Uncovering All The Different Types of Market Research
Market research is an indispensable tool for businesses aiming to thrive in today's competitive landscape. At its core, market research involves gathering, analyzing, and interpreting information about a market, including information about the target audience, competitors, and overall industry.
This process provides businesses with valuable insights that drive strategic decision-making and foster a deeper understanding of the market dynamics that influence their success. The significance of market research cannot be overstated. It equips businesses with the knowledge to identify and understand their customers' needs and preferences, anticipate market trends, and stay ahead of competitors. Moreover, market research helps businesses uncover opportunities for innovation, allowing them to develop new offerings that address unmet needs and capitalize on emerging trends.
Understanding the different types of market research is crucial for businesses seeking to leverage this powerful tool effectively. There are various methods and approaches to conducting market research, each with its unique applications and benefits. Through familiarizing with these diverse methods, businesses can select the most appropriate techniques to gather relevant data and insights for their specific objectives.
In this article, we will delve into the different types of market research methods, providing a comprehensive overview of their applications, advantages, and limitations. We will explore five main methods used in market research, compare primary and secondary research, discuss the three primary focuses of market research, and examine the four standard marketing research methods. Additionally, we will cover various market research techniques, design types, and the importance of asking the right questions.
By the end of this article, you will have a deeper understanding of market research and how it can be utilized to drive business growth and success. Market research is not just a one-time activity but an ongoing process that continually informs and guides businesses.
What are the Two Main Types of Market Research?
Market research can be categorized into two main types: primary market research and secondary market research.
What Is Primary Research?
Primary Market Research involves you collecting new data directly from sources. It is a unique study to discover the wants and needs of consumers who fit the description of your target market.
This type of research is tailored to specific needs and provides current, relevant information. The process largely involves approaching your targeted source and asking questions about your product or service.
The types of primary market research include surveys, interviews, focus groups, and observations. Among these, surveys are the most common and popular due to their versatility and reach. For example, one type of survey would be post-purchase surveys with Fairing. For the average user of Fairing’s post-purchase surveys, at least 60% of customers respond. This allows businesses to gather substantial accurate information for their specific objectives. We go into further detail about the methods of market research below.
The main benefit of primary research is that it provides specific insights relevant to the research objectives. However, it can be time-consuming and costly.
What Is Secondary Research?
Secondary Market Research involves analyzing existing data collected by others. This is a research method that involves compiling existing data sourced from a variety of channels. This includes internal sources (e.g.in-house research) or, more commonly, external sources (such as government statistics, organizational bodies, and the internet).
Secondary research comes in several formats, such as published datasets, reports, and survey responses, and can also be sourced from websites, libraries, and museums.
The information is usually free—or available at a limited cost. When using secondary research, researchers collect, verify, analyze and incorporate it to help them confirm research goals for the research period.
For example, you could be an eCommerce merchant looking to release a new product. You are looking at what has worked for other successful brands, and are finding inspiration for your own brand. This requires research into any statistics online about what your consumers are looking for, what complimentary products there are in your target market or in adjacent markets, and more. This requires extensive secondary research for you to understand the market and develop your own plan.
As well as the above, it can be used to review previous research into an area of interest. Researchers can look for patterns across data spanning several years and identify trends—or use it to verify early hypothesis statements and establish whether it’s worth continuing research into a prospective area.
Secondary research provides a cost-effective and quick way to gather information. However, it is to be noted that the data might not be as specific or current as needed for particular research purposes.
Breaking down the types of secondary market research, we have 2 groups: internal data and external data.
Internal data is a good option for insights and knowledge as you may already have the relevant information stored in your systems. This information is yours, and competitors can’t access it. As such, this can give you a competitive edge.
Examples of internal data include:
- Database information on sales history and business goal conversions
- Information from website applications and mobile site data
- Customer-generated data on product and service efficiency and use
- Previous research results or supplemental research areas
- Previous campaign results
External data on the other hand, while useful, serves different purposes. This could be if you need information on a new topic, want to fill in gaps in your knowledge, or want data that breaks down a population or market for trend and pattern analysis.
Examples of external data include:
- Government, non-government agencies, and trade body statistics
- Company reports and research
- Competitor research
- Public library collections
- Textbooks and research journals
- Media stories in newspapers
- Online journals and research sites
What are the 5 Methods of Market Research?
Market research employs various methods to gather data and insights for your survey data analysis. The five main methods are surveys, focus groups, interviews, observation, and experiments/field trials.
Surveys
Surveys are a systematic method for collecting data from respondents, making them a popular choice for market research. You might ask, what is a market research survey? To put it simply, it's a tool used to gather information from a sample of people by asking questions.
Examples of market research survey examples include post-purchase surveys, customer satisfaction surveys, product feedback surveys, and brand awareness surveys. Surveys can be conducted in several ways, such as online surveys, telephone surveys, face-to-face interviews, and mail surveys. Each type has its applications, such as using online surveys for quick feedback or telephone surveys for detailed responses.
There are a plethora of questions you can be asking to gather the information that you need. For example with post-purchase surveys, ask “What is your age?” to get an understanding of your demographic. This will help you to better strategize your marketing strategy or product launches.
You could also ask “How does our pricing match up to your expectations?”. Pricing strategy is an extremely difficult task, and oftentimes it’s a shot in the dark. But with questions like this, it makes the task much easier with actual customer feedback.
For more questions like these, visit Fairing’s Question Bank. It is an ever-growing resource of questions we’ve gathered from successful clients, brand consultants, and behavioral scientists to tackle zero-party data needs across the business.
Focus groups
Focus groups involve a moderated discussion with a small group of participants to explore consumer attitudes, opinions, and reactions to products or services. This method provides in-depth qualitative data that helps understand the underlying reasons behind consumer behavior.
