Having a hard time understanding about market research? Today we will discuss with you what market research is all about.
In addition to that, we will show you the 8 types of market research that you can use in the market.
What is Market Research?
A market research is the process of assessing the viability of a new service conducted straight with the consumer. This repetition allows a company to discover its target market and record opinions and other input from customers regarding interest in the product.
Marketing research is the systematic process of collecting and analyzing the information relevant to seeking solutions to a problem in the market.
This may be conducted by the corporation or through a third-party company that specializes in the field of market research.
Market research can also be done by surveys, product testing, and focus groups. Meanwhile, the test subjects are usually compensated with product samples and pay a small fee for their time.
Moreover, the purpose of market research is to examine the market associated with a particular service to know how the audiences will receive it. This can contain information gathering for the purpose of market segmentation and product differentiation. These can be used to tailor advertising efforts or to determine which features are seen as priority to the customer.
Types of Market Research
There are different types of marketing research classified on the basis of the research objective wherein the study is to be carried out and the sources of data used to gather the information.
The most commonly used classification of marketing research is based on the functional objectives if the research and are known as:
· Exploratory Market Research
You will only use the exploratory research when you have a little knowledge about the research problem and needs to gain insights about it before finding solutions. This requires you to clear your concept, gain insights, formulate problems, and remove impractical ideas to check the research design.
However, this can only be done through using secondary data, such as information available both inside and outside the organization.
· Predictive Market Research
Predictive research is conducted to forecast a certain market variable for which the research is designed. An example of this type of research is when you predict the future sales, the projection of growth, test market to predict the success of a new product.
· Descriptive Market Research
This type of research is concerned with testing the hypothesis to look for the accurate solutions in the research problem. With this type of market research you must ask yourself, who are the prospective buyers of the product? How the products are consumed? What is the fraction of the population that uses these products? Who are the potential competitors?
Meanwhile, the objective of descriptive market research is to measure the frequency with which the things occur and the extent to which the variables under study are correlated.
· Predictive Market Research
The predictive market research is conducted to predict a certain market variable for which the research is designed. Including the prediction of the future sales, projection of growth, test market to predict the success of a new product, and defining the product line of the firm.
However, the marketing research can be also further classified on the basis of the type of data generated. Also by the degree of mathematical accuracy requires as:
· Quantitative Market Research
In quantitative research you use a statistically significant sampling and close-end questions. A huge sample of population must be studied which means more statistically accurate outcomes, but with a higher cost.
With this type of marketing research, you will gather numerical data. Quantitative research includes:
– Surveys on Customer Return Frequency
– Financial Trends
– Sales Figures
– Online or Phone Questionnaires
– Industry Product Sales Number
You can use quantitative research to identify the size of your market. With this, you can also see how much it might be worth to your business. You can also find the areas for sales growth.
Quantitative research can also help you understand the demographics of each customers, including their age and gender.
This type of research market often produces many statistics. These are actually useful as an overview of your market. However, you have to make sure that you do not rely solely on the statistics of your own research.
An example of this is the average price your target market suggested it would pay for a product can be inaccurate if a few of the participants choose a very high amount.
· Qualitative Market Research
With this type of research you use open-ended questions usually on interviews or focus groups. This will actually allow you to learn more information with a smaller number of people, so it may be cheaper.
However, since the statistical data is lacking, it is hard to make widespread assumptions.
Meanwhile, a qualitative market research gathers views and attitudes. This includes the following:
– A formal and informal conversation with your clients to know their satisfaction towards your business.
– You have to visit and review your competitors to learn their products and customer service practices.
– Do a focus group with your clients and possible clients to understand their feelings about your products and services.
You can use qualitative research to have a better knowledge of the interests and needs of your clients. This is also a great way to identify opportunities for increasing sales and to improve you customer service.
In addition, you must know that analyzing qualitative data requires a much different approach. It can also take longer to interpret than quantitative market research due to the nature of the information.
· Primary Market Research
This type of market research is the information that you collected straight from the source. It also gathers original information directly for your purpose, rather than being gathered from published sources.
Usually, primary research is a custom to the specific project which includes surveys, interviews, and focus groups.
However, primary market research is targeted and specific to your purpose. It is also very time consuming and costly.
Meanwhile, it is much easier now to conduct some surveys with the use of online polls. Here are some of the online survey services you can use:
In addition, you may choose to use this type of market research once you have already conducted a secondary research to determine what information is already existing.
· Secondary Market Research
With secondary market research you gather existing information through available sources. Here are some lists of a secondary research:
– Information from agencies like industry bodies, local councils, government agencies, and libraries.
– The existing market results.
– The information you can find on the internet.
– The existing data from your own stock lists and client database.
This type of market research helps you make the most of existing information about the market. But you must know that it can be a challenge to find the information you need.
However, you might use this market research to get an initial understanding of your market. Secondary research is often faster to analyze compare to primary research. This is due to many cases, someone might have already started analyzing it.
You should remember that when you use this type of research you should be careful on interpreting it. Since this may have been collected for a different purpose that is not related to your business.
Moreover, you have to make sure that any of the secondary data is up-to-date. Since the market can change rapidly and might affect the results.
Top 3 Market Research Tips
Today we will also give you the best 3 market tips you can use when deciding to enter the financial field.
First things first, you must identify your target audience. Know how many respondents you require and know what data you are planning to get before starting. You should always be clear about your objectives.
Do not be afraid for bad feedback from your audience. You have to watch for incorporate unsolicited feedback from social media or review sites. This will help you understand their needs and to know what changes you must do with your service.
Lastly, you have to make sure that your target group is relevant to your needs and represents the market you are aiming.
In order for you to fully understand market research, you have to do your own research on it. Look for the different types of marketing research that you can use in the market.
Once you already know about these different types of market research, you can easily understand the inner workings of the said topic.
To be successful in the field of investing, you must do your own research. And you should always strive to do your best in the market.
If you want to learn new things and learn strategies about the market, BWorldpedia is the site you should visit! We provide profound and useful insights about the market and across a plethora of topics related to it. Also, register an account now with BWorld and start your investment journey.