Desk Market Research: Relevant Now and Always

Desk marketing research is the foundation of a successful business strategy for years to come.

One of the most popular criteria for classifying marketing research is by the nature of the work and the collection of primary information. There are two basic types – field and desk research. Usually, the desired sequence is discussed and written about – first, desk research is conducted, within which hypotheses are formed and preliminarily tested using information that is less specific and current, but more comprehensive and accessible, covering all possible directions and spheres of the company's current and potential activities.

Then, based on the selection of the most interesting areas that could become the birthplace of business growth points or the development of existing potential, field research programs are formed. Within their framework, information with a high degree of relevance, relevance to the tasks set, and verifiability is accumulated. In the conditions of the new economic reality of social and economic constraints, when field work is partially, sometimes significantly, difficult, and the cost of selecting incorrect hypotheses for conducting "field" research is especially high, it is worth talking in detail about desk research. Why should you focus your efforts on this particular area of the company's marketing activities?

"Desk Marketing" helps increase the efficiency of the marketing budget

Cost savings are an enduring value for any company. However, unfavorable economic conditions and falling markets push management to work more efficiently with 'costs'. In Russian practice, the position of management and owners is still widespread that the first (one of the first) thing to be cut in terms of funding is the marketing budget. And here a reasonable question arises – which items should be cut first, and which later.

At the same time, items for conducting market research are always significantly inferior to advertising expenses, for example. And it is rare when these items are anything other than zero. If large businesses have the understanding (and the capabilities too) to form a budget for research and execute it to one degree or another, then small businesses often spend significant (5% or more of the total budget) money on advertising activities, the effectiveness of which is either not calculated or is justified in a way that satisfies everyone (the advertising specialist shows that he is useful, and the manager convinces himself, looking at the numbers in the reports, that he, as a professional, managed to find a good contractor, often vaguely understanding the meaning of all these calculations and justifications).

Of course, advertising is extremely important, especially when the market situation is not the best, but at the same time, before spending money on product promotion, it is advisable to have a clear understanding that we are promoting exactly those products, on that market, to those consumers, and with those parameters (quality, price, options, etc.) that can find the maximum response. This understanding is formed precisely within the framework of marketing research, as they are the basis for making key commercial decisions. Good advertising that does not meet market expectations is as effective as shooting a quality weapon blindly.

Moreover, practical experience shows that a competent and responsible specialist, especially a manager in charge of promotion or advertising, will himself ask to provide him with the widest possible range of information about the market, competitors, and promising trends. Such data, especially prepared and systematized, significantly improve the quality of advertising campaigns and allow the use of more effective communication channels.

But it's not just about advertising. Desk research is the first step towards building an effective business strategy for the company. Having the necessary information to make strategic decisions about the market does not guarantee that they will be agreed upon, let alone implemented, but it creates the necessary basis for that.

A well-prepared and conducted desk marketing research allows the company to form a balanced position on the choice of optimal product and geographic markets, adapt products to these markets, prepare a competitive pricing proposal, develop promising sales channels, and find partners who can adequately represent the interests of the business. Then, of course, this information will be used in preparing the advertising campaign, as it will be clear where, to whom, and with what we are going, what conditions we offer.

Thus, desk research is a tool that works in business like the famous "Occam's razor," cutting off everything superfluous that distracts time, employees, and money. Prioritizing tasks, including market ones, is one of the most resource-intensive but key functions of owners and top management. Its implementation must be supported by information that can only be gathered from outside through marketing tools.

A simple example. One manufacturing company set the task of entering the EU market with products aimed at the end consumer and the DIY channel and marketplaces (this was the hypothesis, in these channels it had achieved success in the Russian market). And it stopped at this stage, as it simply did not have the resources to work out all EU countries in these channels, and the company's management did not understand how to choose priorities.

What did the desk marketing research allow to do in this case? First, to choose a country for the optimal entry into the EU market, taking into account both the internal market and trade relations with other EU states. In our example, the Netherlands was chosen as such a country.

Then, they began to work out entry channels, which made it possible to establish the impossibility of direct entry into the priority (within the initial hypothesis) sales channels. The task was adjusted – to look for entry points, which were found in the direction of wholesale companies with a certain profile.

Thus, through marketing desk research (which included online communication with potential partners), the initial hypothesis – to work out the DIY channel in the EU – was specified to work out the channel of wholesale companies with a certain profile in the Netherlands. As you understand, the costs of implementing these tasks are fundamentally incomparable, not to mention the effectiveness of the initially assumed "using a cannon to kill a sparrow."

The moral is very simple – in most cases, conducting desk marketing research reduces the costs of subsequent commercial activities while improving their effectiveness.

Desk marketing research is necessary for entering export markets

The example given in the previous part of the text confirms the thesis stated in the title of the current part of the article – entering export markets should always begin with "desk marketing."

