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24 September 2024
Knowledge controls your access to opportunity and advancement. This saying holds true, especially for businesses, where information is the foundation for successful strategies and conducting precise market research models. But in a world overflowing with all types of information, extracting the most relevant data insights on a specific market type or audience can be tough.
This is where extensive and accurate market research through different methods is crucial. It allows you to understand your target audience better, fill any market gaps, learn about your competitors, and allocate your resources in the most profitable ways.
Multiple market research methods exist, including traditional ones like focus groups or surveys and now advanced ones like social media listening, sales, and data analysis.
Let's walk you through different market research methods and types in detail.
Market research is a technique businesses use to collect and analyze data about a specific industry, market, or audience to make informed, data-driven decisions. It helps marketers gain valuable insights into the industry, market trends, consumer preferences, competition, and opportunities to refine their marketing strategies effectively.
Market research offers organizations identify:
This practice acts like a compass for marketers, helping them make data-driven decisions for successful product launches, improve customer relationships, and stronger positioning in the business world.
Conducting market research is one of the best ways to achieve customer satisfaction, lower customer churn, and elevate your business. Here are the key reasons why market research is important and should have a primary place for any business:
There are the following different types or categories of market research, each with its own set of tools and methods:
Primary research is original market research you conduct yourself or employ; a third party does it. Involves collecting information directly from the source and getting in touch with your target market to ask different questions and collect data. You can collect data from interviews, focus groups, and mobile interviews during primary research.
During primary research, you can collect information through two types of approaches:
Primary research offers the advantage of helping you gather first-hand information about your customers' needs and preferences and controlling the ownership of the data.
Secondary market research is seeking out existing data already completed by another company. The data often appears in journals or publicly accessible through online sources. Therefore, researchers are not required to amass their intelligence. It is useful if you need more resources to conduct market research independently.
Secondary market research collects data from:
Quantitative market research generates numerical data to measure respondents' attitudes, opinions, and experiences. The data is then used to create product statistics, identify trends, and find prevalence.
It aims to quantify and generalize results so that market researchers can determine the best course of action. Quantitative market research can also test a theory or hypothesis, detect causal relationships between variables, predict outcomes, and formulate generalizations about large populations.
Qualitative market research is more descriptive than quantitative research. It helps gain deeper insight into consumer opinions and motivations for purchases. This research doesn't aim to clarify a situation or occurrence—instead, it seeks to establish the resonating behind it.
Qualitative research relies on ethnographic, psychological, and sociological approaches to understanding its target audience. It occurs in a natural environment, either online or offline.
There are various market research methodologies that you can use to gain valuable market insights. These include:
A focus group is a small group of people participating in a group interview. These individuals represent a consumer demographic or share similar characteristics. The group includes a moderator who asks questions, guides the discussion, and records participants' responses. Because participants represent a large group, their responses provide valuable insights about customer needs and preferences.
Companies can use focus groups when they are going to launch a new product or service and wish to ask questions that are difficult to answer. Focus groups are great for qualitative research, as participants can express their thoughts or experiences on a specific research topic. However, these groups can cause issues of biasedness if people feel uncomfortable expressing their thoughts in front of the rest of the groups.
Surveys are one of the most commonly used market research techniques. In surveys, companies ask participants to answer different questions. The questions have a set of predetermined answers that respondents can choose from.
Surveys can be digital (Online Surveys) or physical (Survey Cards) and are used in the service industry to understand how customers experience different service attributes. Companies can conduct surveys through:
Surveys are helpful if you want to measure something quantitatively and have a relatively large population to survey.
Interviews are a qualitative market research method that combines elements of the focus group and the one-on-one survey. Generally, a single individual is focused during an interview, with the moderator asking questions and recording their answers. The person to be interviewed has to answer open-ended questions in detail. The researcher can also ask some follow-up questions.
Interviews can be semi-structured, with the researchers sometimes allowing interviewees to ask their questions. They are useful for qualitative research but require more time and resources.
Observation in market research refers to the act of studying how customers behave when they purchase something. Two types of observations are used. In the first type, the researcher shows no interaction with the subject, while in the second type, the researcher shows some interaction with the subject.
During observation, the researcher uses a digital camera to track how customers move around a shop or store, how much time they spend in each section, and their shopping habits or patterns. Observational research helps researchers understand customers' actual behavior rather than what they tell during the survey.
Field trials or experiments are more scientific and involve testing a hypothesis or multiple hypotheses. During the experiment, the company allows customers to use a product and then gathers participant data.
Field trials are an example of test marketing companies use when they want to launch a new product on the market. For example, a company developing a novel type of toaster might ask individuals to use it for a specific time and submit their impressions. The company will use these impressions to improve its product or place a new product in the store to see how customers respond.
Social media listing is another effective marketing research technology that involves searching for various topics on social media platforms and analyzing relevant social posts. It offers opinions about a wide variety of topics. For example, a company might research mentions of its product on Facebook, Instagram, or Twitter (now called X) to check the opinions of its buyers and potential customers.
It is an effective marketing research method that provides fast, accurate, and current information about your brand. 61% of businesses have adopted social media listings to track keyword mentions, which helps companies determine trends and brand sentiments in real-time.
Competitive analysis is a highly strategic and specific form of secondary market research in which researchers analyze their company's competitors. It involves identifying all the primary and secondary rivals to see how your brand stacks up to them. You also determine competitors' offerings, profits, marketing strategies, and more during competitor analysis.
Competitive analysis can be conducted from a marketing perspective, including content creation, SEO structure, PR coverage, and social media presence and engagement. It can also be undertaken from a product perspective, such as analyzing types of offerings and their pricing structure. SWOT analysis identifies strengths, weaknesses, opportunities, and threats.
Companies can purchase data from various sources to avoid conducting their market research. Subscriptions exist to buy relevant industry and research reports. Websites like Statista, Mintel, and BBC Research host a litany of reports for purchase. An annual subscription can cost as much as $8,000 and offers market research spanning various countries and industries.
Purchased data can be time-saving and helpful to small or medium-sized companies that cannot afford to conduct their primary market research.
Public data is a secondary market research methodology that involves seeking and analyzing market-related data on the Internet. With more data produced each year, the question of access and curation becomes increasingly pressing— that's why researchers and librarians love to access public domain data.
You can access plenty of public data from government databases, polling data, research centers, and more.
Analyzing sales data is like solving a puzzle, helping reveal the full picture of market research insights. It is a secondary research method that can be paired with other market research methods, such as competitive analysis, and helps researchers better understand actions and consequences.
Sales data analysis helps you understand your customers' buying habits and how they change over time. Although this method is limited to customers, its importance should be considered.
Here are the 10 market research methods you can employ to understand your customers, their buying habits, market trends, and valuable product insights to create your marketing strategies. From focus groups and surveys to competitive and sales data analysis, all methods are equally important and provide valuable market insights.
Thus, choose the right market research methods from the above options and streamline your research process.
Fuel your brand with invaluable data for predictive analytics and actionable insights, empowering your team to make data-driven decisions.
