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Understanding market research for your business plan.

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When you’re building a business plan, market research needs to happen pretty early in the process. It’s where you learn about your audience’s wants and needs and the financial trends in your industry, and where you combine the data, and uncover trends that tell you what customers want and how to provide it most effectively.

The results of that research and analysis will shape aspects of the rest of your business plan. Assessments of your market and competition inform critical decisions in areas such as product design or service offerings, price, marketing methods, and business location.

That means accurate and comprehensive market research matters. To be comprehensive, your information and analysis should answer every possible question about the market you plan to enter and the consumers you believe will buy your product or service, including (but not limited to):

• Demand: Do consumers want what you’re offering?

• Economic indicators: Do they have the money to buy your product/service?

• Pricing: How much will they pay for your product/service?

• Location: Where do they live, and where are they likely to make their purchases?

• Saturation: How many other options do they currently have for that product/service?

First Steps: Budget

You can spend a lot answering these questions. Many large businesses hire firms to do the research and analysis, employing large-scale surveys, focus groups and statistical models, among other methods. However, for entrepreneurs just starting out, marketing budgets are typically too slim to cover that kind of research.

So, the work needs to stay in-house and fit a small marketing budget. Affordable, effective market research is possible. It may not be as specific to your market as the big-budget stuff, but it can get you the information you need to work out a solid understanding of your market.

First Steps: Market-Research Objectives

Before you start your research and analysis, determine your objectives. Decide what you want to learn from the process. It will guide the data you search for and how you use it, so be specific. Write down actual goals – what would give you the most accurate, comprehensive and useful picture of your market? This could include areas such as demographics, competitor offerings and customer pain points.

First Steps: Research Terminology

In market research, you’re basically dealing with two types of research and two types of data:

• Primary research: This is research you perform yourself in order to get very specific insights into your very specific business. It includes methods such as surveys, interviews and direct observations (by visiting competitor locations, for instance). It can help you gather qualitative data. This is data that goes beyond statistics and market trends. It can tell you what your consumers want, what they don’t want and how they feel about your offerings.

• Secondary research: This is research other people have performed and analyzed. To conduct secondary research, you can visit government websites such as the U.S. Census Bureau and the Bureau of Labor Statistics, as well as private data collectors such as Google and market-research companies. It can help you gather quantitative data. This is generally statistical data and can reveal insights on consumer demographics, spending patterns, market trends and earnings projections.

Where To Start Your Market Research

There’s a ton of existing research out there, and a lot of it is totally free. The Small Business Administration website has a list of free government sources for various types of quantitative data, such as industry statistics, consumer demographics, consumer demand and spending, and sales indicators. Much of it comes from the U.S. Census Bureau and the Bureau of Labor Statistics. A simple search will turn up enough places to start gathering secondary research to build a picture of your market.

With a good understanding of your market from secondary sources, you’re in a good position to know which types of primary research, if any, would be worth an investment of your time and energy. Maybe a well-designed survey completed by everyone you know could help fill in some holes.

You can also conduct primary research by visiting and speaking with your would-be competition and their customers; through crowdsourcing forums such as Quora, where you can glean raw data from comments and responses and post questions related to your product, service and market; on social-media websites such as Facebook, where you can parse conversations in relevant interest groups; and by reading product and service reviews on sites such as Amazon or Yelp.

Analyzing Your Market Research

Armed with all your data, you’ll draw conclusions that will help guide many of your business decisions.

But first, make sure all of your data will benefit those decisions. Don’t start analyzing until you weed out extraneous information that will waste your time and hinder focused insights. If it doesn’t relate directly to your business and your market, set it aside.

Then organize the relevant data into tables, graphs, lists and pie charts, and see what trends emerge. What do those trends mean for your business? Your product? Your location? Your planned promotions?

Be open to whatever the data tells you. Even if your research findings are unexpected, embrace them, and make any necessary adjustments. Listening to good market research can save you a lot of headaches down the road: The better you know your consumers, the better your chances of successfully selling to them.

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How to do market research: The complete guide for your brand

Written by by Jacqueline Zote

Published on  April 13, 2023

Reading time  10 minutes

Blindly putting out content or products and hoping for the best is a thing of the past. Not only is it a waste of time and energy, but you’re wasting valuable marketing dollars in the process. Now you have a wealth of tools and data at your disposal, allowing you to develop data-driven marketing strategies . That’s where market research comes in, allowing you to uncover valuable insights to inform your business decisions.

Conducting market research not only helps you better understand how to sell to customers but also stand out from your competition. In this guide, we break down everything you need to know about market research and how doing your homework can help you grow your business.

Table of contents:

What is market research?

Why is market research important, types of market research, where to conduct market research.

• Steps for conducting market research
• Tools to use for market research

Market research is the process of gathering information surrounding your business opportunities. It identifies key information to better understand your audience. This includes insights related to customer personas and even trends shaping your industry.

Taking time out of your schedule to conduct research is crucial for your brand health. Here are some of the key benefits of market research:

Understand your customers’ motivations and pain points

Most marketers are out of touch with what their customers want. Moreover, these marketers are missing key information on what products their audience wants to buy.

Simply put, you can’t run a business if you don’t know what motivates your customers.

And spoiler alert: Your customers’ wants and needs change. Your customers’ behaviors today might be night and day from what they were a few years ago.

Market research holds the key to understanding your customers better. It helps you uncover their key pain points and motivations and understand how they shape their interests and behavior.

Figure out how to position your brand

Positioning is becoming increasingly important as more and more brands enter the marketplace. Market research enables you to spot opportunities to define yourself against your competitors.

Maybe you’re able to emphasize a lower price point. Perhaps your product has a feature that’s one of a kind. Finding those opportunities goes hand in hand with researching your market.

Maintain a strong pulse on your industry at large

Today’s marketing world evolves at a rate that’s difficult to keep up with.

Fresh products. Up-and-coming brands. New marketing tools. Consumers get bombarded with sales messages from all angles. This can be confusing and overwhelming.

By monitoring market trends, you can figure out the best tactics for reaching your target audience.

Not everyone conducts market research for the same reason. While some may want to understand their audience better, others may want to see how their competitors are doing. As such, there are different types of market research you can conduct depending on your goal.

Interview-based market research allows for one-on-one interactions. This helps the conversation to flow naturally, making it easier to add context. Whether this takes place in person or virtually, it enables you to gather more in-depth qualitative data.

Buyer persona research

Buyer persona research lets you take a closer look at the people who make up your target audience. You can discover the needs, challenges and pain points of each buyer persona to understand what they need from your business. This will then allow you to craft products or campaigns to resonate better with each persona.

Pricing research

In this type of research, brands compare similar products or services with a particular focus on pricing. They look at how much those products or services typically sell for so they can get more competitive with their pricing strategy.

Competitive analysis research

Competitor analysis gives you a realistic understanding of where you stand in the market and how your competitors are doing. You can use this analysis to find out what’s working in your industry and which competitors to watch out for. It even gives you an idea of how well those competitors are meeting consumer needs.

Depending on the competitor analysis tool you use, you can get as granular as you need with your research. For instance, Sprout Social lets you analyze your competitors’ social strategies. You can see what types of content they’re posting and even benchmark your growth against theirs.

Brand awareness research

Conducting brand awareness research allows you to assess your brand’s standing in the market. It tells you how well-known your brand is among your target audience and what they associate with it. This can help you gauge people’s sentiments toward your brand and whether you need to rebrand or reposition.

If you don’t know where to start with your research, you’re in the right place.

There’s no shortage of market research methods out there. In this section, we’ve highlighted research channels for small and big businesses alike.

Considering that Google sees a staggering 8.5 billion searches each day, there’s perhaps no better place to start.

A quick Google search is a potential goldmine for all sorts of questions to kick off your market research. Who’s ranking for keywords related to your industry? Which products and pieces of content are the hottest right now? Who’s running ads related to your business?

For example, Google Product Listing Ads can help highlight all of the above for B2C brands.

The same applies to B2B brands looking to keep tabs on who’s running industry-related ads and ranking for keyword terms too.

There’s no denying that email represents both an aggressive and effective marketing channel for marketers today. Case in point, 44% of online shoppers consider email as the most influential channel in their buying decisions.

Looking through industry and competitor emails is a brilliant way to learn more about your market. For example, what types of offers and deals are your competitors running? How often are they sending emails?

Email is also invaluable for gathering information directly from your customers. This survey message from Asana is a great example of how to pick your customers’ brains to figure out how you can improve your quality of service.

Industry journals, reports and blogs

Don’t neglect the importance of big-picture market research when it comes to tactics and marketing channels to explore. Look to marketing resources such as reports and blogs as well as industry journals

Keeping your ear to the ground on new trends and technologies is a smart move for any business. Sites such as Statista, Marketing Charts, AdWeek and Emarketer are treasure troves of up-to-date data and news for marketers.

And of course, there’s the  Sprout Insights blog . And invaluable resources like The Sprout Social Index™  can keep you updated on the latest social trends.

Social media

If you want to learn more about your target market, look no further than social media. Social offers a place to discover what your customers want to see in future products or which brands are killin’ it. In fact, social media is become more important for businesses than ever with the level of data available.

It represents a massive repository of real-time data and insights that are instantly accessible. Brand monitoring and social listening are effective ways to conduct social media research . You can even be more direct with your approach. Ask questions directly or even poll your audience to understand their needs and preferences.

The 5 steps for how to do market research

Now that we’ve covered the why and where, it’s time to get into the practical aspects of market research. Here are five essential steps on how to do market research effectively.

Step 1: Identify your research topic

First off, what are you researching about? What do you want to find out? Narrow down on a specific research topic so you can start with a clear idea of what to look for.

For example, you may want to learn more about how well your product features are satisfying the needs of existing users. This might potentially lead to feature updates and improvements. Or it might even result in new feature introductions.

Similarly, your research topic may be related to your product or service launch or customer experience. Or you may want to conduct research for an upcoming marketing campaign.

Step 2: Choose a buyer persona to engage

If you’re planning to focus your research on a specific type of audience, decide which buyer persona you want to engage. This persona group will serve as a representative sample of your target audience.

Engaging a specific group of audience lets you streamline your research efforts. As such, it can be a much more effective and organized approach than researching thousands (if not millions) of individuals.

You may be directing your research toward existing users of your product. To get even more granular, you may want to focus on users who have been familiar with the product for at least a year, for example.

Step 3: Start collecting data

The next step is one of the most critical as it involves collecting the data you need for your research. Before you begin, make sure you’ve chosen the right research methods that will uncover the type of data you need. This largely depends on your research topic and goals.

Remember that you don’t necessarily have to stick to one research method. You may use a combination of qualitative and quantitative approaches. So for example, you could use interviews to supplement the data from your surveys. Or you may stick to insights from your social listening efforts.

