Market research for ecommerce
A short, practical guide to conducting market research for your ecommerce business
Any new venture requires research, and an ecommerce store isn’t any different. Strategic, well-planned market research will help you get a clearer picture of your target market. Through this process, you’ll be able to gauge the sustainability of your idea, identify your competitors, your target audience, and key industry trends. Market research prepares you for the challenges that lie ahead and sets you on the path for growth and success.
Your first steps towards a successful research strategy
Market research is an umbrella term that can refer to different types of research methods used while entering a new market or expanding within an existing one. Broadly speaking, market research can be classified into primary and secondary research.
Secondary research
Despite what the name suggests, secondary research is an important first step in any market research strategy. Secondary research refers to the analysis of industry statistics, trend reports, government records, and all the pre-existing data you can get your hands on. Before you start your own research (i.e. primary research), it is vital that you analyze existing records to get a general understanding of your place in the market. One of the major components of secondary research is competitive analysis.
Competitive analysis
Your competitors have carried out their research in the field. Closely inspecting their strategy can be a great learning opportunity for you. Competitive analysis will help you:
- Identify your USP (unique selling proposition)
- Identify the pros and cons of your existing plan
- Determine appropriate pricing for your product or service
- Identify competitors’ GTM (go-to-market strategy)
- Identify major keywords for SEO
Here are some places where you can find useful information about your competitors.
Website
The best and most obvious way to analyze a competitor is by visiting their website. Inspect their pricing strategy to understand how they price their products and charge for shipping. Look at the content they publish (such as articles, blogs, and videos) to understand their marketing strategy. Consider their website’s layout and navigation options to identify how you can make your own website better.
Crunchbase
This platform gives you information on public and private companies and can help set your research in motion. Use this website to gather information on a company’s M&A (mergers and acquisitions), founders and co-founders, and funding and investments.
Newsletters/Press releases
Subscribe to your competitors’ newsletters to be updated about their upcoming plans.
Social media
Monitor their social media accounts to learn how they engage with their customers. This will also give you insights into the expectations of your target customer base.
Surveys
Though competitive analysis is considered secondary research, it can be conducted using surveys. Use the Buy Responses feature in Zoho Survey to collect feedback from a sample size of 250-300. Ask respondents which one of your competitors they’d choose and why. You can even use surveys to calculate your competitors’ NPS scores.
Primary research with Zoho Survey
Primary research refers to any research that you do on your own. This includes conducting online surveys, focus groups, research panels, and one-on-one interviews. Surveys are a particularly effective way to conduct primary research, as they are economical and provide relevant information directly from your target audience. Use surveys to:
Segment your market
Use demographic surveys to segment your audience based on gender, age, and more. This will help you market the right products to the right set of people. Use conditional quotas to ensure desired results. Distribute employment status surveys to help you determine the purchase potential of your audience and help you alter your services and pricing accordingly.
Identify your ideal customer
Use qualitative and quantitative research to understand your customers better.
Quantitative data
refers to data that is descriptive. Use open-ended questions, and tools like word cloud and sentiment analysis, to understand the pulse of the customer. Ask questions like:
- How many times per month do you shop online? (Tip: Consider using the drop-down question type for this question.)
- What is your preferred mode of payment? (Tip: Use MCQs for this question.)
- Have you shopped online before? (Tip: Pose this question as Boolean yes/no.)
- To what extent does the delivery charge affect your buying decision? (Tip: Collect answers to this question with a slider scale.)
- How important is prompt customer service? (Tip: Collect answers to this question with a rating scale.)
Qualitative data
It refers to the detailed information obtained from the respondent that can be counted or measured. To obtain quantitative data, ask questions like:
- How would you describe a perfect online shopping experience?
- Do you think online shopping is better than shopping in a brick and mortar store?
- If so, what, in your opinion, are the advantages of shopping online?
- What are some of the challenges you face while shopping online?
- Tell us your preferred modes of payment and your reason for choosing them.
- Which one do you think is better: free shipping or lowered product prices? Share your reasons for choosing your answer.
Create cogent marketing strategies
Use surveys to make your marketing more effective. Different question types help you obtain the specific information you need to upscale your website. Use the image question type when deciding on your brand logo/website design, or for any other instance where you want to present options in the form of images. Use the ranking question type when selecting a new tagline or content for your website.
With inline emails, you can add one question from your survey to the body of an email. Use this to get quick feedback from your customers. For example, you can ask a question like, “Would you like to see this particular range of products in our store?” before introducing or beta testing a new product.
Add surveys to your website as pop-ups or embed the HTML code. This will help you to instantly collect feedback from your website visitors.
Improve supply chain efficiency
Your store’s success greatly depends on the suppliers and delivery partner you work with.
Suppliers
Use surveys to make sure you and your suppliers are on the same page. Clearly understand their policies by asking questions like:
- What happens if some of the products you supplied are defective?
- What happens if you are out of stock?
- What is your standard delivery time?
- What forms of payment do you accept?
- What are your policies on refunds?
Delivery
It is important to get information from your logistics provider about restrictions on the items they deliver, ecommerce fulfillment, and customs declarations. Ask questions like
- What types of items are supported for delivery?
- Have you worked with an ecommerce business before?
- What are the options available regarding packaging? Do you offer padded packaging?
- Do you provide international shipping? If yes, can you provide us with information on customs and tariffs policies?
- Do you provide a fulfillment warehouse?
Final points
Market research is crucial if you want your business to flourish. Surveys can help you conduct effective product research for your ecommerce store. Both secondary and primary research are crucial in their own ways, and for comprehensive research, you should use both. Choose a survey builder like Zoho Survey to be your reliable, secure, and comprehensive DIY market research tool.
In the meantime, choosing an ecommerce platform like Zoho Commerce will make it easier to set up your ecommerce store. Zoho Commerce helps you market your products, effortlessly manage payments, reduce cart abandonment rates by sending follow-up emails, and easily analyze reports.