Conducting Market Research
The goals of market research are to (1) develop a profile of existing members and (2) assess the characteristics of potential target markets.
When planning the research process, it is often more useful to start with defining clearly what the research results will be used for and then working backwards, rather than starting by defining the initial problem.
Steps in the backwards research process
Types of Research
There are essentially four types of research that will guide a marketing strategy throughout its life cycle:
1. Market Analysis
The purpose of analyzing the market is to understand the microinsurance scheme's target or potential market. During this phase of data collection:
- the size of the market and its growth trends are analyzed
- distribution channels are analyzed: What is the quality of existing channels? Are there alternate channels? What would be the implications of changing distribution channels for both the microinsurance scheme and the member?
- market segmentation is carried out. The purpose is to segment the population in such a way that members of a single segment respond in a similar way to marketing stimuli.
- Once the market is segmented, the next step is to evaluate the segments and choose which segments will make up your target audience. It is usually wise to begin by targeting marketing efforts at a single segment and then expanding to other segments, once a succesful strategy has been put in place.
- Key questions to consider when choosing which segment to target:
- What segments of the market are likely to sustain demand for microinsurance and what segments are less likely?
- What is the growth trend within this segment?
- Key questions to consider when choosing which segment to target:
- Research on the target population aims to identify their knowledge, attitudes, beliefs, behaviours, common habits and preferences.
2. Member Analysis
Member analysis tracks the performance of the microinsurance scheme through research collected from current benificiaries. It seeks to establish their level of satisfaction with an insurance product in order to identify problems that may lead to dropout rates if left unadressed.
3. Competitor Analysis
Because microinsurance is a relatively new concept, most markets can be described as ‘new markets’ with few competing products. However, as this is likely to change over time, it is still useful to gather information on what others are doing in order to learn from best practices and mistakes, as well as on alternatives to your insurance product.
Research on the existing insurance market should:
- Include both formal and informal insurance mechanisms
- Determine whether insurance is mostly formal or informal
- Identify direct competitors
- Determine whether the market is concentrated or fragmented
- For a new entry, what are the barriers to entering the market?
4. Environmental Analysis
Research on the external social marketing environment involves looking at the societal forces that affect an organization's ability to serve its beneficiaries. A PEST analysis analysis should be carried out of the environment within which the microinsurance scheme operates:
- Political will, policy issues, presence or absence of supporting legislative framework
- Economic issues affecting members' purchasing power and spending patterns, such as income levels, cost of living, savings, and availability of credit
- Social forces such as demographics and culture which determine values, perceptions, preferences and behaviours
- Technological aspects, such as the modes of communication available
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Tools for research:Guide to conducting research on your target audience Sample household questionnaireSample focus group discussionSample questionnaire of healthcare providerGuidelines for Market Research on the Demand for Market Research |