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The Importance of Marketing Research in a Recession

Today Scrapbook Update welcomes Susan Katz as guest blogger.

Susan Katz is a Marketing Consultant and Market Research Expert with 20 years of experience helping companies develop strategies and tactics to grow their business. She can help you develop customer profiles for use with internet marketing campaigns, track the success of those campaigns, perform message and design tests and track results. For more information, please visit our website: www.KATZsolutions.com or email her at skatz@katzsolutions.com. Connect with her on LinkedIn: http://www.linkedin.com/in/susantudekkatz

Savvy marketers know that cutting back on marketing research during a recession is risky. There are many benefits to continuing marketing research efforts despite a downturn. Riding out this recession depends on staying relevant in the eye of the consumer. Consumers’ attitudes and needs are changing rapidly. Americans are cutting back on purchases and looking for deals. How do companies compete effectively in this new environment without giving away the farm? Companies need to continue marketing research to manage this uncertainty. How will marketing research benefit your company?

Increase sales. Quantitative and qualitative studies can be conducted to help you better understand consumers’ attitudes and needs and determine how well your products meet those needs. Properly designed research will lead to marketing strategies that will target increased product usage from current consumers as well as non-users.

Maximize profit. There are many things a company can do to maximize profits beyond just cutting costs, such as item optimization, customer profitability analysis, and price elasticity. Weeding out unprofitable products and customers takes time and focus, but the company as a whole will be in a stronger financial position for it. A price elasticity study will help to determine how much a price increase will impact sales and profitability. It can also determine the optimal price point or the price in which a product is most profitable. Developing goals based on profitability rather than sales will encourage the entire company to act in a profitable and more responsible manner.

Minimize Risk. The more you know and understand about your consumers, competition and customers, the better able you are to make informed business decisions with confidence. Tracking surveys are a good way to assess attitudes and behaviors over time, and qualitative research will fill in the details and help you understand what works and doesn’t work with your marketing strategy and communication.

Large companies understand the need for market research and have their own market research departments. There are more ways than ever to reach consumers in today’s digital world. You can utilize social networking sites as a cost effective way to conduct market research. But be careful, those websites may not provide you with the total picture. You will want to supplement the research with online surveys and other methodologies. There are still ways to keep research costs low without sacrificing integrity.

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