During less buoyant and more uncertain times, undertaking market research can help provide focus and direction for long-term plans, budgets and forecasts.
Since the start of the pandemic, the construction marketplace has been in a state of change. The way companies are doing business is changing, as is the way homeowners and tradesmen buy things. Some of the changes are temporary, but many of the solutions put in place now will have lasting effects.
As it’s becoming clear that Covid-19 is here to stay, and that the economic situation will remain uncertain for the foreseeable future, it is no longer a case of placing activity on hold and waiting for the storm to pass. Business needs to continue and companies need to adapt to the new conditions we are all facing, meaning important strategic decisions need to be made.
The current volatility, together with the still uncertain impact of Britain leaving the EU at the end of the year, makes it a daunting time to set budgets and construct long-term plans. In a depressed market, identifying niches with growth potential becomes more important, and market research can help with this. But at less buoyant and more uncertain times, there is also a strong case for taking a more detailed look at existing core or mature market sectors.
Competition may have intensified, there may have been movements in price; and when there is negligible or negative market growth, it becomes more important to grow, or at least maintain, market share. It’s a good time to reflect on your market position, on how your customers view your brand, and on what you can do to ensure your customers stay loyal.
The real threat is the one you don’t see
Sometimes it is easy to focus on key competitors while not paying enough attention to new companies entering the market – especially those from overseas – and events that take place outside of traditional boundaries, such as new distribution channels emerging. Online has been growing strongly for many years, and it’s likely that Covid-19 will be a catalyst for significant and more permanent change. Do you have a good estimate for how much product in your sector is sold through channels such as Amazon, or imported directly by clients from overseas manufacturers?
Data and statistics are important for identifying longer term trends and telling us what is happening now; how sales are doing compared to last month, or last year; whether online sales are increasing; or how customers are buying. But in unprecedented times, the past provides a less useful reference, and it becomes more important to look ahead.
Business intelligence, sales information and marketing analytics showing past trends or set against past performance may be of limited use. Instead, it becomes more important to understand how customers see the future, before they start to vote with their feet – or fingers for that matter. In fact, there may never have been a better time to do market research.
Your customers have the answers
One of the most powerful actions you can take is to ask your customers directly. Why not ask your customers how their businesses have been impacted and what you can do to support them? Do you really know what your customers think about your products, and your brand? Have you considered which competing brand your customers have as a back-up? Do you fully understand the changes in the decision-making processes involved in purchasing your products?
Even if you have a good relationship with some customers and feel you understand their needs, a properly conducted survey, which quantifies opinions and is aimed at producing data robust enough to provide a basis for making important strategic decisions, may be needed. It is important to consider the whole customer base, including those at the periphery. These companies may have the potential to become a much larger customer, or may be more likely to leave in favour of a competitor.
Another way research can help with planning, particularly in uncertain times, is by allowing companies to test concepts, ideas and decisions with existing or potential customers before implementing them, as well as to monitor the effect changes have on their customer base.
Before closing a branch and moving to online, is it worth checking in with customers to get an idea of what impact this will have? Or, if a decision has already been made to implement a change, could it be useful to research brand performance or track customer satisfaction over time to see what impact the changes are having? What about benchmarking against your closest competitors to ensure you stay one step ahead?
The future has arrived somewhere, and is on its way here
Something else that can provide invaluable insight, in particular when trying to predict the future, is to seek best practice examples from outside the immediate marketplace, and look at trends outside the industry. Construction is notoriously slow at responding and adapting to change, so it’s likely that what’s happening in other industries – for example retail – will feed through to construction in the future. Similarly, different growth drivers and economic conditions may have led to a faster pace of change in other countries.
While the uncertain economic climate brings major challenges for businesses, the underlying demand for home improvement products, homes and buildings is still there, and the fallout from the pandemic has also provided opportunities for innovation and major change.
The fact that both businesses and the construction market are becoming more resilient is a good thing. Embracing change can mean being better prepared for the next pandemic or other major crisis. But to safely and effectively adapt, without risk of losing customers, research which can provide in-depth and up to date insight is needed.
Get in touch to see how MRA Research can help.