What is Market Research?
Market Research is a systematical process of collecting, analyzing and interpreting information or insights about the market. It is the procedure to identify the target market in which there are potential customers, knowing market trends, competition and providing product and services according to the market needs.
What is the Purpose of Market Research
The primary purpose of market research are, firstly recognizing customer needs, evaluate market demand for a product or service. Then evaluating competition across your industry, making measured business risk. Lastly, testing the market strategies thorough marketing channels.
Types of Market Research
1. Primary Market Research
Primary Market Research requires collecting data directly form the sources form potential customers, businesses or market place. Therefore, the data is to be unique and modify according to its specific needs.
There are 2 types of Primary Market Research:-
A. Quantitative Market Research
Quantitative Market Research primarily focuses on numerical data as it is used to collect large amount of data that can statically be analyzed. There are various number of methods for quantitative market research. First is taking Surveys and Questionnaires to collect large amount of data from people. Surveys and Questionnaires can be taken through phone, in people or mail. The final goal is to collect specific information like interests, demographics.
Second is Poll which is shorter and less detailed. This type of market research is used to collect quick information or insights from a large group. Third are Structured Interviews as they are taken in more personal manner. Interviewers ask respondents pre-defined and standardized questions. Fourth is Observing consumer behaviour in a real environment and defining that observation in quantitative way. The fifth and last in quantitative market research is Experiments. It is testing of different variables and seeing by which consumer behaviour influences.
B. Qualitative Market Research
Qualitative Market Research mainly focuses on understanding attitude, feeling or behaviour of the consumer. There are various number of methods for qualitative market research. First is taking In-Depth Interviews which is one-to-one communication focused at exploring detailed information in a person’s behaviour.
Second is Focus Group which is a small group of people around 6 to 12 people who discuss on a particular topic. Moreover it is encouraging and get to know various point-of-views. Third is Ethnology which is observing and studying consumers in real or natural environment. The fourth and the last is Case Studies which provides information of particular particular scenarios or challenges.
2. Secondary Market Research
Secondary Market Research is to analyze data which is already been collected or published. This market research is often used to get a wide understanding about the market. There are nearly 4 type of Secondary Market Research:-
A. Public Sources
This data is freely available to the public which includes government reports, industry publications, academic research and many more.
B. Commercial Sources
They are paid reports or data taken form private companies which are specialized in market research. Moreover they are primarily specific to the business.
C. Internal Sources
This data is with the business like, sales record, customer reports and research studies about business or market.
D. Digital Research
This data is collected online such as industry websites and digital sources such as social media, review sites and many other. Moreover, it is quickly accessible and often current reports or data.
What is the Process of Market Research?
1. Determine a Research Goal
The first step of market research is to clarify your research objective. There are three questions to be answered in this step:-
- What specific information do you need?
- What problem we are trying to solve?
- What decision will the market research tell or inform?
2. Create a Market Research Plan
The second step is to create a market research plan which involves three things which are:-
- Outlining Research:- It tells that this research will be descriptive, casual or explorative.
- Types of Data:- Using both, Primary and Secondary Data for market research
- Techniques for Data Collection:- Here we see that data will be collected by surveys, interviews, observational studies or focus groups.
3. Start Collecting Data
Here we see by which methods we will used to collect data such as Primary Market Research or Secondary Market Research or both according to your objective.
4. Analyze the Researched Data
The fourth step is to analyzed the researched data and take out the relevant information. As the types of analysis are Quantitative Analysis, Qualitative Analysis as discussed above in the types of market research. The third is Data Visualization which involves analyzing using graphs and dashboards visually.
5. Interpreting the Data & Preparing a Report
After all the analysis, start preparing the report in the context of your objective. The actions to take are:-
- Interpret the Data collected:- Convert the raw data to an understandable and actionable information or insight.
- Prepare a Report:- Prepare report by keeping the format in mind. First Section is Executive Summary, second is Methodology, third is Research Findings which can be presented visually (for example:- graph, tables, etc.), fourth is Conclusion.
6. Start Taking Action
The most important step is to take actions based on the report findings like marketing strategy, pricing, business development and many more.
7. Analyze Outcome
Do the analysis of the outcome and see did you reached the objective for which we made a market research or report. Moreover, see what are the mistakes you did and what additional you can do in your next market research.
8. Continue Research
Market Research is the game of consistency and being regularly monitoring the market conditions, competition and customer demand or preferences.
Conclusion
Finally, by this article we got to know why Market Research is important in business or any kind of problem you are solving or desire you are fulfilling. Its upto you why which method you want to do market research. Therefore, you have to follow the process of the market research and make a report and execute on it. Moreover, its a continuous and never stopping process as you have to keep eye on the market conditions, competition and customer demand or preferences.
