08/20/2024 | Press release | Distributed by Public on 08/20/2024 03:48
Ecommerce market research can help you answer questions like:
And more.
Today, we're breaking down market research for ecommerce businesses. So you know what to do and where to start.
What Is Market Research for Ecommerce?
Ecommerce market research involves collecting and analyzing insights about an online market, focusing on products, digital trends, competitors, and consumers.
It specifically targets the online environment, whereas traditional market research applies to both online and offline businesses. Like a brick-and-mortar store.
Insight from ecommerce market research helps you understand things like which products your market wants. And how competitive (and profitable) the market is. So you can start a new ecommerce business or refine your current offers.
Why Is Ecommerce Market Research Important?
Market research for ecommerce businesses gives you insight into your customers, competitors, and trends.
Here are four ways that insight can shape your business.
Identify New Market Trends
A deep understanding of your market can clue you into different ecommerce trends. Like market shifts, new technology, and evolving customer preferences.
Knowing these trends can help you capitalize on emerging opportunities. And potentially stay ahead of your competitors.
For example, through research you find out your customers prefer to buy now and pay later.
Knowing this, you might add the option to pay at a later date. Which could encourage people to buy from you over your competitors
Build Buyer Profiles
Ecommerce market research lets you understand your target market. And build detailed customer profiles -a description of your ideal customer.
Here's an example of a buyer profile:
These detailed profiles can help you:
Spot Opportunities for Differentiation
Product differentiation is when you distinguish your product from your competition and make it more appealing to your market. To attract more buyers.
Thorough research can give you insight into your competitors' strategies. Including what they do well and where they fall short.
Pair this with other types of research (like audience research) and you'll have a strong sense of how to stand out in your market.
Make Strategic Decisions
Market research gives you the insight you need to make business decisions on data rather than guesses.
Which means there may be less risk involved when making decisions.
For example, say you sell home decor items. Through market research, you learn that customers prefer seeing items in their homes before buying. Knowing this, you might decide to invest in an app that lets customers digitally view items in their home.
Without this insight, creating such an app could be risky. And might not result in higher sales.
Types of Ecommerce Market Research
There are two types of research you can perform:
Primary research may be more costly and difficult to scale. However, it provides valuable insight directly from your target market. Which can be difficult to find through secondary sources such as previously published insight. As that insight might not be from your target market.
On the other hand, secondary research is often more affordable and easier to access. But it may not be as specific to your particular needs.
So, try to get as much research as you can through secondary sources. Then, use primary research to fill in knowledge gaps and answer any remaining questions you have.
Types of Market Research Data
You can also collect two types of data from primary and secondary research. Those types are:
Quantitative data is typically easy to collect, sort, and interpret. As you can turn quantitative data into visuals like charts and graphs. But qualitative data, while harder to analyze, can give you deeper insight.
For example, you might discover that your competitor's products average a 2.5/5 star rating.
But you won't know why without qualitative data (like customer reviews).
So, if you find yourself questioning why certain quantitative data is the way it is, seek out qualitative data to uncover the underlying reason.
How to Do Market Research for Ecommerce Businesses
Perform Competitor Analysis
Competitor analysis is when you collect insights for your competitors' products, audience, and strategies.
This insight can help you understand your competition's strengths and weaknesses. So you can figure out how to position your business. And how to better serve your audience.
First, you'll need a list of competitors. Open Semrush's Market Explorer and click "Find Competitors." Enter your domain and click "Research a market."
Scroll to the "Growth Quadrant." You'll see a matrix of you and your competitors. Categories include:
Knowing this can help you identify which sites you may want to pay attention to. For example, it might be worthwhile to review the market strategies of game changers. Who have fast growth.
So, jot down four competitors you'd like to dive into.
Next, collect information for these competitors on their:
Here's how.
Audience
Open Semrush's Traffic Analytics. Enter your domain and up to four competitor URLs and click "Analyze."
Click the "Audience Overview" tab. You'll see information for yourself and your competitors. Including audience demographics, socioeconomics, and behavior.
Then scroll to the "Audience Overlap for" widget and make sure your website is selected. Review the information to see how your audience overlaps with your competition.
Larger overlaps indicate higher competition. As you're likely to market to the same people. You'll want to pay closer attention to these competitors and what strategies they use.
Marketing Strategies
Use Advertising Research to review competitors' paid ads. Open the tool, enter your domain, and click "Search."
Click the "Competitors" tab. This shows which of your competitors use Google paid search ads. Including an estimation of their ad spend. This can help you determine how much you may want to allocate to paid search ads.
Next review your competitors' organic content strategies (non-paid marketing techniques) like:
Reviewing these strategies can help you understand your audience's communication preferences. So you know where to focus your efforts.
Products
Finally, head to your competitors' online shops and review their products. Including prices and notable features.
Read through customer reviews for each product to see which aspects customers liked. And which ones they didn't.
