How do you design and test your hypotheses using market research methods and tools?

If you want to launch a new product, service, or feature, you need to validate your assumptions and ideas with your target customers. This is where market research comes in handy, as it helps you design and test your hypotheses using various methods and tools. In this article, we will guide you through the steps of creating and evaluating your hypotheses using market research methods and tools.

1 Define your problem and objectives

Before you start designing your hypotheses, you need to clearly define the problem you are trying to solve and the objectives you are aiming for. This will help you focus your research and avoid wasting time and resources on irrelevant or vague questions. A problem statement is a concise description of the gap, pain point, or opportunity that your product, service, or feature addresses. An objective statement is a specific and measurable goal that your solution intends to achieve.

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David H. Deans

Digital Business Growth Advisory Consultant
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As a management and marketing consultant, I first explain the Hypothesis approach to value creation for my clients. A value hypothesis proposes an assumption on how a product or service is valuable to potential customers. And, it tests whether a product or service really delivers value to customers once they are using it. In my experience, it’s applied to align with business value metrics that help the buyer rationalize their investment in your offering, and to assess the realized value performance after implementation. That said, market research and target customer discovery dialog is the key to gaining meaningful and substantive insights for a business value hypothesis.

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2 Generate your hypotheses

A hypothesis is a tentative statement that expresses a relationship between two or more variables. It is based on your assumptions, observations, or existing knowledge, and it can be tested with data. A hypothesis should be clear, testable, and falsifiable, meaning that it can be proven wrong. To generate your hypotheses, you can use various techniques, such as brainstorming, mind mapping, customer interviews, surveys, or competitor analysis. You can also use frameworks, such as the lean canvas or the value proposition canvas, to structure your hypotheses.

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3 Choose your research method

Depending on the hypotheses, objectives, and resources you have available, you can choose from various market research methods. Quantitative research involves collecting and analyzing numerical data from a large sample of respondents, which is useful for measuring the size, frequency, or preferences of your target market. Qualitative research involves collecting and analyzing non-numerical data from a small sample of respondents, which can help explore the motivations, emotions, or behaviors of your target customers. Mixed methods involve combining both quantitative and qualitative research to gain a more comprehensive understanding of the problem and solution. This method is useful for validating, complementing, or contrasting findings from different sources. There are various tools you can use for each type of research, such as online surveys or polls for quantitative research, interviews or focus groups for qualitative research, and experiments or user testing for mixed methods.

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Sushmitha Thirumalaivasan

Programs Manager @Treefrog | Driving Innovation & Social Impact | Board Director
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As a Program Impact Analyst, I start by defining objectives and reviewing existing data. Identify variables and choose research methods such as surveys or interviews. Develop clear survey instruments and implement a strategic sampling plan. Collect data with quality control measures. Analyze data using statistical or qualitative methods. Interpret results, draw conclusions, and communicate findings in a comprehensive report. Seek stakeholder feedback for continuous improvement. This systematic approach ensures effective hypothesis testing and valuable insights into program impact within a concise framework.

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4 Collect and analyze your data

Once you have chosen your research method, you need to collect and analyze your data to test your hypotheses. This involves defining your sample size, sampling technique, data collection method, and data analysis method. You also need to ensure that your data is reliable, valid, and ethical. You can use various software tools, such as spreadsheets, databases, or statistical packages, to store, organize, and manipulate your data. You can also use visual tools, such as charts, graphs, or dashboards, to present and interpret your data.

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5 Evaluate and refine your hypotheses

After you have collected and analyzed your data, you need to evaluate and refine your hypotheses based on your results. This involves comparing your expected outcomes with your actual outcomes, identifying the gaps or discrepancies, and explaining the reasons or factors behind them. You also need to assess the strengths and limitations of your research method and data quality, and acknowledge the uncertainties or assumptions that may affect your conclusions. Based on your evaluation, you can either confirm, reject, or modify your hypotheses, and decide on the next steps for your product development.

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6 Learn and iterate

The last step of designing and testing your hypotheses using market research methods and tools is to learn from your findings and iterate on your solution. This means that you should use your insights to improve your value proposition, product features, customer segments, or marketing strategies. You should also test your new or revised hypotheses with more data and feedback, and repeat the process until you find a product-market fit. By learning and iterating, you can increase your chances of creating a successful and customer-centric solution.

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7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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David H. Deans

Digital Business Growth Advisory Consultant
(edited)
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In my experience, the numerical analysis of data can be used to validate business value assumptions, and thereby create a return-on-investment calculation. However, when presenting the hypothesis to senior executives, I coach my clients to create a "business value narrative" to wrap around their data. While a CFO may be influenced by an ROI assessment, other members of the customer C-Suite often crave proof points from case study examples that will demonstrate the most probable path to achieving a desired business outcome. Your solution must be credible and believable. Numbers alone typically do not communicate business value. Storytelling matters in establishing value creation.

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How do you design and test your hypotheses using market research methods and tools?

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1 Define your problem and objectives

2 Generate your hypotheses

3 Choose your research method

4 Collect and analyze your data

5 Evaluate and refine your hypotheses

6 Learn and iterate

7 Here’s what else to consider

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