To keep things consistent, let’s look at this in the context of the example from earlier. Perhaps you can send out a survey to your existing users asking them a bunch of questions. This might include questions like which features they use the most and how often they use them. You can get them to choose an answer from one to five and collect quantitative data.

Plus, for qualitative insights, you could even include a few open-ended questions with the option to write their answers. For instance, you might ask them if there’s any improvement they wish to see in your product.

Step 4: Analyze results

Once you have all the data you need, it’s time to analyze it keeping your research topic in mind. This involves trying to interpret the data to look for a wider meaning, particularly in relation to your research goal.

So let’s say a large percentage of responses were four or five in the satisfaction rating. This means your existing users are mostly satisfied with your current product features. On the other hand, if the responses were mostly ones and twos, you may look for opportunities to improve. The responses to your open-ended questions can give you further context as to why people are disappointed.

Step 5: Make decisions for your business

Now it’s time to take your findings and turn them into actionable insights for your business. In this final step, you need to decide how you want to move forward with your new market insight.

What did you find in your research that would require action? How can you put those findings to good use?

The market research tools you should be using

To wrap things up, let’s talk about the various tools available to conduct speedy, in-depth market research. These tools are essential for conducting market research faster and more efficiently.

Social listening and analytics

Social analytics tools like Sprout can help you keep track of engagement across social media. This goes beyond your own engagement data but also includes that of your competitors. Considering how quickly social media moves, using a third-party analytics tool is ideal. It allows you to make sense of your social data at a glance and ensure that you’re never missing out on important trends.

Email marketing research tools

Keeping track of brand emails is a good idea for any brand looking to stand out in its audience’s inbox.

Tools such as MailCharts ,  Really Good Emails  and  Milled  can show you how different brands run their email campaigns.

Meanwhile, tools like  Owletter  allow you to monitor metrics such as frequency and send-timing. These metrics can help you understand email marketing strategies among competing brands.

Content marketing research

If you’re looking to conduct research on content marketing, tools such as  BuzzSumo  can be of great help. This tool shows you the top-performing industry content based on keywords. Here you can see relevant industry sites and influencers as well as which brands in your industry are scoring the most buzz. It shows you exactly which pieces of content are ranking well in terms of engagements and shares and on which social networks.

SEO and keyword tracking

Monitoring industry keywords is a great way to uncover competitors. It can also help you discover opportunities to advertise your products via organic search. Tools such as  Ahrefs  provide a comprehensive keyword report to help you see how your search efforts stack up against the competition.

Competitor comparison template

For the sake of organizing your market research, consider creating a competitive matrix. The idea is to highlight how you stack up side-by-side against others in your market. Use a  social media competitive analysis template  to track your competitors’ social presence. That way, you can easily compare tactics, messaging and performance. Once you understand your strengths and weaknesses next to your competitors, you’ll find opportunities as well.

Customer persona creator

Finally, customer personas represent a place where all of your market research comes together. You’d need to create a profile of your ideal customer that you can easily refer to. Tools like  Xtensio  can help in outlining your customer motivations and demographics as you zero in on your target market.

Build a solid market research strategy

Having a deeper understanding of the market gives you leverage in a sea of competitors. Use the steps and market research tools we shared above to build an effective market research strategy.

But keep in mind that the accuracy of your research findings depends on the quality of data collected. Turn to Sprout’s social media analytics tools to uncover heaps of high-quality data across social networks.

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What Is Market Research?

• How It Works
• Primary vs. Secondary
• How to Conduct Research

The Bottom Line

• Marketing Essentials

How to Do Market Research, Types, and Example

Joules Garcia / Investopedia

Market research examines consumer behavior and trends in the economy to help a business develop and fine-tune its business idea and strategy. It helps a business understand its target market by gathering and analyzing data.

Market research is the process of evaluating the viability of a new service or product through research conducted directly with potential customers. It allows a company to define its target market and get opinions and other feedback from consumers about their interest in a product or service.

Research may be conducted in-house or by a third party that specializes in market research. It can be done through surveys and focus groups, among other ways. Test subjects are usually compensated with product samples or a small stipend for their time.

Key Takeaways

• Companies conduct market research before introducing new products to determine their appeal to potential customers.
• Tools include focus groups, telephone interviews, and questionnaires.
• The results of market research inform the final design of the product and determine how it will be positioned in the marketplace.
• Market research usually combines primary information, gathered directly from consumers, and secondary information, which is data available from external sources.

Market Research

How market research works.

Market research is used to determine the viability of a new product or service. The results may be used to revise the product design and fine-tune the strategy for introducing it to the public. This can include information gathered for the purpose of determining market segmentation . It also informs product differentiation , which is used to tailor advertising.

A business engages in various tasks to complete the market research process. It gathers information based on the market sector being targeted by the product. This information is then analyzed and relevant data points are interpreted to draw conclusions about how the product may be optimally designed and marketed to the market segment for which it is intended.

It is a critical component in the research and development (R&D) phase of a new product or service introduction. Market research can be conducted in many different ways, including surveys, product testing, interviews, and focus groups.

Market research is a critical tool that companies use to understand what consumers want, develop products that those consumers will use, and maintain a competitive advantage over other companies in their industry.

Primary Market Research vs. Secondary Market Research

Market research usually consists of a combination of:

• Primary research, gathered by the company or by an outside company that it hires
• Secondary research, which draws on external sources of data

Primary Market Research

Primary research generally falls into two categories: exploratory and specific research.

• Exploratory research is less structured and functions via open-ended questions. The questions may be posed in a focus group setting, telephone interviews, or questionnaires. It results in questions or issues that the company needs to address about a product that it has under development.
• Specific research delves more deeply into the problems or issues identified in exploratory research.

Secondary Market Research

All market research is informed by the findings of other researchers about the needs and wants of consumers. Today, much of this research can be found online.

Secondary research can include population information from government census data , trade association research reports , polling results, and research from other businesses operating in the same market sector.

History of Market Research

Formal market research began in Germany during the 1920s. In the United States, it soon took off with the advent of the Golden Age of Radio.

Companies that created advertisements for this new entertainment medium began to look at the demographics of the audiences who listened to each of the radio plays, music programs, and comedy skits that were presented.

They had once tried to reach the widest possible audience by placing their messages on billboards or in the most popular magazines. With radio programming, they had the chance to target rural or urban consumers, teenagers or families, and judge the results by the sales numbers that followed.

Types of Market Research

Face-to-face interviews.

From their earliest days, market research companies would interview people on the street about the newspapers and magazines that they read regularly and ask whether they recalled any of the ads or brands that were published in them. Data collected from these interviews were compared to the circulation of the publication to determine the effectiveness of those ads.

Market research and surveys were adapted from these early techniques.

To get a strong understanding of your market, it’s essential to understand demand, market size, economic indicators, location, market saturation, and pricing.

Focus Groups

A focus group is a small number of representative consumers chosen to try a product or watch an advertisement.

Afterward, the group is asked for feedback on their perceptions of the product, the company’s brand, or competing products. The company then takes that information and makes decisions about what to do with the product or service, whether that's releasing it, making changes, or abandoning it altogether.

Phone Research

The man-on-the-street interview technique soon gave way to the telephone interview. A telephone interviewer could collect information in a more efficient and cost-effective fashion.

Telephone research was a preferred tactic of market researchers for many years. It has become much more difficult in recent years as landline phone service dwindles and is replaced by less accessible mobile phones.

Survey Research

As an alternative to focus groups, surveys represent a cost-effective way to determine consumer attitudes without having to interview anyone in person. Consumers are sent surveys in the mail, usually with a coupon or voucher to incentivize participation. These surveys help determine how consumers feel about the product, brand, and price point.

Online Market Research

With people spending more time online, market research activities have shifted online as well. Data collection still uses a survey-style form. But instead of companies actively seeking participants by finding them on the street or cold calling them on the phone, people can choose to sign up, take surveys, and offer opinions when they have time.

This makes the process far less intrusive and less rushed, since people can participate on their own time and of their own volition.

How to Conduct Market Research

The first step to effective market research is to determine the goals of the study. Each study should seek to answer a clear, well-defined problem. For example, a company might seek to identify consumer preferences, brand recognition, or the comparative effectiveness of different types of ad campaigns.

After that, the next step is to determine who will be included in the research. Market research is an expensive process, and a company cannot waste resources collecting unnecessary data. The firm should decide in advance which types of consumers will be included in the research, and how the data will be collected. They should also account for the probability of statistical errors or sampling bias .

The next step is to collect the data and analyze the results. If the two previous steps have been completed accurately, this should be straightforward. The researchers will collect the results of their study, keeping track of the ages, gender, and other relevant data of each respondent. This is then analyzed in a marketing report that explains the results of their research.

The last step is for company executives to use their market research to make business decisions. Depending on the results of their research, they may choose to target a different group of consumers, or they may change their price point or some product features.

The results of these changes may eventually be measured in further market research, and the process will begin all over again.

Benefits of Market Research

Market research is essential for developing brand loyalty and customer satisfaction. Since it is unlikely for a product to appeal equally to every consumer, a strong market research program can help identify the key demographics and market segments that are most likely to use a given product.

Market research is also important for developing a company’s advertising efforts. For example, if a company’s market research determines that its consumers are more likely to use Facebook than X (formerly Twitter), it can then target its advertisements to one platform instead of another. Or, if they determine that their target market is value-sensitive rather than price-sensitive, they can work on improving the product rather than reducing their prices.

Market research only works when subjects are honest and open to participating.

Example of Market Research

Many companies use market research to test new products or get information from consumers about what kinds of products or services they need and don’t currently have.

For example, a company that’s considering starting a business might conduct market research to test the viability of its product or service. If the market research confirms consumer interest, the business can proceed confidently with its business plan . If not, the company can use the results of the market research to make adjustments to the product to bring it in line with customer desires.

What Are the Main Types of Market Research?

The main types of market research are primary research and secondary research. Primary research includes focus groups, polls, and surveys. Secondary research includes academic articles, infographics, and white papers.

Qualitative research gives insights into how customers feel and think. Quantitative research uses data and statistics such as website views, social media engagement, and subscriber numbers.

What Is Online Market Research?

Online market research uses the same strategies and techniques as traditional primary and secondary market research, but it is conducted on the Internet. Potential customers may be asked to participate in a survey or give feedback on a product. The responses may help the researchers create a profile of the likely customer for a new product.

What Are Paid Market Research Surveys?

Paid market research involves rewarding individuals who agree to participate in a study. They may be offered a small payment for their time or a discount coupon in return for filling out a questionnaire or participating in a focus group.

What Is a Market Study?

