to make your products or services meet customer pain points along the customer journey.

Customers make or break businesses. Companies that meet buyers’ needs are more profitable, while those that don’t will lose buyers and may fail.

Even so, some businesses pay little to no attention to customers’ expectations. Instead, they chase trends or ideas from their top brass, assuming that they know what interests buyers. Companies that check on customer needs often don’t do so frequently enough to keep up with the rapidly changing world.

This guide is about understanding customer needs—what they are, why they matter, how to identify them, and how to use them to win more customers.

What are Customer Needs?

Simply put, customer needs are the physical or psychological factors that motivate a person to purchase a particular product or service. These can be as varied as the hundreds or millions of customers in your marketplace.

Physical motivators are anything that has a measurable or tangible cause. If a person is hungry, they’ll buy food. If they’re cold, they’ll buy a coat. If their car breaks down, they’ll have it repaired.

Psychological needs are emotional reasons for purchase, and they’re almost always more important than physical needs. Any food, coat, or repair shop would solve the problems above, so how does someone pick where to make their purchase?

Opinions, desires, and preferences shape most purchasing decisions. That’s why things like convenience, pricing, reliability, reputation, service, and values often lead customers to choose one company over the competition.

“Customer needs” are often called “pain points.” While not all marketing professionals agree that these terms are interchangeable, they are indeed similar. Customer pain points are specific problems that people need help solving. Pain points can happen all along the customer journey and can include any physical or psychological issues that stand in the way of their happiness, growth, or success.

No matter what term you use, understanding what motivates buyers in your marketplace is key to winning new business and keeping loyal customers.

Importance of Understanding Customer Needs

customer profiles

As the saying goes, the customer is king because they’re a company’s most valuable asset. Without a solid customer base, a business will eventually die.

Unfortunately, many sales and marketing leaders take for granted that they know what their customers need. These assumptions can be costly, resulting in lost business and lower customer retention rates.

Other organizations view customer feedback as criticism, which may have a negative connotation. Leaning into their critiques, however, allows you to flip problems into opportunities.

When a business takes the time to identify, anticipate, and meet customer needs regularly, it can expect to:

● Improve products/services: Understanding the motivations behind your prospective customers’ purchasing decisions will help you refine your offers. You can identify gaps in your offer stack or enhance existing offers with only limited development costs.

● Generate more sales: The better you know your customer base, the easier it will be to identify relevant marketing channels and cost-effectively promote targeted offers, increasing the likelihood of high-conversion sales.

● Deliver expected results: When you know what your customers need, you can plan appropriately to meet their expectations.

● Improve customer service: Customer service channels constantly evolve, so it’s imperative to keep up with customer preferences. Being available to customers where and when they prefer makes them feel valued and can give your company a distinct competitive edge.

● Boost customer retention: Anticipating, meeting, and even exceeding customers’ needs establishes trust and makes them feel valued and engaged in your business. This, in turn, creates loyal and repeat customers.

● Survive long term: Agile adaptation is key to long-term success in a fast-paced world where the customer needs frequently change. When your offers suit current needs, you’ll develop a reputation that attracts and retains more customers than the competition.

Managing Rapid Change

Another significant benefit of customer needs analysis is ensuring that your company keeps pace in a rapidly changing world.

One of the biggest challenges any company faces is remaining relevant to its target market in the modern world. Customer mindsets and behaviours change so quickly because they have more choice and opportunity than ever.

When consumers can easily switch to a new company with better products or services, it’s imperative to anticipate, predict, and plan for the future. Falling a step behind is a quick path to losing market share.

For example, the recent shift to mass homeworking and the international uptick in tech solutions to support the change has created entirely new pain points for millions of people.

In a short amount of time, the pandemic taught nearly everyone how to communicate online. Zoom has made tech-deficient industries like food service more accessible and shifted many consumers’ preferences from in-person or in-home to virtual options (even in once digital-resistant markets like Asia).

These types of changes have far-reaching tentacles that can affect consumer needs across a wide range of industries.

Avoid the temptation to use customer research as a tool for reflection. Instead, bring a wide-angle lens to work and examine what’s happening in your industry now and in the months and years ahead.

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How to Identify Customer Needs

Understanding your customers shouldn’t be a guessing game based on experience or hunches. To get inside your customer’s mindset, you need to learn who they are and exactly why they need your product or service. The best way to do this is by asking them directly.

A customer needs analysis helps determine a company’s position in its market or how it compares to the competition in meeting customer needs.The insights can be used to change offers, marketing, and customer service to deliver the best possible value.

The first step in this process is to conduct customer research to understand customer behaviour. You’ll use this information to create personas that provide a detailed description of your target audience.

There are several tried-and-true methods for gathering helpful customer feedback. While any one of them can be beneficial, you’ll get the most robust picture of customer needs by using more than one.

Conducting Customer Needs Research

The easiest way to identify your customers’ needs is to ask them. The goal of market research is to learn about your best customers’ backgrounds, what drives their purchasing decisions, their expectations for your product or service, and what challenges may prevent their satisfaction.

The most common tools for this type of research include:

1. Customer interviews

The most direct way to collect data is by having one-on-one conversations with existing customers. Interviews typically elicit the most detailed answers, but customers may be less forthcoming without the promise of anonymity.

2. Focus groups

Pulling together a small group of handpicked customers is a quick way to get more feedback. Hiring a market research firm allows participants to speak candidly. On the downside, individuals can sometimes become influenced by the opinions of others in the group.

3. Surveys

The fastest and most cost-effective method for gathering information from a large group of customers is a survey, typically using an online tool. On the downside, response rates tend to drop if the survey is too long or detailed, limiting how much information they provide.

With any of these methods, you’ll first need to craft questions that elicit the type of feedback you’re seeking. After gathering demographic information (age, marital status, location, occupation, etc.), it’s best to devise open-ended questions that allow the customer the freedom to say anything without outside influence.

