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Written by Mary Kate Miller | June 1, 2021

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Market research is a cornerstone of all successful, strategic businesses. It can also be daunting for entrepreneurs looking to launch a startup or start a side hustle . What is market research, anyway? And how do you…do it?

We’ll walk you through absolutely everything you need to know about the market research process so that by the end of this guide, you’ll be an expert in market research too. And what’s more important: you’ll have actionable steps you can take to start collecting your own market research.

What Is Market Research?

Market research is the organized process of gathering information about your target customers and market. Market research can help you better understand customer behavior and competitor strengths and weaknesses, as well as provide insight for the best strategies in launching new businesses and products. There are different ways to approach market research, including primary and secondary research and qualitative and quantitative research. The strongest approaches will include a combination of all four.

“Virtually every business can benefit from conducting some market research,” says Niles Koenigsberg of Real FiG Advertising + Marketing . “Market research can help you piece together your [business’s] strengths and weaknesses, along with your prospective opportunities, so that you can understand where your unique differentiators may lie.” Well-honed market research will help your brand stand out from the competition and help you see what you need to do to lead the market. It can also do so much more.

The Purposes of Market Research

Why do market research? It can help you…

• Pinpoint your target market, create buyer personas, and develop a more holistic understanding of your customer base and market.
• Understand current market conditions to evaluate risks and anticipate how your product or service will perform.
• Validate a concept prior to launch.
• Identify gaps in the market that your competitors have created or overlooked.
• Solve problems that have been left unresolved by the existing product/brand offerings.
• Identify opportunities and solutions for new products or services.
• Develop killer marketing strategies .

What Are the Benefits of Market Research?

Strong market research can help your business in many ways. It can…

• Strengthen your market position.
• Help you identify your strengths and weaknesses.
• Help you identify your competitors’ strengths and weaknesses.
• Minimize risk.
• Center your customers’ experience from the get-go.
• Help you create a dynamic strategy based on market conditions and customer needs/demands.

What Are the Basic Methods of Market Research?

The basic methods of market research include surveys, personal interviews, customer observation, and the review of secondary research. In addition to these basic methods, a forward-thinking market research approach incorporates data from the digital landscape like social media analysis, SEO research, gathering feedback via forums, and more. Throughout this guide, we will cover each of the methods commonly used in market research to give you a comprehensive overview.

Primary vs. Secondary Market Research

Primary and secondary are the two main types of market research you can do. The latter relies on research conducted by others. Primary research, on the other hand, refers to the fact-finding efforts you conduct on your own.

This approach is limited, however. It’s likely that the research objectives of these secondary data points differ from your own, and it can be difficult to confirm the veracity of their findings.

Primary Market Research

Primary research is more labor intensive, but it generally yields data that is exponentially more actionable. It can be conducted through interviews, surveys, online research, and your own data collection. Every new business should engage in primary market research prior to launch. It will help you validate that your idea has traction, and it will give you the information you need to help minimize financial risk.

You can hire an agency to conduct this research on your behalf. This brings the benefit of expertise, as you’ll likely work with a market research analyst. The downside is that hiring an agency can be expensive—too expensive for many burgeoning entrepreneurs. That brings us to the second approach. You can also do the market research yourself, which substantially reduces the financial burden of starting a new business .

Secondary Market Research

Secondary research includes resources like government databases and industry-specific data and publications. It can be beneficial to start your market research with secondary sources because it’s widely available and often free-to-access. This information will help you gain a broad overview of the market conditions for your new business.

Identify Your Goals and Your Audience

Before you begin conducting interviews or sending out surveys, you need to set your market research goals. At the end of your market research process, you want to have a clear idea of who your target market is—including demographic information like age, gender, and where they live—but you also want to start with a rough idea of who your audience might be and what you’re trying to achieve with market research.

You can pinpoint your objectives by asking yourself a series of guiding questions:

• What are you hoping to discover through your research?
• Who are you hoping to serve better because of your findings?
• What do you think your market is?
• Who are your competitors?
• Are you testing the reception of a new product category or do you want to see if your product or service solves the problem left by a current gap in the market?
• Are you just…testing the waters to get a sense of how people would react to a new brand?

Once you’ve narrowed down the “what” of your market research goals, you’re ready to move onto how you can best achieve them. Think of it like algebra. Many math problems start with “solve for x.” Once you know what you’re looking for, you can get to work trying to find it. It’s a heck of a lot easier to solve a problem when you know you’re looking for “x” than if you were to say “I’m gonna throw some numbers out there and see if I find a variable.”

How to Do Market Research

This guide outlines every component of a comprehensive market research effort. Take into consideration the goals you have established for your market research, as they will influence which of these elements you’ll want to include in your market research strategy.

Secondary Data

Secondary data allows you to utilize pre-existing data to garner a sense of market conditions and opportunities. You can rely on published market studies, white papers, and public competitive information to start your market research journey.

Secondary data, while useful, is limited and cannot substitute your own primary data. It’s best used for quantitative data that can provide background to your more specific inquiries.

Find Your Customers Online

Once you’ve identified your target market, you can use online gathering spaces and forums to gain insights and give yourself a competitive advantage. Rebecca McCusker of The Creative Content Shop recommends internet recon as a vital tool for gaining a sense of customer needs and sentiment. “Read their posts and comments on forums, YouTube video comments, Facebook group [comments], and even Amazon/Goodreads book comments to get in their heads and see what people are saying.”

If you’re interested in engaging with your target demographic online, there are some general rules you should follow. First, secure the consent of any group moderators to ensure that you are acting within the group guidelines. Failure to do so could result in your eviction from the group.

Not all comments have the same research value. “Focus on the comments and posts with the most comments and highest engagement,” says McCusker. These high-engagement posts can give you a sense of what is already connecting and gaining traction within the group.

Social media can also be a great avenue for finding interview subjects. “LinkedIn is very useful if your [target customer] has a very specific job or works in a very specific industry or sector. It’s amazing the amount of people that will be willing to help,” explains Miguel González, a marketing executive at Dealers League . “My advice here is BE BRAVE, go to LinkedIn, or even to people you know and ask them, do quick interviews and ask real people that belong to that market and segment and get your buyer persona information first hand.”

Market research interviews can provide direct feedback on your brand, product, or service and give you a better understanding of consumer pain points and interests.

When organizing your market research interviews, you want to pay special attention to the sample group you’re selecting, as it will directly impact the information you receive. According to Tanya Zhang, the co-founder of Nimble Made , you want to first determine whether you want to choose a representative sample—for example, interviewing people who match each of the buyer persona/customer profiles you’ve developed—or a random sample.

“A sampling of your usual persona styles, for example, can validate details that you’ve already established about your product, while a random sampling may [help you] discover a new way people may use your product,” Zhang says.

Market Surveys

Market surveys solicit customer inclinations regarding your potential product or service through a series of open-ended questions. This direct outreach to your target audience can provide information on your customers’ preferences, attitudes, buying potential, and more.

Every expert we asked voiced unanimous support for market surveys as a powerful tool for market research. With the advent of various survey tools with accessible pricing—or free use—it’s never been easier to assemble, disseminate, and gather market surveys. While it should also be noted that surveys shouldn’t replace customer interviews , they can be used to supplement customer interviews to give you feedback from a broader audience.

Who to Include in Market Surveys

• Current customers
• Past customers
• Your existing audience (such as social media/newsletter audiences)

Example Questions to Include in Market Surveys

While the exact questions will vary for each business, here are some common, helpful questions that you may want to consider for your market survey. Demographic Questions: the questions that help you understand, demographically, who your target customers are:

• “What is your age?”
• “Where do you live?”
• “What is your gender identity?”
• “What is your household income?”
• “What is your household size?”
• “What do you do for a living?”
• “What is your highest level of education?”

Product-Based Questions: Whether you’re seeking feedback for an existing brand or an entirely new one, these questions will help you get a sense of how people feel about your business, product, or service:

• “How well does/would our product/service meet your needs?”
• “How does our product/service compare to similar products/services that you use?”
• “How long have you been a customer?” or “What is the likelihood that you would be a customer of our brand?

Personal/Informative Questions: the deeper questions that help you understand how your audience thinks and what they care about.

• “What are your biggest challenges?”
• “What’s most important to you?”
• “What do you do for fun (hobbies, interests, activities)?”
• “Where do you seek new information when researching a new product?”
• “How do you like to make purchases?”
• “What is your preferred method for interacting with a brand?”

Survey Tools

Online survey tools make it easy to distribute surveys and collect responses. The best part is that there are many free tools available. If you’re making your own online survey, you may want to consider SurveyMonkey, Typeform, Google Forms, or Zoho Survey.

Competitive Analysis

A competitive analysis is a breakdown of how your business stacks up against the competition. There are many different ways to conduct this analysis. One of the most popular methods is a SWOT analysis, which stands for “strengths, weaknesses, opportunities, and threats.” This type of analysis is helpful because it gives you a more robust understanding of why a customer might choose a competitor over your business. Seeing how you stack up against the competition can give you the direction you need to carve out your place as a market leader.

Social Media Analysis

Social media has fundamentally changed the market research landscape, making it easier than ever to engage with a wide swath of consumers. Follow your current or potential competitors on social media to see what they’re posting and how their audience is engaging with it. Social media can also give you a lower cost opportunity for testing different messaging and brand positioning.

SEO Analysis and Opportunities

SEO analysis can help you identify the digital competition for getting the word out about your brand, product, or service. You won’t want to overlook this valuable information. Search listening tools offer a novel approach to understanding the market and generating the content strategy that will drive business. Tools like Google Trends and Awario can streamline this process.

Ready to Kick Your Business Into High Gear?

Now that you’ve completed the guide to market research you know you’re ready to put on your researcher hat to give your business the best start. Still not sure how actually… launch the thing? Our free mini-course can run you through the essentials for starting your side hustle .

About Mary Kate Miller

Mary Kate Miller writes about small business, real estate, and finance. In addition to writing for Foundr, her work has been published by The Washington Post, Teen Vogue, Bustle, and more. She lives in Chicago.

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Secondary Research Advantages, Limitations, and Sources

Summary: secondary research should be a prerequisite to the collection of primary data, but it rarely provides all the answers you need. a thorough evaluation of the secondary data is needed to assess its relevance and accuracy..

5 minutes to read. By author Michaela Mora on January 25, 2022 Topics: Relevant Methods & Tips , Business Strategy , Market Research

Secondary research is based on data already collected for purposes other than the specific problem you have. Secondary research is usually part of exploratory market research designs.

The connection between the specific purpose that originates the research is what differentiates secondary research from primary research. Primary research is designed to address specific problems. However, analysis of available secondary data should be a prerequisite to the collection of primary data.

Advantages of Secondary Research

Secondary data can be faster and cheaper to obtain, depending on the sources you use.

Secondary research can help to:

• Answer certain research questions and test some hypotheses.
• Formulate an appropriate research design (e.g., identify key variables).
• Interpret data from primary research as it can provide some insights into general trends in an industry or product category.
• Understand the competitive landscape.

Limitations of Secondary Research

The usefulness of secondary research tends to be limited often for two main reasons:

Lack of relevance

Secondary research rarely provides all the answers you need. The objectives and methodology used to collect the secondary data may not be appropriate for the problem at hand.

Given that it was designed to find answers to a different problem than yours, you will likely find gaps in answers to your problem. Furthermore, the data collection methods used may not provide the data type needed to support the business decisions you have to make (e.g., qualitative research methods are not appropriate for go/no-go decisions).

Lack of Accuracy

Secondary data may be incomplete and lack accuracy depending on;

• The research design (exploratory, descriptive, causal, primary vs. repackaged secondary data, the analytical plan, etc.)
• Sampling design and sources (target audiences, recruitment methods)
• Data collection method (qualitative and quantitative techniques)
• Analysis point of view (focus and omissions)
• Reporting stages (preliminary, final, peer-reviewed)
• Rate of change in the studied topic (slowly vs. rapidly evolving phenomenon, e.g., adoption of specific technologies).
• Lack of agreement between data sources.

Criteria for Evaluating Secondary Research Data

Before taking the information at face value, you should conduct a thorough evaluation of the secondary data you find using the following criteria:

• Purpose : Understanding why the data was collected and what questions it was trying to answer will tell us how relevant and useful it is since it may or may not be appropriate for your objectives.
• Methodology used to collect the data : Important to understand sources of bias.
• Accuracy of data: Sources of errors may include research design, sampling, data collection, analysis, and reporting.
• When the data was collected : Secondary data may not be current or updated frequently enough for the purpose that you need.
• Content of the data : Understanding the key variables, units of measurement, categories used and analyzed relationships may reveal how useful and relevant it is for your purposes.
• Source reputation : In the era of purposeful misinformation on the Internet, it is important to check the expertise, credibility, reputation, and trustworthiness of the data source.

Secondary Research Data Sources

Compared to primary research, the collection of secondary data can be faster and cheaper to obtain, depending on the sources you use.

Secondary data can come from internal or external sources.

Internal sources of secondary data include ready-to-use data or data that requires further processing available in internal management support systems your company may be using (e.g., invoices, sales transactions, Google Analytics for your website, etc.).

Prior primary qualitative and quantitative research conducted by the company are also common sources of secondary data. They often generate more questions and help formulate new primary research needed.

However, if there are no internal data collection systems yet or prior research, you probably won’t have much usable secondary data at your disposal.

External sources of secondary data include:

• Published materials
• External databases
• Syndicated services.

Published Materials

Published materials can be classified as:

• General business sources: Guides, directories, indexes, and statistical data.
• Government sources: Census data and other government publications.

External Databases

In many industries across a variety of topics, there are private and public databases that can bed accessed online or by downloading data for free, a fixed fee, or a subscription.

These databases can include bibliographic, numeric, full-text, directory, and special-purpose databases. Some public institutions make data collected through various methods, including surveys, available for others to analyze.

Syndicated Services

These services are offered by companies that collect and sell pools of data that have a commercial value and meet shared needs by a number of clients, even if the data is not collected for specific purposes those clients may have.

Syndicated services can be classified based on specific units of measurements (e.g., consumers, households, organizations, etc.).

The data collection methods for these data may include:

• Surveys (Psychographic and Lifestyle, advertising evaluations, general topics)
• Household panels (Purchase and media use)
• Electronic scanner services (volume tracking data, scanner panels, scanner panels with Cable TV)
• Audits (retailers, wholesalers)
• Direct inquiries to institutions
• Clipping services tracking PR for institutions
• Corporate reports

You can spend hours doing research on Google in search of external sources, but this is likely to yield limited insights. Books, articles journals, reports, blogs posts, and videos you may find online are usually analyses and summaries of data from a particular perspective. They may be useful and give you an indication of the type of data used, but they are not the actual data. Whenever possible, you should look at the actual raw data used to draw your own conclusion on its value for your research objectives. You should check professionally gathered secondary research.

Here are some external secondary data sources often used in market research that you may find useful as starting points in your research. Some are free, while others require payment.

• Pew Research Center : Reports about the issues, attitudes, and trends shaping the world. It conducts public opinion polling, demographic research, media content analysis, and other empirical social science research.
• Data.Census.gov : Data dissemination platform to access demographic and economic data from the U.S. Census Bureau.
• Data.gov : The US. government’s open data source with almost 200,00 datasets ranges in topics from health, agriculture, climate, ecosystems, public safety, finance, energy, manufacturing, education, and business.
• Google Scholar : A web search engine that indexes the full text or metadata of scholarly literature across an array of publishing formats and disciplines.
• Google Public Data Explorer : Makes large, public-interest datasets easy to explore, visualize and communicate.
• Google News Archive : Allows users to search historical newspapers and retrieve scanned images of their pages.
• Mckinsey & Company : Articles based on analyses of various industries.
• Statista : Business data platform with data across 170+ industries and 150+ countries.
• Claritas : Syndicated reports on various market segments.
• Mintel : Consumer reports combining exclusive consumer research with other market data and expert analysis.
• MarketResearch.com : Data aggregator with over 350 publishers covering every sector of the economy as well as emerging industries.
• Packaged Facts : Reports based on market research on consumer goods and services industries.
• Dun & Bradstreet : Company directory with business information.

