“The process of gathering, analyzing and interpreting information about a market, about a product or service to be offered for sale in that market, and about the past, present and potential customers for the product or service; research into the characteristics, spending habits, location and needs of your business’s target market, the industry as a whole, and the particular competitors you face.”
Accurate and thorough information is the foundation of all successful business ventures because it provides a wealth of information about prospective and existing customers, the competition, and the industry in general. It allows business owners to determine the feasibility of a business before committing substantial resources to the venture.
Market research provides relevant data to help solve marketing challenges that a business will most likely face an integral part of the business planning process. In fact, strategies such as market segmentation (identifying specific groups within a market) and product differentiation (creating an identity for a product or service that separates it from those of the competitors) are impossible to develop without market research.
Market research involves two types of data:
- Primary information. This is research you compile yourself or hire someone to gather for you.
- Secondary information. This type of research is already compiled and organized for you. Examples of secondary information include reports and studies by government agencies, trade associations or other businesses within your industry. Most of the research you gather will most likely be secondary.
When conducting primary research, you can gather two basic types of information: exploratory or specific. Exploratory research is open-ended, helps you define a specific problem, and usually involves detailed, unstructured interviews in which lengthy answers are solicited from a small group of respondents. Specific research, on the other hand, is precise in scope and is used to solve a problem that exploratory research has identified. Interviews are structured and formal in approach. Of the two, specific research is the more expensive. When conducting primary research using your own resources, first decide how you’ll question your targeted group: by direct mail, telephone, or personal interviews.
The one thing we can all expect to happen in the market research field is an acceleration of the technological trends that are ceaselessly impacting market research work. Simultaneously, the industry will struggle ever more with how to implement and handle all of its latest research possibilities. The coming booming years for market research will give the level of macro, political, monetary, and economic uncertainty across the globe. Companies are going to see tremendous and often unforeseen shifts in their business. Leaders will engage strong primary and secondary research firms to objectively understand the drivers of their evolving customer, competitive, supply chain, and macro dynamics.
With both clients and colleagues, I see a renewed emphasis on our need as researchers to consolidate/interpret data and communicate to senior leaders only the core set of issues that really need to be addressed. With more data available to us nearly every day, the emphasis on conciseness and clarity is rapidly growing. Today, we find ourselves in the ‘water, water everywhere, but not a drop to drink’ scenario, but there seems to be a major shift in client/leader expectations for us as researchers to expertly simplify and consolidate the data for them. This is easier said than done. Whether we’re talking about ‘big data’ or a year’s worth of research studies, finding ways to synthesize and position for senior management consumption has proven difficult for researchers. Part of the challenge is that we as researchers are trained in research — not communication. We tend to expand upon findings and flash numbers/trends — when senior management wants concise direction and a clear point of view. Fortunately, I am seeing improvement and some momentum on the part of researchers. Throughout the industry, there is a bias toward more storytelling, less “researchy” presentations, and tools like dashboards that are providing initial dents into this issue. I fully expect to see more emphasis here from clients and the research industry as a whole.
The soaring growth of big data and related tools will drive the implementation of exciting new reports and platforms based on automated market research. That is, there is a growing trove of data available, through data mining, online surveying (as opposed to telephones), analysis of social media activity, and crawling the internet. So much so that automated software carefully fine-tuned to suit specific market research needs, is the only way to take full advantage of the data options available. Research firms that are capable of seeing the possibilities and developing the software tools to capitalize on them will deliver exciting new market research options. However, the best and most reliable research products will put a layer of human filtering and analysis on top of algorithm-driven data, in order to weed out bad results, deliver value-added analysis, and convey the meaning of data points that seem to be outliers or anomalies.
We expect desk research to be more demanded and robust on results than ever in 2017 for three reasons. First, as the focus of marketers has ultimately shifted to digital, desk research methods provide a way of synthesizing various insights into behavior of the connected consumer and capturing the key market trends. Secondly, in view of economic stagnation predicted for many advanced economies around the world in 2017, businesses will search for more cost-effective ways of doing or sourcing research, giving desk research a competitive edge over other approaches. Lastly, the availability of published information has increased immensely over the past several years, presenting an opportunity for desk research professionals focused on specific areas of expertise. Over the last several years, the market research industry has been focused on ‘big data,’ using quantitative data to try to target the specific needs of the customers. But all that emphasis on quantitative data can’t provide any perspective on the future market, future opportunities, and future needs of the customers. Big data tells about the past, which is important, but can’t predict the future. Today, more and more companies are realizing the failures of big data, so that the big market research trend for 2017 and beyond will be qualitative market research where we can uncover new needs, new insights, new opportunities that will guide innovation. Big data answers the who, what, where, and when, but only qualitative market research can answer the why — why people shop and why people buy — and that is where the future lies for market research.