Importance Of Market Research For Marketing Strategy and COVID
Hindsight, they say, is 20/20.
Capably looking backwards with the clarity to see missed opportunities can be a great learning tool to both avoid the same pitfalls as well as better prepare moving forward.
This year has provided many learning opportunities for business leaders and academics to study into the foreseeable future. While no one knows how much longer the economy and COVID- related impacts will continue, the retrospect on opportunities and lessons learned have already started.
The CMO Survey, whose mission is to collect and disseminate the opinions of top marketers in order to predict the future of the marketplace, track marketing excellence, and improve the value of marketing in firms and in society, recently surveyed almost 300 CMOs in conjunction with Deloitte, Duke University’s Fuqua School of Business, and the American Marketing Association. In the June Survey, they looked at how COVID created a need to rethink how marketing can engage and capture consumers.
Consumer and Shopping Changes During 2020
One topic area that was especially interesting was the fact that marketers had to pivot away from parts of their strategy without a lot of guidance or knowledge of potential outcomes. These pivots responded to the changes in consumer behavior shifts due to limited in-store buying opportunities and the proliferation of online shopping. Additionally, the use of partnerships to extend into new markets and build relationships slowed considerably. Resources were moved away from those initiatives to support digital and online efforts which provided crucial sales and performance numbers during the height of shelter-in-place mandates.
Marketers’ decisions to shift resources and budgets were largely improvised, with little foresight into the outcomes. Due to the speed needed to adjust, the ability to do market testing was not possible. The updates relied less on structured experimentation and more on instincts and experience of tenured staff as indicated by the American Marketing Association, “…with only 31% of marketers reporting that they conducted experiments—varying some marketing actions and observing effects—to understand the impact of their marketing actions during the pandemic.” The takeaway from the CMOs surveyed is their companies were making changes to their strategy without the needed research to understand the outcomes.
Additionally, only 29% reported they invested in additional research over the course of 2020 to understand the consumer changes. While these investments were primarily in the technology sectors, those polled in the energy, consumer services, and technology industries have indicated shifts towards increased market research going forward.
Market Research and Strategy Creation Going Forward
2020 has caused a fast shift of consumer behaviors, leaving businesses needing to understand how behavior changes impact their products and services. These shifts are shuffling the priority order of what consumers value in a brand when making buying decisions. Along with the changes is a contraction of competition in some sectors where consumers are searching for new brands and options.
Even with some CMOs mentioning their intentions to increase market research, the expectation is that planned and existing research will undergo a healthy review. Among the areas market research should be used as companies are planning for the next year are the following:
Trust signals by target audiences – The expectation is that consumers will rely on trusted brands and services. This is an outcome of the heightened awareness of a corporation’s social responsibility, supply chains and how organizations treat employees. Consumers are expected to be more discerning in these areas.
Use and growth of social media – Companies will need to recognize and engage their audiences on social channels to both build trust but also to listen and respond to their targeted segments. Additionally, this is where the greatest access to new customers and options to grow the brand exist with new buyers. Those who responded in the survey spent an additional 12% to 23% of their marketing budget on social media efforts to retain and engage with new consumers.
Ecommerce and online access – Consumers have become more comfortable shopping online, leaving many companies to believe this will not change when COVID-related store restrictions disappear. The requirement is to understand and capitalize on digital marketing to inform and attract buyers who are now looking for online offers and new options to replace unavailable brands.
Know the value you deliver – Companies recognized they were unprepared for the impacts of the pandemic. A reset to pursue insights that provide guidance around newly prioritized areas is needed. This reset should revolve around the goal of understanding what loyal customers value in your product and brand. This will help build a strategy that will capitalize on those strengths and the attributes that are producing the desired outcomes.
Marketing organizations have been challenged unlike any time during the modern era due to the pandemic. Businesses need to consider creative solutions to unknowns, adapt quickly to changes, and consider unproven approaches to ensure they successfully connect with and respond to their audiences. As the CMO Survey indicates, Marketing leaders are glad they weathered the changes but will not be as unprepared for the next disruption.