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How to Do Market Research: The Complete Guide

Learn how to do market research with this step-by-step guide, complete with templates, tools and real-world examples.

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Market research is the systematic process of gathering, analyzing and interpreting information about a specific market or industry.

What are your customers’ needs? How does your product compare to the competition? What are the emerging trends and opportunities in your industry? If these questions keep you up at night, it’s time to conduct market research.

Market research plays a pivotal role in your ability to stay competitive and relevant, helping you anticipate shifts in consumer behavior and industry dynamics. It involves gathering these insights using a wide range of techniques, from surveys and interviews to data analysis and observational studies.

In this guide, we’ll explore why market research is crucial, the various types of market research, the methods used in data collection, and how to effectively conduct market research to drive informed decision-making and success.

What is market research?

The purpose of market research is to offer valuable insight into the preferences and behaviors of your target audience, and anticipate shifts in market trends and the competitive landscape. This information helps you make data-driven decisions, develop effective strategies for your business, and maximize your chances of long-term growth.

Why is market research important? 

By understanding the significance of market research, you can make sure you’re asking the right questions and using the process to your advantage. Some of the benefits of market research include:

• Informed decision-making: Market research provides you with the data and insights you need to make smart decisions for your business. It helps you identify opportunities, assess risks and tailor your strategies to meet the demands of the market. Without market research, decisions are often based on assumptions or guesswork, leading to costly mistakes.
• Customer-centric approach: A cornerstone of market research involves developing a deep understanding of customer needs and preferences. This gives you valuable insights into your target audience, helping you develop products, services and marketing campaigns that resonate with your customers.
• Competitive advantage: By conducting market research, you’ll gain a competitive edge. You’ll be able to identify gaps in the market, analyze competitor strengths and weaknesses, and position your business strategically. This enables you to create unique value propositions, differentiate yourself from competitors, and seize opportunities that others may overlook.
• Risk mitigation: Market research helps you anticipate market shifts and potential challenges. By identifying threats early, you can proactively adjust their strategies to mitigate risks and respond effectively to changing circumstances. This proactive approach is particularly valuable in volatile industries.
• Resource optimization: Conducting market research allows organizations to allocate their time, money and resources more efficiently. It ensures that investments are made in areas with the highest potential return on investment, reducing wasted resources and improving overall business performance.
• Adaptation to market trends: Markets evolve rapidly, driven by technological advancements, cultural shifts and changing consumer attitudes. Market research ensures that you stay ahead of these trends and adapt your offerings accordingly so you can avoid becoming obsolete. 

As you can see, market research empowers businesses to make data-driven decisions, cater to customer needs, outperform competitors, mitigate risks, optimize resources and stay agile in a dynamic marketplace. These benefits make it a huge industry; the global market research services market is expected to grow from $76.37 billion in 2021 to $108.57 billion in 2026 . Now, let’s dig into the different types of market research that can help you achieve these benefits.

Types of market research 

• Qualitative research
• Quantitative research
• Exploratory research
• Descriptive research
• Causal research
• Cross-sectional research
• Longitudinal research

Despite its advantages, 23% of organizations don’t have a clear market research strategy. Part of developing a strategy involves choosing the right type of market research for your business goals. The most commonly used approaches include:

1. Qualitative research

Qualitative research focuses on understanding the underlying motivations, attitudes and perceptions of individuals or groups. It is typically conducted through techniques like in-depth interviews, focus groups and content analysis — methods we’ll discuss further in the sections below. Qualitative research provides rich, nuanced insights that can inform product development, marketing strategies and brand positioning.

2. Quantitative research

Quantitative research, in contrast to qualitative research, involves the collection and analysis of numerical data, often through surveys, experiments and structured questionnaires. This approach allows for statistical analysis and the measurement of trends, making it suitable for large-scale market studies and hypothesis testing. While it’s worthwhile using a mix of qualitative and quantitative research, most businesses prioritize the latter because it is scientific, measurable and easily replicated across different experiments.

3. Exploratory research

Whether you’re conducting qualitative or quantitative research or a mix of both, exploratory research is often the first step. Its primary goal is to help you understand a market or problem so you can gain insights and identify potential issues or opportunities. This type of market research is less structured and is typically conducted through open-ended interviews, focus groups or secondary data analysis. Exploratory research is valuable when entering new markets or exploring new product ideas.

4. Descriptive research

As its name implies, descriptive research seeks to describe a market, population or phenomenon in detail. It involves collecting and summarizing data to answer questions about audience demographics and behaviors, market size, and current trends. Surveys, observational studies and content analysis are common methods used in descriptive research. 

5. Causal research

Causal research aims to establish cause-and-effect relationships between variables. It investigates whether changes in one variable result in changes in another. Experimental designs, A/B testing and regression analysis are common causal research methods. This sheds light on how specific marketing strategies or product changes impact consumer behavior.

6. Cross-sectional research

Cross-sectional market research involves collecting data from a sample of the population at a single point in time. It is used to analyze differences, relationships or trends among various groups within a population. Cross-sectional studies are helpful for market segmentation, identifying target audiences and assessing market trends at a specific moment.

7. Longitudinal research

Longitudinal research, in contrast to cross-sectional research, collects data from the same subjects over an extended period. This allows for the analysis of trends, changes and developments over time. Longitudinal studies are useful for tracking long-term developments in consumer preferences, brand loyalty and market dynamics.

Each type of market research has its strengths and weaknesses, and the method you choose depends on your specific research goals and the depth of understanding you’re aiming to achieve. In the following sections, we’ll delve into primary and secondary research approaches and specific research methods.

Primary vs. secondary market research

Market research of all types can be broadly categorized into two main approaches: primary research and secondary research. By understanding the differences between these approaches, you can better determine the most appropriate research method for your specific goals.

Primary market research 

Primary research involves the collection of original data straight from the source. Typically, this involves communicating directly with your target audience — through surveys, interviews, focus groups and more — to gather information. Here are some key attributes of primary market research:

• Customized data: Primary research provides data that is tailored to your research needs. You design a custom research study and gather information specific to your goals.
• Up-to-date insights: Because primary research involves communicating with customers, the data you collect reflects the most current market conditions and consumer behaviors.
• Time-consuming and resource-intensive: Despite its advantages, primary research can be labor-intensive and costly, especially when dealing with large sample sizes or complex study designs. Whether you hire a market research consultant, agency or use an in-house team, primary research studies consume a large amount of resources and time.

Secondary market research 

Secondary research, on the other hand, involves analyzing data that has already been compiled by third-party sources, such as online research tools, databases, news sites, industry reports and academic studies.

Here are the main characteristics of secondary market research:

• Cost-effective: Secondary research is generally more cost-effective than primary research since it doesn’t require building a research plan from scratch. You and your team can look at databases, websites and publications on an ongoing basis, without needing to design a custom experiment or hire a consultant. 
• Leverages multiple sources: Data tools and software extract data from multiple places across the web, and then consolidate that information within a single platform. This means you’ll get a greater amount of data and a wider scope from secondary research.
• Quick to access: You can access a wide range of information rapidly — often in seconds — if you’re using online research tools and databases. Because of this, you can act on insights sooner, rather than taking the time to develop an experiment. 

So, when should you use primary vs. secondary research? In practice, many market research projects incorporate both primary and secondary research to take advantage of the strengths of each approach.

One rule of thumb is to focus on secondary research to obtain background information, market trends or industry benchmarks. It is especially valuable for conducting preliminary research, competitor analysis, or when time and budget constraints are tight. Then, if you still have knowledge gaps or need to answer specific questions unique to your business model, use primary research to create a custom experiment. 

Market research methods

• Surveys and questionnaires
• Focus groups
• Observational research
• Online research tools
• Experiments
• Content analysis
• Ethnographic research

How do primary and secondary research approaches translate into specific research methods? Let’s take a look at the different ways you can gather data: 

1. Surveys and questionnaires

Surveys and questionnaires are popular methods for collecting structured data from a large number of respondents. They involve a set of predetermined questions that participants answer. Surveys can be conducted through various channels, including online tools, telephone interviews and in-person or online questionnaires. They are useful for gathering quantitative data and assessing customer demographics, opinions, preferences and needs. On average, customer surveys have a 33% response rate , so keep that in mind as you consider your sample size.

2. Interviews

Interviews are in-depth conversations with individuals or groups to gather qualitative insights. They can be structured (with predefined questions) or unstructured (with open-ended discussions). Interviews are valuable for exploring complex topics, uncovering motivations and obtaining detailed feedback. 

3. Focus groups

The most common primary research methods are in-depth webcam interviews and focus groups. Focus groups are a small gathering of participants who discuss a specific topic or product under the guidance of a moderator. These discussions are valuable for primary market research because they reveal insights into consumer attitudes, perceptions and emotions. Focus groups are especially useful for idea generation, concept testing and understanding group dynamics within your target audience.

4. Observational research

Observational research involves observing and recording participant behavior in a natural setting. This method is particularly valuable when studying consumer behavior in physical spaces, such as retail stores or public places. In some types of observational research, participants are aware you’re watching them; in other cases, you discreetly watch consumers without their knowledge, as they use your product. Either way, observational research provides firsthand insights into how people interact with products or environments.

5. Online research tools

You and your team can do your own secondary market research using online tools. These tools include data prospecting platforms and databases, as well as online surveys, social media listening, web analytics and sentiment analysis platforms. They help you gather data from online sources, monitor industry trends, track competitors, understand consumer preferences and keep tabs on online behavior. We’ll talk more about choosing the right market research tools in the sections that follow.

6. Experiments

Market research experiments are controlled tests of variables to determine causal relationships. While experiments are often associated with scientific research, they are also used in market research to assess the impact of specific marketing strategies, product features, or pricing and packaging changes.

7. Content analysis

Content analysis involves the systematic examination of textual, visual or audio content to identify patterns, themes and trends. It’s commonly applied to customer reviews, social media posts and other forms of online content to analyze consumer opinions and sentiments.

8. Ethnographic research

Ethnographic research immerses researchers into the daily lives of consumers to understand their behavior and culture. This method is particularly valuable when studying niche markets or exploring the cultural context of consumer choices.

How to do market research

• Set clear objectives
• Identify your target audience
• Choose your research methods
• Use the right market research tools
• Collect data
• Analyze data 
• Interpret your findings
• Identify opportunities and challenges
• Make informed business decisions
• Monitor and adapt

Now that you have gained insights into the various market research methods at your disposal, let’s delve into the practical aspects of how to conduct market research effectively. Here’s a quick step-by-step overview, from defining objectives to monitoring market shifts.

1. Set clear objectives

When you set clear and specific goals, you’re essentially creating a compass to guide your research questions and methodology. Start by precisely defining what you want to achieve. Are you launching a new product and want to understand its viability in the market? Are you evaluating customer satisfaction with a product redesign? 

Start by creating SMART goals — objectives that are specific, measurable, achievable, relevant and time-bound. Not only will this clarify your research focus from the outset, but it will also help you track progress and benchmark your success throughout the process. 

You should also consult with key stakeholders and team members to ensure alignment on your research objectives before diving into data collecting. This will help you gain diverse perspectives and insights that will shape your research approach.

2. Identify your target audience

Next, you’ll need to pinpoint your target audience to determine who should be included in your research. Begin by creating detailed buyer personas or stakeholder profiles. Consider demographic factors like age, gender, income and location, but also delve into psychographics, such as interests, values and pain points.

The more specific your target audience, the more accurate and actionable your research will be. Additionally, segment your audience if your research objectives involve studying different groups, such as current customers and potential leads.

If you already have existing customers, you can also hold conversations with them to better understand your target market. From there, you can refine your buyer personas and tailor your research methods accordingly.

3. Choose your research methods

Selecting the right research methods is crucial for gathering high-quality data. Start by considering the nature of your research objectives. If you’re exploring consumer preferences, surveys and interviews can provide valuable insights. For in-depth understanding, focus groups or observational research might be suitable. Consider using a mix of quantitative and qualitative methods to gain a well-rounded perspective. 

You’ll also need to consider your budget. Think about what you can realistically achieve using the time and resources available to you. If you have a fairly generous budget, you may want to try a mix of primary and secondary research approaches. If you’re doing market research for a startup , on the other hand, chances are your budget is somewhat limited. If that’s the case, try addressing your goals with secondary research tools before investing time and effort in a primary research study. 

4. Use the right market research tools

Whether you’re conducting primary or secondary research, you’ll need to choose the right tools. These can help you do anything from sending surveys to customers to monitoring trends and analyzing data. Here are some examples of popular market research tools:

• Market research software: Crunchbase is a platform that provides best-in-class company data, making it valuable for market research on growing companies and industries. You can use Crunchbase to access trusted, first-party funding data, revenue data, news and firmographics, enabling you to monitor industry trends and understand customer needs.

• Survey and questionnaire tools: SurveyMonkey is a widely used online survey platform that allows you to create, distribute and analyze surveys. Google Forms is a free tool that lets you create surveys and collect responses through Google Drive.
• Data analysis software: Microsoft Excel and Google Sheets are useful for conducting statistical analyses. SPSS is a powerful statistical analysis software used for data processing, analysis and reporting.
• Social listening tools: Brandwatch is a social listening and analytics platform that helps you monitor social media conversations, track sentiment and analyze trends. Mention is a media monitoring tool that allows you to track mentions of your brand, competitors and keywords across various online sources.
• Data visualization platforms: Tableau is a data visualization tool that helps you create interactive and shareable dashboards and reports. Power BI by Microsoft is a business analytics tool for creating interactive visualizations and reports.

5. Collect data

There’s an infinite amount of data you could be collecting using these tools, so you’ll need to be intentional about going after the data that aligns with your research goals. Implement your chosen research methods, whether it’s distributing surveys, conducting interviews or pulling from secondary research platforms. Pay close attention to data quality and accuracy, and stick to a standardized process to streamline data capture and reduce errors. 

6. Analyze data

Once data is collected, you’ll need to analyze it systematically. Use statistical software or analysis tools to identify patterns, trends and correlations. For qualitative data, employ thematic analysis to extract common themes and insights. Visualize your findings with charts, graphs and tables to make complex data more understandable.

If you’re not proficient in data analysis, consider outsourcing or collaborating with a data analyst who can assist in processing and interpreting your data accurately.

7. Interpret your findings

Interpreting your market research findings involves understanding what the data means in the context of your objectives. Are there significant trends that uncover the answers to your initial research questions? Consider the implications of your findings on your business strategy. It’s essential to move beyond raw data and extract actionable insights that inform decision-making.

Hold a cross-functional meeting or workshop with relevant team members to collectively interpret the findings. Different perspectives can lead to more comprehensive insights and innovative solutions.

8. Identify opportunities and challenges

Use your research findings to identify potential growth opportunities and challenges within your market. What segments of your audience are underserved or overlooked? Are there emerging trends you can capitalize on? Conversely, what obstacles or competitors could hinder your progress?

Lay out this information in a clear and organized way by conducting a SWOT analysis, which stands for strengths, weaknesses, opportunities and threats. Jot down notes for each of these areas to provide a structured overview of gaps and hurdles in the market.

9. Make informed business decisions

Market research is only valuable if it leads to informed decisions for your company. Based on your insights, devise actionable strategies and initiatives that align with your research objectives. Whether it’s refining your product, targeting new customer segments or adjusting pricing, ensure your decisions are rooted in the data.

At this point, it’s also crucial to keep your team aligned and accountable. Create an action plan that outlines specific steps, responsibilities and timelines for implementing the recommendations derived from your research. 

