Every new product begins with an idea, but its successful execution depends on thorough market research. This research, driven by consumer demand, provides guidance for implementation.
Studies show that approximately 95% of new products and services fail in their first year, often due to not fully identifying customer needs and demand.
Market research reduces this risk through concept testing, validation, positioning, and by identifying opportunities and alignment with market needs.
If you were to decide to build a house without first surveying the land, you might end up building a house that nobody wants or on land that is unsuitable for construction.
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In some cases, you could even discover that what you thought was land isn’t actually usable as a building site.
Just as surveying is essential before construction, a structured market research process ensures you’re not just creating a product, but building something that people will truly love and find valuable.
In this blog, we will illustrate six important market research steps in the new product development process and explain the role each step plays in a successful launch.
Step 1: Define the Problem and Objectives
The first step is coming to clarity. Before engaging in any research, it is essential to consider the following question: What do we aim to achieve with this product?
Defining our problem and objectives gives us a good starting point for the rest of the journey.
For example, let’s say a SaaS company is preparing to release a new customer support tool. When they consider their objective of “improving customer experience,” that is way too high-level.
What specifically are they trying to achieve with their research bullet product? Are they trying to improve the time to resolution of support tickets?
Are they trying to improve the personalization in automated responses? Defining the goal will impact what type of data is gathered and what type of research they will employ.
Summary: A sharply defined problem will save us time and money and will also help us stay focused on researching the right issues.
Step 2: Identify Your Target Audience
Your product has little value, at least not to you, if you have no users. It is about who your product is built for, and while demographics are also important, you need to understand the psychographics, behavior traits, and pain points of your target audience.
Developing buyer personas is one way to better envision who you are building for.
For instance, a fintech startup wants to make a savings app. The startup may think it should target all adults with disposable income.
But the research may show that Gen Z is the primary audience and the fastest-growing user segment. You might find that Gen Z likes games in their apps, prefers mobile rather than desktop, and likes apps that transparently communicate fees.
Ways to find your audience: Online surveys or interviews with some of your potential customers will help you.
Social media tools that track what people are saying about competitors or similar products—can help you.
Competitive analysis to understand who the users are for your competitors is also quite useful.
If you know who your audience is, then you can tailor everything down to features, UI design, pricing, marketing strategy, and many more.
Step 3: Gather Secondary Research Data
Secondary research is the use of data that was already collected and is publicly available. This might include any of the following:
- Industry reports (e.g., a report from Gartner, Forrester, Statista, etc.).
- Competitor case studies.
- Market trend reports.
- Academic publishing.
The value of secondary research is speed and cost. For example, prior to launching an enterprise productivity tool, following, reviewing, and analyzing reports about the trends of remote work adoption will help you determine if you have a sustainable demand.
A simple analysis of your competitors may show you missing links, such as the lack of integrations, missing customization, or depleting repertoire based on the actions of your competitors.
Pro tip: Secondary research should always happen first, so you have a starting point, you eliminate redundancy, and your primary research will be more precise and sharper.
Step 4: Conduct Primary Research
Primary research can provide valuable insights directly from potential customers. It provides the “why” behind customer actions that secondary data cannot always capture.
Here are some primary research methods:
- Surveys collect quantitative data about customer needs and attitudes about willingness to pay.
- Interviews provide qualitative information about pain points and expectations.
- Focus Groups can be used for something akin to a small discussion to test ideas or prototypes.
- Beta Testing is releasing of a limited version (a “beta”) of your product, typically with a selected group (often for a start-up, 100), with the intent of getting feedback in the “real” world.
One example is a startup creating a new productivity app for small businesses or freelancers. They might release the beta to 100 people and find that 60% of the beta testers requested more integration with Google Workspace as their top priority.
As a result, the company may have otherwise poured money into other features that would not matter as much to the audience.
Step 5: Analyze and Interpret the Data
The collection of data is text only. The first step – the real power comes from analyzing and interpreting that data, which means you must clean and organize it, but also find the themes you can base your decision-making on without being forced into the process.
The tools available for data analysis will vary depending on the situation.
- Excel or Google Sheets for basic data
- BI tools like Power BI or Tableau for visualization
- AI platforms for searching for predictive trends
For example, if survey data shows that 70% of users prefer a mobile-first design rather than a desktop design, and if only 15% value desktop, then things are likely pretty clear as to which should take priority when designing.