A few examples of helpful market research questions include:

  • What specific problem were you trying to solve when you chose our product/service?
  • What made you choose us over a competitor?
  • How well does our product/service meet your needs?
  • What do you like most/least about our product/service?
  • What challenges have you encountered with our product/service?
  • What do you wish our product/service could do?
  • How would you rate your experience with us?
  • Would you recommend us to others (why/why not)?

Questions should primarily focus on your brand, competitors, and customers’ buying behaviour and mindset. This may also include asking broader questions about their overall values, interests, and opinions.

While nothing is quite as valuable as a customer’s own words, using social media listening or keyword research can provide valuable insights without speaking directly with a person.

Social media listening is the process of analyzing online conversations and trends related to your brand and to your industry as a whole. It goes beyond monitoring basic metrics like mentions and followers to consider the mood behind the data instead.

People frequently use Facebook, Instagram, and Twitter to candidly discuss products and services. Watching for real-time feedback about what they like and don’t like about your company or your competitors is a great way to identify opportunities for change or growth.

Keyword research looks at the popular keywords and terms related to your product or service that people type into search engines. For example, try typing an industry-related question into Google’s search bar and see what auto-suggestions pop up. This is a good glimpse into what problems your customers are trying to solve.

Also, use a tool like Moz Keyword Explorer or SEMrush to research words related to your offer and find similar keywords. Check the average search volume to determine what language your customers and prospects use to describe their needs.

Creating Customer Personas

target personnas

It’s a good idea to turn data you collect during customer research into a customer or buyer persona. This fictional representation of your ideal customer will ensure that every part of the customer experience is tailored to their needs.

Focus on your best, most loyal customers. What are the patterns and commonalities among them? What demographics do they share? What are their similar experiences, motivations, and opinions?

Distil all the data into one profile that includes the most common demographics and interests. Include answers to what needs, and pain points brought them to your solution, what considerations went into their purchasing decision, what objections they had, the competitors they considered, and what made them purchase from you.

If you serve multiple market segments or different types of customers, you may need more than one persona to address each group.

This fictional profile provides a simple, actionable snapshot of your prospective customers’ mindset and behaviours. It reveals the specific needs that drive them to choose you, a competitor, or no solution at all.

Customer personas typically include a fake name, stock photo, and beautiful design, but it’s unnecessary. Sharing the same information as a “customer needs statement” in a basic text document is also perfectly acceptable.

Either way, share the profile with your team to give everyone a deeper understanding of your customers’ needs. These profiles should guide everything from product development to prioritizing projects and marketing campaigns to customer service solutions.

Understanding Customer Behaviour

Good customer research should uncover the many factors influencing your ideal customers’ purchasing decisions. The best research is robust enough to determine how customer mindset and behaviours change at various points along the customer journey.

The strategic practice of detailing these changes is called journey mapping. The goal is to outline the exact steps that customers take as they move from awareness to research and consideration, purchase and delivery, and finally (hopefully) to loyalty and brand advocacy.

If your research sample is large enough, segment the results based on where participants fall along the journey map. This allows you to analyze how your customer’s mindset and behaviour changes over time.

Look for recurring trends or common roadblocks for each of the different stages. This added context can help you make more specific improvements to the entire customer experience.

How to Deliver on Customer Needs

Once you have all the necessary insights to identify your ideal customer and their needs along the buying journey, it’s time to put the information to good use.

First, review the research for any glaring problems that need a quick solution, especially anything driving customers away. Prioritize these issues and assign the appropriate staff to implement changes.

For example, if multiple customers expressed frustration about long wait times for answers to simple questions, you may decide to add a FAQ section or a live chat option to your website.

Customer research is about more than finding problems. Just as important is using the information to make proactive changes that allow your company to grow. Every part of your company can benefit from the insights of a customer needs analysis.

The key is to look for gaps between your business and customer needs. Finding innovative ways to reduce even minor gaps can make a significant difference in customer acquisition and retention.

Marketing

A customer needs analysis almost always offers insights for optimizing marketing efforts. The better you understand customer mindset and customer behaviour, the more effectively you can tweak your marketing messages.

Use the data to speak specifically to the needs of customers at every point along the journey map. Your research should tell you exactly what will motivate them to make a purchase.

In addition to understanding what content will resonate best with customers, you’ll also know their preferred social media or other marketing channels.

Offer development

Asking questions about what customers wish your product or service did can help you discover areas for improvement or create an entirely new offer.

Examining the data to determine a need before taking action dramatically improves the success rate of new product or service offers.

Also, when you repeatedly and consistently conduct customer needs research, you’ll be more likely to notice a shift in market trends early. This can help you be the first to address a burgeoning need and capture market share before the competition.

Customer service

Identifying the varying needs of customers along the journey map can help you better tailor good service solutions. It’s easier to capture questions, comments, and suggestions when you know the preferred social media channels.

Knowing where roadblocks tend to occur along your customer journey map also allows the customer service team to provide perfectly timed help. This includes upsell and cross-sell offers that solve the exact problem that your customers face.

Customer retention

Studies have shown that acquiring a new customer costs at least 5x more than retaining one. The best use of a customer needs analysis is to devise methods for reducing customer churn and creating repeat, loyal buyers and brand advocates.

Customers’ expectations include special recognition when they’re a “good customer,” according to Accenture. Use your research to ask about ways your customers would like to be acknowledged (handwritten notes, social media shoutouts, discounts, etc.).

You can also ask questions to test whether a referral program might be beneficial in growing your market share.

Ongoing Market Research

Ongoing market research

After making changes based on customer research, communicate them to your customer base. Share the story of how you identified customer pain points and the efforts you took to resolve them. It demonstrates that you care about customer experience, which builds trust and increases engagement with your brand.

It’s also essential to ask for customer feedback on how well those efforts meet their needs. This is an excellent opportunity to send another survey and collect more data.

Your research shouldn’t end there, however. It should never end. Build feedback loops into your business operation so that you are constantly revalidating your unique selling proposition (USP) and always striving to understand your customers’ needs.

Keep a pulse on how your customers feel with interviews, surveys, and social media polls. Also, frequently review metrics like conversion rate, acquisition cost, and customer lifetime value to track how well you’re meeting customer needs.