10. Monitor and adapt

Market research isn’t a one-time activity; it’s an ongoing process. Continuously monitor market conditions, customer behaviors and industry trends. Set up mechanisms to collect real-time data and feedback. As you gather new information, be prepared to adapt your strategies and tactics accordingly. Regularly revisiting your research ensures your business remains agile and reflects changing market dynamics and consumer preferences.

Online market research sources

As you go through the steps above, you’ll want to turn to trusted, reputable sources to gather your data. Here’s a list to get you started:

• Crunchbase: As mentioned above, Crunchbase is an online platform with an extensive dataset, allowing you to access in-depth insights on market trends, consumer behavior and competitive analysis. You can also customize your search options to tailor your research to specific industries, geographic regions or customer personas.

• Academic databases: Academic databases, such as ProQuest and JSTOR , are treasure troves of scholarly research papers, studies and academic journals. They offer in-depth analyses of various subjects, including market trends, consumer preferences and industry-specific insights. Researchers can access a wealth of peer-reviewed publications to gain a deeper understanding of their research topics.
• Government and NGO databases: Government agencies, nongovernmental organizations and other institutions frequently maintain databases containing valuable economic, demographic and industry-related data. These sources offer credible statistics and reports on a wide range of topics, making them essential for market researchers. Examples include the U.S. Census Bureau , the Bureau of Labor Statistics and the Pew Research Center .
• Industry reports: Industry reports and market studies are comprehensive documents prepared by research firms, industry associations and consulting companies. They provide in-depth insights into specific markets, including market size, trends, competitive analysis and consumer behavior. You can find this information by looking at relevant industry association databases; examples include the American Marketing Association and the National Retail Federation .
• Social media and online communities: Social media platforms like LinkedIn or Twitter (X) , forums such as Reddit and Quora , and review platforms such as G2 can provide real-time insights into consumer sentiment, opinions and trends. 

Market research examples

At this point, you have market research tools and data sources — but how do you act on the data you gather? Let’s go over some real-world examples that illustrate the practical application of market research across various industries. These examples showcase how market research can lead to smart decision-making and successful business decisions.

Example 1: Apple’s iPhone launch

Apple ’s iconic iPhone launch in 2007 serves as a prime example of market research driving product innovation in tech. Before the iPhone’s release, Apple conducted extensive market research to understand consumer preferences, pain points and unmet needs in the mobile phone industry. This research led to the development of a touchscreen smartphone with a user-friendly interface, addressing consumer demands for a more intuitive and versatile device. The result was a revolutionary product that disrupted the market and redefined the smartphone industry.

Example 2: McDonald’s global expansion

McDonald’s successful global expansion strategy demonstrates the importance of market research when expanding into new territories. Before entering a new market, McDonald’s conducts thorough research to understand local tastes, preferences and cultural nuances. This research informs menu customization, marketing strategies and store design. For instance, in India, McDonald’s offers a menu tailored to local preferences, including vegetarian options. This market-specific approach has enabled McDonald’s to adapt and thrive in diverse global markets.

Example 3: Organic and sustainable farming

The shift toward organic and sustainable farming practices in the food industry is driven by market research that indicates increased consumer demand for healthier and environmentally friendly food options. As a result, food producers and retailers invest in sustainable sourcing and organic product lines — such as with these sustainable seafood startups — to align with this shift in consumer values. 

The bottom line? Market research has multiple use cases and is a critical practice for any industry. Whether it’s launching groundbreaking products, entering new markets or responding to changing consumer preferences, you can use market research to shape successful strategies and outcomes.

Market research templates

You finally have a strong understanding of how to do market research and apply it in the real world. Before we wrap up, here are some market research templates that you can use as a starting point for your projects:

• Smartsheet competitive analysis templates : These spreadsheets can serve as a framework for gathering information about the competitive landscape and obtaining valuable lessons to apply to your business strategy.
• SurveyMonkey product survey template : Customize the questions on this survey based on what you want to learn from your target customers.
• HubSpot templates : HubSpot offers a wide range of free templates you can use for market research, business planning and more.
• SCORE templates : SCORE is a nonprofit organization that provides templates for business plans, market analysis and financial projections.
• SBA.gov : The U.S. Small Business Administration offers templates for every aspect of your business, including market research, and is particularly valuable for new startups. 

Strengthen your business with market research

When conducted effectively, market research is like a guiding star. Equipped with the right tools and techniques, you can uncover valuable insights, stay competitive, foster innovation and navigate the complexities of your industry.

Throughout this guide, we’ve discussed the definition of market research, different research methods, and how to conduct it effectively. We’ve also explored various types of market research and shared practical insights and templates for getting started. 

Now, it’s time to start the research process. Trust in data, listen to the market and make informed decisions that guide your company toward lasting success.

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How to do market research: The complete guide for your brand

Written by by Jacqueline Zote

Published on  April 13, 2023

Reading time  10 minutes

Blindly putting out content or products and hoping for the best is a thing of the past. Not only is it a waste of time and energy, but you’re wasting valuable marketing dollars in the process. Now you have a wealth of tools and data at your disposal, allowing you to develop data-driven marketing strategies . That’s where market research comes in, allowing you to uncover valuable insights to inform your business decisions.

Conducting market research not only helps you better understand how to sell to customers but also stand out from your competition. In this guide, we break down everything you need to know about market research and how doing your homework can help you grow your business.

Table of contents:

What is market research?

Why is market research important, types of market research, where to conduct market research.

• Steps for conducting market research
• Tools to use for market research

Market research is the process of gathering information surrounding your business opportunities. It identifies key information to better understand your audience. This includes insights related to customer personas and even trends shaping your industry.

Taking time out of your schedule to conduct research is crucial for your brand health. Here are some of the key benefits of market research:

Understand your customers’ motivations and pain points

Most marketers are out of touch with what their customers want. Moreover, these marketers are missing key information on what products their audience wants to buy.

Simply put, you can’t run a business if you don’t know what motivates your customers.

And spoiler alert: Your customers’ wants and needs change. Your customers’ behaviors today might be night and day from what they were a few years ago.

Market research holds the key to understanding your customers better. It helps you uncover their key pain points and motivations and understand how they shape their interests and behavior.

Figure out how to position your brand

Positioning is becoming increasingly important as more and more brands enter the marketplace. Market research enables you to spot opportunities to define yourself against your competitors.

Maybe you’re able to emphasize a lower price point. Perhaps your product has a feature that’s one of a kind. Finding those opportunities goes hand in hand with researching your market.

Maintain a strong pulse on your industry at large

Today’s marketing world evolves at a rate that’s difficult to keep up with.

Fresh products. Up-and-coming brands. New marketing tools. Consumers get bombarded with sales messages from all angles. This can be confusing and overwhelming.

By monitoring market trends, you can figure out the best tactics for reaching your target audience.

Not everyone conducts market research for the same reason. While some may want to understand their audience better, others may want to see how their competitors are doing. As such, there are different types of market research you can conduct depending on your goal.

Interview-based market research allows for one-on-one interactions. This helps the conversation to flow naturally, making it easier to add context. Whether this takes place in person or virtually, it enables you to gather more in-depth qualitative data.

Buyer persona research

Buyer persona research lets you take a closer look at the people who make up your target audience. You can discover the needs, challenges and pain points of each buyer persona to understand what they need from your business. This will then allow you to craft products or campaigns to resonate better with each persona.

Pricing research

In this type of research, brands compare similar products or services with a particular focus on pricing. They look at how much those products or services typically sell for so they can get more competitive with their pricing strategy.

Competitive analysis research

Competitor analysis gives you a realistic understanding of where you stand in the market and how your competitors are doing. You can use this analysis to find out what’s working in your industry and which competitors to watch out for. It even gives you an idea of how well those competitors are meeting consumer needs.

Depending on the competitor analysis tool you use, you can get as granular as you need with your research. For instance, Sprout Social lets you analyze your competitors’ social strategies. You can see what types of content they’re posting and even benchmark your growth against theirs.

Brand awareness research

Conducting brand awareness research allows you to assess your brand’s standing in the market. It tells you how well-known your brand is among your target audience and what they associate with it. This can help you gauge people’s sentiments toward your brand and whether you need to rebrand or reposition.

If you don’t know where to start with your research, you’re in the right place.

There’s no shortage of market research methods out there. In this section, we’ve highlighted research channels for small and big businesses alike.

Considering that Google sees a staggering 8.5 billion searches each day, there’s perhaps no better place to start.

A quick Google search is a potential goldmine for all sorts of questions to kick off your market research. Who’s ranking for keywords related to your industry? Which products and pieces of content are the hottest right now? Who’s running ads related to your business?

For example, Google Product Listing Ads can help highlight all of the above for B2C brands.

The same applies to B2B brands looking to keep tabs on who’s running industry-related ads and ranking for keyword terms too.

There’s no denying that email represents both an aggressive and effective marketing channel for marketers today. Case in point, 44% of online shoppers consider email as the most influential channel in their buying decisions.

Looking through industry and competitor emails is a brilliant way to learn more about your market. For example, what types of offers and deals are your competitors running? How often are they sending emails?

Email is also invaluable for gathering information directly from your customers. This survey message from Asana is a great example of how to pick your customers’ brains to figure out how you can improve your quality of service.

Industry journals, reports and blogs

Don’t neglect the importance of big-picture market research when it comes to tactics and marketing channels to explore. Look to marketing resources such as reports and blogs as well as industry journals

Keeping your ear to the ground on new trends and technologies is a smart move for any business. Sites such as Statista, Marketing Charts, AdWeek and Emarketer are treasure troves of up-to-date data and news for marketers.

And of course, there’s the  Sprout Insights blog . And invaluable resources like The Sprout Social Index™  can keep you updated on the latest social trends.

Social media

If you want to learn more about your target market, look no further than social media. Social offers a place to discover what your customers want to see in future products or which brands are killin’ it. In fact, social media is become more important for businesses than ever with the level of data available.

It represents a massive repository of real-time data and insights that are instantly accessible. Brand monitoring and social listening are effective ways to conduct social media research . You can even be more direct with your approach. Ask questions directly or even poll your audience to understand their needs and preferences.

The 5 steps for how to do market research

Now that we’ve covered the why and where, it’s time to get into the practical aspects of market research. Here are five essential steps on how to do market research effectively.

Step 1: Identify your research topic

First off, what are you researching about? What do you want to find out? Narrow down on a specific research topic so you can start with a clear idea of what to look for.

For example, you may want to learn more about how well your product features are satisfying the needs of existing users. This might potentially lead to feature updates and improvements. Or it might even result in new feature introductions.

Similarly, your research topic may be related to your product or service launch or customer experience. Or you may want to conduct research for an upcoming marketing campaign.

Step 2: Choose a buyer persona to engage

If you’re planning to focus your research on a specific type of audience, decide which buyer persona you want to engage. This persona group will serve as a representative sample of your target audience.

Engaging a specific group of audience lets you streamline your research efforts. As such, it can be a much more effective and organized approach than researching thousands (if not millions) of individuals.

You may be directing your research toward existing users of your product. To get even more granular, you may want to focus on users who have been familiar with the product for at least a year, for example.

Step 3: Start collecting data

The next step is one of the most critical as it involves collecting the data you need for your research. Before you begin, make sure you’ve chosen the right research methods that will uncover the type of data you need. This largely depends on your research topic and goals.

Remember that you don’t necessarily have to stick to one research method. You may use a combination of qualitative and quantitative approaches. So for example, you could use interviews to supplement the data from your surveys. Or you may stick to insights from your social listening efforts.

To keep things consistent, let’s look at this in the context of the example from earlier. Perhaps you can send out a survey to your existing users asking them a bunch of questions. This might include questions like which features they use the most and how often they use them. You can get them to choose an answer from one to five and collect quantitative data.

Plus, for qualitative insights, you could even include a few open-ended questions with the option to write their answers. For instance, you might ask them if there’s any improvement they wish to see in your product.

Step 4: Analyze results

Once you have all the data you need, it’s time to analyze it keeping your research topic in mind. This involves trying to interpret the data to look for a wider meaning, particularly in relation to your research goal.

So let’s say a large percentage of responses were four or five in the satisfaction rating. This means your existing users are mostly satisfied with your current product features. On the other hand, if the responses were mostly ones and twos, you may look for opportunities to improve. The responses to your open-ended questions can give you further context as to why people are disappointed.

Step 5: Make decisions for your business

Now it’s time to take your findings and turn them into actionable insights for your business. In this final step, you need to decide how you want to move forward with your new market insight.

What did you find in your research that would require action? How can you put those findings to good use?

The market research tools you should be using

To wrap things up, let’s talk about the various tools available to conduct speedy, in-depth market research. These tools are essential for conducting market research faster and more efficiently.

Social listening and analytics

Social analytics tools like Sprout can help you keep track of engagement across social media. This goes beyond your own engagement data but also includes that of your competitors. Considering how quickly social media moves, using a third-party analytics tool is ideal. It allows you to make sense of your social data at a glance and ensure that you’re never missing out on important trends.

Email marketing research tools

Keeping track of brand emails is a good idea for any brand looking to stand out in its audience’s inbox.

Tools such as MailCharts ,  Really Good Emails  and  Milled  can show you how different brands run their email campaigns.

Meanwhile, tools like  Owletter  allow you to monitor metrics such as frequency and send-timing. These metrics can help you understand email marketing strategies among competing brands.

Content marketing research

If you’re looking to conduct research on content marketing, tools such as  BuzzSumo  can be of great help. This tool shows you the top-performing industry content based on keywords. Here you can see relevant industry sites and influencers as well as which brands in your industry are scoring the most buzz. It shows you exactly which pieces of content are ranking well in terms of engagements and shares and on which social networks.

SEO and keyword tracking

Monitoring industry keywords is a great way to uncover competitors. It can also help you discover opportunities to advertise your products via organic search. Tools such as  Ahrefs  provide a comprehensive keyword report to help you see how your search efforts stack up against the competition.

Competitor comparison template

For the sake of organizing your market research, consider creating a competitive matrix. The idea is to highlight how you stack up side-by-side against others in your market. Use a  social media competitive analysis template  to track your competitors’ social presence. That way, you can easily compare tactics, messaging and performance. Once you understand your strengths and weaknesses next to your competitors, you’ll find opportunities as well.

Customer persona creator

Finally, customer personas represent a place where all of your market research comes together. You’d need to create a profile of your ideal customer that you can easily refer to. Tools like  Xtensio  can help in outlining your customer motivations and demographics as you zero in on your target market.

Build a solid market research strategy

Having a deeper understanding of the market gives you leverage in a sea of competitors. Use the steps and market research tools we shared above to build an effective market research strategy.

But keep in mind that the accuracy of your research findings depends on the quality of data collected. Turn to Sprout’s social media analytics tools to uncover heaps of high-quality data across social networks.

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• Social Media Strategy

Social media RFPs: The best questions to include (plus a template)

Template: Essential Questions to Ask in Your Social Media Management Software RFP

• Team Collaboration

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• Customer Experience

Brand trust: What it is and why it matters

• Now on slide

Build and grow stronger relationships on social

Sprout Social helps you understand and reach your audience, engage your community and measure performance with the only all-in-one social media management platform built for connection.

Market Research: What It Is, Why It Matters, and How To Get It Right

What is market research?

What is market research used for? How important is it? And, how do you choose the right type of research for your business?

Sit back, take five, and I’ll explain the different types of research , what tools are best for the job, and how you can leverage them to grow your business and master your market .

Market research definition:

Market research means to systematically collect and analyze data about a target market or defined segment. It’s a multivariate process that uncovers key facts and insights to inform decisions.

Whether you’re launching a new product , looking for ways to expand a business, or seeking out efficiencies in an existing company, market research is a highly effective way to flesh-out ideas, innovate, and grow. 

Advantages of market research

Market research helps you identify your greatest strengths, threats, and opportunities. It can help you find your way when markets become tough to predict and find efficient ways to grow your business .