A market study is an analysis of consumer demand for a product or service. It looks at all of the factors that influence demand for a product or service. These include the product’s price, location, competition, and substitutes as well as general economic factors that could influence the new product’s adoption, for better or worse.

Market research is a key component of a company’s research and development (R&D) stage. It helps companies understand in advance the viability of a new product that they have in development and to see how it might perform in the real world.

Britannica Money. “ Market Research .”

U.S. Small Business Administration. “ Market Research and Competitive Analysis .”

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How to Do Market Research: The Complete Guide

Learn how to do market research with this step-by-step guide, complete with templates, tools and real-world examples.

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What are your customers’ needs? How does your product compare to the competition? What are the emerging trends and opportunities in your industry? If these questions keep you up at night, it’s time to conduct market research.

Market research plays a pivotal role in your ability to stay competitive and relevant, helping you anticipate shifts in consumer behavior and industry dynamics. It involves gathering these insights using a wide range of techniques, from surveys and interviews to data analysis and observational studies.

In this guide, we’ll explore why market research is crucial, the various types of market research, the methods used in data collection, and how to effectively conduct market research to drive informed decision-making and success.

What is market research?

Market research is the systematic process of gathering, analyzing and interpreting information about a specific market or industry. The purpose of market research is to offer valuable insight into the preferences and behaviors of your target audience, and anticipate shifts in market trends and the competitive landscape. This information helps you make data-driven decisions, develop effective strategies for your business, and maximize your chances of long-term growth.

Why is market research important? 

By understanding the significance of market research, you can make sure you’re asking the right questions and using the process to your advantage. Some of the benefits of market research include:

• Informed decision-making: Market research provides you with the data and insights you need to make smart decisions for your business. It helps you identify opportunities, assess risks and tailor your strategies to meet the demands of the market. Without market research, decisions are often based on assumptions or guesswork, leading to costly mistakes.
• Customer-centric approach: A cornerstone of market research involves developing a deep understanding of customer needs and preferences. This gives you valuable insights into your target audience, helping you develop products, services and marketing campaigns that resonate with your customers.
• Competitive advantage: By conducting market research, you’ll gain a competitive edge. You’ll be able to identify gaps in the market, analyze competitor strengths and weaknesses, and position your business strategically. This enables you to create unique value propositions, differentiate yourself from competitors, and seize opportunities that others may overlook.
• Risk mitigation: Market research helps you anticipate market shifts and potential challenges. By identifying threats early, you can proactively adjust their strategies to mitigate risks and respond effectively to changing circumstances. This proactive approach is particularly valuable in volatile industries.
• Resource optimization: Conducting market research allows organizations to allocate their time, money and resources more efficiently. It ensures that investments are made in areas with the highest potential return on investment, reducing wasted resources and improving overall business performance.
• Adaptation to market trends: Markets evolve rapidly, driven by technological advancements, cultural shifts and changing consumer attitudes. Market research ensures that you stay ahead of these trends and adapt your offerings accordingly so you can avoid becoming obsolete. 

As you can see, market research empowers businesses to make data-driven decisions, cater to customer needs, outperform competitors, mitigate risks, optimize resources and stay agile in a dynamic marketplace. These benefits make it a huge industry; the global market research services market is expected to grow from $76.37 billion in 2021 to $108.57 billion in 2026 . Now, let’s dig into the different types of market research that can help you achieve these benefits.

Types of market research 

• Qualitative research
• Quantitative research
• Exploratory research
• Descriptive research
• Causal research
• Cross-sectional research
• Longitudinal research

Despite its advantages, 23% of organizations don’t have a clear market research strategy. Part of developing a strategy involves choosing the right type of market research for your business goals. The most commonly used approaches include:

1. Qualitative research

Qualitative research focuses on understanding the underlying motivations, attitudes and perceptions of individuals or groups. It is typically conducted through techniques like in-depth interviews, focus groups and content analysis — methods we’ll discuss further in the sections below. Qualitative research provides rich, nuanced insights that can inform product development, marketing strategies and brand positioning.

2. Quantitative research

Quantitative research, in contrast to qualitative research, involves the collection and analysis of numerical data, often through surveys, experiments and structured questionnaires. This approach allows for statistical analysis and the measurement of trends, making it suitable for large-scale market studies and hypothesis testing. While it’s worthwhile using a mix of qualitative and quantitative research, most businesses prioritize the latter because it is scientific, measurable and easily replicated across different experiments.

3. Exploratory research

Whether you’re conducting qualitative or quantitative research or a mix of both, exploratory research is often the first step. Its primary goal is to help you understand a market or problem so you can gain insights and identify potential issues or opportunities. This type of market research is less structured and is typically conducted through open-ended interviews, focus groups or secondary data analysis. Exploratory research is valuable when entering new markets or exploring new product ideas.

4. Descriptive research

As its name implies, descriptive research seeks to describe a market, population or phenomenon in detail. It involves collecting and summarizing data to answer questions about audience demographics and behaviors, market size, and current trends. Surveys, observational studies and content analysis are common methods used in descriptive research. 

5. Causal research

Causal research aims to establish cause-and-effect relationships between variables. It investigates whether changes in one variable result in changes in another. Experimental designs, A/B testing and regression analysis are common causal research methods. This sheds light on how specific marketing strategies or product changes impact consumer behavior.

6. Cross-sectional research

Cross-sectional market research involves collecting data from a sample of the population at a single point in time. It is used to analyze differences, relationships or trends among various groups within a population. Cross-sectional studies are helpful for market segmentation, identifying target audiences and assessing market trends at a specific moment.

7. Longitudinal research

Longitudinal research, in contrast to cross-sectional research, collects data from the same subjects over an extended period. This allows for the analysis of trends, changes and developments over time. Longitudinal studies are useful for tracking long-term developments in consumer preferences, brand loyalty and market dynamics.

Each type of market research has its strengths and weaknesses, and the method you choose depends on your specific research goals and the depth of understanding you’re aiming to achieve. In the following sections, we’ll delve into primary and secondary research approaches and specific research methods.

Primary vs. secondary market research

Market research of all types can be broadly categorized into two main approaches: primary research and secondary research. By understanding the differences between these approaches, you can better determine the most appropriate research method for your specific goals.

Primary market research 

Primary research involves the collection of original data straight from the source. Typically, this involves communicating directly with your target audience — through surveys, interviews, focus groups and more — to gather information. Here are some key attributes of primary market research:

• Customized data: Primary research provides data that is tailored to your research needs. You design a custom research study and gather information specific to your goals.
• Up-to-date insights: Because primary research involves communicating with customers, the data you collect reflects the most current market conditions and consumer behaviors.
• Time-consuming and resource-intensive: Despite its advantages, primary research can be labor-intensive and costly, especially when dealing with large sample sizes or complex study designs. Whether you hire a market research consultant, agency or use an in-house team, primary research studies consume a large amount of resources and time.

Secondary market research 

Secondary research, on the other hand, involves analyzing data that has already been compiled by third-party sources, such as online research tools, databases, news sites, industry reports and academic studies.

Here are the main characteristics of secondary market research:

• Cost-effective: Secondary research is generally more cost-effective than primary research since it doesn’t require building a research plan from scratch. You and your team can look at databases, websites and publications on an ongoing basis, without needing to design a custom experiment or hire a consultant. 
• Leverages multiple sources: Data tools and software extract data from multiple places across the web, and then consolidate that information within a single platform. This means you’ll get a greater amount of data and a wider scope from secondary research.
• Quick to access: You can access a wide range of information rapidly — often in seconds — if you’re using online research tools and databases. Because of this, you can act on insights sooner, rather than taking the time to develop an experiment. 

So, when should you use primary vs. secondary research? In practice, many market research projects incorporate both primary and secondary research to take advantage of the strengths of each approach.

One rule of thumb is to focus on secondary research to obtain background information, market trends or industry benchmarks. It is especially valuable for conducting preliminary research, competitor analysis, or when time and budget constraints are tight. Then, if you still have knowledge gaps or need to answer specific questions unique to your business model, use primary research to create a custom experiment. 

Market research methods

• Surveys and questionnaires
• Focus groups
• Observational research
• Online research tools
• Experiments
• Content analysis
• Ethnographic research

How do primary and secondary research approaches translate into specific research methods? Let’s take a look at the different ways you can gather data: 

1. Surveys and questionnaires

Surveys and questionnaires are popular methods for collecting structured data from a large number of respondents. They involve a set of predetermined questions that participants answer. Surveys can be conducted through various channels, including online tools, telephone interviews and in-person or online questionnaires. They are useful for gathering quantitative data and assessing customer demographics, opinions, preferences and needs. On average, customer surveys have a 33% response rate , so keep that in mind as you consider your sample size.

2. Interviews

Interviews are in-depth conversations with individuals or groups to gather qualitative insights. They can be structured (with predefined questions) or unstructured (with open-ended discussions). Interviews are valuable for exploring complex topics, uncovering motivations and obtaining detailed feedback. 

3. Focus groups

The most common primary research methods are in-depth webcam interviews and focus groups. Focus groups are a small gathering of participants who discuss a specific topic or product under the guidance of a moderator. These discussions are valuable for primary market research because they reveal insights into consumer attitudes, perceptions and emotions. Focus groups are especially useful for idea generation, concept testing and understanding group dynamics within your target audience.

4. Observational research

Observational research involves observing and recording participant behavior in a natural setting. This method is particularly valuable when studying consumer behavior in physical spaces, such as retail stores or public places. In some types of observational research, participants are aware you’re watching them; in other cases, you discreetly watch consumers without their knowledge, as they use your product. Either way, observational research provides firsthand insights into how people interact with products or environments.

5. Online research tools

You and your team can do your own secondary market research using online tools. These tools include data prospecting platforms and databases, as well as online surveys, social media listening, web analytics and sentiment analysis platforms. They help you gather data from online sources, monitor industry trends, track competitors, understand consumer preferences and keep tabs on online behavior. We’ll talk more about choosing the right market research tools in the sections that follow.

6. Experiments

Market research experiments are controlled tests of variables to determine causal relationships. While experiments are often associated with scientific research, they are also used in market research to assess the impact of specific marketing strategies, product features, or pricing and packaging changes.

7. Content analysis

Content analysis involves the systematic examination of textual, visual or audio content to identify patterns, themes and trends. It’s commonly applied to customer reviews, social media posts and other forms of online content to analyze consumer opinions and sentiments.

8. Ethnographic research

Ethnographic research immerses researchers into the daily lives of consumers to understand their behavior and culture. This method is particularly valuable when studying niche markets or exploring the cultural context of consumer choices.