Some businesses may assign a dedicated team to collect customer insights, while others may prefer to add it to the responsibilities of existing departments. Either way, develop a system for discovering, analyzing, and delivering on customer needs.

By creating a repeatable process, you’ll shine a bright light on customer experience and stay one step ahead of the competition on addressing customer needs.

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How is your product received by consumers or business decision-makers? What are the pros and cons of a change in an existing product feature or new varieties of your current big-sellers? Why is a product failing to perform? You want to tweak a formulation, messaging or packaging to cut costs or reach new audiences – but will that scupper or supercharge your sales? The answers to all these questions can be found in product testing research.

What is product testing?

With product testing, we’re not looking to establish general consumer attitudes or behaviours. Nor is this about standing up a new concept or looking for gaps in the market. The primary job of product testing is to tell us how people respond to an actual product – including how they use it and what they think its qualities are – allowing brands to decide whether and how to market it.

When should I do product testing research?

Let’s look at the natural marketing life-cycle to explain how product testing research can support the emergence, and successful exploitation, of a product – and place it in the context of a wider field of market research:

  • Ideation – dreaming up an idea worth pursuing. Research helps identify unmet consumer needs, value-chain opportunities, potential applications of innovation and new markets.
  • Screening – a rigorous approach to deciding which ideas are worth pursuing, again drawing on research and feasibility work, and assessing potential audiences.
  • Concept testing – seeing how the manifestation of ideas might work in the market, leading to additional screening out of less viable concepts.
  • Prototyping – designing products to prove mass production feasibility, form factors and feature sets.
  • Early product testing – evaluating consumer attitudes to the product itself, either in controlled settings, in the field or in everyday contexts; typically unbranded or with highly simplified packaging.
  • Late product testing – which might include feedback from earlier tests to refine messaging, packaging and final form factor.
  • Testing iterations of a product to forecast the impact (on sales and usage) of changes to features, formulations, targeting and marketing – often in response to changes in sales patterns or negative customer feedback.

In other words, product testing is distinct from concept testing. It’s all about refining the delivery of something that is (or soon will be) a finished product. This might include changes to feature sets, the marketing pitch, pricing, ideal target audience and other details. It’s not so much whether the product works – it’s how the product will work best.

Use cases for product testing research

In summary, then, you can apply product testing to:

  • Find out how a close-to-final version of a new product might perform.
  • Tweak that product to optimise its performance on launch.
  • See how a new product is performing post-launch.
  • Test the effect of changes to product design or presentation.
  • Evaluate or explore how a product is marketed.
  • See how well consumers in a new market will accept an existing product.
  • Undertake ‘penalty analysis’ to see which qualities, when changed, alter consumer options about a product.

Product testing in action – a case study

One way to think about the value of product testing is as a way to optimise the introduction or evolution of a particular product. A good example is work we’ve done with a beverage brand to launch a new range of iced teas. The client wasn’t launching a brand-new product – they had worked up some new flavours and wanted to know which they could launch successfully, how these might affect brand perception and what consumers made of them.

There were eight formulations to be tested. We added in an established variant to act as a benchmark, giving us a way to test the relative strength of the products. We measured various metrics with consumers to provide comparable scores as a key insights.

The product isn’t necessarily going to change in this case. It’s a chance for the client to check which variants might work best, to optimise the roll-out and then make minor refinements if the research delivers consistent feedback on particular elements. How research subjects describe the teas might also help shape marketing and packaging for instance.

In other cases, clients might test out product names and straplines on consumers while they’re testing the product to create a range of possibilities, not just on the branding and marketing, but also on likely target audiences and even pricing. Does the product live up to a premium positioning? Or will it chime with more down-to-earth messaging?

The role of product testing guidelines

We work with many clients that have well-established product testing guidelines – a set of standards that enable them to better evaluate products over time and give them clearer benchmarks for making decisions. For large corporates in particular, the product testing research project is an exercise in generating fairly standardised numbers – data that fits a well-established, almost algorithmic approach to evaluating potential product performance.

When this isn’t the case – or if the guidelines are relatively basic – it’s a good idea to establish some clear ground rules at the start of a project to ensure it delivers insights that will shape client decisions. You might need to agree:

  • How the product should be stored, prepared, presented and used.
  • The audience it should be tested with, and how to recruit them.
  • Where to conduct tests with participants (see below).
  • What metrics to record.
  • How to record their experiences – and other feedback.
  • The research methodologies that will work best.
  • Whether to use a control product for comparative purposes.

Introducing a framework helps everyone understand what success looks like for a product: for it to go forward, what will the research need to show? Is it being on par with an existing or rival product on overall performance? Does it need to be statistically stronger on key metrics?

In some ways, it’s akin to a science experiment: you outline the aim (proving it’s better than the existing product) based on your prediction (the product design); we provide a sound, rigorous methodology to test that assumption (the research); and the result gives conclusive result to tell you how to proceed.

How does product testing work? Where and how to test

Different objectives of product testing will suit different methodologies. A lot depends on what brands already know about the product and the way it’s perceived; on what they want to learn from the tests (see below); and the type of product under review.

There are broadly three environments to conduct product tests. Let’s look at the use-cases and the pros and cons.

1. Central Location Testing (CLT)

This is where participants are invited to a facility to undertake the test. This is ideal for evaluating products in controlled conditions, especially when testing a variety of use cases. It’s also suited to products that won’t be used as much in the home – especially in food outlets, for instance.

A good example would be a new foamless cappuccino we tested. To get comparable results, the same machine was used in different central testing centres, with the client providing an expert barista to produce the same product every time.

CLT is ideal for evaluating products under controlled conditions – testing different fragrances, say, is hard if the conditions allow for cross-contamination of scents. But it’s also very useful where confidentiality is important. We set up a CLT in a hotel, for example, so that a new tech product could be tested by invited consumers without the design leaking. Non-disclosure agreements might be a feature of any product test, but for this kind of commercially or technologically sensitive research, the controlled setting can be helpful too.

The other advantage of CLT is liability management. Some products – foodstuff and cosmetics, in particular – might cause adverse reactions with test subjects, and it’s easier to screen and monitor them on-site.