• Reduce costs
• Define detailed customer personas
• Make data-driven decisions
• Find new opportunities for growth
• Unpack competitor’s successes
• Develop an informed content marketing strategy
• Identify trends
• Inform market analysis
• Discover the best marketing channels to use
• Find the best ways to communicate with customers
• Benchmark performance against rivals

Online market research can help the whole business at any stage of its life. When practiced consistently and systematically, you can realize its many benefits.

Why is market research important?

Market research helps you identify your greatest threats. And it also gives you a clear picture of opportunities you can capitalize on for greater returns on your business investments, or ROI.

Understanding your specific market on different levels and from different perspectives helps you reach well-informed, data-informed decisions . The process can involve multiple phases. But, if you follow a systematic approach using a market research template , your efforts will pay off.

To skip ahead and start right now, download our free pack of market research templates.

Different types of market research

Market research is a questions and answers game. Once you’ve asked the important questions, you’ll need to choose the right type of research to get your answers. There are four core types of research, each of which can be applied to help you solve a problem or gather insights to inform key decisions.

Primary market research

Primary market research is the first-hand collection of data. It’s data that’s not available to others, and can be obtained in a number of ways. Here are the most common.

• Web Metrics Use analytics software that provides traffic and engagement metrics to understand how audiences behave.
• Observation To observe how users behave and navigate your site, you can install software that records visits and creates heatmaps. Such tools are useful for qualitative research regarding your UX/UI and at the same time, quantify the findings.
• Customer surveys Survey questionnaires and polls can be distributed to any number of customers through email, SMS, your site, or social media. They let you collect both qualitative and quantitative data from respondents using open-ended questions.
• Focus groups You select a small number of people for a group discussion. A moderator leads the session with questions and records the conclusions. This is also a form of qualitative research, and you would use it to get in-depth information.
• Face-to-face interviews Another qualitative assessment method is one-on-one interviews. Consumers representative of your target audience or a segment of it are selected to answer questions about a specific research topic.
• Phone calls To involve a larger number of people and get more answers, you can conduct surveys over the phone. These interviews would be less specific and include fewer questions.

Helpful: A complete guide to doing primary market research

Secondary market research

Secondary research is second-hand data that has already been produced. It’s available to all who wish to consume it. Using this type of data is preferred by those who wish to keep costs low, as it can be quicker and freely available.

• Government reports and census data Annual, quarterly, and other periodic industry reports are a rich data source to tap into. Government organizations publish statistics in areas of trade, ecommerce, and finance.
• Academic papers and educational resources University research is a source of high-quality information. This is useful for in-depth background information on a broad scale.
• Online articles and case studies, public and commercial sources Industry-specific publications can be a valuable source of information for market segmentation, providing you with data and insights on market trends or a specific market segment or niche.

Further reading: A complete guide to doing desk research

Qualitative market research

Qualitative market research is one of the best ways to understand how people think or feel about a brand, product, or service. It takes more time to plan and analyze the results than other market research types. However, with tools like market research surveys , there are quick and effective ways to do it.

As some of the methods are outlined in the primary and secondary research sections, I’ve included a short list of qualitative research methods below.

• Focus groups
• Case study or whitepaper 
• Online forums
• Biometrics 
• Ethnography

Helpful: Read the complete guide to qualitative research and 83 qualitative research questions & examples

Quantitative market research

Quantitative market research is all about numbers. It collects numerical data to help answer specific research questions . The information collected can be easily quantified and analyzed to establish trends, insights, and patterns.

With this type of research, you’ve got three core data collection methods. However, you’ve also got to consider the design of the research, which can impact which method is used.

What is market research used for?

The applications for market research are virtually limitless. Market research can help you unravel the most complex of business challenges to reach data-driven decisions , and when used consistently, it can help you navigate turbulent times, fuel growth, and support your success . Here are just a few examples of what market research is used for, with a few real-world examples thrown in for good measure.

1. Company research

Market research allows you to shine a spotlight on any business and unpack its wins and losses for your own gain. Let’s say you are doing market research for a business plan ; you’ll likely want to evaluate the successes of others in your industry. Doing systematic company research is a proven way to inform a SWOT analysis .

Doing industry analysis can show you who your industry leaders are , along with any emerging players showing exponential growth.

Let’s say I want to find out which companies to research, I would use Similarweb Digital Research Intelligence to analyze an industry. Here, I can see who my top companies to watch are instantly. It also shows me other companies showing rapid growth in my market.

Read More: How to Research a Company: The Ultimate Guide

2. Competitive benchmarking

Most of your relevant data will come from your competition. If you plan to offer something that’s new for you but already exists in the market, learn from other’s mistakes and successes. If your goal is to evaluate and optimize, collect competitors’ data, and compare it to yours. See what works for them, find their weak spots, and improve on them.

What market research gives you here, is the ability to systematically compare each of your rivals. And, it’s not as complex as it sounds either. Simply choose a type of competitive analysis frameworks to use, complete the template for each; then compare the results to uncover relevant insights.

Read More: The Why and How of Competitive Benchmarking

3. Trendspotting

Another objective for market researchers is to forecast upcoming trends. Data collection over time helps you understand the dynamics of the market. Some markets have strong seasonal fluctuations. Increased shopping during December is an obvious example, but often these shifts are not always evident unless you measure and analyze them specifically.

With the data from your historical market research, you can evaluate their impact and the likelihood you will keep seeing these trends. Based on that, you can make predictions about future developments.

4. Audience analysis

Who will find your product most useful and why? 

Examining the size of your audience and the existing demand for your product or services is crucial. Understanding  your target audience allows you to build your product offering and marketing strategy more efficiently. You also want to learn first-hand where people buy this type of product and how much they are willing to spend so that you can estimate your reachable market share .

Here’s a quick example of how we use Similarweb to do effective audience analysis . You can unpack key audience demographics for any site you choose. And get up-to-date stats about gender, age, location, interests, browsing habits, and more.

5. Market segmentation

There are lots of ways to segment a market. Doing this well can deliver higher conversions, reduce costs, redefine marketing strategies, and help you connect with customers on a more personal level. Market research can help you do most types of market segmentation, the most widely adopted of all is demographic segmentation. Here, you look for shared but specific characteristics of a target audience.

Using Similarweb, I can view audience demographics for a website, and compare it side-by-side with rival sites. In this example, I am looking at hotel booking sites to try and spot any difference between the respective audiences of each.

Helpful: Read our complete guide to market segmentation

6. Marketing strategy

Market research can also help you reach the right decision regarding where to advertise or market your business. After analyzing the data, you’ll know which marketing channels are most effective with your target audience. You can also use research to look at the specific keywords and ad creatives that are generating the best responses and ROI.

Similarweb Digital Research Intelligence makes this type of research effortless. Within the marketing channels tab, you can analyze an entire industry or hone in on a specific site of interest. View the various channels across social media, email, direct, organic search, paid search, and display ads to see which channels convert and where the highest channel traffic comes from.

7. Customer experience

Market research is your best way to get information that isn’t naturally visible but that may significantly affect your business. Just think, the fact that your users don’t complain doesn’t necessarily mean they are all delighted with what you offer.

While some customers tend to keep their criticism to themselves, others will be vocal and leave reviews online. Market research is a powerful tool to help inform improvements to services and products alike. Asking for feedback, listening to it, and looking at the feedback left for rivals in your market can uncover telling insights that can shape service offerings, marketing campaigns, and new feature development.

To see what people use market research for and view real-world instances of research in action, head over to our market research examples page.

Tools for market research

When we look at what market research is, the answer is always rooted in data . Over 100 years ago, vehicle manufacturers undertook extensive research to help them develop different models to suit various segments of society. Fast-forward 100 years, and we find similar applications still exist. However, what’s changed are the tools being used and, more importantly, the accessibility of those tools to a far broader audience .

There are more market intelligence tools in existence today than ever before. Here’s a quick summary of a few you can use to collect information for your market research.

• Google Trends Google Trends is a valuable resource for quantitative research data about market tendencies and user behavior.

• Similarweb Research Intelligence Get the freshest digital intelligence from a platform that shows the insights that count. With the ability to analyze an entire market in an instant and unpick competitors’ wins and losses online, you can count on it to help you perform quick and effective market research.
• Hotjar The digital tool lets you observe and record user behavior on your website. It also creates heatmaps of your pages so you can analyze how visitors navigate.
• SurveyMonkey Create your own online survey with this free tool. SurveyMonkey provides templates for questionnaires and lets you distribute them through your various channels, then collect and interpret results.
• YouGov This platform offers its users daily with thousands of data points and statistics on consumer attitudes, opinions, and behavior.
• Pew Research Center This non-profit organization conducts and publishes public opinion polling, demographic research, content analysis, and other data-driven social science research.
• Living Facts The site provides current statistics about the American population, including demographics, social and health issues, opinions, and more.

Read this post to see what market research tools are hot right now.

Wrapping up: what is market research

Market research is insight. It gives you information to fuel key decisions in your business. Without it, companies must navigate their market uncertainly and make key decisions based on instinct or outdated data.

Similarweb transforms the way companies do market research . There’s no expensive outlay for prolonged research reports that take an age to produce. The data is the freshest there is; it’s credible and shows traffic trends and comparable performance like no other.

Try using it to answer your next big market research question.

Stop Guessing, Start Analyzing

Get actionable insights for market research here

What are the benefits of market research?

Effective market research helps businesses understand and improve their position while also identifying potential threats and opportunities, while also spotting emerging trends .

What is the main purpose of market research?

The main benefit of market research is insight. It can give you access to the data you need to make decisions in your business. Before you invest money or time in any venture, use market research to inform your decision.  

What’s the difference between primary and secondary market research?

Primary research is research you conduct on your own that uses numbers and metrics, and secondary research is research that was done by someone else with a qualitative focus.

by Liz March

Digital Research Specialist

Liz March has 15 years of experience in content creation. She enjoys the outdoors, F1, and reading, and is pursuing a BSc in Environmental Science.

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Top 10 Benefits of Market Research: An Overview

Explore the dynamic world of Business Intelligence with our blog on the "Top 10 Benefits of Market Research." Uncover how strategic insights drive success, enhance decision-making, and maximise profitability. From customer satisfaction to competitive analysis, delve into the invaluable Benefits of Market Research and revolutionise your approach.

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Table of Contents

1) Key Benefits of Market Research

     a) Improved communication with customers

     b) Facilitates the creation of strategic

     c) Formulate comprehensive target personas

     d) Minimise expenses and enhance time efficiency

     e) Maintain a competitive edge in the Market

      f) Recognise growth opportunities

2) Challenges associated with Market Research

3) Conclusion

Key Benefits of Market Research

Market Research can provide valuable insights into various aspects of your business, such as customer satisfaction, Market trends, competitor analysis, product development, pricing, branding, and more. Some of the key Benefits of Market Research are:

1) Improved communication with customers

Communication is essential for building and maintaining relationships with customers, as well as understanding their needs, expectations, feedback, and pain points. By conducting Market Research, businesses can collect customer data and analyse their opinions, attitudes, and behaviors, using methods such as surveys, interviews, focus groups, or online reviews. 

It can help businesses improve their customer service, loyalty, retention, and referrals, by addressing their issues, answering their questions, solving their problems, or fulfilling their desires. For example, a business can use Market Research to find out what customers think about their products or services, how satisfied they are, what they like or dislike, what they want or need, or how they use or perceive them. It can help the business improve its products or services or create new ones that meet or exceed customer expectations.  

2) Facilitates the creation of strategic

Strategic plans are long-term goals and actions that guide the direction and vision of a business. By conducting Market Research, businesses can identify their Strengths, Weaknesses, Opportunities, And Threats (SWOT analysis) and evaluate their current performance, position, and potential in the Market. It can help businesses create strategic plans that are realistic, achievable, and measurable, and align with their mission, vision, and values. 

For example, a business can use Market Research to assess its Market size, share, growth, and trends, compare itself with its competitors, and identify gaps or areas for improvement. It can help the business create strategic plans focusing on its core competencies, differentiating itself from its competitors, and capitalising on its opportunities.

3) Formulate comprehensive target personas

Target personas are detailed profiles of the ideal customers for a business based on their demographics, psychographics, behaviours, and needs. By conducting Market Research, businesses can segment their Market into different groups and create target personas for each group, using methods such as surveys, interviews, focus groups, or online analytics. It can help businesses tailor their Marketing messages, channels, and strategies to appeal to each segment and increase their conversion, retention, and loyalty rates. 

For example, a business can use Market Research to find out the age, gender, income, education, location, lifestyle, hobbies, values, goals, challenges, and motivations of their customers and create target personas that reflect their characteristics, preferences, and behaviours. It can help the business design and deliver products or services or create and distribute content that resonates with each target persona and addresses their needs, wants, or pain points.

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4) Minimise expenses and enhance time efficiency

Expenses and time are valuable resources for any business, and they should be used wisely and efficiently. By conducting Market Research, businesses can reduce the risk of making costly mistakes or wasting resources by testing their products or services or their Marketing strategies before launching them and ensuring that they meet the needs and expectations of their customers. It can help businesses optimise their pricing, distribution, promotion, and positioning strategies and ensure that they are aligned with their Market demand and competitive advantage. 

For example, a business can use Market Research to test their products or services with their target customers, using methods such as surveys, interviews, focus groups, or experiments, and collect their feedback, opinions, and reactions. It can help the business refine its products or services, eliminate flaws, and improve its quality, functionality, usability, or appeal.

5) Maintain a competitive edge in the Market

Competition is inevitable and unavoidable in any Market, and it can be a threat or an opportunity for any business. By conducting Market Research, businesses can keep themselves updated on the latest trends, innovations, and changes in their industry, and monitor their competitors’ activities, such as their products, prices, promotions, strengths, weaknesses, and strategies. It can help businesses maintain a competitive edge in the Market by staying ahead of the curve, adapting to the changing environment, and leveraging their strengths while overcoming their weaknesses. 

For example, a business can use Market Research to identify the emerging needs, preferences, expectations, and demands of their customers, and adapt their products or services accordingly. They can also use Market Research to spot the emerging trends, innovations, and opportunities in their industry, and leverage them to gain a competitive advantage.

6) Recognise growth opportunities

Growth opportunities are potential ways for a business to expand its Market, products, or services, and increase its sales, revenue, or profit. By conducting Market Research, businesses can explore new Markets, products, or services and assess their potential size, demand, and profitability using methods such as surveys, interviews, focus groups, or secondary data. It can help businesses recognise growth opportunities that are feasible, desirable, and viable, and pursue them with confidence and clarity. 

For example, a business can use Market Research to assess the potential of new geographic, demographic, or psychographic segments and enter them with appropriate products, services, or Marketing strategies. They can also use Market Research to generate new ideas, concepts, or features for their products or services based on customer needs, preferences, or feedback to create new products or services or improve existing ones.

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7) Mitigate risks through concept testing

Concept testing is the process of evaluating the feasibility, desirability, and viability of a new product or service before launching it, using methods such as surveys, interviews, focus groups, or experiments. By conducting Market Research, businesses can mitigate risks through concept testing and ensure that their new products or services are aligned with their customers’ needs, expectations, and preferences and that they have a clear value proposition, competitive advantage, and Market potential. 

It can help businesses avoid launching products or services that are not well-received, not well-differentiated, or not well-Marketed and save time, money, and resources. For example, a business can use Market Research to test their new product or service with their target customers, and collect their feedback, opinions, and reactions, and use them to refine their product or service, eliminate flaws, and improve their quality, functionality, usability, or appeal.

8) Enhance decision-making with better information

Decision-making is the process of choosing the best course of action among various alternatives based on the available information, criteria, and goals. By conducting Market Research, businesses can enhance their decision-making with better information by providing them with reliable, accurate, and relevant data and insights that support their decisions with facts, evidence, and logic, rather than relying on intuition, assumptions, or guesses. 

