While economic indicators show an improving economy, most businesses are still reeling from the recession. We continue to see layoffs, plant closings and store closings, to name a few. For those of us in public relations, marketing and advertising, we know too well about drastic budget cuts. In addition, market research is taking a hit.
But of all things to cut, market research is a critical component of any communications campaign that can save communicators from serious mistakes. Market research provides the insight that is the pulse of your consumers. It tests your campaign messages and your creative concepts to see if it will move consumers or audiences.
In short, market research takes the guess work out of your campaigns so you are surer that your messages and concepts will hit the mark. Skip this process in your campaign planning and you court disaster, risking damage to your campaign, company or organization.
Here’s one story to serve as an example. In 2006 we (The Hannon Group) were secured by xG Technology to market test a prototype of new VOIP technology that was going to offer consumers very low cost telephone service to beat any other product on the market. The company decided to market test it for attractiveness and preferred price points.
It’s a good thing.
We designed and executed a multiple focus group study in multiple cities with a variety of participants from college-age adults to retired seniors. It turned out that the prototype was deeply disliked — across the board. The company decided not to rollout the tested prototype and, instead, marketed the TX-60, a “sexier” phone that participants said they much preferred.
The research saved xG Technology hundreds of thousands of dollars in production and promotion costs for a product that would have surely tanked in the market…just around the time that the economy started to tank. Can you imagine the impact that would have had on the company? Instead, with the introduction of a more attractive consumer product in 2007, the company managed to make a profit in 2008, while other companies were going belly-up.
I like to think market research helped to save xG Technology from financial disappointment. Maybe that comment is an over-reach, but there is more than an element of truth to the statement too.