How to do market research

• Set clear objectives
• Identify your target audience
• Choose your research methods
• Use the right market research tools
• Collect data
• Analyze data 
• Interpret your findings
• Identify opportunities and challenges
• Make informed business decisions
• Monitor and adapt

Now that you have gained insights into the various market research methods at your disposal, let’s delve into the practical aspects of how to conduct market research effectively. Here’s a quick step-by-step overview, from defining objectives to monitoring market shifts.

1. Set clear objectives

When you set clear and specific goals, you’re essentially creating a compass to guide your research questions and methodology. Start by precisely defining what you want to achieve. Are you launching a new product and want to understand its viability in the market? Are you evaluating customer satisfaction with a product redesign? 

Start by creating SMART goals — objectives that are specific, measurable, achievable, relevant and time-bound. Not only will this clarify your research focus from the outset, but it will also help you track progress and benchmark your success throughout the process. 

You should also consult with key stakeholders and team members to ensure alignment on your research objectives before diving into data collecting. This will help you gain diverse perspectives and insights that will shape your research approach.

2. Identify your target audience

Next, you’ll need to pinpoint your target audience to determine who should be included in your research. Begin by creating detailed buyer personas or stakeholder profiles. Consider demographic factors like age, gender, income and location, but also delve into psychographics, such as interests, values and pain points.

The more specific your target audience, the more accurate and actionable your research will be. Additionally, segment your audience if your research objectives involve studying different groups, such as current customers and potential leads.

If you already have existing customers, you can also hold conversations with them to better understand your target market. From there, you can refine your buyer personas and tailor your research methods accordingly.

3. Choose your research methods

Selecting the right research methods is crucial for gathering high-quality data. Start by considering the nature of your research objectives. If you’re exploring consumer preferences, surveys and interviews can provide valuable insights. For in-depth understanding, focus groups or observational research might be suitable. Consider using a mix of quantitative and qualitative methods to gain a well-rounded perspective. 

You’ll also need to consider your budget. Think about what you can realistically achieve using the time and resources available to you. If you have a fairly generous budget, you may want to try a mix of primary and secondary research approaches. If you’re doing market research for a startup , on the other hand, chances are your budget is somewhat limited. If that’s the case, try addressing your goals with secondary research tools before investing time and effort in a primary research study. 

4. Use the right market research tools

Whether you’re conducting primary or secondary research, you’ll need to choose the right tools. These can help you do anything from sending surveys to customers to monitoring trends and analyzing data. Here are some examples of popular market research tools:

• Market research software: Crunchbase is a platform that provides best-in-class company data, making it valuable for market research on growing companies and industries. You can use Crunchbase to access trusted, first-party funding data, revenue data, news and firmographics, enabling you to monitor industry trends and understand customer needs.

• Survey and questionnaire tools: SurveyMonkey is a widely used online survey platform that allows you to create, distribute and analyze surveys. Google Forms is a free tool that lets you create surveys and collect responses through Google Drive.
• Data analysis software: Microsoft Excel and Google Sheets are useful for conducting statistical analyses. SPSS is a powerful statistical analysis software used for data processing, analysis and reporting.
• Social listening tools: Brandwatch is a social listening and analytics platform that helps you monitor social media conversations, track sentiment and analyze trends. Mention is a media monitoring tool that allows you to track mentions of your brand, competitors and keywords across various online sources.
• Data visualization platforms: Tableau is a data visualization tool that helps you create interactive and shareable dashboards and reports. Power BI by Microsoft is a business analytics tool for creating interactive visualizations and reports.

5. Collect data

There’s an infinite amount of data you could be collecting using these tools, so you’ll need to be intentional about going after the data that aligns with your research goals. Implement your chosen research methods, whether it’s distributing surveys, conducting interviews or pulling from secondary research platforms. Pay close attention to data quality and accuracy, and stick to a standardized process to streamline data capture and reduce errors. 

6. Analyze data

Once data is collected, you’ll need to analyze it systematically. Use statistical software or analysis tools to identify patterns, trends and correlations. For qualitative data, employ thematic analysis to extract common themes and insights. Visualize your findings with charts, graphs and tables to make complex data more understandable.

If you’re not proficient in data analysis, consider outsourcing or collaborating with a data analyst who can assist in processing and interpreting your data accurately.

7. Interpret your findings

Interpreting your market research findings involves understanding what the data means in the context of your objectives. Are there significant trends that uncover the answers to your initial research questions? Consider the implications of your findings on your business strategy. It’s essential to move beyond raw data and extract actionable insights that inform decision-making.

Hold a cross-functional meeting or workshop with relevant team members to collectively interpret the findings. Different perspectives can lead to more comprehensive insights and innovative solutions.

8. Identify opportunities and challenges

Use your research findings to identify potential growth opportunities and challenges within your market. What segments of your audience are underserved or overlooked? Are there emerging trends you can capitalize on? Conversely, what obstacles or competitors could hinder your progress?

Lay out this information in a clear and organized way by conducting a SWOT analysis, which stands for strengths, weaknesses, opportunities and threats. Jot down notes for each of these areas to provide a structured overview of gaps and hurdles in the market.

9. Make informed business decisions

Market research is only valuable if it leads to informed decisions for your company. Based on your insights, devise actionable strategies and initiatives that align with your research objectives. Whether it’s refining your product, targeting new customer segments or adjusting pricing, ensure your decisions are rooted in the data.

At this point, it’s also crucial to keep your team aligned and accountable. Create an action plan that outlines specific steps, responsibilities and timelines for implementing the recommendations derived from your research. 

10. Monitor and adapt

Market research isn’t a one-time activity; it’s an ongoing process. Continuously monitor market conditions, customer behaviors and industry trends. Set up mechanisms to collect real-time data and feedback. As you gather new information, be prepared to adapt your strategies and tactics accordingly. Regularly revisiting your research ensures your business remains agile and reflects changing market dynamics and consumer preferences.

Online market research sources

As you go through the steps above, you’ll want to turn to trusted, reputable sources to gather your data. Here’s a list to get you started:

• Crunchbase: As mentioned above, Crunchbase is an online platform with an extensive dataset, allowing you to access in-depth insights on market trends, consumer behavior and competitive analysis. You can also customize your search options to tailor your research to specific industries, geographic regions or customer personas.

• Academic databases: Academic databases, such as ProQuest and JSTOR , are treasure troves of scholarly research papers, studies and academic journals. They offer in-depth analyses of various subjects, including market trends, consumer preferences and industry-specific insights. Researchers can access a wealth of peer-reviewed publications to gain a deeper understanding of their research topics.
• Government and NGO databases: Government agencies, nongovernmental organizations and other institutions frequently maintain databases containing valuable economic, demographic and industry-related data. These sources offer credible statistics and reports on a wide range of topics, making them essential for market researchers. Examples include the U.S. Census Bureau , the Bureau of Labor Statistics and the Pew Research Center .
• Industry reports: Industry reports and market studies are comprehensive documents prepared by research firms, industry associations and consulting companies. They provide in-depth insights into specific markets, including market size, trends, competitive analysis and consumer behavior. You can find this information by looking at relevant industry association databases; examples include the American Marketing Association and the National Retail Federation .
• Social media and online communities: Social media platforms like LinkedIn or Twitter (X) , forums such as Reddit and Quora , and review platforms such as G2 can provide real-time insights into consumer sentiment, opinions and trends. 

Market research examples

At this point, you have market research tools and data sources — but how do you act on the data you gather? Let’s go over some real-world examples that illustrate the practical application of market research across various industries. These examples showcase how market research can lead to smart decision-making and successful business decisions.

Example 1: Apple’s iPhone launch

Apple ’s iconic iPhone launch in 2007 serves as a prime example of market research driving product innovation in tech. Before the iPhone’s release, Apple conducted extensive market research to understand consumer preferences, pain points and unmet needs in the mobile phone industry. This research led to the development of a touchscreen smartphone with a user-friendly interface, addressing consumer demands for a more intuitive and versatile device. The result was a revolutionary product that disrupted the market and redefined the smartphone industry.

Example 2: McDonald’s global expansion

McDonald’s successful global expansion strategy demonstrates the importance of market research when expanding into new territories. Before entering a new market, McDonald’s conducts thorough research to understand local tastes, preferences and cultural nuances. This research informs menu customization, marketing strategies and store design. For instance, in India, McDonald’s offers a menu tailored to local preferences, including vegetarian options. This market-specific approach has enabled McDonald’s to adapt and thrive in diverse global markets.

Example 3: Organic and sustainable farming

The shift toward organic and sustainable farming practices in the food industry is driven by market research that indicates increased consumer demand for healthier and environmentally friendly food options. As a result, food producers and retailers invest in sustainable sourcing and organic product lines — such as with these sustainable seafood startups — to align with this shift in consumer values. 

The bottom line? Market research has multiple use cases and is a critical practice for any industry. Whether it’s launching groundbreaking products, entering new markets or responding to changing consumer preferences, you can use market research to shape successful strategies and outcomes.

Market research templates

You finally have a strong understanding of how to do market research and apply it in the real world. Before we wrap up, here are some market research templates that you can use as a starting point for your projects:

• Smartsheet competitive analysis templates : These spreadsheets can serve as a framework for gathering information about the competitive landscape and obtaining valuable lessons to apply to your business strategy.
• SurveyMonkey product survey template : Customize the questions on this survey based on what you want to learn from your target customers.
• HubSpot templates : HubSpot offers a wide range of free templates you can use for market research, business planning and more.
• SCORE templates : SCORE is a nonprofit organization that provides templates for business plans, market analysis and financial projections.
• SBA.gov : The U.S. Small Business Administration offers templates for every aspect of your business, including market research, and is particularly valuable for new startups. 

Strengthen your business with market research

When conducted effectively, market research is like a guiding star. Equipped with the right tools and techniques, you can uncover valuable insights, stay competitive, foster innovation and navigate the complexities of your industry.

Throughout this guide, we’ve discussed the definition of market research, different research methods, and how to conduct it effectively. We’ve also explored various types of market research and shared practical insights and templates for getting started. 

Now, it’s time to start the research process. Trust in data, listen to the market and make informed decisions that guide your company toward lasting success.

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How to do market research in 4 steps: a lean approach to marketing research

From pinpointing your target audience and assessing your competitive advantage, to ongoing product development and customer satisfaction efforts, market research is a practice your business can only benefit from.

Learn how to conduct quick and effective market research using a lean approach in this article full of strategies and practical examples. 

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A comprehensive (and successful) business strategy is not complete without some form of market research—you can’t make informed and profitable business decisions without truly understanding your customer base and the current market trends that drive your business.

In this article, you’ll learn how to conduct quick, effective market research  using an approach called 'lean market research'. It’s easier than you might think, and it can be done at any stage in a product’s lifecycle.

How to conduct lean market research in 4 steps

What is market research, why is market research so valuable, advantages of lean market research, 4 common market research methods, 5 common market research questions, market research faqs.

