Market Research Methods of Market Research
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After watching the video, view questions that can be answered through market research, some of which are below:
Questions Answered by Market Research
• What countries/markets are currently buying products similar to yours?
• How large are your potential markets?
• Who are your competitors, and how large are they?
• What are the required standards, testing, and certifications?
• Do your products (or their labeling or packaging) need to be modified for one or more markets?
• Is your price point appealing within the market? If not, what can you do to make it more appealing?
• What distribution channels are available?
• What will be your duties, taxes, and other costs or restrictions?
Methods of Market Research
Because of the expense of primary market research, most companies rely on secondary data sources. The below recommendations will help you obtain useful secondary information:
1. Keep abreast of world events that influence the international marketplace.
Watch for announcements of specific projects, or simply visit likely markets. For example, a thawing of political hostilities often leads to the opening of economic channels between countries. A steep depreciation in the value of the dollar can make your product considerably more competitive. The opposite can happen when the dollar appreciates, making some markets less attractive.
2. Analyze trade and economic statistics.
Trade statistics are generally compiled by product category and by country, and provide information concerning shipments of products over specified periods of time. Demographic and general economic statistics, such as population size and makeup, per capita income, and production levels by industry, can be important indicators of the market potential for your company’s products.
3. Obtain advice from experts. There are several ways to obtain this advice:
- Contact experts at the U.S. Department of Commerce and other government agencies.
- Attend seminars, workshops, and international trade shows in your industry.
- Hire an international trade and marketing consultant.
- Talk with successful exporters of similar products, including members of District Export Councils in your local area.
- Contact trade and industry associations.
Primary Market Research
- You may research a market by using either primary or secondary data resources. Conducting primary market research involves collecting data directly from the foreign marketplace through interviews, surveys, and other direct contact with representatives and potential buyers.
- Primary market research has the advantage of being tailored to your company’s needs and provides answers to specific questions. However, the collection of such data on your own is time consuming and expensive and may not be comprehensive. The U.S. Commercial Service can collect primary data for you and help you analyze it. This service costs, on average, several hundred dollars for each market analyzed and does not require you to travel there. The U.S. Commercial Service can also help you find intermediaries with specific market expertise.
Secondary Market Research
- When conducting secondary market research, your company collects data from various sources, such as trade statistics for a country or a product. Working with secondary sources is less expensive and helps your company focus its marketing efforts. Although secondary data sources are critical to market research, they do have limitations. The most recent statistics for some countries may be more than a few years old, or the data may be too broad to be of much value to your company.
- Once you’ve decided that your company is able to export and is committed to it, the next step is to populate your export plan with data and insights gleaned from available sources. Chapter 2 of A Basic Guide to Exporting discusses the value of a written plan and sections of the plan that can be customized to make them a valuable strategic and operational tool for growing the export side of your business.
- This last advantage is especially important. Building an international business takes time. It often takes months, sometimes even several years, before an exporting company begins to see a return on its investment of time and money. By committing to the specifics of a written plan, you can make sure that your company will finish what it begins and that the hopes that prompted your export efforts will be fulfilled.
For more on market research, see Chapter 3 of A Basic Guide to Exporting.