Although marketing is usually viewed as solely a tool to sell products, it can actually become a product itself when managed by marketing research companies. Market research is crucial for companies to achieve a competitive advantage and avoid wasting money on promotion efforts tailored to the wrong target market. Although companies can do market research through their internal marketing department, many companies instead choose to outsource this complex and time-consuming process to specialized marketing research firms. Due to the high demand for these companies, it can be a great investment to buy stocks from top-performing marketing research companies.
It is important to know what to look for in a marketing research company before investing. The primary aspect that makes a marketing research company stand out is their research methodologies and access to tools. The most successful firms will be capable of running large-scale, trustworthy surveys, specialized focus groups, in-depth interviews, and customer observation. Additionally, the ability to perform marketing segmentation based on demographic, behavioral, and psychographic data is crucial to identify the best target audience.
Demographic data focuses on big-picture data like the customer’s age, sex, income, education level, and other categories. Behavioral data focuses on the customer decision process, such as what products they typically buy or how they interact with a website or business. However, one of the main differentiating factors for marketing research firms is how well they can answer the question: what is psychographic segmentation? This is a relatively new way of segmenting customers, and it involves combining many data factors to discover how customers actually think. Psychographic segmentation utilizes both demographic and behavioral data to predict a customer’s motivation for purchasing a product. Although this is a complicated process, marketing firms capable of performing psychographic segmentation effectively are much more competitive to large companies who can use this data to tailor products specifically to what a customer cares about.
Besides just looking at the marketing capabilities of marketing research companies, it is also important to assess their current and past client list to ensure they are a profitable enterprise before investing. Reading reviews from companies who have worked with the marketing firm is also a great way to assess their longevity, since marketing firms that continually receive poor reviews likely will perform worse over time than companies with positive reputations. Avoiding multi-level marketing (MLM) companies if possible is a good rule of thumb, since there have been scandals of ethical issues such as falsely claiming ownership of content or poor employee treatment.
Results are crucial to marketing research companies, because if all of this research cannot be turned into actual increases in sales, customer retention, or customer satisfaction, then the firm has failed and must change strategies. Overall, make sure a marketing research company is well equipped to produce demographic, behavioral, and psychographic data segmentation as well as handle a variety of research methodologies like surveys and focus groups. Finally, before investing, make sure that the marketing firm has a track record of positive reviews and tangible, successful results.