Developing a new product is an exciting process, but it’s also a risky one. There’s no guarantee that your product will be successful, no matter how great it is. That’s why market research for product development is essential.
Market research involves gathering information about potential customers and understanding their needs and desires. This information can help you to determine whether there is a market for your product and, if so, what features customers are looking for.
There are many different ways to conduct market research for product development purposes, from online surveys to competitive analysis and each approach has its own pros and cons.
In this blog, we’ll outline what data is most useful for product development and the best methods for gathering and analysing it.
What is Market Research for Product Development?
Market research is used for other business purposes too, such as understanding customer buying habits and assessing the effectiveness of marketing campaigns. However, when it comes to product development, the focus is on finding out what potential customers want from a product in order to ensure that you can create something that meets their needs.
What Data is Useful for Product Development?
The first place to start is identifying what data is most useful for product development. You’ll want to understand the existing competition, customer needs, and the overall market size. Broadly, there are four categories of data that are useful for product development:
1. Customer insights
This includes information about customer demographics (such as age, gender and location), psychographics (such as values and personality traits) and behaviour (such as purchase history, preferences and opinions).
2. Competitive analysis
Collecting data on competitors’ products is essential to understanding what works and what doesn’t in the market. Data includes pricing, features, design and how they are perceived by their customers.
3. Market trends
Collecting data on macro-level developments in the market can help you to identify emerging opportunities and threats. This could include the size of the market, growth rate, industry trends, and changing customer buying habits.
4. Product testing
This involves getting feedback on your product concept and prototypes from potential customers before it goes to market.
TOP TIP: Start with Secondary Data
All of the data listed above can be collected through either primary or secondary research.
Primary research is when you go out and gather data yourself, such as through customer surveys or focus groups. With secondary research, you collect data that has already been collected by someone else – think customer reviews, competitor analysis, industry reports, etc.
It can be tempting to dive right in and start collecting primary data, however secondary data is the best place to start for two main reasons.
- It’s cheap. You don’t need to spend money on creating surveys or running focus groups.
- It’s quick. You don’t need to wait for people to respond, you can get the data instantly.
With the insights you gather from secondary data, you may already have enough information to start the product development process, or to rule out specific ideas.
With the help of insights tools, you might be surprised at the level of detail you can gain from secondary data.
From there you can narrow down your primary data collection by focusing on the questions that will provide the most useful insights.
Conducting Market Research for Product Development
Secondary research methods
1. Analyse customer reviews and social media
One of the easiest, and most cost-effective, ways to conduct market research for product development is to look at reviews they have left on product pages, review sites or social media.
You can gain insights into why people buy certain products, what features they like and dislike and which things can be improved.
With a natural language processing (NLP) tools such as those we offer at Symanto, you can process a large volume of reviews and comments for quick, easy and detailed insights.
For example, you can conduct aspect-based sentiment analysis to find out how people feel about specific features.
2. Analyse competitors’ products and pricing
You can also gain valuable insights by analysing the products and pricing of competitors.
By researching competitor websites, social media channels, customer reviews and press releases, you can gain a good understanding of their strategy and what works for them.
You can then use this information to inform your own product development, such as what features to include or how much to charge for the product.
3. Government and Non-government Archive Data
Government and non-government archive data can also be a good source of secondary information for product development.
These sources often contain useful data about market trends, customer behaviour, industry regulations and more.
You could use this type of data to gain insights into changing customer needs or industry regulations that may affect your product design or pricing.
4. News sources and industry reports
News sources and industry reports can also provide valuable insights into market trends, customer needs and competitor strategies.
These sources could be useful for gaining an understanding of how the industry is developing, as well as what customers are looking for in terms of features, design and value.
Primary research methods
5. Conduct interviews and focus groups with potential customers
Interviews and focus groups can be a great way to get deeper insights into customer needs.
By having an open conversation with people, you can directly enquire about the types of products they use, why they buy them and what features they value most.
Interviews and focus groups can be conducted in person or online. Plus, you can use video conferencing tools to virtually bring people together for a more engaging experience.
6. Create surveys
Similarly, surveys can be a good way to get customer feedback.
You can use surveys to ask customers specific questions about their current needs, as well as what features they would like to see in future products.
Surveys are easy to distribute and can be set up quickly using online survey tools. Plus, with an NLP tool, you can quickly process qualitative data to gain detailed insights into customer needs.
7. Run product testing
Once you have enough information, you can create a minimum viable product, or prototype, and have it tested with a limited sample of customers.
You might even want to run A/B testing by creating two different versions of a product and then seeing which one performs better with customers.
This will give you real-time feedback on features and usability, which can be invaluable for optimising a product before launch.
Overall, there are a variety of secondary and primary methods for collecting research for product development. By using both types of research together, you can ensure you have a comprehensive understanding of customer needs and wants, and position yourself to create the best possible product for your audience.
Get Started With Symanto
Kickstart your market research for product development with Symanto. We offer the most advanced Natural Language Processing technology to help you analyse customer reviews and qualitative survey and interview responses more quickly and with greater accuracy than ever.
Our technology also enables you to read between the lines to gain an in-depth understanding of customer needs and drivers, so you can be confident that your next product will be a success.
Our technologies are available in 50+ languages meaning you can easily conduct global market research and gain deeper insights into customer needs across territories.
Get in touch today to find out more about how Symanto can help you with your market research for product development.