It can help businesses make informed, rational, and effective decisions that are aligned with their goals, objectives, and strategies and that have positive impacts, outcomes, and consequences. For example, a business can use Market Research to support their decisions on product development, pricing, distribution, promotion, or positioning, by providing them with data and insights on customer needs, expectations, preferences, behaviours, or feedback, Market size, share, growth, or trends, competitor strengths, weaknesses, opportunities, or threats, or industry innovations, changes, or opportunities.

9) Compete with greater effectiveness

Competing with greater effectiveness means being able to outperform, outsmart, or outshine your competitors and attract, satisfy, and retain more customers by offering superior products or services or Marketing strategies that are differentiated, valuable, and appealing. By conducting Market Research, businesses can compete with greater effectiveness by understanding their competitive position, advantages, and disadvantages in the Market and by developing or improving their Unique Selling Proposition (USP), which is the factor that distinguishes them from their competitors and makes them attractive to their customers. It can help businesses stand out from the crowd, create a loyal customer base, and increase their Market share, sales, revenue, or profit. 

For example, a business can use Market Research to compare its performance, products, prices, and strategies with its competitors and identify its strengths, weaknesses, opportunities, and threats. They can also use Market Research to develop or improve their USP by highlighting their benefits, features, or values that are unique, relevant, and compelling to their customers.

10) Stay abreast of current trends

Trends are patterns or movements of change or development in a Market, industry, or customer behaviour that have significant impacts or implications for businesses. By conducting Market Research, businesses can stay abreast of current trends by monitoring and anticipating the changes and developments in their Market, industry, and customer behaviour, using methods such as surveys, interviews, focus groups, or secondary data. 

It can help businesses stay relevant, responsive, and proactive, adapt their products or services, or their Marketing strategies, to the changing environment, and meet or exceed customer expectations. For example, a business can use Market Research to identify the current trends, innovations, and opportunities in their industry and leverage them to gain a competitive edge. They can also use Market Research to identify the current needs, preferences, expectations, and demands of their customers and adapt their products or services accordingly. Bsides the benefits, Market Research provides a deeper understanding on customer needs, identifying trends  and much more, to achieve these utilising market research tools is essential.

Challenges associated with Market Research

Market Research can provide many benefits for your business, but it can also pose some challenges, such as:

a) Cost: Market Research can be expensive, depending on the scope, scale, and complexity of the research project. You may need to invest in hiring professional Researchers, Consultants, or agencies or purchasing specialised tools, software, or databases.

b) Time: Market Research can be time-consuming, depending on the type, method, and frequency of the research. You may need to spend a lot of time planning, designing, conducting, analysing, and reporting the research.

c) Quality: Market Research can be affected by the quality of the data, sources, methods, and analysis. You may encounter issues such as bias, error, validity, reliability, or generalizability of the research results.

d) Action: Market Research can be useless if you do not act on the findings, insights, and recommendations. You may need to implement, monitor, and evaluate the changes or improvements that you make based on the research.

Therefore, you need to plan and execute your Market Research carefully and use it wisely to reap the maximum Benefits of Market Research for your business.

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Market Research is a powerful tool that can help you grow your business in various ways. By conducting Market Research, you can improve your communication with your customers, facilitate the creation of strategic plans, and much more. However, you also need to be aware of the challenges associated with Market Research, such as cost, time, quality, and action, and overcome them with proper planning and execution. By doing so, you can enjoy the Benefits of Market Research and achieve your business goals.

Empower your business acumen with precision: Join our Marketing Research Training and harness the intelligence to propel your brand ahead of the competition.

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10 key benefits of market research

Market research is available as a service to help any company, service provider, individual or organisation make better, more informed decisions. The more research is embedded in the strategic plans of a firm, the better equipped it is to deal with the changing environment within which it operates. Here is a list outlining the main benefits of investing in marketing research:

• It helps businesses strengthen their position. Knowledge is power. Use market research to gain a better perspective and understanding of your market or target audience and ensure that your firm stays ahead of the competition.
• It minimises any investment risk. This is a simple but vitally important and often business critical consideration. Spending what is often only a small proportion of your investment on researching and testing the market, product, concept or idea makes sound business sense.
• It identifies potential threats and opportunities. Both primary research (fieldwork) and secondary research (desk research) can be utilised as an insurance policy against both obvious dangers on the road ahead. Coupling this with some qualitative research for deeper probing can highlight certain opportunities or warning signs that may otherwise have been missed.
• It helps to discover your’s and your competitor’s strengths and weaknesses. It’s vitally important to adopt an ‘eye’s wide open’ approach to any market research project which is why it’s often advised to work with a market research agency to ensure completely unbiased reporting. Use research findings to adapt and learn from your own weaknesses whilst capitalising on your new-found knowledge from competitor analysis to take advantage and forge ahead of the pack.
• It facilitates strategic planning. What is the foundation of your business strategy? If it’s evidence based and you’ve taken the time to invest in your own (and hopefully ongoing) research, you can be confident that you’ve given yourself the best chance to achieve your business goals.
• It helps in spotting emerging trends. Staying ahead in business is often about being the first, being the best or doing something that no-one else has thought about. Regularly taking the ‘pulse’ of what’s hot and what’s not in your industry is a key discipline. Speak to your research agency or research consultant about the range of techniques you can employ to spot and exploit these trends.
• It assists businesses to stay ahead of the competition.  Being the best demands a relentlessness to keep getting the basics right combined with a curiosity and willingness to innovate. Knowing how to leverage the findings and insights you extract from market research, audience research and data research are the keys to both getting ahead and staying ahead.
• It provides revenue projections.  A market forecast is a core component of a market analysis projecting the future numbers, characteristics, and trends in your target market. Potential customers can then be divided into segments . You want to focus on the best market – which is not necessarily the largest one or the market with the highest growth – it will be the one that matches your own company profile.
• It focuses on customer needs and demands. There are so many important reasons to keep your customers at the centre of all that you do in business and the same goes for research. With so many ways to reach customers using online panels, web communities, telephone survey’s, depth interviews and focus groups, market research keeps you attentive to where you can improve your proposition, customer service or product offering.
• It helps to evaluate the success of a business against benchmarks. A PWC survey found that companies that benchmark achieve 69% faster growth and 45% greater productivity than those that don’t. Use market research for competitor research, employee engagement surveys, and to highlight performance or knowledge gaps and areas for potential growth. This will open your company up to thinking about new methods, ideas and tools to improve your business effectiveness.

Find out more…

If you’re interested to find out more about the many techniques and research methodologies that are available to you, then check out our introduction to market research .

How to avoid common market research mistakes…

To help you avoid some common market research pitfalls , we’ve put together a list of the most common market research mistakes  and how to avoid them!

Can we help you?

If you have a specific business question that you think could be solved with the help with a market research professional then we’d be delighted to have chat. Please get in touch using the form below or you can email [email protected] or call us on 01271 337 100.

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The Ultimate Guide to Market Research: Types, Benefits, and Real-World Examples

Team Fratzke

Today's consumers hold a lot of power when making purchase decisions. With a quick inquiry in a search engine or search bar within a social media platform, they can access genuine reviews from their peers without relying on sales reps.

Considering this shift in consumer behavior, adjusting your marketing strategy so it caters to the modern-day buying process is essential . To achieve this, you must thoroughly understand your target audience, the market you operate in, and the factors influencing their decision-making.

This is where market research can be leveraged so you stay current with your audience and industry. 

Article Overview

In this article, we’ll walk you through everything you need to know about how to conduct market research, including:

• Why market research is essential for understanding your target audience, the market you operate in, and factors influencing decision-making
• What are the different types of market research, such as primary and secondary market research
• How to collect information about your customers and target market to determine the success of a new or existing product, improve your brand, and communicate your company's value
• Real-world examples of companies leveraging market research

What is market research?

Market research is a necessary process that involves collecting and documenting information about your target market and customers. This helps you determine the success of a new product, improve an existing one, or understand how your brand is perceived. You can then turn this research into profits by  developing marketing strategies and campaigns to effectively communicate your company's value .

While market research can provide insights into various aspects of an industry, it is not a crystal ball that can predict everything about your customers. Market researchers typically explore multiple areas of the market, which can take several weeks or even months to get a complete picture of the business landscape.

Even by researching just one of those areas, you can gain better insights into who your buyers are and what unique value proposition you can offer them that no other business currently provides.

Of course, you can simply use your industry experience and existing customer insights to make sound judgment calls. However, it's important to note that market research provides additional benefits beyond these strategies. There are two things to consider:

• Your competitors also have experienced individuals in the industry and a customer base. Your immediate resources may equal those of your competition's immediate resources. Seeking a larger sample size for answers can provide a better edge.
• Your brand's customers do not represent the entire market's attitudes, only those who are attracted to your brand.

The market research services industry is experiencing rapid growth , indicating a strong interest in market research as we enter 2024. The market is expected to grow from approximately $75 billion in 2021 to $90.79 billion in 2025, with a compound annual growth rate of 5%. 

Your competitors have highly skilled individuals within the industry, meaning your available personnel resources are likely similar to those of your competitors. So what are you going to do to get ahead?

You’re going to do thorough market research, which is why seeking answers from a larger sample size is essential. Remember that your customers represent only a portion of the market already attracted to your brand, and their attitudes may not necessarily reflect those of the entire market. You could be leaving money on the table by leaving out untapped customers .

Why do market research?

Market research helps you meet your buyers where they are. Understanding your buyer's problems, pain points, and desired outcomes is invaluable as our world becomes increasingly noisy and demanding. This knowledge will help you tailor your product or service to appeal to them naturally. 

What’s even better is when you're ready to grow your business, market research can also guide you in developing an effective market expansion strategy.

Market research provides valuable insights into factors that impact your profits and can help you to :

• Identify where your target audience and current customers are conducting their product or service research
• Determine which competitors your target audience looks to for information, options, or purchases
• Keep up with the latest trends in your industry and understand what your buyers are interested in
• Understand who makes up your market and what challenges they are facing
• Determine what influences purchases and conversions among your target audience
• Analyze consumer attitudes about a particular topic, pain, product, or brand
• Assess the demand for the business initiatives you're investing in
• Identify unaddressed or underserved customer needs that can be turned into selling opportunities
• Understand consumer attitudes about pricing for your product or service.

Market research provides valuable information from a larger sample size of your target audience, enabling you to obtain accurate consumer attitudes. By eliminating any bias or assumptions you have about your target audience, you can make better business decisions based on the bigger picture. 

As you delve deeper into your market research, you will come across two types of research: primary and secondary market research . Simply put, think of two umbrellas beneath market research - one for primary and one for secondary research. In the next section, we will discuss the difference between these two types of research. That way, if you work with a market who wants to use them, you’ll be ready with an understanding of how they can each benefit your business.

Primary vs. Secondary Research

Both primary and secondary research are conducted to collect actionable information on your product. That information can then be divided into two types: qualitative and quantitative research. Qualitative research focuses on public opinion and aims to determine how the market feels about the products currently available. On the other hand, quantitative research seeks to identify relevant trends in the data gathered from public records. 

Let's take a closer look at these two types.

Primary Research

Primary research involves gathering first-hand information about your market and its customers. It can be leveraged to segment your market and create focused buyer personas . Generally, primary market research can be categorized into exploratory and specific studies.

Exploratory Primary Research

This type of primary market research is not focused on measuring customer trends; instead, it is focused on identifying potential problems worth addressing as a team. It is usually conducted as an initial step before any specific research is done and may involve conducting open-ended interviews or surveys with a small group of people.

Specific Primary Research

After conducting exploratory research, businesses may conduct specific primary research to explore issues or opportunities they have identified as necessary. Specific research involves targeting a smaller or more precise audience segment and asking questions aimed at solving a suspected problem. Specific primary research reveals problems that are unique to your audience so you can then offer a unique (and valuable) solution.

Secondary Research

Secondary research refers to collecting and analyzing data that has already been published or made available in public records. This may include market statistics, trend reports, sales data, and industry content you already can access. Secondary research really shines when you go to your competitors . The most commonly used sources of secondary market research include:

• Public sources
• Commercial sources
• Internal sources

Public Sources

When conducting secondary market research, the first and most accessible sources of information are usually free . That’s right–these public sources are free and at your fingertips so there’s no reason for you to not be checking them out and leveraging them for your own gain.

One of the most common types of public sources is government statistics. According to Entrepreneur, two examples of public market data in the United States are the U.S. Census Bureau and the Bureau of Labor & Statistics. These sources offer helpful information about the state of various industries nationwide including:

Commercial Sources

Research agencies such as Pew, Fratzke, Gartner, or Forrester often provide market reports containing industry insights from their own in-depth studies . These reports usually come at a cost if you want to download and obtain the information, but these agencies are experts at what they do, so the research is most likely valuable.

Internal Sources

Internal sources of market data can include average revenue per sale, customer retention rates, and other data on the health of old and new accounts. They are often overlooked when it comes to conducting market research because of how specific the data is; however, these sources can be valuable as they provide information on the organization's historical data.

By analyzing this information, you can gain insights into what your customers want now . In addition to these broad categories, there are various ways to conduct market research. Let’s talk about them.  

Types of Market Research

• Interviews (in-person or remote)

Focus Groups

• Product/ Service Use Research

Observation-Based Research

Buyer persona research, market segmentation research, pricing research.

• Competitive Analysis Research

Customer Satisfaction and Loyalty Research

Brand awareness research, campaign research.

Interviews can be conducted face-to-face or virtually, allowing for a natural conversation flow while observing the interviewee's body language. By asking questions about themselves, the interviewee can help you create buyer personas , which are made by using information about the ideal customer, such as:

• Family size 
• Challenges faced at work or in life 

And other aspects of their lifestyle. This buyer profile can shape your entire marketing strategy , from the features you add to your product to the content you publish on your website. Your target audience will feel that the marketing was made just for them and will be drawn to your product or service.

Focus groups are market research involving a few carefully selected individuals who can test your product, watch a demonstration, offer feedback, and answer specific questions. This research can inspire ideas for product differentiation or highlight the unique features of your product or brand that set it apart from others in the market.  This is a great market research option to gain specific feedback, which you can use to improve your services .

Product/Service Use Research

Product or service usage research provides valuable insights into how and why your target audience uses your product or service.  This research can help in various ways including:

•  Identifying specific features of your offering that appeal to your audience. 
• Allowing you to assess the usability of your product or service for your target audience. 

According to a report published in 2020, usability testing was rated the most effective method for discovering user insights, with a score of 8.7 out of 10. In comparison, digital analytics scored 7.7, and user surveys scored 6.4.

Observation-based research is a process that involves observing how your target audience members use your product or service. The way that you intended your product or service to be used may not be the actual way that it is used. Observation-based research helps you understand what works well in terms of customer experience (CX) and user experience (UX), what problems they face, and which aspects of your product or service can be improved to make it easier for them to use.

To better understand how your potential customers make purchasing decisions in your industry, it is essential to know who they are. This is where buyer persona research comes in handy. Buyer or marketing personas are fictional yet generalized representations of your ideal customers. They give you someone to whom you want your marketing efforts to empathize and move, even though they don’t really exist. 

Gathering survey data and additional research to correctly identify your buyer personas will help you to visualize your audience so you can streamline your communications and inform marketing strategy . Key characteristics to include in a buyer persona are:

• Job title(s)
• Family size
• Major challenges

Market segmentation research enables you to classify your target audience into various groups or segments based on specific and defining characteristics. This method allows you to understand their needs, pain points, expectations, and goals more effectively.

Pricing research can provide valuable insights about the prices of similar products or services in your market. It can help you understand what your target audience expects to pay for your offerings and what would be a reasonable price for you to set. Correct pricing is important because if you set it too high, consumers will go to your cheaper competitor; but if you set it too low, your consumers may become suspicious of your product or service and still end up with your competitor. This information allows you to develop a solid pricing strategy aligning with your business goals and objectives. 

