A loyal customer base forms a strong foundation on which to grow your startup – so you need to be passionate about delivering value and giving them more of what they want.
That’s where market research comes in.
But if you don’t have the time to do this in-house, you’ll need to outsource it. So where do you start? In this guide, we’ll explore everything you need to know when it comes to outsourcing your market research as an SME.
Why do you need to carry out market research?
When you started building your business, you likely did some form of market research, taking the time to understand the commercial landscape, finding your niche, and getting to know your customers’ needs, goals, and frustrations. These findings would have informed your branding and helped you resonate with your target audience.
But market research isn’t a ‘one and done’ activity. If you want to take your business to the next level, you’ll need to make it an ongoing part of your business operations. If you don’t, you risk launching products and ad campaigns that are at odds with what your target audience actually wants – driving them into the arms of your competitors.
Why outsource your market research?
If your hands are full with the day-to-day business operations, you may not have the time to carry out this market research yourself. Using an agency can be a great way to get access to quality market research data and insights that will inform your business strategy.
How to ensure ROI with market research
There’s a few different aspects to address when ensuring ROI from your outsourced market research. Here’s the big ones.
1. Decide on your research methodology
Your agency will suggest some research methodologies that suit your company’s goals, but you may have your own ideas of how you’d like to do it.
Research methodologies are divided into qualitative and quantitative methods. Quantitative methods collect large volumes of simple data from broad sample sizes (polls, surveys, and panel discussions). While qualitative methods provide more detailed information from smaller sample sizes (focus groups, diary studies, and ethnography). Your agency will help you make an informed decision on which way to go.
They might also suggest the use of any technologies to leverage your research, ranging from social media platforms to biometrics and VR.
2. Provide a bulletproof brief
This is a biggie. You need to provide a detailed brief outlining exactly what you want the agency to achieve on your behalf. By doing this, you’ll ensure their methods are aligned with your company’s goals, and that the information they provide can be of tangible value to your business.
A good brief should cover context, purpose, and objectives.
A good agency will take the time to get to know you before undertaking market research on your behalf. They’ll want to understand your business’s ethos, marketing strategy, and ultimate goals. Your brief should provide an overview that points them in the right direction.
Your agency will ask you plenty of questions before they get started, but providing a summary for context in your brief will make sure everyone’s on the same page from the outset.
Make sure you provide the agency with samples of your marketing materials that reflect your brand tone of voice. Give them details to better understand your market, your competitors, and your niche. Some agencies specialise in one specific market, while others pride themselves on being good all-rounders.
“Getting to know your market better” is a good – but broad – goal. You’ll need to get more granular when describing the intended purpose of this research to your external agency. Nailing a clear purpose for the project will help both you and the agency to establish a clear set of objectives (more on those later).
Start by asking yourself what the overarching purpose of the research project is. If you’re unsure, think of what problem or stumbling block you’ve encountered as a business and how you want this research to help you solve it.
Do you have trouble engaging new prospects? Are your conversion rates lower than you’d expect? Has your new product launch gone with a whimper rather than a bang? Are you worried that your messaging might be aimed at the wrong audience? All these questions can help you pinpoint your purpose and communicate them effectively to your agency.
Once you know the purpose of the research project, you then need to identify your objectives – specific goals that you want the project to achieve within its overarching purpose.
Objectives can be divided into two categories: business objectives and research objectives. Both categories need to include action standards and company benchmarks so that you can accurately quantify the results and influence internal decision-making. So what’s the difference between business objectives and research objectives?
Business objectives: Directly relate to the specific operational goals of your company. This could include expanding your operations into a new territory, improving the click-through rates of your paid ads, optimising conversion rates, or increasing customer loyalty. Try to keep the number of goals to under 5, and make sure they’re realistic, achievable and have a rough time frame for achieving them.
Research objectives: Pertain more to the research itself. It helps if you have a clear idea what you’d like the research to include, and what insights you hope to glean from it. Again, choose no more than 5 specific objectives for the project, and keep them simple, achievable and quantifiable.
Focus on specific actions (such as initiatives and strategic decisions) that you’ll take as a result of the research’s findings. This will help prevent you from being mired in data with no tangible use for it.
3. Define your deliverables
Setting clearly-defined deliverables before the project commences is a good way of ensuring ROI from your market research and getting you and your agency on the same page.
Make sure that all internal stakeholders have clear and specific expectations that can be shared with the agency. Are you looking for raw data that your internal teams can process, analyse and convert into actionable insights using business intelligence software or good old-fashioned brainpower? Or do you want the agency to present your findings to you on-site or over a video call?
What kind of reporting would you like to receive, and how often would you like to receive it? The clearer you make your expectations in terms of deliverables, the easier it is for an agency to ensure that they provide you with a service that brings value to you.
4. Know your constraints
Finally, it’s important to consider any constraints that may affect the project. Both you and your agency will have to work within certain constraints that may affect the quality, volume or presentation of your research data.
But as a positive, the better an agency understands its constraints, the more it can do to mitigate the effect on the quality and quantity of your data. So make sure that you’re forthcoming with these in your agency brief.
The most common constraints are time and budget. But depending on the nature of your research, there may be ethical or legal constraints (such as the Data Protection Act) that will need to be considered. There may also be reliability constraints that will need to be planned for and avoided (such as asking leading questions in a consumer poll).
You should also plan a series of milestones for the project that will enable you to touch base with the agency and address any issues that may influence the research undertaken.
Get advice on your market research outsourcing from the people who’ve been there. Join the Founders Hub community to connect with fellow founders and business peers.