You can find out more about central location testing in our guide.

2. Street Intercept Testing (SIT)

This is literally grabbing participants in an ambient setting for a few minutes to get them to try something and test their reactions. This works well for relatively simple research – the questionnaire will need to be relatively quick in a supermarket or street setting – and for targeting particular participants. Testing a new cheese at the deli counter in a supermarket would be one application.

It’s also ideal for capturing insights within specific use locations – when a central facility would be a little abstract. We worked with a sports beverage brand to test a special protein-rich drink. The use-case is post-exercise, so intercepts with the target market in a gym setting yielded much more insights than a central location could have.

3. In-Home Testing (IHT)

For many products, the consumer’s home (or, in some cases, their workplace) will be the usual usage location. Getting the products into the home for a period of use, then running online, telephone or face-to-face follow-up questionnaires is a great way to see how they work ‘as intended’.

In-home testing tends to be ideal for more sustained testing. The taste of a new iced tea or reformulated cheese can be tested fairly immediately. But a toothpaste, cleaning product, in-home device or even lightbulb, will only reveal itself properly over a few days’ use. Out of the control conditions, we can learn more about how good instructions for use are; we can see how consumers might use the product in their daily lives or in combination with other products; and we can monitor evolving opinions about the product as they get used to it.

Obviously in-home testing has been popular during Covid-19 lockdowns – not least because many products are now being consumed or used in the home that might otherwise have been ambient products; but also because centralised or street intercept tests have been harder to run for biosecurity reasons.

Note also that IHT allows for different research methodologies. As well as post-use surveys, we can get consumers to keep diaries of use, highlighting a wider variety of situations and providing more qualitative inputs.

Woman scanning food in her fridge with her phone

How to do product testing

Where to start

For many companies, product testing isn’t the start of their journey with us. This kind of research is often part of a much bigger engagement process around a brand or product line; or it might be commissioned by a brand we already do different kinds of work with. So the starting point is rarely a cold introduction to a product.

But even with some engagement beforehand, the first step in product testing is to look at the product and the client’s requirements, and then design an approach that will answer their key questions.

For some, those questions will be extremely precise. For example, one detergent brand asked us to test out a new toilet cleaning product. They knew exactly what segment they wanted to target – ABC1 consumers in their 30s and 40s who were already familiar with the brand – and even the methodology they wanted (in-home testing).

That’s largely a logistical challenge – getting the product and a control cleaner into their homes, in plain packaging, so they can be tested side-by-side; then running an online survey to generate some quantitative data and some qualitative feedback comparing the product to a known comparator.

Another example might be a commercial-kitchen mayonnaise we tested. The client was keen to assess not just how the product performed against other formulations of mayo, but also what professional chefs thought of it in different applications. Will it be at least on par with the existing product? What recipes or dishes did it suit? And how did it compare commercially?

One thing to bear in mind is that you should be testing for things you might change as a result of the insights we generate. Knowing what can change (from packaging and marketing, to cosmetic attributes or even key design features) as a result of the research findings – and what you definitely can’t alter – will ensure the tests are focused and useful.

Methodology reflections

We find that CLT is generally better for ‘sequential monadic’ testing. ‘Monadic’ means the consumer is evaluating a single product, and this is obviously possible in any environment. Even ‘paired comparison’ testing – head-to-head – can be done in-home. But sequencing the comparisons scientifically (standalone, then in head-to-head, for example) often generates more reliable data.

In terms of participant recruitment, clearly targeting the audience accurately – whether in the field, via lists of consumers, or panels – is key. They are often motivated because they receive free products. But in some cases, especially with the more in-depth or time-consuming studies, the chance to earn money is also a motivator.

Hard and soft questions

Product testing can answer a lot of questions. For seasoned clients, they’re often very precise ones – they’re seeking standardised data on usage and performance that will help them contextualise the product within a portfolio.

A good example of a ‘hard’ question might be pricing. Using techniques such as the Gabor–Granger method (to understand price elasticity) or the Van Westendorp Price Sensitivity Meter (which creates an optimal price point for a given audience), research can reveal a lot about the economics of a product.

Hard questions like that are often central, even when we’re working with smaller companies that are looking to take a product from prototype to production and need to calculate the risk/rewards involved.

Smaller companies, however, are more likely to be asking ‘soft’ questions, too, where quantitative surveys are augmented with qualitative insights. They might be trying to learn more about consumer attitudes to the category as well as the product; or develop a deeper understanding either to tweak the product being researched – or inform future innovations.

A good market research agency can really help with this part of the process. For example, in some companies there might not be rigid product testing guidelines in place. But by explaining what they need to know to market the product, what they might be able to change about it and what they’re not sure about, we can help companies come up with fieldwork that will deliver clear metrics and provide answers to their key questions.

What’s the outcome?

A well-planned, well-run product testing project is rarely just looking for a blunt ‘go/no-go’ answer to a product roll-out or adjustment. Although many big brands have a well-established formula for conducting product tests – designed to plug data into their tried-and-tested algorithms – even these clients will often use the test as an opportunity to learn more about the product in different dimensions.

Sometimes that’s just a by-product of a sufficiently expert and thoughtful product test. As market research professionals, we learn a lot more about products during tests than the raw data suggests. Often it’s the degree of flexibility the market research team brings to the product test that makes it most valuable.

That’s true whether the primary objective is standardised data on product attributes – or semi-quantitative work with a healthy dose of qualitative inputs to shape decisions. By making sure the parameters for the product’s adaptation are clear and the questions about it well framed, we can ensure the right blend of methodology and insights meet the client needs.

A good example of that would be taste tests for a new formulation at a chocolate brand. ‘Super tasters’ working at the client will arrive at some finely calibrated formulation, created to be aligned to brand values and differentiate the product. But it’s ordinary consumers whose verdict will shape its ultimate success.

Looking to embark on product testing research?

With experience in product testing research, we can combine the inputs and recommend robust methodologies to make sure the product hits the sweet spot in the market. Find out more about our product testing capabilities or get in touch to discuss with our team.

