This blog is the third in a series of articles reviewing different types of market research and how best to use them to inform your business strategy; the first explained customer satisfaction surveys and the second customer perception studies. In this article we will be looking at the process of gathering market feedback and the evaluation of this.
The objective of market feedback and evaluation is to inform decision making. This relates to the size of the market, how sectors will grow or shrink and the share you and your competitors hold.
It is important to have an accurate understanding of how the market is growing (or more likely today, shrinking) so that you have a backdrop to help you understand your own sales performance.
Research data should paint a picture. Providing you with a complete understanding of your market place, the key drivers, what the opportunities and challenges are and how things are changing. It should also inform you on how you are placed against your competitors, comparing strengths and weaknesses, including price.
Market evaluation is vital for informing business strategy and should be carried out on an ongoing basis, so that you can measure progress in the implementation of strategy and adjust it to cope with the changing market environment. This is particularly important in the current challenging environment, where declining construction activity has contributed to some companies going out of business and others taking market share. This is affecting both your competitors and your customers and contributes to a constantly changing environment.
What are you trying to figure out?
To make informed decisions you need to fully understand your market. That means understanding:
- Market size and your share of it
- Which sectors are you most successful in and why?
- What are the prospects for these sectors in the short to medium term?
- What other market sectors are there which require similar skills and which of these offer the best growth potential?
Much of the information you will require is in the public domain. Both Construction News and Building regularly publish summaries of market forecasts, although it is worth purchasing the full reports, the principal two are published by the Construction Products Association and Experion. Glenigan and Barbour ABI are also useful sources of information, basing their market projections upon planning approvals. Much of this information is summarised in Competitive Advantage’s free monthly newsletter, you can also view a list of useful information sources in the Resources section of our website.
In addition to the general market data, reports are available for sector activity. However many of our clients who have a specific project of issue consider it worthwhile to commission a bespoke review of the market, supporting the general market information with in depth review and analysis.
Another useful source of information is the Mystery Shopper. Its principal role is to gather information on prices being quoted for your products and your competitors. But it also provides useful information as to which wholesale and merchant groups are promoting which products and what is being said about your products and your competitors.
A Mystery Shopper uses a researcher to contact a series of distributors, merchants or wholesalers with a fictitious enquiry for a particular product while posing as a customer, usually a contractor. A record will be made of what the salespersons recommends, prices quoted and any other information key to the sales process. Analysis then shows which groups are offering which products and the price levels. Sometimes it can identify that although a supply agreement is in place, that product is not being actively promoted, providing the opportunity for further negotiation with the re-seller. The mystery shopper is a relatively inexpensive means of monitoring the market, and if repeated on a regular basis can also highlight trends.
Conclusion: Using the results to inform your strategy
All of this information needs to be gathered together, interpreted and evaluated. Very often it will be incorporated into the business or marketing plan. The main output should be an action plan, covering the short, medium and long term with accountability and timescales.
The benefits of market feedback and evaluation:
- Make sound decisions when developing strategy
- Be confident of making the right decision in terms of product investment and development
- Identify product opportunities for new and existing products
- Anticipate future product demand
- Identify new market sectors you could move into with minimal risk
- Track progress and evaluate your success for your business or a particular product
- Identify marketing messages that can be used
Competitive Advantage has been conducting construction market research since 2000. Our research team have construction industry experience, are familiar with the industry’s language and practices and understand the challenges you and your customers face.
Our commercial experience means that as well as reporting market research findings we are able to interpret these effectively and make sound business recommendations.
We aim to provide high quality information at an economic cost.
Related blog articles:
Our latest reports:
Designing with Sustainable Products
Construction Marketing Expenditure Survey – complete our survey to get a free copy of the report