We’ll jump right into our 4-step approach to lean market research. To show you how it’s done in the real world, each step includes a practical example from Smallpdf , a Swiss company that used lean market research to reduce their tool’s error rate by 75% and boost their Net Promoter Score® (NPS) by 1%.

Research your market the lean way...

From on-page surveys to user interviews, Hotjar has the tools to help you scope out your market and get to know your customers—without breaking the bank.

The following four steps and practical examples will give you a solid market research plan for understanding who your users are and what they want from a company like yours.

1. Create simple user personas

A user persona is a semi-fictional character based on psychographic and demographic data from people who use websites and products similar to your own. Start by defining broad user categories, then elaborate on them later to further segment your customer base and determine your ideal customer profile .

How to get the data: use on-page or emailed surveys and interviews to understand your users and what drives them to your business.

How to do it right: whatever survey or interview questions you ask, they should answer the following questions about the customer:

Who are they?

What is their main goal?

What is their main barrier to achieving this goal?

Pitfalls to avoid:

Don’t ask too many questions! Keep it to five or less, otherwise you’ll inundate them and they’ll stop answering thoughtfully.

Don’t worry too much about typical demographic questions like age or background. Instead, focus on the role these people play (as it relates to your product) and their goals.

How Smallpdf did it: Smallpdf ran an on-page survey for a couple of weeks and received 1,000 replies. They learned that many of their users were administrative assistants, students, and teachers.

Next, they used the survey results to create simple user personas like this one for admins:

Who are they? Administrative Assistants.

What is their main goal? Creating Word documents from a scanned, hard-copy document or a PDF where the source file was lost.

What is their main barrier to achieving it? Converting a scanned PDF doc to a Word file.

💡Pro tip: Smallpdf used Hotjar Surveys to run their user persona survey. Our survey tool helped them avoid the pitfalls of guesswork and find out who their users really are, in their own words. 

You can design a survey and start running it in minutes with our easy-to-use drag and drop builder. Customize your survey to fit your needs, from a sleek one-question pop-up survey to a fully branded questionnaire sent via email. 

We've also created 40+ free survey templates that you can start collecting data with, including a user persona survey like the one Smallpdf used.

2. Conduct observational research

Observational research involves taking notes while watching someone use your product (or a similar product).

Overt vs. covert observation

Overt observation involves asking customers if they’ll let you watch them use your product. This method is often used for user testing and it provides a great opportunity for collecting live product or customer feedback .

Covert observation means studying users ‘in the wild’ without them knowing. This method works well if you sell a type of product that people use regularly, and it offers the purest observational data because people often behave differently when they know they’re being watched. 

Tips to do it right:

Record an entry in your field notes, along with a timestamp, each time an action or event occurs.

Make note of the users' workflow, capturing the ‘what,’ ‘why,’ and ‘for whom’ of each action.

Don’t record identifiable video or audio data without consent. If recording people using your product is helpful for achieving your research goal, make sure all participants are informed and agree to the terms.

Don’t forget to explain why you’d like to observe them (for overt observation). People are more likely to cooperate if you tell them you want to improve the product.

💡Pro tip: while conducting field research out in the wild can wield rewarding results, you can also conduct observational research remotely. Hotjar Recordings is a tool that lets you capture anonymized user sessions of real people interacting with your website. 

Observe how customers navigate your pages and products to gain an inside look into their user behavior . This method is great for conducting exploratory research with the purpose of identifying more specific issues to investigate further, like pain points along the customer journey and opportunities for optimizing conversion .

With Hotjar Recordings you can observe real people using your site without capturing their sensitive information

How Smallpdf did it: here’s how Smallpdf observed two different user personas both covertly and overtly.

Observing students (covert): Kristina Wagner, Principle Product Manager at Smallpdf, went to cafes and libraries at two local universities and waited until she saw students doing PDF-related activities. Then she watched and took notes from a distance. One thing that struck her was the difference between how students self-reported their activities vs. how they behaved (i.e, the self-reporting bias). Students, she found, spent hours talking, listening to music, or simply staring at a blank screen rather than working. When she did find students who were working, she recorded the task they were performing and the software they were using (if she recognized it).

Observing administrative assistants (overt): Kristina sent emails to admins explaining that she’d like to observe them at work, and she asked those who agreed to try to batch their PDF work for her observation day. While watching admins work, she learned that they frequently needed to scan documents into PDF-format and then convert those PDFs into Word docs. By observing the challenges admins faced, Smallpdf knew which products to target for improvement.

“Data is really good for discovery and validation, but there is a bit in the middle where you have to go and find the human.”

3. Conduct individual interviews

Interviews are one-on-one conversations with members of your target market. They allow you to dig deep and explore their concerns, which can lead to all sorts of revelations.

Listen more, talk less. Be curious.

Act like a journalist, not a salesperson. Rather than trying to talk your company up, ask people about their lives, their needs, their frustrations, and how a product like yours could help.

Ask "why?" so you can dig deeper. Get into the specifics and learn about their past behavior.

Record the conversation. Focus on the conversation and avoid relying solely on notes by recording the interview. There are plenty of services that will transcribe recorded conversations for a good price (including Hotjar!).

Avoid asking leading questions , which reveal bias on your part and pushes respondents to answer in a certain direction (e.g. “Have you taken advantage of the amazing new features we just released?).

Don't ask loaded questions , which sneak in an assumption which, if untrue, would make it impossible to answer honestly. For example, we can’t ask you, “What did you find most useful about this article?” without asking whether you found the article useful in the first place.

Be cautious when asking opinions about the future (or predictions of future behavior). Studies suggest that people aren’t very good at predicting their future behavior. This is due to several cognitive biases, from the misguided exceptionalism bias (we’re good at guessing what others will do, but we somehow think we’re different), to the optimism bias (which makes us see things with rose-colored glasses), to the ‘illusion of control’ (which makes us forget the role of randomness in future events).

How Smallpdf did it: Kristina explored her teacher user persona by speaking with university professors at a local graduate school. She learned that the school was mostly paperless and rarely used PDFs, so for the sake of time, she moved on to the admins.

A bit of a letdown? Sure. But this story highlights an important lesson: sometimes you follow a lead and come up short, so you have to make adjustments on the fly. Lean market research is about getting solid, actionable insights quickly so you can tweak things and see what works.

💡Pro tip: to save even more time, conduct remote interviews using an online user research service like Hotjar Engage , which automates the entire interview process, from recruitment and scheduling to hosting and recording.

You can interview your own customers or connect with people from our diverse pool of 200,000+ participants from 130+ countries and 25 industries. And no need to fret about taking meticulous notes—Engage will automatically transcribe the interview for you.

4. Analyze the data (without drowning in it)

The following techniques will help you wrap your head around the market data you collect without losing yourself in it. Remember, the point of lean market research is to find quick, actionable insights.

A flow model is a diagram that tracks the flow of information within a system. By creating a simple visual representation of how users interact with your product and each other, you can better assess their needs.

You’ll notice that admins are at the center of Smallpdf’s flow model, which represents the flow of PDF-related documents throughout a school. This flow model shows the challenges that admins face as they work to satisfy their own internal and external customers.

Affinity diagram

An affinity diagram is a way of sorting large amounts of data into groups to better understand the big picture. For example, if you ask your users about their profession, you’ll notice some general themes start to form, even though the individual responses differ. Depending on your needs, you could group them by profession, or more generally by industry.

We wrote a guide about how to analyze open-ended questions to help you sort through and categorize large volumes of response data. You can also do this by hand by clipping up survey responses or interview notes and grouping them (which is what Kristina does).

“For an interview, you will have somewhere between 30 and 60 notes, and those notes are usually direct phrases. And when you literally cut them up into separate pieces of paper and group them, they should make sense by themselves.”

Pro tip: if you’re conducting an online survey with Hotjar, keep your team in the loop by sharing survey responses automatically via our Slack and Microsoft Team integrations. Reading answers as they come in lets you digest the data in pieces and can help prepare you for identifying common themes when it comes time for analysis.

Hotjar lets you easily share survey responses with your team

Customer journey map

A customer journey map is a diagram that shows the way a typical prospect becomes a paying customer. It outlines their first interaction with your brand and every step in the sales cycle, from awareness to repurchase (and hopefully advocacy).

The above  customer journey map , created by our team at Hotjar, shows many ways a customer might engage with our tool. Your map will be based on your own data and business model.

📚 Read more: if you’re new to customer journey maps, we wrote this step-by-step guide to creating your first customer journey map in 2 and 1/2 days with free templates you can download and start using immediately.

Next steps: from research to results

So, how do you turn market research insights into tangible business results? Let’s look at the actions Smallpdf took after conducting their lean market research: first they implemented changes, then measured the impact.

Implement changes

Based on what Smallpdf learned about the challenges that one key user segment (admins) face when trying to convert PDFs into Word files, they improved their ‘PDF to Word’ conversion tool.

We won’t go into the details here because it involves a lot of technical jargon, but they made the entire process simpler and more straightforward for users. Plus, they made it so that their system recognized when you drop a PDF file into their ‘Word to PDF’ converter instead of the ‘PDF to Word’ converter, so users wouldn’t have to redo the task when they made that mistake. 

In other words: simple market segmentation for admins showed a business need that had to be accounted for, and customers are happier overall after Smallpdf implemented an informed change to their product.

Measure results

According to the Lean UX model, product and UX changes aren’t retained unless they achieve results.

Smallpdf’s changes produced:

A 75% reduction in error rate for the ‘PDF to Word’ converter

A 1% increase in NPS

Greater confidence in the team’s marketing efforts

"With all the changes said and done, we've cut our original error rate in four, which is huge. We increased our NPS by +1%, which isn't huge, but it means that of the users who received a file, they were still slightly happier than before, even if they didn't notice that anything special happened at all.”

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Market research (or marketing research) is any set of techniques used to gather information and better understand a company’s target market. This might include primary research on brand awareness and customer satisfaction or secondary market research on market size and competitive analysis. Businesses use this information to design better products, improve user experience, and craft a marketing strategy that attracts quality leads and improves conversion rates.

David Darmanin, one of Hotjar’s founders, launched two startups before Hotjar took off—but both companies crashed and burned. Each time, he and his team spent months trying to design an amazing new product and user experience, but they failed because they didn’t have a clear understanding of what the market demanded.

With Hotjar, they did things differently . Long story short, they conducted market research in the early stages to figure out what consumers really wanted, and the team made (and continues to make) constant improvements based on market and user research.

Without market research, it’s impossible to understand your users. Sure, you might have a general idea of who they are and what they need, but you have to dig deep if you want to win their loyalty.

Here’s why research matters:

Obsessing over your users is the only way to win. If you don’t care deeply about them, you’ll lose potential customers to someone who does.

