Despite the importance of market research, some small or medium sized businesses don’t collect primary research; in the outdoor industry, this seems to be particularly true. Large outdoor retailers such as Patagonia, North Face, Arc'teryx, and REI all perform their own market research studies, but many medium-sized brands fail to take advantage of consumer behavior research. This is a shame because market research is a simple way to develop the insights necessary to make a company truly successful.
So if market research is so important for outdoor retail companies, why do so many medium-sized outdoor retailers fail to conduct their own market research? Based on our experience, there are a few things that commonly prevent companies from conducting their own research. We’ve listed these barriers below, and we make a few suggestions for how companies can overcome these common obstacles:
The “I Know My Industry” Mindset
Outdoor retail companies are largely founded and managed by individuals that love their industry. This is fantastic because a love of the outdoors (something we personally possess) has driven the start-up of many great out-door retail businesses. That being said, when people build a business surrounding something they love, they start to assume they know exactly what that industry needs. Runners assume they know what type of shoe other runners needs, climbers assume other mountaineers climb like they do, etc.
While being personally invested in the products your company develops can lead to great innovations, it can also generate great biases in the products your company produces. Market research allows business owners to take a step back and evaluate the thoughts/feelings/opinions of their customers from a different perspective. In the case of outdoor retail, it allows companies to develop the products people truly want, rather than assuming they know what other outdoorsy individuals might need.
Lack of Understanding/Technical Skill
People naturally veer away from things that they don’t understand. If you work in outdoor retail, you probably love the outdoors and know a lot about being in the wilderness; further, if you’re a business owner, you likely know a lot about managing businesses. That being said, you probably don’t know much about how to conduct primary research. Therefore, market research is a trip outside the comfort zone for many small/medium business owners.
This does not mean that market research isn’t useful for outdoor retail businesses. Quite the contrary, we argue that market research is an important tool for growing your businesses from a small/medium size into a fortune 500 giant. The fundamental issue is that medium-sized businesses shy away from doing things that seem unfamiliar to them. Conducting research is its own set of skills and knowledge that often times takes many years to develop. Considering the importance of market research in the business world, unfamiliarity with a concept should not prevent market research from occurring.
For businesses that don’t have the technical expertise or personnel to conduct market research the solution is simple, hire a market research firm to do the work for you. That fundamental truth leads us to the last barrier that prevents companies from conducting market research projects: project costs.
Money
The cost associated with conducting market research sometimes feels difficult to overcome, but most businesses owners don’t consider the opportunity that’s afforded by conducting “expensive” research (which sometimes costs as little as 5-10k). While market research might feel pricey at the time it’s conducted, it’s important that business owners remember research is a long-term investment that more than pays itself back over time. Businesses commonly spend tens of thousands of dollars developing ineffective products, or they waste money on marketing campaigns directed at the wrong demographics. Market research keeps companies from making costly blunders, helps interpret company images, and contributes to designing products that people actually want.
Admittedly, massive market research companies can be too expensive for small or medium-sized businesses. For smaller businesses that have a limited research budget, we recommend that you seek out a small or medium-sized research firm.
The Real Cost
Above, we’ve highlighted three things that commonly prevent small and medium-sized businesses from conducting market research, especially businesses involved in the outdoor retail industry. Business owners commonly feel that they know everything about their industry, and therefore they do not feel the need to conduct market research; we’ve argued that this perception is false because assuming you know everything about your industry creates biases and prevents you from connecting to lucrative demographics that might be interested in your business. Further, many business owners shy away from conducting market research because they simply don’t understand it; this doesn’t mean that business owners should prevent themselves from harnessing all the benefits of market research, they just need to consider contracting individuals that have that expertise. Finally, some outdoor retail businesses feel that research is not worth the monetary investment; never forget that consumer behavior research has the potential to save companies immensely more money than it costs.
In short, if you run a small or medium-sized business that does not currently engage in market research, you’re not taking full advantage of all the tools available to help grow your business.