Competitive Analysis

Competitive analyses are incredibly valuable as they provide a deep understanding of your market and industry competition. Through these analyses, you can gain insights like: 

• What works well in your industry 
• What your target audience is already interested in regarding products like yours
• Which competitors you should work to keep up with and surpass 
• How you can differentiate yourself from the competition

Understanding customer satisfaction and loyalty is crucial to encouraging repeat business and identifying what drives customers to return (such as loyalty programs, rewards, and exceptional customer service). Researching this area will help you determine the most effective methods to keep your customers coming back again and again. If you have a CRM system, consider further utilizing automated customer feedback surveys to improve your understanding of their needs and preferences.

Brand awareness research helps you understand the level of familiarity your target audience has with your brand. It provides insights into your audience members' perceptions and associations when they think about your business.This type of research reveals what they believe your brand represents. This information is valuable for developing effective marketing strategies, improving your brand's reputation, and increasing customer loyalty .

To improve your marketing campaigns, you need to research by analyzing the success of your past campaigns among your target audience and current customers. This requires experimentation and thoroughly examining the elements that resonate with your audience. By doing so, you can identify the aspects of your campaigns that matter most to your audience and use them as a guide for future campaigns. 

Now that you understand the different market research categories and types let's look at how to conduct your market research.  Using our expertise and experience, we’ve created a step-by-step guide to conducting market research.

How to Do Market Research (Detailed Roadmap)

• Define the problem or objective of the research. 
• Determine the type of data needed. 
• Identify the sources of data. 
• Collect the data. 
• Analyze the data. 
• Interpret the results. 
• Report the findings. 
• Take action based on the findings.

1. Define the problem or objective of the research

Defining the problem or objective of the research is the first step in conducting market research. This involves identifying the specific issue that the research is trying to address. It is essential to be clear and specific about the research problem or objective, as it will guide the entire research process.

2. Determine the type of data needed

After defining the research problem or objective, the next step is determining the data type needed to address the issue. This involves deciding whether to collect primary or secondary data. Primary data is collected directly from the source, while secondary data is collected from existing sources such as government reports or market research studies.

3. Identify the sources of data

Once the data type has been determined, the next step is identifying the data sources. This involves identifying potential sources of primary and secondary data that can be used to address the research problem or objective. Primary data sources can include surveys, focus groups, and interviews, while secondary data sources can include government reports, industry publications, and academic journals.

4. Collect the data

After identifying the data sources, the next step is to collect the data. This involves designing and implementing a data collection plan consistent with the research problem or objective. The data collection plan should specify the methods and procedures for collecting data, sample size, and sampling method.

5. Analyze the data

Once the data has been collected, the next step is to analyze the data. This involves organizing, summarizing, and interpreting the data to identify patterns, relationships, and trends. The research problem or objective should guide the data analysis process and be conducted using appropriate statistical methods and software.

6. Interpret the results

After analyzing the data, the next step is to interpret the results. This involves drawing conclusions from the data analysis and using the results to address the research problem or objective. It is essential to analyze the results objectively and to avoid making assumptions or drawing conclusions that are not supported by the data.

7. Report the findings

Try identifying common themes to create a story and action items.To make the process easier, use your favorite presentation software to create a report, as it will make it easy to add quotes, diagrams, or call clips.

Feel free to add your flair, but the following outline should help you craft a clear summary:

• Background: What are your goals, and why did you conduct this study?
• Participants: Who you talked to? A table works well to break groups down by persona and customer/prospect.
• Executive Summary: What were the most exciting things you learned? What do you plan to do about it?
• Key Findings: Identify the key findings using data visualizations and emphasize key points.
• Recommendations + Action Plan: Your analysis will uncover actionable insights to fuel strategies and campaigns you can run to get your brand in front of buyers earlier and more effectively. Provide your list of priorities, action items , a timeline, and its impact on your business.

8. Take action based on the findings

The final step in conducting market research is to take action based on the findings. This involves using the results to make informed decisions about the marketing strategy, product development, or other business decisions. It is important to use the findings to drive action and to monitor and evaluate the effectiveness of the action taken continuously.

How to Prepare for Market Research Projects

Identify a persona group to engage, prepare research questions for your market research participants, list your primary competitors.

The idea is to use your persona as a reference point for understanding and reaching out to your industry's audience members. Your business might cater to more than one persona, and that's completely acceptable! However, you must be mindful of each persona while strategizing and planning your content and campaigns. 

How to Identify the Right People to Engage for Market Research

When selecting a group on which to conduct market research , it is essential to consider individuals with the same characteristics as your target audience. 

If you need to research multiple target audiences, recruit separate groups for each one. Select people who have recently interacted with you by looking through social media for post interactions or seeing if they’ve made recent purchases from you.

If you are planning to conduct an evaluation, it is recommended that you focus on people who have completed it within the last six months. However, if you have a longer sales cycle or a specific market, you can extend the period up to a year. It is crucial to ask detailed questions during the evaluation, so the participants' experience must be fresh.

Gather a mix of participants

If you want to expand your customer base, you’re going to want to get viewpoints of your product or service from every angle. Consider getting this mix by recruiting individuals who have already purchased your product, those who have bought a competitor's product, and those who haven't purchased anything. While targeting your existing customers may be the easiest option, gathering information from non-customers can help you gain a more balanced market perspective .

We recommend taking the following steps to select a mix of participants:

• Create a list of customers who made a recent purchase . This is usually the most accessible group to recruit. If you have a CRM system with list segmentation capabilities, run a report of deals that closed within the past six months and filter it for the characteristics you're looking for. Otherwise, work with your sales team to get them a list of appropriate accounts.
• Create a list of customers who were in an active evaluation but didn't make a purchase. You should get a mix of buyers who either purchased from a competitor or decided not to purchase. Again, you can obtain this list from your CRM or your Sales team's system to track deals.
• Use social media to call for participants. Try reaching out to people who follow you on social media but decided not to buy from you. Some may be willing to talk to you and explain why they did not purchase your product.
• Leverage your network . Spread the word that you're conducting a study to your coworkers, former colleagues, and LinkedIn connections. Even if your direct connections don't qualify, some will likely have a coworker, friend, or family member who does.
• Choose an incentive to motivate participants to spend time on your study. If you're on a tight budget , you can reward participants for free by giving them exclusive access to content. 

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Preparation is key when conducting research in hopes of gaining productive and informative conversations. This involves creating a discussion guide, whether it is for a focus group, an online survey, or a phone interview. The guide should help you cover all the relevant topics and manage your time efficiently.

The discussion guide should be in an outline format, with an allocated time and open-ended questions for each section. All the questions must be open-ended, as asking closed questions may lead the interviewee to respond with a simple "yes" or "no" answer. You may need more detailed answers to make informed decisions, so be sure to ask follow-up questions as necessary.  Also leave out any leading questions as they may unintentionally influence the interviewee's response, skewing your research results.

It's essential to identify your competitors accurately and you may even have some hidden in plain sight.  There are some instances where your company's business division might compete with your main product or service, even though that company's brand might have a different focus. Take a look at Apple:  the company is known primarily for its laptops and mobile devices, but Apple Music competes with Spotify over its music streaming service.

From a content perspective, you might compete with a blog, YouTube channel, or similar publication for inbound website visitors — even though their products don't overlap with yours. An example of this is when a toothpaste company might compete with publications like Health.com or Prevention on specific blog topics related to health and hygiene, even though the magazines don't sell oral care products.

Here are a few ways to build your competitor list:

• Check your industry quadrant on G2 Crowd: This is a significant first step for secondary market research in some industries. G2 Crowd aggregates user ratings and social data to create "quadrants" that show companies as contenders, leaders, niche players, or high performers in their respective industries. G2 Crowd specializes in digital content, IT services, HR, e-commerce, and related business services.
• Download a market report: Companies like Forrester and Gartner offer free and gated market forecasts yearly on the vendors leading their industry. On Forrester's website, for example, you can select "Latest Research" from the navigation bar and browse Forrester's latest material using a variety of criteria to narrow your search. These reports are good assets to save on your computer.
• Use social media : Social networks can be excellent company directories if you use the search bar correctly. On LinkedIn, for example, select the search bar and enter the name of the industry you're pursuing. Then, under "More," select "Companies" to narrow your results to the businesses that include this or a similar industry term on their LinkedIn profile.

Identifying Content Competitors

Search engines can be beneficial when it comes to secondary market research . To identify the online publications competing with your business, start with the overarching industry term you identified earlier, and then come up with more specific industry terms that are related to your company . For example, if you run a catering business, you might consider yourself a "food service" company, as well as a vendor in "event catering," "cake catering," "baked goods," and so on.

Once you have this list, follow these steps:

• Google it: Running a search on Google for the industry terms that describe your company can be very beneficial. You may come across a mix of product developers, blogs, magazines, and other websites.
• Compare your search results against your buyer persona: Remember the persona you created during the primary research stage? You can use it to evaluate whether a publication you found through Google could steal website traffic from you. If the website's content aligns with what your buyer persona would want to see, it is a potential competitor and should be added to your list of competitors.

After a series of similar Google searches for the industry terms you identify with, look for repetition in the website domains that have come up.

When searching, examine the first two or three pages of results. These websites are considered reputable sources of content in your industry and should be monitored closely as you create your collection of videos, reports, web pages, and blog posts.

Market Research Examples

Mcdonald's focus on customer feedback and profiling.

McDonald's invests in developing a detailed consumer profile to attract and retain customers, including parents of young children who appreciate the family-friendly atmosphere and menus. The brand seeks feedback from customers through surveys and questionnaires in stores, social media, and its mobile app. It also monitors customer feedback on digital channels.

Nike's Extensive Research and Collaboration for Running Shoes Development

Nike invests heavily in creating running shoes that cater to the needs of its customers, which it determines through extensive market research and customer surveys. The brand goes to great lengths to understand its customers' preferences, such as the type of running surface, the distance they run, and their running style, to develop shoes that meet their specific needs.

In addition to customer surveys, Nike also collaborates with athletes to develop shoes that cater to their specific requirements. This research helps Nike improve its existing running shoe models and innovate new ones, ensuring that the brand stays ahead of the competition.

Disney employs focus groups that specifically cater to children to test out their new characters and ideas.

The Walt Disney Company invests millions of dollars in creating captivating stories tested for their effectiveness with children, the intended audience. Disney executives hold focus groups with preschoolers and kindergartners several times a year to gather their opinions and feedback on TV episodes, Disney characters, and more. 

This market research strategy is effective because children are the ultimate audience that Disney aims to please. The collected feedback helps the company improve existing content to meet the preferences of its audience and ensure continued success as a multi-billion dollar enterprise.

KFC tested its meatless product in specific markets before launching it nationwide.

In 2019, KFC began developing and testing a meatless version of its famous chicken. However, instead of immediately launching the product nationwide, they decided to test it in select stores in the Atlanta, Georgia area. 

This is an innovative and practical approach to market research, as it allows the company to determine the product's sales performance on a smaller scale before committing too many resources to it. If the meatless chicken fails to gain popularity in Georgia, KFC can make the necessary changes to the product before introducing it to the broader market.

Yamaha conducted a survey to determine whether to use knobs or sliding faders on the Montage keyboard.

Yamaha is a Japanese corporation that produces various products, from motorcycles to golf cars to musical instruments. When it began developing its new Montage keyboard, the team was unsure whether to use knobs or sliding faders on the product. 

To address this dilemma, Yamaha used Qualtrics to send a survey to their customers. Within just a few hours , they received 400 responses. By using survey feedback, Yamaha ensured that it was designing a product that would perfectly meet the preferences of its audiences.

The Body Shop used social listening to determine how to reposition brand campaigns based on customer feedback.

The Body Shop is a well-known brand that offers ethically sourced and natural products. They take pride in their core value of sustainability. The Body Shop team tracked conversations to understand the sustainability subtopics that were most important to their audiences. 

They found that their customers cared a lot about refills. Based on this information, the Body Shop team confidently relaunched their Refill Program across 400 stores globally in 2021, with plans to add another 400 in 2022. Market research confirmed that their refill concept was on the right track and also highlighted the need for increased efforts to demonstrate how much the Body Shop cares about its customers' values .

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The takeaway.

Fratzke Consulting offers a comprehensive suite of market research services to help brands gain valuable insights into their target market, competitors, and industry trends. Our expert team utilizes various primary and secondary research methods to gather accurate and unbiased data, including surveys, competitive research, and industry reports. With Fratzke Consulting, you'll have the tools to succeed in today's rapidly evolving business landscape.

Interested in learning more? Book a free audit consultation today.

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10 Benefits of Market Research

Continuing the market research series, in this article, we’ll discuss the importance and benefits of market research.

To recap, in the last article we talked about what market research is, and the different types of market research every business needs to conduct.

From the last article you probably already have a good idea on the benefits of conducting your research, but let’s go deeper and expand on what you stand to gain from a thorough market research.

1. Provides Better Understanding Of Your Customers

Market research will help you map out the full profile of your ideal customers. Knowing who your customers really are will help you determine the market size and what triggers them to buy. 

By conducting market research you stand to gain valuable insights like their age, location, gender & income, which will help you in creating effective marketing and pricing campaigns.

Market research will also help you determine the type of product or service that would be profitable to introduce in a market. Which would also help you test if the existing product/services in the market are meeting the customer’s needs or if there are potential customers you have not reached.

If you already have a product/service in the market that is not meeting customers’ expectations then the research will help you find out if you require a change in the packaging, delivery or in the product/service features itself.

2. Provides Insights On Your Competitor And How To Outsell Them

Your competitors are taking away your customers and winning in the marketplace because they’ve done their research ahead of you.

Market research is a good evaluation tool that can help you track your company’s progress and the growth of your competitors, by keeping an eye on your competitors. We can use the data collected to devise business strategies that would keep you ahead of your business rivals.

Being the best in your market demands a relentlessness to keep getting the basics right combined with a curiosity and willingness to innovate. Knowing how to leverage the findings and insights you get the from market research is the key to getting ahead and staying ahead.

According to Tutsplus Business , If you can beat your competitors at finding out your customers’ needs and you aim to fulfill those needs, you’ve got a better chance of standing out from the competition. Here are some ways you can use market research to outsell competitors:

• Target your competitors’ dissatisfied customers
• Find an under-served customer segment
• Identify unaddressed customer needs

3. Ability To Test Product Success Before Launch

You can never be 100% sure that your product will be a hit or will instantly connect with your potential customer.

However, with market research, you’ll find out what approach you should take when marketing the product and the key messages that resonates with potential customers

4. Helps In Decision Making

If the goal of market research is to identify business opportunities and strengthen your position in the market, then there would undoubtedly be several big decisions that could facilitate the success of your business.

The need for and importance of marketing research frequently comes up when making tough business decisions. Instead of guessing, going with your gut feelings or having arbitrary criteria for the decisions you make as a business owner, you can always go back to your market research report. 

Based on that research you would get answers to questions such as 

• Will this decision lead to more customers?
• Will we be able to reach more people who are likely to buy from us? 
• Will it be clear to customers that our business can meet their needs? 

While not all decisions should be solved by market research, many of them can be, such as:

• where to spend your advertising or marketing budget
• whether there’s a demand for a new product you want to make
• if you should open a storefront in a new location
• which products to discontinue and which ones to improve
• how to price all your offers

5. Spot Business Opportunities

Every business is constantly looking to identify new market opportunities for existing and new products. 

There is a lot of competition out there, for every product or service you put into the market, there are at least a dozen others from competitors. Even worse, consumer needs are difficult to predict based on product functionality alone. 

This is where market research comes in to play. Good market research will assist in production planning and make the distribution process seamless.