In this guide we explain how to do international market research, exploring the key considerations to set you up for success.

Why is conducting international marketing research so important?

Whatever you think of it, globalisation is now a fact of life. For more than half a century, the biggest brands in the world have operated on a truly international scale. But in the past 25 years – the internet era – an ability to service global markets much more easily has made an international footprint even more compelling.

Near-universal penetration of the internet – often via a smartphone, equipped with GPS locators, camera and microphone – has created low-friction access for brands into markets they didn’t even know existed. Global supply chains and logistics make serving overseas markets easier than ever. And although there have been notable blips – in the form of sanctions, national protectionism and policy decisions such as Brexit – the overall trajectory is towards fewer tariff and non-tariff barriers to trade.

All that adds up to international business no longer being the preserve of multi-billion dollar blue-chip names; or even mid-corporate specialists and cool brands. Any company can now expand beyond their local market. International marketing today is a much more open field.

But the Covid-19 pandemic has also reminded us that within that global picture, markets evolve unpredictably. And they have always been subject to rapid change driven by local conditions, culture and consumption patterns.

That’s made multi-market insights even more useful for global brands already operating internationally – and any business planning to grow ‘overseas’ for the first time. Marketing research is important even at ‘home’. But in brand-new target markets with high potential, it’s nothing short of critical.

Finding a balance – with pertinent local insights or the one hand, and global uniformity for brand consistency on the other – can be a huge challenge. Marketing textbooks include plenty of examples of a failure to localise products and services, mistranslations of brand messaging (some of which are urban legends…) and other cultural blunders.

That’s made market research a crucial tool for business looking to foreign markets, both to help generate insights that can be benchmarked across their global consumer base; aggregated to inform global decisions; and ensure international progression isn’t tripped up by nuances that demand locally tailored marketing or even products themselves.

Big world, small questions – How to embark on an international market research project

So what does it take to run an international market research project? One fundamental truth about market research holds true whatever you want to find out: the tighter the brief, the more useful the results.

That’s not to say brands could, or should, never conduct wide-ranging and open-ended research studies to test general attitudes or behaviours on a global scale. But while that kind of ‘scene-setting’ work can be very valuable in one location, country or even cultural context, it can be much harder to come up with firm conclusions when you’re trying to be ‘global’. International market research might start out with the intention of finding global commonalities or appetites, but the data collected will rarely reveal universal insights.

It’s more a question setting out the kinds of insights that might drive operational, product design or branding decisions for different markets. Country specific norms for consumers and logistics will affect the brief. And different nations, cultures and infrastructure will dramatically affect the available research methodologies, too. Again: it’s not impossible to design international research projects that have perfect consistency in methodology – but for many situations, it’s also not necessarily going to deliver the biggest return on investment.

There is significant value in getting inputs from research professionals even before setting the brief. Getting those right at the outset helps the market researchers you work with get a clearer idea of how they might target their investigations and sets expectations about what’s possible – whether you’re looking at a single overseas market, the potential for an entire region or tailoring local research work to evaluate global possibilities for your brand.

International, regional or global? Approaching international market research

That decision – one or two new markets, a region (perhaps opened up thanks to changes in logistics infrastructure) or a global snapshot – probably won’t be defined by the research process itself.

For the biggest brands, global methodologies (which you can learn more about here) such as brand trackers might seem to be universal. But you still need to localise the process to draw broad conclusions. This isn’t simply a question of ensuring that two completely different markets generate results that can be compared at the global level to inform business decisions. National and regional situations are constantly evolving, adding different contexts that research should be able to factor in. Just like running focus groups around a large country, the broad methods might be the same, but the way you ask questions and interpret answers needs finesse.

The biggest global brands – such as Starbuck or McDonald’s – often undertake localisation work on their products and services, too. The Tsukimi Burger is alien to anyone outside Japan, for example. Research conducted to support these market-specific development projects is usually undertaken by local teams. But decision-makers at these companies’ HQs will still expect research supporting those decisions to meet their global standards.

For companies breaking into foreign markets for the first time, similar rules apply. They will have a standard of insight they demand from research; but they will benefit hugely from working with research teams or agencies who understand the local cultures, dialects and the most productive research methodologies.

So right at the inception we need to ask some basic questions:

  • Are we looking to assess products that present uniformly across the globe? (An iPhone is the same everywhere; a chocolate recipe might not be.)
  • How would we tailor products or positioning for a local audience? (Is this just packaging, for example, or tweaks to the features to adapt them to local conditions or cultural norms.)
  • What are the financial implications of these decisions? (Tailoring research to local markets and contextualising the outputs against your global strategic objectives is usually fascinating work. But will it create valuable enough insights to offset the cost of both the research itself and the tailoring?)

Speaking our language

One of the biggest issues for research internationally is translating your project into different languages (we explore that in detail here). That means not just the questionnaires or scripts that you use, but the brief (so local fieldwork teams understand your intent), the responses and insight reports.

In the era of Google translate (and, to a lesser extent, the use of English in many markets) this might not seem so difficult. But the nuances of language can be a major pitfall for brands and for research projects. Remember, even dialects and local idiom can affect both the meaning of a survey response, a focus group transcript or even the focus of a question.

Language and culture across South East Asia is incredibly diverse, so you can’t simply treat it as a homogenous region. Even in India (see our article on breaking the markets there) there are dozens of languages and cultural identities. And in Canada, for example, you need translators who know Quebecois, not just French. Making small mistakes can undermine engagement and trust, and it’s usually a relatively easy thing to get right if you know what to look for.

These language traps are particularly acute for qualitative work assessing softer or more descriptive product features or emotional product branding –especially if there is a very strong global brand identity that needs to be maintained around any local variation.

Working with local teams to ensure the meaning of questionnaires and responses is captured, not just literal translations, helps ensure marketing decision-makers aren’t trapped. Specialist translation services and research teams on the ground but who are in on the initial project brief are hugely valuable.