Also, even if customers are happy with certain features, and they should appreciate some considerations concerning design, your analysis could expose things like price being the primary barrier to signing contracts, which can inform both your product design and market entry decisions.
Pivotal point: data is just noise in the absence of interpretation. You’ve got to be able to attach patterns to your business goals to get to insights.
Step 6: Apply Insights to Product Development
This is where research transitions into action. The findings from your research should help shape product features, price, positioning, and overall approach.
For example, if your research indicates that consumers believe that faster service is more valuable than additional features, that finding could drive you to develop premium “priority access” pricing tiers instead of features.
Don’t forget that market research is an ongoing process. Consumer needs change, competitors launch new products, and trends emerge.
Leveraging continuous feedback loops, like regular surveys, revisits of consumer reviews, and using data, will allow you to stay relevant and competitive.
Vionsys’ Role in Market-Driven Product Development
At Vionsys IT Solutions India Pvt. Ltd, we are adamant that successful product development is based on insights, not assumptions. We are here to help businesses run structured, reliable, and data-driven research so all product decisions start and end in market reality.
So how does Vionsys help?
- Technology-driven Research: We leverage advanced analytic tools and methodologies, which allow us to gather and analyze market data efficiently and accurately.
- Customer Journey Mapping: We assess every stage of the customer journey in order to identify unmet needs and potential opportunities.
- Digital-First Strategy Support: We partner with businesses to design and refine products that fit today’s rapidly evolving digital ecosystems.
No matter the product, whether developing a SaaS platform, mobile application, or enterprise solution, Vionsys has the experience and research framework to help you mitigate risks and increase the likelihood of market success.
By combining both technological and insight-driven approaches, we ensure products not only launch but thrive.
Common Mistakes to Avoid in Market Research
Even well-meaning research can fail if it is poorly executed. Here is a breakdown of some of the common pitfalls to look out for:
- Biased or Leading Questions
If surveys or interviews are badly designed with biased or leading questions, you can sidetrack respondents towards particular answers.
For example, using biased wording, “Wouldn’t you agree that faster delivery is more important than price?” is not fair, as it leads to bias in the results.
Therefore, you will want to keep questions as neutral as possible to solicit an authentic response.
2. Neglecting Secondary Data
Some businesses immediately conduct primary research because it is costly, and don’t even review the reports and findings available on the subject through secondary data.
Neglecting secondary data means that poor research may lead you to miss the key trends available, which have already been documented on your topic.
For example, industry information may have been previously documented showing a decline in demand for that product category. Spending money and time on primary research could be a waste of resources.
3. Using Small or Unrepresentative Samples
When you take feedback from a small group, or from a biased audience (for example, only friends and family), you will not get good results.
If your sample does not represent your true customer base, you may be building a product around incorrect assumptions. By having a larger, more diverse respondent pool, you will help to provide a better outcome.
4. Confusing Data with Insights
It is easy to gather data, but many companies miss the boat on gathering insights. Companies will gather massive datasets, but if left unassessed and unanalyzed, they are just numbers on a page.
The mistake is to believe raw data is the same as insight; it is not. Companies must dedicate time and expertise to analyze raw data in order to create actionable insights actionable strategies.
5. Not Acting on the Insights
One of the major pitfalls is to invest your time and your dollar in conducting research, just to discard what you learned from the research through the final product decisions.
For example, if the research was performed and it was written down and documented that when given the choice customers overwhelmingly preferred the subscription pricing model over the one-time model, if the final decision is not to utilize that research data and instead chose a different pricing model and uses one-time pricing, the product is misaligned with the needs of the customer.
By providing proper attention to avoiding these common errors, organizations can ensure that their research is not merely an academic exercise or feel feel-good result, but a useful instrument used for increasing the product’s probability of success.
Smarter Products Start with Smarter Research
Market research isn’t just another box to tick—it’s the backbone of successful product development.
By following the six steps, defining objectives, identifying audiences, gathering secondary data, conducting primary research, analyzing insights, and applying findings, you can create products that meet real customer needs and stand out in competitive markets.
Companies that treat market research as an ongoing process, rather than a one-time task, consistently build stronger, more adaptable products.
And with expert partners like Vionsys IT Solutions India Pvt. Ltd, organizations can ensure their product strategies are backed by robust, data-driven insights.