After you’ve done your market research, it’ll be clear to you who you want to reach out to (your target customers), where you can reach them (your marketing channels), and what they’re interested in. Once you’ve defined these, you’ll be able to easily spot business opportunities such as:

• Partnerships with other businesses
• Profitable order upgrades
• New locations to sell to

6. Strengthen Your Business Position In The Market

When done right, market research can provide detailed information on the market share, competitors, customer dissatisfaction levels, sales performance, and channel distribution. 

Which would, in turn, identify potential issues with your business and ideas on how to address these issues quickly.

As the saying goes Knowledge is power . You should use market research to gain a better perspective and understanding of your market or target audience and ensure that your firm stays ahead of the competition.

When it comes to strengthening your position in your target market, the whole idea is to promote and distribute ideas, goods, and services to create a satisfying customer base. This is the basis of business growth.

Going a step further, market research also helps to analyze the cause of an existing customer choosing a different brand over the old one. The goal here is to retain your customer base while generating profit at the same time.

7. Lower Business Risks

According to data from the Bureau of Labor Statistics roughly half of businesses with employees don’t survive past the fifth year. And we all know that the only way to make sure that your business survives is to ensure that you’ve got a steady stream of sales and customers.

Here’s the kicker, you need market research to sustain your business.

Market research helps you understand your customers’ demands, identify more business opportunities, plan the perfect marketing campaign, minimize losses, and keep track of the competition. 

Even better, it allows businesses to Identify problems in their strategies and business executions before they happen. Effective market research will not only help you predict some pitfalls that can occur but also it will save you a lot of money too. 

We all want to believe that our product or service is the perfect solution to your customer’s needs, that our offering is a perfect customer-market fit, but what if that isn’t the case? What if you’re wrong and giving launching would be a big risk?

The process of market research itself is designed to reduce the risk.

What if you’re yet to launch, but is considering investing in a business venture? Well, Market research is also essential here. Spending what is a small proportion of your investment in researching and testing the market, product, concept or idea makes sound business sense.

Regular market research will help you check your business performance with your current customers and potential customers to ensure that you’re still meeting their needs. 

8. Create Relevant Marketing Resources

We know that when we run ads, we should test to see what phrases, colors, images perform better than others. The same thing applies to marketing in general.

With in-depth market research, you’ll know what images or phrases to put on marketing assets such as fliers, website, social media, blog posts, videos, etc.

You’ll know this because if your research targets the right audience, then technically your target customers have already told you their wants, needs, and frustrations. And as such, you’ll know exactly what to address and how to address it when you create your marketing materials.

For example, an author or blogger can ask their readers via a survey, what problems they have and are trying to solve. and instead of blindly coming up with blog topics, they can use the result of the survey to create posts that readers are really interested in.

Here are some other ways your marketing materials will be easier to create:

• Knowing whether customers see your products and services as a necessity or as a luxury can help you design your product labels, brochures, and a website that fits their perception.
• Identifying the age range of your customers can tell you the type of language you’ll be using in your promotional materials. You’ll write differently when addressing retired Baby Boomers than you would when addressing young professionals.

The collecting relevant data and analyzing this data can help businesses adopt a proactive approach for both, framing and implementing market strategies.

9. Knowledge On Where To Advertise

Market research not only helps in identifying new business opportunities but also helps in designing ad campaigns that will directly target the interest of your potential consumers and help in increasing sales. 

Thorough research should provide valuable information about the sales potential of a particular market segment, during a specific time period, and within a particular age group.

Let’s be honest, Ads can be expensive and one major issue small businesses face is a limited budget. This means you need to get smart with your marketing budget, and your ads must be optimized to give you the best possible return within your budget.

Conducting market research can help ensure that you’re reaching your intended audience in the channels where they’re most likely to see your message.

According to Tutsplus Business , market research can help with:

• Buying ads on social media: If your market research shows that your target audience spends most of their time on Instagram and almost never use Twitter, you’ll know to direct most of your social media ad budget to Instagram and forget about Twitter.
• Placing flyers and posters: Knowing the physical spaces where your customer spends their time will tell you where you can best place your advertising. For example, university students are likely to be on campus, so placing ads for that market means that you can try bulletin boards on campus or outside local establishments that their crowd frequents.
• Targeting ads: Online ads such as social media ads and pay-per-click ads can often be targeted with precision. This means that you can target based not just on the usual demographic data, but also based on online behaviors, life stage, and interests. If you truly know your customers, you’ll be able to maximize the potential for targeting. For example: here are some targeting options for Facebook Ads .

10. Facilitates Strategic Planning

What is the basis of your current business strategy? If it’s evidence-based and you’ve taken the time to invest in market research, you can be confident that you’ve given yourself the best chance to achieve your business goals.

When businesses set goals for their business, it’s typically related to growth in sales or customers. But without market research, you won’t be able to know if your goal is achievable and how to achieve it in the first place.

You might say that you want to double sales by the end of the next quarter. But how would you know if this goal is feasible if you don’t know whether the size of your target market is more than twice the size of your current customer base?

Without knowing the current size of your potential market, you’ll just be setting irrational goals.

Now that you know the importance of market research and how it can benefit your business, in the next article will discuss how to create a market research proposal. A template of the proposal process will also be included.

Comment with any questions you have about Market Research Proposals and I will get back to you ASAP.

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Market Research: 9 Key Benefits You Might Not Have Considered

Why Is Market Research Important?

Is conducting market research worth it, benefits of market research, 1. customer-centric business approach, 2. effective communication with customers, 3. decreased investment risk, 4. data-driven decisions, 5. identifying potential threats and opportunities (swot analysis), 6. understanding the target market and personas, 7. keep up with emerging trends, 8. keep up with competition, 9. identifying the right marketing channels, learn about market research and more.

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25 Advantages and Disadvantages of Market Research

Market research is a systematic process of collecting, analyzing, and interpreting data and information to gain insights into various aspects of a market, including its size, trends, customer preferences, competition, and potential opportunities or threats. It is a fundamental tool used by businesses, organizations, and governments to make informed decisions, develop effective strategies, and stay competitive in their respective markets.

Market research has ancient roots. It dates back to the time of the Babylonians, who gathered information on crop yields and prices. Even in those early days, data collection and analysis were used to make informed decisions.

To capture a holistic view of consumer behavior , market researchers often combine data from various channels, including social media, e-commerce, traditional surveys, and customer support interactions.

While market research offers numerous advantages, it also comes with its fair share of disadvantages.

Advantages of Market Research

The advantages of market research are not just about surface-level benefits. They are about deepening understanding, mitigating risks, and driving sustainable growth.

1. Informed Decision-Making

Market research provides businesses with a wealth of information that forms the foundation for informed decision-making.

This advantage goes beyond the general idea of making better choices. It means that decisions are grounded in empirical evidence and insights gathered from data analysis. This precision can lead to more effective resource allocation, optimized strategies, and ultimately, increased profitability.

2. Customer Understanding

The understanding of customers garnered through market research is multifaceted. It goes beyond merely recognizing demographics ; it delves into psychographics, behavior, motivations, and pain points.

In-depth customer profiles help businesses craft highly targeted marketing campaigns, design products that meet specific needs, and enhance customer experiences. The result is not just customer satisfaction but customer loyalty and advocacy.

3. Competitive Advantage

Market research serves as a strategic compass for gaining a competitive advantage. It allows businesses to assess their strengths and weaknesses relative to competitors.

By benchmarking performance against rivals, companies can identify areas for improvement or differentiation. This advantage is not about following the competition but strategically outperforming them in ways that resonate with customers.

4. Risk Mitigation

Market research plays a pivotal role in risk mitigation. It’s not just about identifying risks but also understanding their potential impact.

Businesses can use market research to assess the severity of threats and the likelihood of their occurrence. Armed with this knowledge, they can develop contingency plans, adapt to changing market conditions, and reduce exposure to unforeseen risks.

5. Product Development

The advantage of market research in product development is not limited to identifying features customers desire. It extends to optimizing the entire product life cycle. Research helps in defining product specifications, pricing strategies, and launch plans.

It also guides post-launch improvements based on feedback and market response. This iterative approach leads to more successful products with a higher chance of market acceptance.

6. Market Segmentation

Market segmentation through research is akin to using a finely tuned lens to view a diverse audience. It allows businesses to create highly tailored marketing messages, product variations, and distribution channels for each segment.

This personalization leads to higher conversion rates, better customer engagement, and more efficient use of marketing resources.

7. Measuring Effectiveness

Market research doesn’t stop after implementing strategies; it includes continuous monitoring and evaluation. It allows businesses to measure the effectiveness of marketing campaigns, product launches, and other initiatives.

Metrics like customer acquisition cost (CAC), customer lifetime value (CLV), and conversion rates help gauge success. This feedback loop ensures strategies can be adjusted in real time for maximum impact.

8. Enhanced Communication

Effective communication is at the heart of successful marketing, and market research is the cornerstone of this process. It helps businesses understand the language, preferences, and communication channels favored by their target audience .

By tailoring messages accordingly, companies can create a genuine connection with customers, fostering brand loyalty and advocacy.

9. Cost Efficiency

The cost-efficiency advantage of market research extends beyond immediate savings. It ensures that resources are allocated where they are most likely to generate returns.

By avoiding wasted efforts on unproductive strategies or irrelevant markets, businesses can achieve higher returns on investment (ROI) and operate more efficiently.

10. Long-Term Growth

Market research isn’t just about short-term gains; it’s a catalyst for long-term growth. It facilitates innovation, identifies emerging trends, and helps businesses evolve with changing consumer preferences.

This adaptability is essential for sustained success and staying ahead in a dynamic marketplace.

11. Brand Building

Market research plays a pivotal role in brand building. It helps businesses understand how their brand is perceived by customers and competitors.

By conducting brand perception surveys and analyzing the results, companies can identify areas for improvement in brand image, messaging, and positioning. This insight allows for the development of a more compelling and consistent brand identity , which is essential for long-term success and customer loyalty.

12. Product Innovation

Market research is instrumental in driving product innovation . Beyond simply understanding customer needs, it delves into anticipating future needs and desires.

Through methods like trend analysis and concept testing, businesses can identify emerging market trends and consumer preferences. This proactive approach enables companies to stay ahead of the curve by developing innovative products that resonate with evolving consumer demands.

13. Optimized Pricing Strategies

Pricing is a critical element of any business strategy, and market research provides invaluable insights for optimizing pricing strategies .

By conducting pricing surveys, competitive pricing analysis, and willingness-to-pay studies, companies can set prices that maximize revenue while remaining competitive. This precision in pricing can lead to increased profit margins and improved market positioning.

14. Global Expansion

For businesses considering global expansion, market research is indispensable. It helps in assessing the viability of entering new markets by providing insights into local consumer behavior , cultural nuances, regulatory environments, and competitive landscapes.

In-depth international market research ensures that expansion efforts are well-informed, reducing the risks associated with entering unfamiliar territories.

15. Evaluating Marketing Channels

In the digital age, businesses have a multitude of marketing channels at their disposal, from social media and email marketing to content marketing and influencer partnerships.

Market research helps in evaluating the effectiveness of these channels for reaching and engaging with the target audience. By analyzing customer preferences and behavior, businesses can allocate marketing budgets to the most productive channels, maximizing their marketing ROI.

Disadvantages of Market Research

Certainly, let’s explore the disadvantages of market research in greater detail, shedding light on the intricacies and potential challenges associated with this crucial business practice.

1. Costly and Time-Consuming

Market research can be a resource-intensive endeavor. The costs associated with data collection, analysis, and hiring experts can add up quickly, especially for small businesses with limited budgets .

Additionally , conducting comprehensive research often takes time, and in rapidly changing markets, delays can lead to missed opportunities.

2. Risk of Bias

Bias is a significant concern in market research. Researchers and survey designers must be vigilant to minimize bias in various forms, including question phrasing, sample selection, and interpretation of results.

Failure to address bias can lead to skewed data, undermining the reliability and accuracy of research findings.

3. Complex Data Analysis

Interpreting market research data can be complex, requiring expertise in statistics and data analysis.

Misinterpretation of data or improper statistical methods can lead to incorrect conclusions and misguided decision-making. This complexity may necessitate the involvement of trained analysts or data scientists.

4. Overreliance on Data

While data-driven decision-making is essential, an overreliance on data can stifle innovation and creativity.

Market research primarily deals with existing data and known trends, which may limit the exploration of new ideas and unconventional solutions. Striking a balance between data-driven insights and strategic vision is crucial for holistic decision-making.

5. Limited Predictive Power

Market research excels at providing insights into past and current market conditions, but predicting the future is inherently challenging.

Rapid changes in consumer behavior, technological advancements, and external factors can make accurate forecasting difficult. Businesses should be aware that research findings are not crystal balls but rather informed estimations.

6. Data Privacy Concerns

With the increasing emphasis on data privacy regulations and ethical considerations, mishandling customer data can lead to legal issues and reputational damage.

Businesses must navigate a complex landscape of data protection laws and ensure they handle customer information ethically and transparently.

7. Information Overload

In the digital age, businesses have access to vast amounts of data. Handling this information overload can be overwhelming.

Distinguishing valuable insights from noise and managing the sheer volume of data can be challenging, requiring robust data management systems and skilled analysts.

8. Resistance to Change

Implementing changes based on market research findings can be met with resistance, particularly if the findings challenge established beliefs or practices within an organization.

Managing organizational change , convincing stakeholders, and aligning teams with research-driven strategies can be a complex and time-consuming process.

9. Competitive Intelligence Risks

While monitoring competitors is crucial, there’s a risk of overemphasizing competitive intelligence to the detriment of innovation.

Focusing too much on what competitors are doing can lead to a “ follow the leader ” mentality rather than forging a unique market position. Businesses should use competitive intelligence as a tool for inspiration rather than imitation.

10. Sample Size Limitations

The accuracy of market research findings heavily depends on the representativeness of the sample used for data collection.

Small or unrepresentative samples can lead to skewed results and misguided strategies. Ensuring a large enough and diverse sample can be challenging, especially when dealing with niche markets or elusive demographics.

Conclusion:

Market research is a valuable tool for businesses seeking to thrive in competitive markets. It offers a plethora of advantages, including informed decision-making, customer understanding, and a competitive edge. However , it is not without its drawbacks, such as costliness, bias, and limitations in predicting the future.

To harness the benefits of market research while mitigating its disadvantages, businesses must approach it strategically. They should invest in high-quality research, ensure data integrity, and strike a balance between data-driven decisions and visionary thinking.

Moreover , staying updated on ethical and legal considerations in data collection and management is crucial to maintaining a positive reputation and customer trust.

In a rapidly changing business landscape, market research remains an indispensable tool for companies looking to adapt, grow, and succeed. When conducted thoughtfully and with a keen understanding of its strengths and weaknesses, market research can be a cornerstone of sustainable business success.

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In times of economic uncertainty, every organization looks for places to tighten the purse strings. Market research is a tempting area to cut back on, but that could ultimately prove a critical mistake. Discover the top 6 market research benefits you should consider in times of recession and inflation.

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1. Customer Centricity

When a company is customer-centric, it delivers a customer experience (CX) that fulfills the needs and desires of its target customers. Businesses with high levels of customer engagement see the following benefits, according to Gallup:

• 66% higher sales growth
• 10% increase in net profit
• 25% increase in customer loyalty
• +20 percentile uplift in consumer confidence (-100 negative, 0 neutral, 100 positive)

To understand those needs and desires, you need to perform targeted market research.

One way to drive customer-centricity is through the STP model:

Segmentation – What customer segments exist for your product or service, including geographically and demographically? Targeting – Which segment(s) are the best targets for each product line? Who is your target customer? Positioning – How do you position your product or service in the market? How do you reach your target segment with the right messaging to convey the benefits of your product or service?

2. Greater Efficiency, Higher Engagement

A more comprehensive understanding of your target customers’ wants and desires helps you drive product and service alignment, which market research provides.

