Understanding your target market is essential, regardless of the industry you are focusing on. Market research plays a crucial role in gaining valuable insights, which is why larger companies often rely on internal resources or market research firms. Selling the wrong solution to the wrong audience can have disastrous effects on sales and overall success.
When is a Good Time to use Market Research?
InsurTech companies are revolutionizing the insurance industry with their innovative use of technology. But to succeed in this highly competitive space, they need to deeply understand their target market. This is where market research comes in. In this blog, we will discuss three areas where investment in market research makes sense for InsurTech companies and how it can benefit their marketing and sales efforts.
Raising Capital
Even if you possess extensive knowledge about your target market, it is still advantageous to gain an impartial perspective. While conducting your market research during the creation of your value proposition is a good starting point, having an independent third party assess your offering adds a fresh perspective to the discussion.
Our experience has revealed that insurers are often more forthcoming with a third-party firm than with a passionate founder of a startup. This enables a more objective evaluation of your company and its potential in the market.
When seeking funding, it is crucial to establish clear expectations with your investors to ensure your company's long-term success. Instead of relying on assumptions about the sales cycle of your solution, it is essential to conduct thorough research and gain a realistic understanding of its timeline.
While not all investors may agree with your findings, it is important to identify those who do, as their support can greatly benefit your business and contribute to its growth and prosperity.
Entering New Markets
Our clients from Canada and the U.K. are often surprised by the diverse perspectives their offerings receive in the U.S. market. It's truly fascinating how even small differences, such as switching from the spelling of "centre" to "center," can significantly impact how a product or solution is perceived.
One of the significant variations lies in the operational methods of the insurance industry across different countries. For instance, prominent providers of core systems have a deep understanding of this aspect and have successfully tailored their systems to cater to international markets.
The role of technology cannot be overstated. Considering how different insurers view upgrading core applications like underwriting or claims is fascinating.
In a recent collaboration with a Japanese consulting firm, we gained valuable insights into their industry practices. Surprisingly, their insurance core systems still reside on mainframe platforms and are thriving. This leads us to question whether these systems would find similar success in our market.
When Sales are Flat or in Decline
Even the most well-informed industry professionals can find themselves misguided when making assumptions about their target market. It's crucial to recognize that what may have worked in the past may no longer be effective today. The ever-changing landscape of the market can bring about shifts and changes that are difficult to pinpoint. Logic and reality don't always align, and staying adaptable and open to new insights is essential.
Taking the time to thoroughly research your target market allows you to uncover potential areas for improvement. Even if you already have some insight into why your sales may not be meeting expectations, conducting market research can help validate your assumptions.
Additionally, the research process may uncover new information, both positive and negative, that you were previously unaware of. This newfound knowledge can guide you in making necessary adjustments to ensure the success and growth of your business.
How Do I Get Started?
As you embark on your market research journey, it is imperative to focus on the critical areas that are vital to your business. Determining if your product or solution effectively tackles a pressing need or pain point in today's market is crucial. Take into consideration whether your offering is a "nice to have" or a "must-have" solution that is essential for your target audience.
If you happen to discover that your solution is mistakenly seen as a luxury rather than a necessity, don't worry. You can employ effective strategies to reposition it and change the perception. Furthermore, it is vital to delve into the research, evaluation, selection, and implementation processes followed by insurance companies in your target market.
Understanding these aspects will provide invaluable insights into how your company, products, and solutions are perceived by your target audience.
Devoting time to conducting market research can yield invaluable insights into how your target market perceives your company, products, and solutions. This understanding is crucial for effectively positioning your offerings and gaining a competitive advantage in the market.
By delving into the minds of your audience, you can uncover key information that will help you tailor your approach and stand out from the competition.
If you're interested in delving deeper into our market research process and discovering how we can help you validate your target markets, simply click on the link below.
