Types of Market Research

An Overview

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Contents:

- Market Research – Definition

- Need (If required)
- Difference between Market and Marketing Research
- Objectives
- Types Of Market Research
- Knowing which type of Research to use
- Market Research Process (If required)
- Conclusion

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What is Market Research (MR)?
• Market Research is the action or activity of gathering
information about customer needs and preferences. -
Google
• Market research provides important information/ insights to
identify and analyze the market need, market size and
competition.
• Business market research is the process of collecting data
to determine whether a particular product/service will
satisfy the needs of your customers. With effective market
research, your company can gain invaluable information
about your competitors, economic shifts, demographics, the
current market trends and the spending traits of your
customers.
• “Thus, market research may be defined as the systematic
and objective process of collecting, generating, analysing,
and interpreting information and communicating the
findings for use in making marketing decisions.” -
American Marketing Association (1987)
• Hence, market research is a special effort rather than a
haphazard attempt at gathering information.

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 Need of Market Research

1. Identify Potential New customers - In order to identify potential

new customers, you first must understand who your customers are as well as
key demographics.

When looking at your product or service, it’s important to consider questions, such
as:

 Who will use your product or service?

 What is the age range of your customers?
 Are they predominantly male or female?
 What is their income level, marital status, and geographical location?

Understanding these factors will enable you to target customers effectively.

2. Understanding Existing Customers - Similar to the above point,

businesses should also take the time to understand who their existing
customers are.
Here are some questions to ask:

 Why do your customers choose your products over your competition?

 How do your customers use your products?
 How do your products solve a challenge?
 Who or what influences their purchase decisions?
 What do your customers enjoy doing, watching, and reading?

Understanding how your existing customers use your products as well as what
challenges your products solve will help businesses improve their products as well
as identify upsell opportunities with existing customers.

3. Knowledge about Competitors and how they approach the

market - Who is your competition? Someone that you know of or you
don’t, is taking away your customers and wins the market. That’s because
they’ve done their research ahead of you, and now you need to do the same if
you want to stay in the game.

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Market research will help you find out who is providing the service that you plan to
offer. It will help you find out if any new competitors want to enter the market.

Also, with effective market research, you can predict what will be your
competitor’s reaction when you decide to enter the market, and how your customers
will perceive your product compared to the competitors.

Market research will do the job of finding weaknesses in your competitor’s

approach that you can utilize to gain more customers, as well as find out what
worked for them to help you think more innovatively while modeling your new
strategy.

Knowing as much as you can for your competition will be crucial to the success of
your business.

4. Set realistic targets - Now that you are armed with information about
your target customers and existing customers, you can then use this data to
set achievable and realistic goals for continuous improvement as well as
business growth.

5. Develop New Effective Strategies - Based on your market

research results, you can make more informed decisions regarding the
pricing, distribution channels, marketing mediums, or to identify
opportunities to introduce a new product or service.
These results will also help you to make more informed decisions about your
existing operations and activities.

 Should you expand or reduce?

 Is there room in your current operations to diversify?

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Importance of Market Research
- MR can help you create a business plan, launch a new product/ service,
expand into new market, develop advertising services, set prices, select
business location.
- MR can be used to determine which portion of the population will purchase
a product or service based on variables like age, gender, location and income
level.
- MR is the process of gaining information about your market. Preferably this
is specific information about your target market and key factors that
influence their buying decisions.
- Can provide critical information about the buying habits needs, preferences
and opinion of current and prospective customers.

Objectives of Market Research

 To link the consumer with the company through information to know
more about him.
 To investigate the real needs and requirements of customers.
 To search for and analyze information that can be used for evolving some
marketing decision alternatives and finally arriving at the best alternative
 To suggest necessary changes in the goods and services in order to meet
the market demands.
 To find out reasons for slowly losing market share, and to identify ways
and means for strengthening company’s position in the market, within
and outside the country.
 To identify opportunities and threats in the external environment of the
company.
 To know about the reactions of the people in the market about the
existing or newly introduced products of the company.
 To know in advance what kind of target markets exist in the economy
where the company may launch its products as an innovation in the line

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Market Research and Marketing Research

Market Research -Researching the immediate competitive environment of the

marketplace, including customers, competitors, suppliers, distributors and retailers

Marketing Research - Includes all the above plus: - companies and their strategies
for products and markets - the wider environment within which the firm operates

Basis Of Market Research Marketing Research

Difference
Meaning A study undertaken to Marketing research is the
collect information about the systematic and objective study,
market statistics, is known as analysis and interpretation of
market research. problem related to marketing
activities.

Focus On a specific Market New products, modes of

distribution, Product development

Scope Specific and Limited Generic and Wide (Research of all

(Research of marketplace the aspects of marketing.)
and the buyer's behavior
within that market.)

