Definition:
Market Research requires that data be gathered from both secondary sources (existing literature) and Primary sources (gathered from market participants directly).
- What it is: Most market research starts with the gathering of data relevant to the markets, industries, customers, competitors, economies, technologies, etc. for which you are doing research. Before you can complete analysis of the market research the types of data need to be defined and the sources of data need to be identified. Data is most often gathered from primary and secondary data.
- What does it do: Primary data is data that you create yourself through going to the sources of data and collecting them directly. Secondary research is the process of looking for publically available data that has previously been collected, assimilated, categorized, analyzed, and reported. Secondary data is almost always cheaper and requires fewer resources to gather than primary research. Primary research should only be gathered when the information required is not available from public sources, or the private sources of secondary data will not make it available to you.
Uses:
Data gathering is necessary to provide the information required for all forms of marketing research analysis.
- How is it used: Both Primary and Secondary research is used within the different forms of analysis to reach understanding, determine strategy, and make tactical decisions about actions in the marketplace.
- Where: Market Research data is used in SWOT analysis, competitor analysis, customer segmentation, industry analysis, etc.
- Why. One of the most common sources of market failure is the lack of knowledge concerning the market drivers in a market or industry. New product development seldom fails from an inability to make the technology work as desired, but about 290 of 300 new product ideas fail because the product marketer misread the needs and desires of their customers. Market Research data is needed to complete market analysis and big data analysis.
Limitations:
- Where it shouldn't be used: Don't use primary or secondary market research data to draw conclusions about the larger market unless it is survey data that has a known confidence interval and certainty. Do not use casual interview data or focus group output to draw conclusions about the larger market. Do not use data gathered from a small subset of the market because of the risk of sampling bias.
- Any restrictions: Do not use data that comes from: too small of a sample, a biased sample, gathered by interviewers that are trying to prove a point, unknowledgeable customers, customers who do not make the buying decision, or from simply reading a competitor's or company's website. Company websites often list the wishes of management but may not have many similarities to what the employees of the company actually do.
- Warnings: Be careful of using data that has passed its freshness date. Data that gathered several years ago, may not be relevant to decisions that are being made today. Be sure to consider the potential for attitudes, technology, competitive positions, market needs, etc. to shift over time. Be certain the data you are using is current, relevant, and unbiased.
Demonstrations:
Step-by-step process:
- Gathering data: Always start with Secondary data, then collect Primary data only if necessary
- Create a Data Plan of what information is required to complete the analyses that you have planned.
- Always start with Secondary Sources of data
- Review Public Sources of data on the internet, government reports, trade data, magazines, articles, associations, competitor and customer websites, other publically available sources.
- Identify proprietary sources of information from reports, databases, multiclient students, subscription services, etc.
- When necessary utilize the more resource-intensive Primary Resources
- Expert Interviews are a great way to test the trends and initial findings from your secondary research. They can highlight important issues and players.
- Focus Groups are one of the best places to try out new ideas to see how a subset of the market might react. It is most often used to identify the ranges to be used on a survey and the factors that should be included in the lists of topics in a survey. You should test the survey topics on focus groups to be sure you understand how the more expensive survey questions will be perceived by the target market.
- Quantitative Surveys are used to collect data that can be used to project opinions of the target market. If you have a random sample of the target market that is large enough to give you a narrow accuracy range with 95% confidence, then you can anticipate how the target market as a whole will respond to your anticipated stimuli. Survey research is expensive, complex, and resource-intensive. It should almost always be the very last thing you do so that you can leverage everything else you have learned to make sure that your survey will provide accurate answers to the most important questions.
- Analysis of data: The analysis of the data will be dependent on the type of research analysis tool you are planning to use.
- Interpretation of results: will follow the type of planned analysis tool
- Presentation of results: Should always include the sources of the data and the confidence you have in the sources that provided the data you used in your analysis.
Template for capturing data:
Capturing the data in a template will be unique based on the data plan you developed. Most data can be captured in a standard spreadsheet.
Output representation and recommendations:
Output representation and recommendations should always include the sources of the data and the confidence you have in the sources that provided the data you used in your analysis and recommendations.
