Recently, a CEO of a mid-sized firm, for whom Advantage Marketing had proposed a much-needed market research project, asked how he should justify the project to his Board of Directors. Here’s what I told him:
Are any of your board members pilots? Ask them if they would fly blind, without the indicators on the plane’s control panel. Market research is just like those indicators. It keeps you aloft as a business, and prevents you from crashing and burning. Right now your company is flying blind – how close are you to crashing and burning without valid market insights? If you’re not crashing and burning, you’re at least wasting fuel (money) by running inefficiently with things that won’t bring value to clients or get you new business.
With market research, the return on investment is almost always positive.What would be the value if this project netted you just one new client? Or, even better, if it enabled you to develop a new product line for a new market? It’s not certain that you’d get either, but you certainly aren’t getting either now.
Other benefits of market research include:
- Maintaining and improving the sales team’s focus.
- Pointing you in the direction of the most lucrative opportunities.
- Keeping your company relevant and future-oriented.
- Improving your decision-making and reducing your risk.
- Keeping you ahead of the competition.
It also avoids negative consequences such as:
- Plunging blindly ahead and investing money where it doesn’t provide value for customers.
- Staying the same as always and losing market share to others who innovate and come up with a better, faster, or cheaper way of doing what you’re doing now.
- Losing money because you’re caught sleeping while the market is changing.