Purpose To check the viability of the To make effective decisions

product in the target market. regarding marketing activities and
to keep control on the marketing of
economic output.

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Types of Marketing Research:

 By Objectives – Exploratory, Descriptive and Casual

 By Data Source – Primary and Secondary
 By Methodology – Quantitative and Qualitative

• Similar Web (other’s data)

• Keyword analysis (competitiveness etc.)
• Social Media (sentiment etc.)
• Financials (DueDil)
• Secret shopping
• Surveys
• NPS (Net Promoter Score)
• Interviews (Skype etc.)
• Focus Groups and Interviews
• Google Trends (interest over time)
• Google Analytics (your own data)
• Observation (A/B Testing,User testing,heat maps etc.)
• Online forums (Product Hunt etc.)
• The humble landing page
• Crowdfunding (Kickstarter, IndieGogo)
• Start a blog / newsletter / social media group
• MVP / lean startup

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• Host an event (Eventbrite)
• Experiment / Field trials
• Trusted Publications
• Google Search (looking for reports etc.)

Market Research based on data source

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What Is Secondary Data?
Secondary data is public information that has been collected by others. It is typically free or
inexpensive to obtain and can act as a strong foundation to any research project —
provided you know where to find it and how to judge its worth and relevance.

Secondary Data Examples

Sources of secondary data include (but are not limited to):

Government statistics are widely available and easily accessed online, and can provide
insights related to product shipments, trade activity, business formation, patents, pricing and
economic trends, among other topics. However, data is often not presented explicitly for the
subject you are interested in, so it can take some manipulation and cross-checking of the
data to get it as narrowly focused as you’d like.

Industry associations typically have websites full of useful information — an overview of

the industry and its history, a list of participating companies, press releases about product
and company news, technical resources, and reports about industry trends. Some

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information may be accessible to members only (such as member directories or market
research), but industry associations are a great place to look when starting to learn about a
new industry or when looking for information an industry insider would have.

Trade publications, such as periodicals and news articles, most of which make their
content available online, are an excellent source of in-depth product, industry and
competitor data related to specific industries. Oftentimes, news articles include insights
obtained directly from executives at leading companies about new technologies, industry
trends and future plans.

Company websites can be virtual goldmines of information. Public companies will have
investor relations sections full of annual reports, regulatory findings and investor
presentations that can provide insights into both the individual company’s performance and
that of the industry at large. Public and private companies’ websites will typically provide
detail around product offerings, industries served, geographic presence, organizational
structure, sales methods (distribution or direct), customer relationships and innovations.

Published market research reports are another possible resource, as anyone who’s ever
googled the name of the industry they’re interested in and “market research” can tell you.
For a fee, they can provide a great overview of an industry, including quantitative data you
might not find elsewhere related to market size, growth rates and industry participant market
share. The downside is that you might not be interested in an overview — you might be
interested in a niche, and that niche is only discussed on three of the report’s 300 pages.

With all these sources of secondary data, you should be all set, right? Well, maybe not. If
you are interested in a niche product or a new technology, there may not be a lot out there
in the public sphere. The most current information you can find might be a few years old.
You might not be sure if the material you found online reflects an accurate portrayal of the
whole industry. You might be asking a question no one’s ever asked before, let alone
answered. Now what?

What Is Primary Data?

Now it’s time for primary data, new information collected specifically for your purposes,
directly from people in the know. Methods of primary data collection vary based upon the
goals of the research, as well as the type and depth of information being sought.

Primary Data Examples

In-depth interviews present the opportunity to gather detailed insights from leading
industry participants about their business, competitors and the greater industry. When you
approach a company contact from a position of knowledge — thanks to all that secondary
data you’ve already collected — you can have a free-flowing conversation about the topics
of interest. You can guide the conversation toward your research objectives, but also allow

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yourself to be led down unexpected paths by interviewees — some of the most valuable
insights are the ones you didn’t know you should be looking for.

If you’re seeking data you can quantify, surveys are an excellent way to collect a large
amount of information from a given population. Surveys can be used to describe a
population in terms of who they are, what they do, what they like and if they’re happy. You
can then forecast the population’s future behavior in light of these identified characteristics,
behavior, preferences and satisfaction. Surveys yield the most meaningful data when they
ask the right questions of the right people in the right way, so care should be taken both to
develop survey questions respondents will find relevant and interesting, and to determine
which method of conducting the survey (online, telephone or in-person) is most appropriate.

Looking to get consumers’ thoughts on a new product or service offering idea when you’re
in the early stages of the development process? A focus group can get a small group of
people that fit your target demographic in a room to discuss what they like, dislike, are
confused by, would do differently — whatever. The group’s leader encourages honest, open
discussion among participants, collecting opinions that can further direct your development
efforts.

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