Many marketers strive for the complete understanding of the processes by which consumers decide to buy, or not to buy, their products hoping that it will help to make better marketing decisions. This belief is based on the assumption that it is possible to discover an underlying pattern and order in human behavior which has the same status as the natural laws of the physical sciences. A great deal of market research is carried out to uncover these fundamental 'laws' of human behavior. This seldom, if ever, makes sense.
In spite of all this research, it is absurdly optimistic to expect that a research company, with a research budget of a few tens of thousands of dollars, will be able to develop a reliable theory of carpet buying, or choice of brand of coffee. In other words, what market research cannot do is produce reliable, comprehensive explanations of consumer behavior. What it can do is increase the probability of making correct marketing decisions.
Here is what market research can do (this list is derived from David Ogilvy's book Ogilvy on Advertising):
1. To elicit new product ideas from potential consumers. But consumers' perceptions are largely constrained by their past experiences, so it is unrealistic to expect any revolutionary ideas.
2. To generate consumer reactions to a new product when it is still in the conceptual stage. If necessary, several different concepts can be tested and the one with the highest probability of success concentrated on.
3. To determine what formulation, flavour, fragrance, colour and other product features from a range of alternatives appeal most to customers.
4. To find out which of several package designs is likely to sell best and whether people can actually open or use a package.
5. To estimate the potential sales of new products and the advertising expenditures required to achieve maximum profits. In some circumstances research can predict the effect of price changes on product sales and indicate the price that should be charged for a product.
6. To determine how consumers rate it compared with products they are currently buying once a product is ready for market
7. To help to decide the optimum positioning for a product. In other words, how the product fits into the market, what its image is or will be, and who is likely to buy it.
8. To establish what factors are important in purchase decisions, what vocabulary consumers use when talking about products, and what newspapers they read, radio stations they listen to and television programs they watch.
9. To determine whether advertising communicates what was intended.
What each of these tasks has in common is that they all relate to management decisions. In each case market research provides the means of making better management decisions. This in turn implies that management knows what decisions it needs to make and that it is not conducting research in the hope that by fully 'understanding' consumers the solutions to all its problems will somehow become apparent.
However, even when market research is decision-oriented, management cannot relinquish its responsibility to manage. Market research is not, and never will be, a substitute for management.