Of course, there might be an objection – foreign buyers contacted us themselves and now we export without any research. Yes, such a situation is rare but possible. However, it does not at all exclude the need for marketing research; it even increases its relevance for one simple reason – if an external contact has already been established and has begun to be executed, then it is all the more necessary to have a complete "layout" of the situation in the foreign market where your product is in demand. To understand, at a minimum, whether you are working with the right partner and whether the profit you are left with as a result of this cooperation is the right one. In practice, there are many examples of how even large businesses trusted foreign partners and, as a result, missed out on millions of dollars in lost profits.

Now the topic of exports is more relevant than ever. First, the situation in many Russian markets is unfavorable, which is associated with the epidemiological situation and the exchange rate. It is logical that companies are trying to hedge their risks by operating in different geographic markets. Information has already passed about the gradual recovery of the economy in China and the lifting of restrictions. Other countries will also enter the phase of economic growth at different times.

The second reason is that in 2020, measures of state support for exporters are still in place, including, on a co-financing basis (the business bears 20% of the costs), services for conducting marketing research of export markets are provided. Therefore, if a company does not have sufficient in-house competencies to organize and conduct research, it can use this service, saving significant funds.

Moreover, in the process of providing such a service, interaction with the contractor is possible (export support centers attract agencies specializing in marketing research of foreign markets for these purposes), which means you can not only get the result of a specific study but also, to some extent, master the principles and content of such work in order to later independently attempt to conduct a similar study in a simpler and more understandable foreign market.

Why are desk studies especially important for operating in foreign markets? The main thing is that more often than not, businesses are poorly oriented in the specifics of their functioning, do not imagine the barriers that need to be overcome to supply their products to a particular country. If there is an understanding for some country and region, it can play both positively and negatively.

The positive is clear – there is information for decision-making. The negative is that thereby the priority market becomes not the one that is optimal from a business point of view, but the one that was "remembered at the right moment." Hence such cases when a company tries to enter a market because the owner's friend lives there or the son studied at a good university and now wants to stay and do business.

Of course, sometimes this works too, but it is much better to proceed step by step and identify priorities objectively. To do this, within the economically justified supply area (not all goods can be profitably supplied worldwide), it is necessary to consider all markets in order to rank them for subsequent in-depth study of the most promising ones (not only by desk methods but also by field methods).

The first steps are precisely the responsibility of desk marketing research. Not every company, especially those belonging to the category of small and medium-sized businesses, has the human resources to solve this problem. But for this, there is outsourcing. If the marketing team is ready for such challenges, then it is a sin not to use the available opportunities to find new growth points for your company.

They look both at the market potential – how much and at what markup can be sold, and at the barriers – what costs will be required at the entry stage, at what sales volume they become economically justified. Sometimes barriers are of a direct prohibitive nature, and not only for distant markets but also within the Customs Union (many petroleum products to Kazakhstan, for example, a Russian company will not be able to sell due to a direct prohibition).

So, export now is a reasonable and justified step, but it must be prepared. Desk research will help with this, answering the question of where and with what we will go. At the same time, we will know for sure that we will be allowed there.

"Desk Marketing" – a local trend of spring 2020

As psychologists tell and write to us, one must look for positivity and opportunities in everything. April 2020 teaches many Russian companies to work remotely, employees are at home, sometimes – isolated from colleagues in the workplace. Currently, many field research methods are unrealizable, but for "desk marketing," the situation has practically not changed at all. Access to the main sources of information does not depend on the introduced restrictions, therefore, technically, such work can be carried out in full.

From the point of view of communication with information carriers, both in Russia and abroad, the situation is rather favorable, as many remain at home and spend a lot of time on the Internet, some are bored without work in the usual mode of load, so they are ready to contact with greater willingness. Now it is even easier to start communication and get acquainted, as there is a certain unity of people all over the world, barrier prejudices in communications are less manifested. Easy and business communication helps to resist stress and see a positive perspective for the development of the situation.

The workload on in-house marketers has also decreased, budgets are on hold, but firing employees and sharply reducing their pay is not recommended, so it's time to check their competencies in the field of marketing analysis and market research. A calmer work mode can help in carrying out such functions, even if they are not core.

However, the most important of the current trends is the change in the socio-economic situation in Russia and the world. Many experts are already saying that the world will emerge from the current crisis differently, the priorities of consumer behavior will change, the motives for choosing goods and services. Furthermore, significant changes are predicted in the structure of the world economy – in different countries with varying depth and dynamics, but the industry structure will change. Some markets will fall more, some less, and some will manage to increase their influence and become more significant. And this is without even mentioning the multitude of local changes – in individual geographic and product markets, in sales channels, methods of competitive struggle and promotion, and so on.

In the whirlwind of recent events, it is difficult to focus on long-term goals and objectives, but right now it is extremely useful and significant for business. Good desk marketing research will help to draw up a clear plan for getting out of the crisis and restoring the economic potential of the enterprise. Perhaps this will require significant changes in development priorities, which cannot be found in current operational activities.