Analytics gives you the ‘what’, while research gives you the ‘why’. Big data, user analytics , and dashboards can tell you what people do at scale, but only research can tell you what they’re thinking and why they do what they do. For example, analytics can tell you that customers leave when they reach your pricing page, but only research can explain why.

Research beats assumptions, trends, and so-called best practices. Have you ever watched your colleagues rally behind a terrible decision? Bad ideas are often the result of guesswork, emotional reasoning, death by best practices , and defaulting to the Highest Paid Person’s Opinion (HiPPO). By listening to your users and focusing on their customer experience , you’re less likely to get pulled in the wrong direction.

Research keeps you from planning in a vacuum. Your team might be amazing, but you and your colleagues simply can’t experience your product the way your customers do. Customers might use your product in a way that surprises you, and product features that seem obvious to you might confuse them. Over-planning and refusing to test your assumptions is a waste of time, money, and effort because you’ll likely need to make changes once your untested business plan gets put into practice.

Lean User Experience (UX) design is a model for continuous improvement that relies on quick, efficient research to understand customer needs and test new product features.

Lean market research can help you become more...

Efficient: it gets you closer to your customers, faster.

Cost-effective: no need to hire an expensive marketing firm to get things started.

Competitive: quick, powerful insights can place your products on the cutting edge.

As a small business or sole proprietor, conducting lean market research is an attractive option when investing in a full-blown research project might seem out of scope or budget.

There are lots of different ways you could conduct market research and collect customer data, but you don’t have to limit yourself to just one research method. Four common types of market research techniques include surveys, interviews, focus groups, and customer observation.

Which method you use may vary based on your business type: ecommerce business owners have different goals from SaaS businesses, so it’s typically prudent to mix and match these methods based on your particular goals and what you need to know.

1. Surveys: the most commonly used

Surveys are a form of qualitative research that ask respondents a short series of open- or closed-ended questions, which can be delivered as an on-screen questionnaire or via email. When we asked 2,000 Customer Experience (CX) professionals about their company’s approach to research , surveys proved to be the most commonly used market research technique.

What makes online surveys so popular?  

They’re easy and inexpensive to conduct, and you can do a lot of data collection quickly. Plus, the data is pretty straightforward to analyze, even when you have to analyze open-ended questions whose answers might initially appear difficult to categorize.

We've built a number of survey templates ready and waiting for you. Grab a template and share with your customers in just a few clicks.

💡 Pro tip: you can also get started with Hotjar AI for Surveys to create a survey in mere seconds . Just enter your market research goal and watch as the AI generates a survey and populates it with relevant questions. 

Once you’re ready for data analysis, the AI will prepare an automated research report that succinctly summarizes key findings, quotes, and suggested next steps.

An example research report generated by Hotjar AI for Surveys

2. Interviews: the most insightful

Interviews are one-on-one conversations with members of your target market. Nothing beats a face-to-face interview for diving deep (and reading non-verbal cues), but if an in-person meeting isn’t possible, video conferencing is a solid second choice.

Regardless of how you conduct it, any type of in-depth interview will produce big benefits in understanding your target customers.

What makes interviews so insightful?

By speaking directly with an ideal customer, you’ll gain greater empathy for their experience , and you can follow insightful threads that can produce plenty of 'Aha!' moments.

3. Focus groups: the most unreliable

Focus groups bring together a carefully selected group of people who fit a company’s target market. A trained moderator leads a conversation surrounding the product, user experience, or marketing message to gain deeper insights.

What makes focus groups so unreliable?

If you’re new to market research, we wouldn’t recommend starting with focus groups. Doing it right is expensive , and if you cut corners, your research could fall victim to all kinds of errors. Dominance bias (when a forceful participant influences the group) and moderator style bias (when different moderator personalities bring about different results in the same study) are two of the many ways your focus group data could get skewed.

4. Observation: the most powerful

During a customer observation session, someone from the company takes notes while they watch an ideal user engage with their product (or a similar product from a competitor).

What makes observation so clever and powerful?

‘Fly-on-the-wall’ observation is a great alternative to focus groups. It’s not only less expensive, but you’ll see people interact with your product in a natural setting without influencing each other. The only downside is that you can’t get inside their heads, so observation still isn't a recommended replacement for customer surveys and interviews.

The following questions will help you get to know your users on a deeper level when you interview them. They’re general questions, of course, so don’t be afraid to make them your own.

1. Who are you and what do you do?

How you ask this question, and what you want to know, will vary depending on your business model (e.g. business-to-business marketing is usually more focused on someone’s profession than business-to-consumer marketing).

It’s a great question to start with, and it’ll help you understand what’s relevant about your user demographics (age, race, gender, profession, education, etc.), but it’s not the be-all-end-all of market research. The more specific questions come later.

2. What does your day look like?

This question helps you understand your users’ day-to-day life and the challenges they face. It will help you gain empathy for them, and you may stumble across something relevant to their buying habits.

3. Do you ever purchase [product/service type]?

This is a ‘yes or no’ question. A ‘yes’ will lead you to the next question.

4. What problem were you trying to solve or what goal were you trying to achieve?

This question strikes to the core of what someone’s trying to accomplish and why they might be willing to pay for your solution.

5. Take me back to the day when you first decided you needed to solve this kind of problem or achieve this goal.

This is the golden question, and it comes from Adele Revella, Founder and CEO of Buyer Persona Institute . It helps you get in the heads of your users and figure out what they were thinking the day they decided to spend money to solve a problem.

If you take your time with this question, digging deeper where it makes sense, you should be able to answer all the relevant information you need to understand their perspective.

“The only scripted question I want you to ask them is this one: take me back to the day when you first decided that you needed to solve this kind of problem or achieve this kind of a goal. Not to buy my product, that’s not the day. We want to go back to the day that when you thought it was urgent and compelling to go spend money to solve a particular problem or achieve a goal. Just tell me what happened.”

— Adele Revella , Founder/CEO at Buyer Persona Institute

Bonus question: is there anything else you’d like to tell me?

This question isn’t just a nice way to wrap it up—it might just give participants the opportunity they need to tell you something you really need to know.

That’s why Sarah Doody, author of UX Notebook , adds it to the end of her written surveys.

“I always have a last question, which is just open-ended: “Is there anything else you would like to tell me?” And sometimes, that’s where you get four paragraphs of amazing content that you would never have gotten if it was just a Net Promoter Score [survey] or something like that.”

What is the difference between qualitative and quantitative research?

Qualitative research asks questions that can’t be reduced to a number, such as, “What is your job title?” or “What did you like most about your customer service experience?” 

Quantitative research asks questions that can be answered with a numeric value, such as, “What is your annual salary?” or “How was your customer service experience on a scale of 1-5?”

 → Read more about the differences between qualitative and quantitative user research .

How do I do my own market research?

You can do your own quick and effective market research by 

Surveying your customers

Building user personas

Studying your users through interviews and observation

Wrapping your head around your data with tools like flow models, affinity diagrams, and customer journey maps

What is the difference between market research and user research?

Market research takes a broad look at potential customers—what problems they’re trying to solve, their buying experience, and overall demand. User research, on the other hand, is more narrowly focused on the use (and usability ) of specific products.

What are the main criticisms of market research?

Many marketing professionals are critical of market research because it can be expensive and time-consuming. It’s often easier to convince your CEO or CMO to let you do lean market research rather than something more extensive because you can do it yourself. It also gives you quick answers so you can stay ahead of the competition.

Do I need a market research firm to get reliable data?

Absolutely not! In fact, we recommend that you start small and do it yourself in the beginning. By following a lean market research strategy, you can uncover some solid insights about your clients. Then you can make changes, test them out, and see whether the results are positive. This is an excellent strategy for making quick changes and remaining competitive.

Net Promoter, Net Promoter System, Net Promoter Score, NPS, and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld, and Satmetrix Systems, Inc.

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Lessons from the Bud Light Boycott, One Year Later

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Six factors that make a brand more susceptible to consumer backlash.

Why did the Bud Light boycott affect the beer brand’s sales when many other boycotts have only marginal or short-term impact? An analysis of sales data confirms that Bud Light suffered a sustained downturn in sales, more pronounced in Republican-leaning counties in the U.S. And it explains several factors that determine how vulnerable a brand is to a boycott. Boycotts can have a bigger impact when a product is more substitutable, when it is more visible, and when consumers feel psychological “ownership” over it.

Taking a social stance has become a rite of passage for contemporary brands that are hoping to resonate with younger, more socially-conscious audiences. In April 2023, Bud Light tried its hand at this strategy, collaborating with transgender influencer Dylan Mulvaney on a social media promotional post. This sparked backlash from several prominent conservatives , leading many conservative figures and groups to call for a boycott of Bud Light.

• Jura Liaukonyte is an Associate Professor at Cornell University’s SC Johnson College of Business. Her research focuses on quantifying the effects of advertising, information, and social media movements on consumer choice.
• Anna Tuchman is an Associate Professor of Marketing at Northwestern University’s Kellogg School of Management. Her research addresses economic questions related to advertising, pricing, and public policy.
• Xinrong Zhu is an Assistant Professor of Marketing at Imperial College London Business School, specializing in quantitative marketing, retail analytics, and the causal impact of policy changes, marketing activities, and politics on consumer behavior.

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For many, being a social media influencer has transformed from a side gig into a multimillion dollar business. Creators now have more say in the sponsored content they create for brands as well as the earnings they receive. And as creators continue to prove themselves as influential brand advocates, marketers are tapping these influencers for content beyond social feeds, including TV, out-of-home, and other digital media.  

Influencers have also proven resilient amid economic uncertainty and an increasingly crowded space. Influencer marketing spend rose roughly 3.5 times faster in 2023 than social ad spending, according to EMARKETER’s July 2023 forecast. 

In this guide, we explore the current state of influencer marketing, and why marketers, social platforms, and media companies should adjust their strategies as the power of the creator economy grows. 

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What is the creator economy?

The creator economy , also called the influencer economy, is the interconnected ecosystem of creators, audiences, digital platforms, marketers, and agencies and/or vendors. The creator economy, as defined by EMARKETER’s Creator Economy Explainer report , enables creators to generate revenues in the form of money, goods, or services through their content, usually delivered via social media platforms. Meanwhile, marketers can partner with creators to build awareness for their brands.

Because interaction among stakeholders is constantly evolving, revenue data is sparse. A March 2023 estimate from Citigroup values the creator economy at $65.2 billion in 2023. By 2024, that figure is expected to reach $74.0 billion. 

What is influencer marketing?

Influencer marketing involves a celebrity, content creator, subject matter expert, or public figure endorsing a brand’s product or service to drive social proof. 

The market is rapidly expanding as influencer types have increased, with influencers filling every conceivable niche and sub-niche interest. 

