Information is power, and in the business world, it also frequently equals money. The more facts and figures a company can gather about how and when and why people use its products or services, the better it’s able to meet and exceed their demands, hopefully generating profits along the way. Harnessing effective information is made easier and better when businesses rely on a standard market research process. Take a look at the basics of market research:
What is Market Research?
Basically, market research is the process of gathering data that helps uncover insights about customer wants and needs.
The Types of Market Research
There are two types of market research: primary market research and secondary market research.
Primary Market Research
Primary Market Research is research that a company undertakes itself with its own customers and consumers. It seeks to ask specific questions of the people buying (or not buying) a company’s products and services so that the company can better predict consumer and competitor behavior within an industry in the future. Primary research utilizes data collection methods that are either quantitative (capable of being measured) or qualitative (capable of being described) by nature, with the best research projects making use of both.
Quantitative data collection methods encourage the use of mathematical analysis to reveal insights. They measure the size or amount of a specific variable (such as units sold) so that they can be statistically compared to another (such as links clicked). Thus, a lot of data must be collected in order for any conclusions to be significant. Examples of quantitative research methods include surveys and polls.
Qualitative data collection methods, on the other hand, facilitate the understanding of human emotions, opinions and conduct. They are intrinsically much more subjective, relying on human interpretation of attitudes and behavior to establish meaning. Because they are not being statistically reviewed, however, qualitative data sets can be much smaller than quantitative data sets. Examples of qualitative research methods include focus groups, interviews and observation.
Secondary Market Research
Secondary Market Research is research that another company has already completed. It is usually less expensive and more general than primary market research, but it can be a good place for preliminary research to begin. Trade journals, books, census reports and other studies can help companies develop an understanding of fundamental demographic information, as well as any substantial industry trends, so that their subsequent primary research is better defined and executed.
Need More Info?
A firm grasp of the market research basics is necessary for businesses wanting to identify and address issues and increase ROI. If you need assistance understanding market research basics, including the type of research you need and how to do it, contact our team at Communications for Research (CFR). We can help you create a market research plan that delivers actionable results.
You might also like to download our free video, The 5 Most Common Market Research Mistakes. In it, we discuss how you can avoid five of the most frequent research blunders.