Two women having a conversation

Realities on the ground – how cultural nuances can influence your choice of methodology for international market research

There are huge variations in the cultural acceptance of different research methodologies too. In some countries, certain methodologies simply don’t work that well. You might find a survey on WeChat in China works well; but in some markets, you may need to spend more time building rapport with consumers – and allow them a sense of anonymity to build the confidence they need to be open with you. This worked well on a recent project in Saudi Arabia, for example, where we conducted an online community.

Some societies have historically been more open to face-to-face research rather than online approaches (although this is changing as a result of the pandemic), so we often recommend a blended approach to get to comparable levels of insight versus other markets where this might be attainable exclusively through online methodologies.

Even between Germany and the UK the research context varies hugely.  A lot of cultural nuance is rooted in history, too. In eastern Germany, for example, the folk memory of the Stasi is still recent history for many older people – which informs attitudes towards research and certain methodologies. So what you ask, how, where and when will differ in Leipzig compared to Paris or Birmingham, say. (And in much of the US, respondents will typically tell you much more than you need to know!)

And even well-understood quantitative methodologies – that you might think don’t require that linguistic nuance – need to be properly calibrated. For example, point scales vary around the world. In China, people are more open to giving 8s, 9s and 10s; in the UK, these are much rarer. If that’s not factored in it can skew important localisation decisions.

Research projects also need to account for infrastructure and social norms. If you’re investigating the relative strength of a drinks brand, for example, knowing how many people have access to refrigeration at home or whether drinking in the street is frowned upon will be important.

Online – not entirely global

Culture, history, consumption patterns, economics, language and infrastructure aren’t the only variations that need to be taken into account for an international research project. Technology has a potentially huge impact on the types of research you can conduct and how well it works.

The rate of adoption of devices and quality of connectivity in each market is a big factor. In some developing countries, you’ll need to tailor a more light-touch experience, with lower bandwidth requirements for online and mobile methodologies; in others, you can use more data-intensive approaches that are demanding on bandwidth and storage.

The smartphone has flattened out some of the methodological variety between markets, it’s true. Take Indonesia, for example. It was always very much a face-to-face market. But that is changing, as the need to inform faster decision making grows, with research through online panels– like our KOINS panel – taking off.

But there are still very clear cultural differences that mean it’s not simply a question of getting every market to download the same app, for example. Yet again, local knowledge is key – not just of those cultural or technological norms, but also of regulation. Data protection laws vary widely, for example.

Online survey methodologies can also lay traps on language. A couple of years ago, lots of brands were interested in the idea from Scandinavia of ‘hygge’ – a king of super-relaxed personal indulgence. There is also a word in Dutch to imply a notion of ‘coziness’, but it’s a different concept. If that crops up in responses, is it the same thing or not? Automated keyword searching and the surging use of AI analytics might not give you the whole picture.

In short: think global, research local

The smartest headquarters’ marketing teams already understand what needs to be tailored locally and what of their global branding they can apply in existing or new export markets. Knowing you can apply product branding across different markets can mean finding huge economies of scale in creative execution and being able to hook local variation into a wider brand image.

They will also trust either local marketing teams, or research specialists with local knowledge, to adapt both marketing and product sets to the conditions in their target markets. They need to know for each market what’s driving the local nuance and how to marry those with the logistical, economic and branding issues around that market.

And they know that whether it’s the attempt to tests global opinions, the openness of local consumers to existing products and branding or to uncover creative and value-creating local adjustments to products and messaging, there is no substitute for in-the-field expertise of a research partner capable of delivering to brief with the most appropriate methodologies.

The old phrase ‘think global, act local’ might be a tired truism. But when it comes to the way research is conducted to optimise performance in global markets, it’s still the number one rule.

Looking to embark on an international market research project?

Learn more about our international research capabilities, or request a proposal to discuss an international research project with us.

Market research is critical for driving growth. It can inform strategy development, product development and marketing, setting you up for success. But it’s even more important when it comes to growing your business in countries outside of your home market. 

The global market research process looks different from domestic market research and requires a different approach in order to get the best results. In this article, we’ll break down why global market research is so important, the challenges involved, and how to do it as effectively as possible.

What is global market research?

Global market research is an umbrella term for the collection and analysis of information that companies undertake in a country that isn’t their domestic market. This includes designing the study, conducting the fieldwork, analysing the data and reporting the results – and can pertain to anything from customer understanding to product development research. It differs from market research that takes place domestically, with an understanding of cultural differences being crucial to its successful execution. 

Why is global market research important?

Global market research serves a number of important purposes. It helps companies understand their current or potential customers in international markets. These markets — and the people in them — are often radically different from your domestic market in many significant ways.

Failing to understand the often subtle distinctions between different global markets and gain a solid understanding of them before you launch a product can be a critical mistake that costs companies dearly.

Market research is equally important in global markets where you already operate. Here, it helps companies feel out new potential product launches and marketing campaigns, understand how numerous factors in those areas may have changed since they last conducted research, and better understand the feelings of their customers internationally.

Here are some of the main reasons to prioritize global market research:

What works well at home might fall flat abroad. You may have heard of Starbucks. It’s one of the most successful businesses in its home market of the US and is a hit with customers in many other countries across the globe. In many cities around the world, you’ll find a Starbucks almost on every corner.

In Italy, however, its presence is more limited. This is because the Italian coffee culture is profoundly different from what Starbucks offers, and the Italian public simply doesn’t have much of an appetite for the brand. The fact Starbucks has been able to gain a foothold there is an impressive achievement in itself and was only possible by significantly altering its product range — a change driven by extensive market research and collaboration with local businesses. 

It allows you to improve operations and save costs. Market research helps you gain a more thorough and clear understanding of your new markets and the logistical and practical steps involved in operating there.

This allows you to get your operations right the first time, avoiding expensive mistakes and delays and streamlining the process so you can maximize your chances of overall success.

It helps you understand your competition and what you’re getting into. When it comes to new global markets and expanding into different cultures, competition is a huge factor. Market research helps you understand your competition so you can compete effectively and avoid being completely eclipsed by more popular brands.