Here are the types of influencers, based on follower count and focuses:

• Mega-influencers: Often celebrity influencers, those accounts with more than 1 million followers 
• Macro-influencers: Influencers with a follower count of 100,000 to 999,999
• Mid-tier influencers: Influencers with a follower count of 20,000 to 99,999
• Micro-influencers: Followers ranging between 5,000 to 19,999 
• Nano-influencers: A community of 1,000 to 4,999 followers 
• Kidfluencers: Gen Alphas with social followings that often review toys and games 
• Gaming influencers: Esport and video game players who discuss game strategy and livestream while in-game 
• Virtual influencers: Computer-generated avatars like Noonoouri, a fashion model and digital-only popstar 

The pandemic sped up changes in influencer marketing that were already underway, such as the trend toward “unfiltered” or less-scripted content, the rise of TikTok, and the popularity of “everyday influencers” with genuine and relatable personalities like Elyse Myers. 

Industries like financial services that hadn’t invested in influencer marketing earlier are also learning to navigate the space. And as ecommerce and social media converge, influencers will become increasingly vital intermediaries, helping to connect brands with consumers on social media. 

Creators vs. influencers: What’s the difference? 

Creators create content. Influencers are creators if the content they develop can sway the purchase decisions of a population regardless of whether they are being paid to promote a product. The term refers to a wide group of people from celebrities to loyal customers. Creators are influencers if their content affects purchase decisions. 

Who is a creator? 

Everyone has the potential to be a content creator thanks to how the term is defined. Adobe estimates there could be up to 303 million creators worldwide. For context, that figure is close to the US population at the start of 2023, per the US Census Bureau. 

Most content creators worldwide are under 41, but there are creators of all ages, including Gen Xers and baby boomers, per Adobe. 

Creators over 60 years old, dubbed “granfluencers,” have found popularity on social media due to their cross-generational appeal. 

For example, Nonna Pia, a TikTok account with 4 million followers, features a grandmother who cooks classic Italian dishes while her grandson narrates. Similarly, the Instagram account “Excuse My Grandma” follows a grandmother-granddaughter duo as they discuss generational differences in dating, fashion, and more. 

Creator categories

Although there is an account for every interest and target audience—from foraging to chiropractic medicine—lifestyle, fashion, and beauty are among the top creator categories.

While broad, these top categories overlap with many other industries, including travel, health, entertainment, food and drink, and art. Cross-category appeal is ideal for brand marketers looking to expand their reach to find like-minded audience demographics. 

Areas that have seen recent growth in creator focus include:

Collegiate sports

A 2021 NCAA policy change allows college athletes to be compensated for their name, image, and likeness. College athletes already command large audiences and regularly create content on social media, per August 2022 data from Curastory.  

B2B professionals 

Industry professionals are increasingly building audiences by sharing B2B content online. For example, a “ LinkedInfluencer ” is an influencer on B2B social platform LinkedIn. 

Nearly 1 in 4 people in the US are on LinkedIn, according to EMARKETER’s May 2023 forecast, as both the creator economy and B2B ad spending grow. As buyers get younger and B2B marketing becomes increasingly digital, authenticity and experience will matter more in marketing. 

Financial services

In the financial sector, “ finfluencers ” use their social media platform to share videos that cover personal experiences, tips, and advice about investing, budgeting, financial trends, and the economy. 

Finfluencers are capitalizing on a widespread lack of financial literacy. However, the quality of the content is controversial because some creators do not have a professional background in finance. Despite concerns, 60% of investors ages 18 to 35 use social media as a source of investment information, according to a Finra Investor Education Foundation report.  

The generational response 

Younger shoppers are more likely to use social media . About 129.5 million US Gen Zers and millennials will use social media in 2024, per a May 2023 EMARKETER forecast. 

Younger shoppers are also more likely to follow and buy from accounts run by influencers. A Q2 2022 Klarna survey found that over 40% of Gen Zers and millennials worldwide follow influencers , compared with one-quarter of Gen Xers and less than 10% of baby boomers. 

Millennials

Often considered a millennial concept, influencer culture is embraced by this extremely active social media user base. Close to 70 million US millennials will use social media next year, per EMARKETER’s May 2023 forecast. 

Millennials look to trusted influencers for product recommendations, reviews, and as a discovery point for new brands. 

They’re also willing to purchase what they see being promoted by their favorite influencers on social media. Over half (54.1%) of US social network users ages 25 to 34 will make a purchase on a social platform in 2024, per September 2023 EMARKETER data. 

In 2024, 60.7 million US Gen Zers will use social media, according to EMARKETER’s May 2023 forecast. And while that growth is expected to continue through 2027, Gen Z will remain slightly behind millennial users.  

Gen Zers, however, are not as sold on following influencers as their older peers. Less than half (48.6%) use social media to view creator/influencer content, according to a July 2023 EMARKETER survey’s findings. 

Where influencers do have an outsize influence over Gen Z is women’s beauty and wellness. Close to 80% of Gen Z women rank creators as their most trusted source for beauty recommendations, a survey conducted by LTK found. 

Those recommendations are also turning into online and offline sales. Eighty-three percent of Gen Z women shop for creators’ product suggestions online, and 82% shop for those items in-store.  

Influencing by “de-influencing” 

While the majority of influencers promote what to buy, some influencers are turning to platforms like TikTok to tell their followers what not to buy. As of January 2024, #deinfluencing videos on TikTok have roughly 1.3 billion views, up considerably from 208 million in February 2023. 

Seen as a method to combat overconsumption in a tight economy, deinfluencing videos often offer economical alternatives to expensive products or discuss the pitfalls of fast-fashion shopping hauls. 

Creators also use de-influencing videos to share critical commentary to distance themselves from brand controversies and post honest reviews of products that don’t meet expectations. Doing so can help reinforce creator trust through authenticity and transparency. 

Influencer marketing spend 

In 2024, advertisers will spend $5.89 billion on influencer marketing, a 14.7% increase YoY, according to EMARKETER’s July 2023 forecast, which excludes paid media. 

US influencer marketing spend grew more than three times faster than social ad spending in 2023, and it will remain ahead through 2025, according to a July 2023 EMARKETER forecast. 

Social platforms are reliant on creators, not the other way around, as creators’ options extend and include owned channels like blogs, podcasts, and newsletters.

A number of well-known creators, such as YouTuber MrBeast and podcaster Alex Cooper, have launched their own audio and video networks.

Although not every creator has a strong enough brand or following to create a successful media business , the growing success of these ventures should signal to brand marketers and entertainment companies that creators can offer much more than an outlet to generate hype or hawk goods. 

Where influencers post sponsored content

Creators utilize a number of social media platforms. 

To be impactful, influencer content should be engaging, entertaining, and educational, and marketers should work with credible creators who have built trust with their communities. 

US marketers will allocate over $1 billion to sponsored content on each of the top four influencer marketing platforms in 2024, according to EMARKETER’s July 2023 forecast. When it comes to influencer monetization , Instagram posts were the top format that creators worldwide were paid by brands to create in December 2022, per a Later and Mavrck December 2022 survey. Here’s a look at the top social media marketing platforms for influencers.

Instagram remains the top platform for sponsored content, per a June 2023 report from Mavrck. About 98% of US creators share brand content via Instagram feed posts, Instagram Stories, and Instagram Reels, while 69.1% go live on the platform. 

As of June 2023, more creators worldwide report being paid to create Reels (98.0%) compared with TikTok videos (89.6%). 

Creator monetization: In May 2023, Meta began testing a new payout model for Ads on Reels. The monetization program pays creators based on the performance of the Reel, rather than the earnings of the Reel ad, per TechCrunch. 

As TikTok’s popularity rises, brand opportunities for paid content is likely to increase as well. 

Influencer marketing spending growth on TikTok has grown 27.8%, compared with 12.7% on Instagram, according to EMARKETER’s July 2023 forecast.

In 2024, over half of marketers (54.0%) will use TikTok specifically for influencer marketing, with $1.25 billion in US influencer marketing spend going to the platform, per the same EMARKETER forecast.

Creator monetization: If an influencer promotes a brand’s product on TikTok Shop, the social app’s ecommerce tool, they can earn a commission through product sales. For both brands and influencers, TikTok Shop holds a lot of promise and room for growth. In 2024, we expect 40.7 million TikTok users to make a purchase on the app. 

YouTube, like Instagram and TikTok, has a solid hold on influencer marketing. YouTube is the top platform for US adults to follow influencers, according to March 2023 CivicScience data. 

EMARKETER forecasts that in 2024, US marketers will spend $1.07 billion on influencer content for YouTube. 

Similar to Instagram Reels, YouTube has been emphasizing Shorts as a cost-effective option for marketers.

Livestreaming is also leveraged by YouTube to connect influencers—and, ultimately, the brands they partner with—to followers. One-fourth (25.0%) of internet users say they watch creator- or influencer-led livestreams on YouTube, making it the most popular livestreaming app, ahead of TikTok (18.7%), Facebook (17.4%), and Instagram (14.0%), per an April 2023 survey by The Influencer Marketing Factory. 

Creator monetization: YouTube attracts and retains creators in a number of ways. The platform offers a way to connect creator, artist, and brand stores to their YouTube channel, enabling users to more easily find and purchase featured products. YouTube also has affiliate shopping capabilities for creators interested in revenue opportunities. 

Other platforms with influencer marketing potential include Facebook, Twitch, and to a lesser extent, Snapchat and X, the social media company formerly known as Twitter. 

Despite its waning popularity among users, especially youths, Facebook is still expected to see $1.00 billion in influencer marketing spending next year, per an EMARKETER forecast. 

Popular with the esports gaming community, livestreaming app Twitch recently launched a number of features for creators. In July 2023, Twitch announced its Discovery Feed, made up of livestream clips and ad features that help creators share their content from other platforms such as YouTube, TikTok, and Reddit. 

Snap has struggled with ad monetization and commands a fraction of influencer marketing spend compared with larger platforms. In 2023, Snap crossed $40 million in influencer marketing spending, and is expected to see growth of 3.4% in 2024.  

In October 2023, Snap released Creator Collab Campaigns, a suite of tools to facilitate brand-creator partnerships on the platform. Previously, Snap’s primary focus was helping creators monetize directly on the platform through programs like ad revenue sharing. 

X (formerly Twitter)

X saw total US ad revenues decline by 54.9% in 2023 after Elon Musk’s 2022 purchase, according to EMARKETER’s October 2023 forecast, which means it is not an attractive platform for influencer marketing. 

The aforementioned June 2023 Mavrck survey found that 45.9% of US creators shared promoted tweets, while a December 2022 Later and Mavrck survey found that 8.3% of creators worldwide have been paid by a brand to post on X. 

