What is Market Research – Meaning and Importance?
Oct. 31, 2023
Did you know you need help from your customers to do Market Research?
The term Market Research stands for the research about a particular factor that affects a business. Market research is a process where experts gather information from different sources. After collecting, they refine it to get more structured data. This data further helps in the decision-making process in a business.
Market research is essential as it helps business owners and management to make informed decisions.
This article will delve into the details of the market research and why you must invest in it for your business. But first, let's explore the origin and transformation of Market Research over time.
How Did Market Research Started?
Today's Market Research procedure enabled by powerful technology like AI wasn't the same when it first existed. The first time something like Market Research was done was in the early 1900s. However, at that time, only face-to-face polls were done by advertisers to identify the readership.
But soon, it was changed when Daniel Starch coined the idea to learn about the audience that the ads were reaching. So that ads can be transformed based on their needs.
In the 1940s, qualitative data collection methods, such as focus groups and interviews, were introduced. Can you guess how long it took for quantitative approaches to come into play?
Around 20 years. In the 1960s, quantitative data-collecting methods were introduced. Another thing that was changed during this time was a shift from considering psychological aspects to social sciences.
After that, the modern Market Research era started with the introduction of the Internet. As the Internet started reaching every home, Market Research became easier. Finally, today, it is getting powered with Artificial Intelligence, as mentioned above.
Why Market Research?
Target Audience Identification
Businesses often invest in market research to find the preferred audience for their products and services. It allows them to cut their marketing and advertising costs.
Brand Health Track
Market research for tracking brand Health deals with measuring your brand's ability to meet the company's goals.
Consumers' perception and needs for identification
Market research to identify the needs of consumers helps to make improvements in products and services. It helps to make changes based on the perspective of a consumer.
Industry Trend Research
Trends keep changing over time, and keeping updated about these trends is important and can be done through market research.
Tracing Competitor Strategies
It's one of the most important purposes of market research. It allows businesses to keep track of their competitors' strategies. Moreover, the research data helps to derive marketing and advertising strategies to tackle the competition.
Many times, there are instances of instant or exponential growth for businesses. Sudden changes in the Market create these instances. Market research can help in identifying such dynamics with the help of data.
Identifying Market Drivers and Challenges
Root cause analysis and force field analysis are some market research types. They help to learn about the market drivers and challenges faced by a business.
What Are the Types of Market Research?
Primary research includes a collection of data gathered directly from individuals or groups. It provides a fresh perspective on certain research objectives. Moreover, it is customized as per your needs
There are two types of methods for primary research:
1. Qualitative Research
This type of research helps you to understand the underlying emotions, opinions, and emotions of individuals. Hence, it provides a deep view of customer behavior.
2. Quantitative Research
It focuses on the collection of numerical data and other quantifiable metrics. With the help of quantitative research, you can make statistically significant conclusions.
- Personal/in-depth interviews: One-on-one interaction with participants.
- Online/digital surveys: Collection of data from a large number of respondents.
- Observational research: Systematic observation of participants in a natural or controlled setting.
- Focus group: Gathering a small group of participants in a structured conversation guided by a moderator.
This type of research involves using existing data and information that is collected by other sources. Secondary research is very cost-effective. Moreover, it saves a lot of time and helps access a wide range of data.
The various types of secondary research include literature reviews, meta-analyses, and case studies.
Sources for secondary research:
- Public sources: Government websites, non-profit organizations, and public libraries.
- Commercial sources: Market research firms and data analytics companies.
- Educational institute sources: Academic papers, case studies, and scholarly articles from universities and research institutes.
- Government publications: Reports, statistics, and policy documents from government agencies.
- Journals & articles: Academic articles, online articles, and trade publications.
Also Read: Types of Market Research Surveys
What Is the Process of Market Research?
Market research is a very systematic process. It is designed in a way that helps to gather, analyze, and interpret information about a market. The flow consists of the following steps:
1. Define objective: First, you have to outline the research goals, questions, and objectives clearly.
2. Data collection: The next step is to choose the right research methods and collect data from primary or secondary sources.
3. Data analysis: In this step, you have to analyze the entire data to extract meaningful information and identify trends.
4. Interpret findings: Next, you have to interpret the data as per the objective of your research. By doing so, you’ll be able to draw conclusions 5. and recommendations.
5. Report and presentation: Now, you will have to present your research in front of stakeholders.
6. Decision making: Your research findings will now provide help to make strategic decisions and marketing campaigns.
7. Continuous monitoring: Since market research is an ongoing process, you will have to adapt according to the changing market conditions.
In conclusion, prioritizing market research is pivotal for business growth. To maximize its benefits, careful consideration of the most suitable research approach is essential. This evaluation should consider your objectives, desired outcomes, and financial resources. Adhering to a well-defined market research strategy will not only enhance the value your business offers but also expedite its growth journey.