When Best Buy attempted to move into the Chinese market, it failed miserably, closing all its stores in the country just five years later. Why did this attempt fail so badly? Ultimately, it was due to local competition.

Local, smaller Chinese electronics companies were able to offer similar products at a much lower price by paying staff less and offering fewer benefits. They also had stores in more accessible locations, catering to a more bike-based and less car-based customer population.

Had Best Buy spent more time researching the local market, they may have taken a different approach, or opted not to expand into China at all.
It allows you to identify new opportunities you may not have otherwise considered. By better understanding your market through research, you’ll be able to pinpoint new opportunities to grow, generate ideas for new products and strategies, and innovate in a way that increases your chances of success.

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The challenges of global market research

Doing market research on a global scale can be much more challenging than doing it domestically and there are many more factors and variables to consider. Much of your market research will involve speaking to customers in markets that differ from your home country. This can be difficult for many reasons:

Cultural

Some international markets will be home to a vastly different culture from your domestic market. This can make research difficult. It’s important to respect cultural norms and take these differences into account both when designing your research approach and analysing your results. 

For example, in some cultures, like in China, people might be more inclined to moderate their views in a group setting, making it harder to get to the heart of an issue in a focus group, for instance. Understanding this can help you determine which methodology to choose, along with how to probe, and what to look for when you’re analysing the data.

Linguistic

Carrying out customer surveys, focus groups, in fact, anything involving interviews and questions poses obvious linguistic barriers in foreign markets. This makes global research particularly challenging. You’ll need to be able to connect with respondents and understand their views in the local language. Understanding nuances and ensuring key details aren’t lost in translation is vital, so it pays to work with native speakers to help you navigate these issues. 

Logistical

Finding appropriate facilities to conduct research in a different market can be tough, particularly if you’re working on logistically challenging projects such as central location tests or taste tests, where you also need to factor in transporting products for consumers to test in person. For this, it’s important to plan ahead so you can anticipate problems and delays that might not exist in your home market.

Legal

In many parts of the world, there are laws and regulations in place that you’ll need to consider when designing your research approach. For example, Europe’s GDPR or Singapore’s PDPA.

(More information on the challenges of global market research and how to overcome them can be found in this article).

The right way to do global market research

Learn as much as possible about the regions you’re targeting

Before you start actually speaking to people and conducting market research, it’s essential to gain a thorough understanding of the region you’ll be working in. This helps avoid or mitigate many of the cultural and linguistic challenges mentioned above.

Find out as much as possible about the demographics, laws, culture, language etc of your chosen region. Publicly available resources can help with this. You may be able to access government statistics or reports that can give an illuminating view of the business landscape for companies in your industry in your chosen market and what other firms are doing. This can provide you with a solid base for your research before you even start talking to your target audience.

Design an effective research approach, rooted in your understanding of the market

You need to design a research approach that works in the context of the market. Every region of the world is different, sometimes in quite startling ways, from your domestic market. It’s important to make sure your research is designed in a way that reflects that.

This is important when you’re considering what methodology to use. For instance, you’ll need to ensure that if you’re conducting online research in China, the platform will need to be mobile-first due to the technological leapfrog the country has  experienced. 

(For more information about conducting online research in Asia, read our best practice guide)

It’s also important when thinking about sampling. For example, when conducting research in Vietnam, it’s essential to understand the striking cultural differences between North and South. People in the North tend to favour well-known brands, whereas those in the South are typically more open to new experiences,Make sure you think carefully about who you want to research at the outset, and if you are exploring an entire country, beware that these nuances do exist. 

One of the best ways to really immerse yourself is by working with an agency that has boots on the ground, and offices in the location you want to explore. This allows you to build a research strategy that is adapted to your new market, helping you to obtain valuable insights.

Collect the data and analyse the results, bringing cultural understanding to bear 

Once you’ve designed your approach, you’re ready to embark on the research itself. 

There are multiple methods you can use here, such as:

  • In-person interviews
  • Online surveys
  • Focus groups
  • Online or mobile research 

Each method has its own pros and cons, and the best research strategies will contain a blend of several approaches. Again, cultural understanding is really important here. 

This can impact the way you approach every element of your research. For example, when writing a questionnaire in Japan, it’s important to acknowledge the cultural aversion to giving negative feedback. Here, if you used a typical 5-point Likert scale, responses might tend to end up right in the middle, giving an unhelpful result. Instead, try a 4-point scale to give a clear indication of attitudes or intent. 

The next step is analysis, where again, a deep understanding of the market is critical to be able to properly interpret the results and to compare between countries. In Vietnam, for instance, it’s common for Vietnamese respondents to show high interest levels when asked about their likelihood to purchase a product. But these responses are not always realistic — many Vietnamese people will enthusiastically signal their desire to buy a product even when they don’t have the economic means to realistically do so. It’s important to cross-reference these results with other market data for a more reliable result. 

Remember to account for translation or working with native speakers at this point to ensure success too.

Looking to embark on a global market research project?

Global market research is an essential process for any company looking to expand into different international markets or grow their presence in existing ones. It allows you to optimize your chances of success when trying new things in markets that may be profoundly different from your domestic market in numerous ways. It also helps you understand those markets much more keenly so you can better serve your customers there.

There are lots of variables that can make the research process for global market research projects much more challenging. It’s important to take the time to understand your new market before you begin the research process.

However, if done right, global market research can be a critical factor in mounting a successful market entry attempt, marketing campaign, or product launch allowing you to expand your brand across the world and reach entirely new levels of growth.
At Kadence, we help businesses all over the world expand into new global markets by carrying out in-depth and localised research. Contact us to find out more about how we can help you do the same.

Market segmentation — the process of breaking your market into segments according to factors like needs, past behavior and more — is essential if you want to gain a clear understanding of your customers and target them effectively.

Companies that use market segmentation successfully can access a whole range of benefits. Segmented marketing tends to perform significantly better, and many of the world’s most successful brands have rigorously segmented their markets for decades. 

However, market segmentation is also wrought with challenges. Depending on the scale, it can be a major operation that requires a large number of resources and work. In this article, we’ll look at 5 of the main challenges facing companies as they conduct market segmentation, and how to mitigate them.