Interviews
Interviews are another in-depth method for gathering detailed information from individuals. They can be structured, semi-structured, or unstructured, allowing flexibility depending on the research goals.
Observation
Observation involves monitoring consumer behavior in natural settings, providing insights into how customers interact with products and services. This method is valuable for understanding real-world usage and identifying pain points.
Experiments
Experiments/Field Trials test products or services in real-world scenarios to observe their performance and gather feedback. This method helps businesses refine their offerings before a full-scale launch.
What are the 3 Main Areas Which Market Research Focuses On?
Market research focuses on three primary areas: consumer research, market analysis, and competitive analysis.
Consumer Research
Consumer Research aims to understand customer needs, preferences, and behaviors. This type of research involves collecting data on customer satisfaction, buying habits, and demographics. An example of a market research data example in this area might be a customer satisfaction survey that measures how well a product meets customer expectations.
Market Analysis
Market Analysis evaluates market conditions, trends, and opportunities. This analysis helps businesses understand the market size, growth rate, and market share, providing a comprehensive view of the market landscape.
Competitive Analysis
Competitive Analysis involves analyzing competitors' strategies, strengths, and weaknesses. This research helps businesses identify market gaps and develop effective positioning strategies. For instance, a company might analyze a competitor's product launch to understand its strengths and weaknesses and identify opportunities for differentiation.
What are the Four Standard Marketing Research Methods?
The four standard marketing research methods are quantitative research, qualitative research, descriptive research, and exploratory research.
Quantitative Research
Quantitative Research uses numerical data to quantify behaviors, attitudes, and other variables. This method includes types of quantitative market research such as surveys, experiments, and statistical analysis. Quantitative research provides measurable and comparable data that can be used to make data-driven decisions.
Qualitative Research
Qualitative Research explores attitudes, behaviors, and experiences through non-numerical data. Types of qualitative market research include focus groups, in-depth interviews, and ethnographic research. This method provides rich, detailed insights into consumer motivations and experiences.
At Fairing, our post-purchase surveys offer you both quantitative and qualitative insights. Our post-purchase surveys allow you to ask close-ended questions such as “How did you hear about us?” or open-ended questions like “How would you describe the affordability of our products?” among others. These give you clear qualitative data that you can utilize for your objectives.
Additionally, other Fairing features as well as our Analytics Suite gives our users the ability to analyze their quantitative data. Our suite includes LTV Analytics, NPS Analytics, Last-click Insights, and more.
Descriptive Research
Descriptive Research provides an accurate portrayal of characteristics of a particular individual, situation, or group. It is used to describe market potential studies and product usage reports. This method helps businesses understand the current state of the market and identify trends.
Exploratory Research
Exploratory Research is used to explore a problem or situation to gain insights and understanding. Methods include literature reviews, expert interviews, and pilot surveys. This research helps define problems and formulate hypotheses for further study.
Types of Market Research Techniques
Market research employs various techniques depending on the research objectives and context.
Types of market research techniques include social media analytics, web analytics, and customer feedback tools. These techniques are used for specific purposes, such as understanding consumer sentiment or tracking online behavior.
Types of market research methods can vary by industry. For example, B2B research might focus on in-depth interviews with key decision-makers, while B2C research might use large-scale surveys to gather consumer insights.
Examples include using social media analytics to understand customer sentiment or web analytics to track online behavior. These techniques provide valuable data that can be used to make informed business decisions.
Types of Market Research Design
Types of market research design are crucial for ensuring that the research is structured and systematic. Different design types and their applications include exploratory design, descriptive design, and causal design.
Exploratory Design
Exploratory Design is used for initial research to clarify and define the nature of a problem. This design helps gather preliminary data and identify key issues for further investigation.
It is a type of qualitative market research that helps companies understand a company, idea, or concept, often when there is limited knowledge or understanding of a situation. It can be used to discover new insights, ideas, or opportunities for marketing problems or opportunities. For example, a company might use exploratory research when entering a new market, or when sales are declining but managers aren't sure why.
Descriptive Design
Descriptive Design is used to describe characteristics of a population or phenomenon. This design helps businesses understand the current state of the market and identify trends.
Causal Design
Causal Design is used to determine cause-and-effect relationships. This design helps businesses understand the impact of changes in one variable on another.
Examples of effective market research design include combining qualitative and quantitative methods to get a comprehensive view and using longitudinal studies to track changes over time.
Asking the Right Types of Market Research Questions
Types of market research questions are essential for gathering accurate and relevant data. There are two main types of questions: closed-ended and open-ended.
Closed-ended questions
Closed-ended questions provide predefined responses, such as multiple-choice or rating scales. These questions are useful for gathering quantitative data that can be easily analyzed. An example of a closed-ended question might be, "How satisfied are you with our product? (Very satisfied, Satisfied, Neutral, Dissatisfied, Very dissatisfied)."
Open-ended questions
Open-ended questions allow respondents to answer in their own words, providing deeper insights into their thoughts and experiences. These questions are useful for gathering qualitative data that can help understand the underlying reasons behind consumer behavior. An example of an open-ended question might be, "What features do you think our product is missing?"
How to formulate questions for different research purposes involves ensuring that questions are clear and unbiased and tailoring them to the target audience and research objectives. Effective market research questions help gather accurate and relevant data that can inform business decisions.
Conclusion
Market research is a vital tool for understanding the market, customers, and competition. By exploring various types of market research, businesses can gather valuable insights to make informed decisions. Understanding the methods, techniques, and design of market research helps in choosing the right approach for different research needs. Effective market research drives strategic planning, product development, and marketing efforts, ultimately leading to business success.