Influencer marketing strategy

An influencer marketing strategy allows a brand to further its reach and tap new audiences, but narrowing down the right creator to work with requires an understanding of the landscape and what type of partnership will best serve the brand’s objectives.  

Influencer marketing hubs: As influencer marketing took off, agencies dedicated to influencers sprang up to help brands manage the opportunity and vice versa. 

Acting as a directory, influencer marketing hubs organize creator profiles by follower count per social platform, audience demographics, location, services offered, the price of partnership, and their interests (e.g., fashion, travel, home improvement, etc.), to take the guesswork out of selecting an influencer to partner with.  

In addition to facilitating brand-creator relationships and identifying new talent, influencer hubs create campaign narratives, determine KPIs, and amplify influencer-led social campaigns, among other responsibilities. 

For creators, working with an influencer marketing agency can be beneficial to scale and manage their own business. As influencer campaigns become more complex, an agency can manage payment, negotiate contracts, handle data analytics and reporting, and oversee other business functions.

Influencer marketing campaigns: An influencer marketing campaign is one that leverages the influence the creator has over their followers. 

When in a paid partnership with a brand, the influencer campaign’s objective is to increase awareness, engagement, and, ultimately, sales. In comparison, an unsponsored campaign, while achieving the same objectives to various degrees, can be seen as more trustworthy and authentic by the influencer’s community.  

Influencer campaigns fall into two categories: 

• User-generated content (UGC) is organic content shared by a social media influencer to promote a brand or product without direct input from the featured brand. The influencer is not paid for UGC posts, and is often not as polished as content created with brand involvement. UGC posts range from product reviews, recommendations, tutorials, and personal experiences with a given good or service.
• Influencer-generated content is a collaboration between a creator and partner brand. These campaigns follow a brand’s creative guidelines—including tone of voice, talking points, aesthetics, and frequency of posts—to produce content fitting for that creator’s audience. As more influencers become trusted partners, brands have loosened the reins, allowing talent to tap into their own creativity for campaigns. Like UGC, influencer-led campaigns are more authentic and engaging, and may prove more effective for the brand involved. 

Influencer posts: When paid for by a brand partner, an influencer post is a type of native advertising. When unpaid with no brand involvement, the post is considered UGC. 

Most commonly seen on social media platforms, formats include Instagram photos with captions, short-form videos on TikTok, and long-form video content posted to YouTube. Influencers can also post written content on blogging platforms like Substack. Influencers will often promote their posts across various platforms to increase reach, engagement, and effectiveness. 

While format is an important aspect of influencer marketing, the post’s creative should be at the forefront. According to EMARKETER’s Influencer Monetization 2023 report, the “three E’s” of influencer marketing should be remembered when creating posts. 

“Regardless of the format, each piece of content should be engaging, entertaining, and educational to drive the most impact,” according to EMARKETER analyst Jasmine Enberg. Brands should also trust creators’ input on creative and format decisions because they know what will resonate best with their audience, Enberg continued.   

Product launches: Influencers are an ideal way for a brand to launch new products. 

When introducing a new product, brands can expand their reach by working with influencers with a similar following as the brand’s target audience. A kitchenware brand, for instance, may work with a popular food influencer to introduce a new range of pots to show off the products, its attributes, and how to buy. 

As influencers become brands in their own right, many have launched their own product lines.

Thanks to an engaged and well-known audience, some influencers are able to develop products that align with the interests of the community they’ve built across their social media footprint. 

For example, beauty vlogger and influencer Huda Kattan launched her own line of false eyelashes in 2013 after her community expressed an interest. Kattan then expanded the line into a full range of cosmetics. Huda Beauty, named after Kattan’s YouTube channel and blog, is now sold D2C and at Sephora. 

Creators with large followings have launched food and beverage products, fitness programs, clothing lines, restaurants, and more to capitalize on their popularity and the value and willingness of their followers to support their businesses. Venturing into their own products also helps creators diversify their revenues and avoid alienating their audiences with too much sponsored content. 

Collaboration: Similar to leveraging an influencer’s help to launch a new product, brands also partner with their stable of creators for product collaborations. 

Often developed as a one-off or limited-edition product, brand-influencer collaborations can be a great source of product innovation. 

In March 2023, Chipotle added two new limited-edition menu items to its quesadilla lineup, the “Keithadilla” and the “Fajita Quesadilla Hack,” which were developed and popularized by TikTok creators Keith Lee and Aleix Frost. 

For some influencers, a brand collaboration may be a jumping-off point to developing their own product lines if the collaborative effort was deemed successful. 

Common influencer marketing KPIs

These metrics are a good way for brands to measure their return on investment for influencer marketing campaigns: 

• Facebook engagement rates (subscribers only): Engagement rate is defined as measurable interactions on social media posts, including likes, comments, favorites, retweets, shares, replies, and reactions, and is calculated based on all these interactions divided by total follower count.  
• Facebook posts per week  
• Instagram affiliate engagement rate : The percentage of an affiliate influencer’s audience that interacts with an affiliate influencer’s campaign or post on Instagram; this includes likes, comments, and shares.
• Instagram affiliate impression per follower rate : The number of affiliate-generated views that a specific post or piece of content received over a specific period of time on Instagram. 
• Instagram affiliate reach : The percentage of followers and viewers from an affiliate influencer’s audience that is exposed to the affiliate influencer’s Instagram. 
• Instagram affiliate view rate : The percentage of an affiliate influencer’s audience that views an affiliate influencers’ campaign or post on Instagram. 
• Instagram engagement rates : Engagement rate is defined as measurable interactions on social media posts, including likes, comments, favorites, retweets, shares, replies, and reactions, and is calculated based on all these interactions divided by total follower count.
• Instagram posts per week
• Social affiliate clicks : The clicks generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website.
• Social affiliate conversion rate : The percentage of clicks generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website that also result in completed orders or purchases.
• Social affiliate engagement rate : The percentage of an affiliate influencer’s audience that interacts with an affiliate influencer’s campaign or post on a social media platform; this includes likes, comments, and shares.
• Social affiliate orders : The orders generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website.
• Social affiliate sales : The sales or revenues generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website.
• Social affiliate view rate : The percentage of an affiliate influencer’s audience that views an affiliate influencer’s campaign or post on a social media platform.
• TikTok affiliate engagement rate : The percentage of an affiliate influencer’s audience that interacts with an affiliate influencer’s campaign or post on TikTok; this includes likes, comments, and shares.
• TikTok affiliate view rate : The percentage of an affiliate influencer’s audience that views an affiliate influencer’s campaign or post on TikTok.
• X (formerly Twitter) tweets per week

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Cd and savings rates today: grow your savings.

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Banks are fighting for customer dollars right now, and people with cash to spare are well-positioned to benefit from a high rate environment. With rates rapidly changing, how can you feel confident that you're getting the  best savings account or best CD ?

We monitor rates from banks and credit unions daily to help you feel confident before you open a new account. Experts don't expect CD rates to go up in 2024 , so now could be a great time to lock in a rate if you're ready. Here are the top rates for popular savings accounts and CDs on Sunday, March 31.

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About High-Yield Accounts

High-yield savings accounts aren't the only accounts paying favorable rates right now. You'll typically see the highest rates at online or lower-profile institutions rather than national brands with a significant brick-and-mortar presence. This is normal; online banks have lower overhead costs and are willing to pay high rates to attract new customers.

High-Yield Savings Accounts

The best high-yield savings accounts provide the security of a savings account with the added bonus of a high APY. Savings accounts are held at a bank or credit union — not invested through a brokerage account — and are best for saving cash in pursuit of shorter-term goals, like a vacation or big purchase. 

High-Yield Checking Accounts

The best high-yield checking accounts tend to pay slightly lower rates than high-yield savings, but even they are strong in today's rate environment. A checking account is like a hub for your money: If your paycheck is direct deposited, it's typically to a checking account. If you transfer money to pay a bill, you typically do it from a checking account. Checking accounts are used for everyday spending and usually come with checks and/or debit cards to make that easy.

Money Market Accounts

The best money market accounts could be considered a middle ground between checking and savings: They are used for saving money but typically provide easy access to your account through checks or a debit card. They usually offer a tiered interest rate depending on your balance.

Cash Management Accounts

A cash management account is also like a savings/checking hybrid. You'll generally see them offered by online banks, and, unlike a checking account, they usually offer unlimited transfers. A savings account often limits the number of monthly transfers, while a checking account doesn't. Cash management accounts typically come with a debit card for easy access, but you may have to pay a fee if you want to deposit cash.

Certificates of Deposit

The best CD rates may outpace any of the other accounts we've described above. That's because a certificate of deposit requires you to "lock in" your money for a predetermined amount of time ranging from three months to five years. To retrieve it before then, you'll pay a penalty (unless you opt for one of the best no-penalty CDs ). The longer you'll let the bank hold your money, the higher rate you'll get. CD rates aren't variable; the rate you get upon depositing your money is the rate you'll get for the length of your term.

About CD Terms

Locking your money into an account in exchange for a higher interest rate can be a big decision. Here's what you need to know about common CD terms.

No-Penalty CDs

Most CDs charge you a fee if you need to withdraw money from your account before the term ends. But with a no-penalty CD, you won't have to pay an early withdrawal penalty. The best no-penalty CDs will offer rates slightly higher than the best high-yield savings accounts, and can offer a substantially improved interest rate over traditional brick-and-mortar savings accounts.

6-Month CDs

The best 6-month CDs are offering interest rates in the mid-5% range. Six-month CDs are best for those who are looking for elevated rates on their savings for short-term gains, but are uncomfortable having limited access to their cash in the long term. These can be a good option for those who may just be getting started with saving, or who don't have a large emergency fund for unexpected expenses.

The best 1-year CDs tend to offer some of the top CD rates, and are a popular option for many investors. A 1-year term can be an attractive option for someone building a CD ladder , or for someone who has a reasonable cash safety net but is still concerned about long-term expenses. 

The best 2-year CD rates will be slightly lower than 1-year and no-penalty CD rates. In exchange for a longer lock-in period, investors receive a long-term commitment for a specific rate. These are best used as part of a CD ladder strategy, or for those worried about a declining rate market in the foreseeable future.

The best 3-year CDs tend to have rates that are comparable to 2-year CDs. These are usually less popular for your average investor, but can be an important lever when diversifying investments and hedging against the risk of unfavorable rate markets in the long term.

The best 5-year CDs will offer lower rates than the other terms on our list, but are still popular options for investors. These CDs are best for those looking to lock in high rates for the long term. CDs are generally viewed as safe investment vehicles, and securing a favorable rate can yield considerable earnings in year three and beyond — even if rates fall elsewhere.

Watch: 6 simple investing tips for beginners

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