Why market segmentation is so important

Market segmentation allows you to divide your market into smaller groups, which comes with a whole range of powerful benefits. Here are some of the main advantages:

It gives you greater focus. By segmenting your market, you can target the right groups with the right products. The alternative is taking a one-size-fits-all approach, targeting a vast range of different people with the same product and marketing message, which is far less likely to convert any given person.

With segmentation you can use a different strategy for each group, tailoring your approach so your customers get more choice and a higher chance of getting exactly what they want — or at least much closer to what they want as you can offer.

It can give your brand a stronger identity. Brands and products that try to appeal to everyone often satisfy nobody. Look at highly successful brands like Coca-Cola and McDonald’s — they know who they are appealing to, the needs they want to meet and they don’t try to pretend otherwise. Nobody is drinking a coke or eating a Big Mac to be healthy or lose weight, they do it for the taste and convenience.

These brands are able to forge a strong and memorable brand identity by focusing on specific segments of the market and specific needs: in this case, people who want a refreshing and tasty beverage on the go and people who want fast, convenient food. They’re not trying to appeal to healthy gym-goers or people looking for an expensive sit-down meal, so they’re able to focus their marketing and product range exclusively on their true target market. This allows them to build a clear and unmistakable brand.

It reveals opportunities for innovation. Segmenting your market can illuminate new areas for innovation that you may have missed otherwise. You’ll notice ideas for new products, tweaks you can make to existing lines, and new campaigns to create.

When you divide your market into smaller segments, you’ll notice that some groups have a demand for specific things. If you treat your entire market as one block, these distinctions can easily get lost in the noise.

More accurate and targeted marketing. When you segment your market, you can speak to your customers in each respective group more directly. This allows you to create marketing campaigns and use channels that are much more tailored to your audience.

For example, some customers might respond extremely well to TikTok content, whereas others may be completely missed by that. Segmenting your market helps you avoid wasting money by targeting the wrong people, so you can optimize your marketing budget and maximize results.


It can drive international expansion for your brand. Entering a new market is fraught with challenges. But segmentation can help you hone in when it comes to launching your brand in a new market to give you a better chance of success. Segmentation allows you to target consumers with precision. You can then tailor your approach to the specific customer groups in that country, rather than simply using the same strategies you used in a different place.

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The challenges of market segmentation

Market segmentation, while incredibly useful, can be challenging to conduct and implement.  Here are some of the main challenges you’ll likely encounter when segmenting your market, with our top tips on how to overcome them:

1. Cost

Segmentation is an investment. Splitting your market into groups means you’ll have to do some things, for instance, marketing campaigns, multiple times in different ways. This can work out to be more expensive than simply running one campaign aimed at a single market.

There isn’t really any way to avoid this challenge. The cost of market segmentation is always going to be an investment, but if done right, the extra revenue you will generate from targeting the segments that represent the best opportunities for your brand will more than pay for the initial investment.  

2. Understanding that people can belong to multiple segments 

It’s easy to fall into the trap of thinking that each potential customer belongs solely in one  specific segment. However, this is an oversimplification. Imagine you’re selling a brand of wine. One of your segments might be wine connoisseurs who enjoy drinking at bars with friends.  Another segment might be those who drink to unwind at home.

One person could fall into both of these segments, depending on factors like the time of the week and their current social schedule. People are individuals, after all, and their habits and desires can change based on environment and mindset. 

Bear this in mind when you’re approaching a segmentation, particularly in FMCG, and consider segmenting based on occasions, asking people about different scenarios to ensure their diverse needs are represented. 

3. Keeping segments precise

Segmentation only works when segments are clearly defined and are distinct from one another. If your segments are too broad and vague, you’ll lose out on many of the benefits of market segmentation because you’re not able to tailor your approach precisely enough. 

To ensure your segments are narrow and clear enough, it helps to create detailed personas for each one. A persona is a fictional profile that encapsulates the core qualities of each segment, including their needs, behaviours and motivations, based on the initial research. The purpose of personas are to bring to life the segments and demonstrate how they differ from one another.

For example, if you’re selling a brand of bottled water, one of your personas might be “Healthy Harry” who buys water to drink during workouts or while doing sports events. His persona profile would contain a range of information from what motivates him and to what he’s looking for in a product. The more detail, the better — this helps you create precise and tailored segments.

 4. Selecting the right segments to focus on

It can be easy to overlook some potentially promising groups when segmenting your market.

For example, you might end up disproportionately targeting one segment that makes up a big section of the market, when another might be a more natural fit for your product.

Remember, the benefit of segmentation is that it can enable you to be incredibly precise and personalised in your approach. This means that even when targeting segments that make up smaller proportions of the market, you will still see significant returns. 

It’s important to take your time in this phase of the segmentation to ensure you identify the right market segments or you’ll risk missing out on some lucrative avenues for growth.

5. Embedding the segmentation in your organisation

When people try to anticipate the difficulties involved in running a segmentation, the research approach is often the first thing to come to mind. But the real challenge for many organisations is in embedding the segmentation. This is of crucial importance if the segmentation is to drive change and growth for the business.

A segmentation is only as powerful as its internal champions. Fail to get stakeholders on board in the beginning and you’ll have a tough job ahead of you getting people to harness the segmentation to inform strategic decisions and realise the resulting benefits. 

We recommend taking an active approach to stakeholder management, making this a crucial element of the study’s design. Start with stakeholder interviews to secure buy-in to the project, then keep these people involved throughout. Towards the end of the project, visual outputs can help bring segments to life and keep them front of mind when stakeholders are making decisions. Workshops can also be a useful tool for taking the segmentation and using this to inform your strategy. 

Market segmentation is a powerful tool for businesses. It allows you to improve your product range, tailor your marketing, and increase your chances of connecting with customers and growing your brand.

Although the process can be challenging, it’s well worth taking the time to anticipate the potential barriers and work around them. At Kadence, we help companies of all kinds with market segmentation, mitigating the challenges while boosting their chances of success. Contact us to find out more about how we can help you do the same.