Qualitative Market Research and Analysis for Product Management

Market research helps companies to understand what the customers really want so that the product can be tailored to resemble the needs of the customer. Market research is a core skill for product managers. Artifacts like product requirements, competitive landscapes, and positioning all require some type of research. Regrettably, most product managers only leverage their instinct and secondary research sources like websites. Product managers should conduct more primary research to advance their work with actual market facts instead of postulates based solely on their personal experiences and backgrounds.

There are three broad categories of product manager research techniques: Intuition, Primary Research, and Secondary Research. Product Manager’s intuition is the combination of domain knowledge, skills, and experiences that a product manager brings to the table. Individual intuition is very important and is often the main reason why a product manager is hired. Unfortunately, it is hard to justify a particular opinion aside from the statement ‘based on my experience’. Intuition can’t be independently tested to see if it is valid. Primary research is focused on collecting data from external sources, such as customers and prospects.

There are two main branches of primary research: quantitative and qualitative research. Quantitative research concentrates on gathering and analyzing large amounts of data via surveys or questionnaires. Analytics data such as user recordings, heat maps, and website analytics are often the most common quantitative analysis techniques product managers use. Qualitative data converges on gathering subjective data like transcripts from in-depth interviews, focus groups, or video recordings. Qualitative research provides more acumen into the research subject’s thinking or behavior but typically lacks the statistical rigor that quantitative research offers.

How Can Product Managers make better use of Qualitative research?

Product managers prefer quantitative research techniques for a couple of reasons. First, quantitative research offers results that usually are statistically notable. You can use standard statistical analysis techniques to analyze data. But, Qualitative research is one of the tools a product manager should have in their market research toolbox. Just as there is a role for quantitative research like Google Analytics, there is a role for qualitative research. Qualitative research, like in-depth interviews, is best suited for answering questions that begin with ‘Why?’ Why do users recognize this feature set to be innovative while others consider it to be irrelevant? Why do customers not want to buy an upgrade that includes new and more beneficial features? These are the types of answers that you cannot get from an online survey or a website analytics tool. An interview-based research program is required.

An interview-based qualitative research program consists of giving basic steps:

  1. PLANNING

The first step of the process is to do all of the preparatory work required to ensure the success of the project. An important first step is setting research objectives. Setting clearly defined Research Objectives will help you to both target your research as well as set expectations for the success of the program. Setting research objectives is best done as a team project. And be sure to align your Research Objectives with the strategic goals of your organization. There is no sense chasing information from buyers that your organization has no interest in anyways. Research objectives may include:

  • Your Product-Market-Price fit
  • Newmarket problems that your organization can answer
  • Your service levels
  • Persona refinement
  • Buyer purchase-decision process
  • Sales process
  • Communication style
  • A better comprehension of your place in the competitive mix

In addition to establishing your Research Objectives, you should also define the questions that will be asked during the interviews. The questions should be open-ended and designed to encourage a free-flowing discourse.

Finally, you should design the process you will use to recruit potential interviewees, conduct the interviews, investigate and report the results you have learned. The plan should lay out the roles and responsibilities of each participant in the project. You should also develop a schedule and a simple status reporting schedule so everyone can stay up to date. Create a project charter that contains the research objectives, interview questions, roles, accountabilities, and schedule. Conduct a review meeting with the participants to approve and commit to the plan.

2. RECRUITMENT

The following step in the process is to recruit people for the interviews. Most companies target a mix of net new customers and existing customers who have upgraded or expanded their use of products. You are looking for a mix of won deals and lost deals.

A portfolio approach solicits the interviews work best. The tactic that has the highest success rate is when a salesperson makes a personal outreach to a potential interviewee. Generally, 25% to 40% of these contacts will convert to an interview. The second most common approach is email. Organizations pull a list of candidates from their CRM or sales force automation system and then email them asking for participation in the project. This approach performs like most email campaigns — a 20% open rate and 2% to 5% click-thru rate. 50% of those who click-thru convert to interviews. The final tactic is to do phone follow-up with contacts that opened the email but did not click thru. These tactics perform like telemarketing campaigns — a 1% to 2% success rate.

Most interview programs use incentives to encourage targets to commit to doing the interview. Companies offer a $25 or $50 gift card. This provides the interviewee with something tangible in exchange for their valuable time.

3. INTERVIEWS

The core activity of the project is conducting interviews. Most interviews take 20 to 30 minutes to complete. Companies use internet meeting services that facilitate the interview scheduling process and allow the discussion to be recorded. This enables the interviewer to focus on the discussion instead of trying to listen and take notes at the same time.

Organizations often outsource the entire process to third parties. Experience has shown that interviewers are more comfortable talking to an independent third party instead of a representative from the company. This results in a free and easy discussion. It also avoids making embarrassing or disparaging comments about their experiences or opinions.

A critical aspect of the interview process is asking why a customer believes certain things they say. Surveys and checklists are one way to get customer feedback, but they cannot follow up on interesting statements. The real value of using experienced interviewers is that they can follow up and explore why a customer believes specific things. Often this is the most valuable outcome from the interviews.

4. ANALYSIS

After the interviews are completed, the recordings are transcribed. Next, the team reviews the transcripts to identify common themes. These themes are analyzed and documented in a final report. The report contains a summary of the interviewees — company size, interviewee title, etc. For each theme or finding, specific quotes from the interviews are included. This lets the report’s reviewers hear, from the customer’s perspective and in their voice, the exact point they were trying to make. A meeting is held with all of the interested internal organizations to review the report’s findings and conclusions.

5. ACTION

The final step is to take action on the recommendations. Effective interview programs are part of a cycle to drive improvements in the business. If action is not taken based on the recommendations from the interview analysis then an opportunity to fundamentally improve your business will be missed.

Product Managers Should Do More Qualitative Research

Product managers tend to shy away from doing qualitative research for several reasons — it is hard to recruit candidates, they may not have experience in conducting structured interviews, and they may prefer the anonymity that surveys or analytics can provide. There are some research topics, however, that do not lend themselves to Internet surveys or in-app analytics.

Product Enthusiast, currently hooked to upskilling my knowledge about product management. Firmly believe in People, Principles, Products, and Processes.