Market Research 101: Meaning & Importance
Updated: 4 days ago
This market research 101 post will help you to understand exactly what is market research and why it is important to individuals and businesses.
Market research is a collection of information about a target audience's needs, wants, attitudes and behaviour that has been gathered systematically by surveys or other methods to be analysed and interpreted to give insights to businesses to help them achieve their goals.
Market research is important whether that be to resolve a problem, explore new opportunities, identify growth opportunities, help launch a new product or website. The insights gained from the information and data gathered will help guide marketing decisions.
The collection of market research information and data is done in two ways - primary research and secondary research.
What is primary market research?
The primary market research definition is the data that was gathered either internally or by a research agency for a specific purpose that was set out by the decision maker. Primary research through surveys, in-depth interviews or focus groups is individually tailored for the decision makers of organisations that pay for these services through research agencies or consultancies but can be done internally as well. This tends to be a collection of opinions, views, attitudes, claimed and predicted behaviour of individuals or businesses.
2 types of primary market research
As primary research is quite a broad area it’s broken down into two types of market research that can be applied separately or together in hybrid form, which is quantitative research and qualitative research.
1. Qualitative research
Qualitative research is exploring the in-depth views and opinions of a small group of individuals in a more open manner rather than rigid set of questions. These tend to be observational techniques like mystery shopping as well as face to face in-depth interviews or focus groups, where people can discuss the subject at hand openly but with guidance from the interviewer to help steer the direction of the conversation.
2. Quantitative research
Quantitative research is as the name suggests, where results can be measured by quantity and is easily digestible for decision makers of organisations. These quantified results are collected by interviewing a sizeable group of people (from 50 running into the 1000s) that is reflective of the whole population. Therefore, with a bigger sample size, statistical analysis can be applied to provide greater insights such as key drivers of purchase decisions, optimum price levels and predicted behaviour.
What is secondary market research?
While secondary research, which is also referred to as desk research is information that has been gathered from different sources, that were prepared for a different purpose. This could be internal sales data, paid or free market intelligence reports, private and government databases including census data and online sources like Google, which has become more prevalent and widely available with the information age.
They are both vitally important in order for a business to move forward.
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