This can clue you into customer preferences. And help you develop and refine your own offers.
Further reading: Check out our guide on how to perform in-depth competitor analysis.
Understand Your Target Audience
Audience research helps you understand what makes your audience tick. So you can effectively market to them, create products and offers they'll be excited to buy, and retain them as long-time customers.
You'll want to get to know your audience in four core areas:
Semrush's Audience Intelligence app can get you all the info you need. Open the app and click "Let's start."
Click "+ Buy reports" and follow the prompts.
After purchasing a report you can create a new report. Give your report a name, add an X (formerly Twitter) handle for the audience you want information on, and click "Create new report."
You'll see a high-level report. For more specific details, click "See all clusters."
Then click "View more details."
Click into the different tabs along the top ("Demographics," "Socioeconomics," "Influencers & brands," etc.) to learn more about your audience.
For example, the "Personality" tab has psychographic information.
You can also collect audience information through:
Finally, pull all your information together and create buyer profiles of your different buyer personas. Let these personas guide efforts like product creation and marketing.
Further reading: How to Create Your Buyer Personas
Identify Trends Within Your Market
Digging into trends can help you spot areas of opportunity-like new viable products. Or shifting market interests.
A few ecommerce market research tools can help:
Use these tools to search names of products and related keywords. Then, see if interest for each keyword is growing or shrinking.
Consider pairing this insight with primary research to better understand why your market may be shifting their behavior.
For example, say you sell computers. And you notice that sales for a specific laptop are spiking. But you don't know why.
Consider speaking to your audience to uncover why they're buying this specific model.
Maybe a TikTok video featuring the product went viral. Which could indicate a short-term trend. And might not be a worthwhile investment. But maybe this laptop has new technology that excites your market. And you want to invest in this new technology to attract more customers.
You can also stay on top of trends by subscribing to (or buying) industry-relevant reports from places like:
Find Your Target Keywords
Finding target keywords helps you understand how much organic-unpaid-traffic you can drive to your site. And how much budget you may need to allocate towards the creation of organic content (like blog posts).
To start, open a keyword research tool like the Keyword Magic Tool. Enter a seed keyword-a broad keyword related to your niche-and your domain. Select your country and click "Search."
The tool will give you thousands of keyword ideas. Filter these keywords by using the left hand widget or any of the filters along the top.
Note the column titled "PKD %." This stands for Personal Keyword Difficulty-the level of difficulty Semrush estimates your site will have ranking for specific keywords.
Keywords with a high difficulty may require more budget. As you'll likely need to build backlinks -links from external websites that point to your site-to build your authority to rank higher.
However, if you have many keywords with low difficulty, you may not need to allocate as much to link building efforts. And may just need to factor content creation into your budget.
Another column to note is "Intent." Intent tells you why people search for a term.
There are four primary search intents:
This information can help you understand how profitable specific keywords may be. It can also give you deeper audience insight. Such as what questions people have about the products in your industry. Which can give you even more content ideas.
Social media offers insight into how your market feels about you and your competitors-also known as sentiment.
Analyzing market sentiment helps you figure out your audience's biggest pain points. So you can tailor your offers to reduce those pain points. And what your customers want. So you can build those wants into your offer.
Tools like Brand Monitoring automatically collect market sentiment for you.
To start, download the app and click "Get Started." Then, enter a brand to monitor (your own or a competitor).
Next, add the social media profiles you'd like to monitor for that brand.
Click the "Analytics" tab to view the "Sentiment" widget. This shows you how the market has felt about this brand over time.
And click the "Mentions" tab to review market discussions for this brand. This can help you dig into a specific time frame where the brand may have had a spike in positive or negative sentiment.
For example, say you want to sell premade meals. And competitor sentiment analysis reveals that customers complain about unknown ingredients in their meals. You could potentially make your brand more appealing to your market by highlighting a simple ingredient list on your website.
Review Site Analytics
Use site analytics (from places like Google Analytics) to get deeper insight into your market-and their behavior-after launching your ecommerce site.
For example, you might notice more users turn to leads from "how to" type blog posts than any other format. Which might indicate your audience likes step-by-step tutorials. Knowing this can guide your content creation strategy.
Turn to Organic Traffic Insights to dig into site analytics. Open the tool, enter your domain, and click "Get Insights."
Go through the prompts to connect your Google Analytics and Google Search Console accounts and configure the tool.
The tool will display important metrics for your organic search traffic. Like the average number of users, average session duration, and bounce rate.
Review this information to understand which types of content your market prefers. And which pages lead to the most conversions.
Using Your Market Research
You've done market research for your ecommerce shop and have a pile of data. Now what?
Your first step is to synthesize and summarize your insights. Compile everything into a single document and highlight key findings, trends, and patterns.
Then, use your insight to:
But your first step is to collect the data. And Semrush can help.
Try Semrush's tools for free and get to know your market, your competitors, and the trends within your industry.