Perhaps one segment of customers wants fruit, and another wants vegetables. It is pointless to market fruit to consumers who want vegetables and vice versa. This is where segmentation, targeting and positioning come in (STP) to drive marketing efficiency and reduce expenditure.

Other market research benefits include checking marketing channels and understanding what demographic is on each platform. Younger people may use YouTube, TikTok, and other social networks, while older consumers may still watch TV advertisements. If you share marketing materials in the channel where your target consumer naturally resides, they are more likely to engage.

3. Identifying Growth Opportunities

When performing market research, respondents reveal previously unseen opportunities for growth. These opportunities help cross-sell and upsell products and services by identifying secondary wants and desires in-context of the primary reasons.

Examples of growth opportunities include:

• Tapping into customer segments with unmet needs
• Partnering with other businesses in your industry
• Product and service development to improve functionality and usability

4. Reducing Risk via Concept Testing

You can design and manufacture a product or ad without concept testing, but you’d essentially be taking a stab in the dark. Wouldn’t you rather know if customers are interested in your product or ad concept before launching development?

Concept testing significantly reduces risk by validating ideas with real customers. If these customers dislike the idea, it’s probably not a good candidate for go-to-market. Continuous validation of concepts for longitudinal insights during product or ad development is one way to become more data driven as an organization.

5. Informed Decisions Reduce Risk

What if your company announced it’s investing $1 million in expanding manufacturing capacity, without doing any market research?

Your first big question should be: Why? What if the target market is forecast to shrink imminently? What if new products have made your offering obsolete?

Market research supports critical business decision-making. Medical companies cannot make claims without evidence to back them up, and CPG, finance, media, or tech companies shouldn’t make important business decisions without supporting proof, either.

6. Proactively Compete

Perhaps the greatest benefit of market research is proactivity. Market research gives you a glimpse into the future of customer demand. It allows you to get ahead of the competition and cater to upcoming trends thanks to increased agility and awareness in the market. Who wouldn’t want an edge in times of economic uncertainty?

Finding the Right Market Research Solutions

The business benefits of market research are myriad. From improving customer-centricity and efficiency, to identifying growth opportunities, to reducing risk and staying competitive, market research helps organizations make informed decisions for better business outcomes.

Market research doesn’t have to break the bank, either. Sago offers a wide array of solutions to help you gather the insights you need while remaining within budget. From Methodify , our automated quantitative research engine, to QualBoard , our digital qualitative discussions platform, there’s an option to suit your needs.

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Research Methodologies

August 14, 2024

Qualitative vs. Quantitative Market Research: Why Not Both?

Discover the benefits of qualitative and quantitative methods. Learn how to leverage both approaches for insights into consumer behavior and industry trends.

by Ashley Shedlock

Content Coordinator at Greenbook

Market research is vital for understanding target markets, consumer behavior, and industry trends. Qualitative and quantitative methods offer distinct advantages. Qualitative research explores concepts, opinions, and motivations, uncovering rich insights into consumer preferences through techniques like interviews and focus groups.

Quantitative market research involves gathering numerical data through surveys and questionnaires for statistical analysis to identify trends in a target market. It offers measurable results from a large sample size for generalization and prediction. On the other hand, qualitative research explores subjective experiences and motivations, aiming to provide deeper insights into consumer behavior through non-statistical analysis.

Selecting the appropriate research approach is vital for successful studies. Qualitative dives into intricate matters, while quantitative gauges broader market trends. The choice between qualitative and quantitative methods depends on research objectives and results. Both offer valuable insights for strategic decisions in competitive markets. Knowing the distinctions between the methods aids in picking the optimal approach for meaningful data and a competitive advantage.

What is Qualitative Market Research?

Qualitative research methodologies, such as in-depth interviews and focus groups, play a crucial role in providing a deeper understanding of consumer behavior. These methodologies delve into the intricacies of individual attitudes and motivations, allowing researchers to uncover rich insights that quantitative data alone cannot reveal.

One of the key advantages of qualitative research lies in its ability to explore the underlying reasons behind consumer behaviors. By allowing researchers to engage directly with participants, qualitative methods offer a more holistic view of consumer attitudes, preferences, and decision-making processes. This approach can uncover nuanced insights that quantitative surveys may overlook.

However, it is important to acknowledge the limitations of qualitative research, particularly in its subjective nature. The reliance on human interpretation in qualitative analysis introduces the potential for biases to influence outcomes. Researchers must be vigilant in managing subjectivity and potential biases throughout the research process to ensure the credibility and reliability of their findings.

In real-world applications, qualitative research proves invaluable in various contexts, from product development to marketing strategies. By gaining a deep understanding of consumer perspectives and behaviors, businesses can tailor their offerings to meet customer needs more effectively. Qualitative research also plays a crucial role in shaping communication strategies and enhancing customer engagement by tapping into the emotional and psychological drivers behind consumer decisions.

While qualitative research may come with its challenges in terms of subjectivity and potential biases, its ability to provide rich, nuanced insights into consumer behavior makes it a valuable tool for any market researcher looking to gain a deeper understanding of their target audience.

Types of Qualitative Research 

When it comes to qualitative research, there are various types that provide unique insights into consumer behavior and preferences. 

Ethnographic Research: Involves immersing researchers in the environment or context of the subjects to observe their behaviors in real-life settings. This approach goes beyond simply asking questions, allowing researchers to uncover deeper insights into how consumers interact with products or services on a day-to-day basis.

In-depth Interviews: Enable researchers to explore participants' thoughts and motivations thoroughly by asking open-ended questions. Focus groups, another qualitative method, involve a small group discussing a topic, allowing researchers to observe group dynamics and shared perspectives.

Observational Research: the direct observation and recording of participant behavior in natural settings. This approach is particularly valuable for capturing nonverbal cues and subconscious behaviors that might not surface during standard interview formats. By focusing on body language, gestures, and interactions, researchers can gain profound insights into consumer preferences and the intricacies of decision-making processes.

Advantages of Qualitative Research

Qualitative research offers valuable insights into the emotional and psychological aspects of consumer decision-making, uncovering the reasons behind consumer behaviors.

Qualitative research offers flexibility and adaptability, allowing researchers to adjust approaches based on emerging insights. By directly engaging with participants, it uncovers hidden motivations and attitudes that may not be easily quantified, fostering a human connection for authentic data collection.

Qualitative data delves into intricate consumer emotions, brand perceptions, and societal influences on purchasing choices. It forms hypotheses tested later via quantitative research , enhancing insights into consumer behavior. Utilizing the qualitative aspect provides a profound grasp of intricacies determining consumer preferences and market trends.

What is Quantitative Market Research?

Quantitative methods play a vital role in market research by using surveys and questionnaires to gather structured data systematically. This approach provides measurable insights into consumer behavior, trends, and preferences, offering a comprehensive view of the market. A key benefit is the statistical analysis capability, allowing researchers to identify correlations and predictive patterns within large datasets. This analytical depth enables data-driven decision-making and strategic planning based on empirical evidence.

However, like any methodological approach, quantitative research does have its limitations. One notable constraint is the potential difficulty in capturing nuanced or complex phenomena that may be better understood through qualitative means. While quantitative research excels in quantifying data and providing statistical significance, it may sometimes overlook the underlying reasons or motivations driving consumer behavior. This limitation underscores the complementary role that qualitative research plays in offering deeper insights into the 'whys' behind the 'whats' uncovered through quantitative analysis.

Quantitative research is widely used in different industries for tasks like market segmentation , customer profiling, and product testing. It helps businesses evaluate market share, consumer preferences, and marketing campaign effectiveness with credibility and objectivity. Stakeholders can rely on the empirical evidence from quantitative research to make informed decisions for business growth and innovation.

Types of Quantitative Research

Quantitative research involves the collection and analysis of numerical data to understand patterns, correlations, and trends in a target audience or market. This method utilizes structured questionnaires, surveys, and experiments to gather information that can be statistically analyzed for meaningful insights. 

One common type of quantitative research is surveys, which provide a snapshot of the opinions, behaviors, and preferences of a large group of people. Another approach is experiments, where variables are manipulated to study cause-and-effect relationships within a controlled environment. These quantitative methods offer the advantage of producing numerical data that can be easily quantified and compared across different groups or time periods.

Advantages of Quantitative Research

Quantitative research offers a plethora of advantages that make it an indispensable tool in the realm of market analysis. 

Quantitative research excels in offering numerical data for statistical analysis, ensuring objective insights into market trends and consumer behavior through structured surveys and experiments.

Quantitative data is ideal for large sample sizes, providing generalizable insights applicable to broader populations. The scalability enhances reliability, revealing trends not obvious in smaller studies. In fast-paced markets, the quick data collection, analysis, and interpretation of quantitative research are advantageous for swift decision-making.

Quantitative research is crucial for marketers to measure variables and determine causal relationships, aiding in understanding consumer behavior and strategic decision-making. Techniques like regression analysis or correlation studies unveil hidden patterns, offering valuable market insights and ensuring businesses remain competitive.

Quantitative research not only provides analytical rigor and scalability but also allows for easy comparability and benchmarking. It quantifies data in numerical terms, facilitating comparisons of variables, tracking changes over time, and benchmarking against industry standards or competitors. This comparative nature empowers businesses to identify best practices, evaluate market positioning, and optimize strategies effectively.

Comparing Qualitative and Quantitative Approaches

Combining qualitative and quantitative research methods provides a comprehensive understanding of market dynamics. Triangulating data from both sources offers a well-rounded perspective. Qualitative methods like interviews reveal consumer motivations, while surveys give broader trends. Selecting between qualitative and quantitative research hinges on research objectives and the nature of questions. Qualitative research delves into complex phenomena, while quantitative uncovers patterns at scale. The choice depends on study goals and required information for decision-making.

Common misconceptions about qualitative research often revolve around its perceived subjectivity and lack of generalizability. However, when conducted rigorously, qualitative research can provide valuable insights into the underlying reasons behind consumer behaviors and preferences. On the other hand, quantitative research is sometimes criticized for being too rigid and detached from the human experience. In reality, quantitative methods can yield actionable data that reveal trends and correlations with a high degree of reliability.

Market research methodologies are evolving to prioritize a balance between qualitative depth and quantitative breadth. Combining qualitative richness with quantitative rigor provides a holistic view of consumer behavior, uncovering patterns and underlying motivations effectively. Emerging trends in market research incorporate advanced analytics such as predictive modeling and machine learning for faster, more precise decision-making. The future of market research lies in integrating qualitative and quantitative approaches, emphasizing innovation to navigate complexities and derive valuable strategic insights.

How to Choose the Right Method? Quantitative vs Qualitative Research 

When choosing between quantitative and qualitative market research, align the method with your research goals. Quantitative research gathers numerical data for statistical analysis, while qualitative research explores underlying reasons and opinions through interviews or observation.

The decision depends on research objectives. Quantitative research quantifies data for testing hypotheses and generalizing results, ideal for customer satisfaction or A/B testing . Conversely, qualitative research offers insights into behavior and preferences through open-ended questions and exploratory techniques like content analysis or ethnographic studies.

Consider timing and resources: quantitative research needs larger samples for statistical significance, while qualitative research is flexible with smaller samples. For quick feedback, opt for quantitative surveys or experimental studies.

Balancing detailed insights with ample data is crucial in research. A mixed-method approach often provides the most complete understanding. The key is to align your research method with your goals, resources, and desired insights to make informed decisions that enhance your marketing strategies and business outcomes.

Ashley Shedlock

10 articles

The views, opinions, data, and methodologies expressed above are those of the contributor(s) and do not necessarily reflect or represent the official policies, positions, or beliefs of Greenbook.

Comments are moderated to ensure respect towards the author and to prevent spam or self-promotion. Your comment may be edited, rejected, or approved based on these criteria. By commenting, you accept these terms and take responsibility for your contributions.

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10 Key Benefits of Market Research

What is market research in business.

Every business, big or small, can benefit from understanding market research. Understanding both existing and potential customers should be a primary component of any marketing strategy, and organizations keen on maintaining a competitive edge are wise to invest in market research.

Market research can be as simple as getting to know a business’s target market, or hearing about feedback from focus groups. Making the most of valuable information about customer behaviors and emerging opportunities all comes down to a proper understanding of market research.

“If you are thinking of starting a business, the first thing you have to do is to conduct thorough and extensive market research,” Business 2 Community reported last year. “There has never been a business which grew successfully without going through the painstaking process of researching the market they are playing in.”

What Types of Businesses Use Market Research?

Market research data can be beneficial to any type of business or organization, large or small. Large, international corporations can especially profit from market research that identifies cultural changes in foreign regions. Anyone trying to conduct business with anyone else can gain insights from market research—primary research, as well as secondary.

Benefits of Market Research

There are a number of market research benefits, and it’s usually possible to tailor them to an organization’s unique business objectives. Market research can help organizations gain a better understanding of their competitors, and it can identify opportunities for growth. Market research can help identify emerging customer trends within a target audience, and it can clarify why customers might choose one product over another.

Market research can also help organizations streamline their operations, eliminate unnecessary spending, and conduct more effective strategic planning. Here we’ll examine 10 of the many other benefits of market research.

1. Helps steer business communication

Market analysis allows businesses to understand how and when to communicate with their customers. It can help them avoid mixed messaging and prevent corporate communications from getting lost in translation.

Marketing research can also identify what customers expect to hear from a company, and assist in learning about their feelings when those expectations aren’t met. Market research helps everyone communicate more effectively.

2. Limits risk

Better communication is one thing, but perhaps even more important is properly understanding and managing the potential for risk in the marketplace. Business-forward organizations understand that some of the most important market research has the potential for risk in mind.

Market research data can impact a company’s mere survival by identifying extremely risky scenarios in advance—which allows it to better allocate responsive resources, or to avoid the possibility completely.

Additionally, let’s not forget that members of a target audience are human, and change their minds over time. There’s a lot of risk involved when companies disregard shifting consumer attitudes, and effective market analysis can assist those companies in staying connected with their target audiences.

3. Identifies opportunities in the marketplace

Any business that anticipates market needs and opportunities before others will have a competitive edge. Market research can identify emerging trends, which allows, for example, companies to develop new products to meet new customer needs.

Market trends around the world are influenced by culture, natural events, technology, and many other factors. When we utilize market research to help us become more aware of the changes a different society or culture is experiencing, we’re all able to answer the call for new products and services.

4. Discovers potential issues

How many times would you have saved time or money by knowing in advance that business would be hitting a snag? It applies to nearly everyone, and here’s where market research can be especially helpful.

When we conduct market research, we’re not just doing so with competitor research in mind. Ideally, we’re also learning ways that our own businesses might not meet customer needs. Or, we’re able to learn when external influences impact the way business is done (new government regulations, for example).

Market research helps us prepare for many different situations, both internal and external.

5. Estimates sales and fully utilizes advertising expenditure

Consider as well how market research helps organizations budget resources for the promotion of a new product or service. Any budget, in fact, benefits from market research.

For example, let’s say you notice at the grocery store that peanut butter is going up in cost. Well, that simple observation is considered market research, and it will allow you to budget funds appropriately for the next grocery trip.

Now imagine that scenario on a massive scale: Let’s say you’re a purchasing agent in charge of stocking a million packages of peanut butter per year. You can see how market research tools can be essential for budgeting and advertising.

6. Determines brand reputation and customer needs

Now let’s think about brand reputation and customer needs. Every single brand today banks big on their reputation. It’s why a styrofoam cup of coffee from a gas station might cost $1.50, while a coffee chain might charge $6.50 for the same product.

Every time a brand’s reputation gets “dinged”–that is, becomes less favorable in the public eye–their entire existence might be at stake. Market research can be invaluable in helping an organization or company keep tabs on how it’s perceived (not just by devoted customers, but by potential customers as well).

It’s not just harmful mistakes that can damage a brand’s reputation, though. Sometimes, emerging trends can cause the public to see a company as simply old-fashioned or out of touch. Effective market research helps companies avoid that trap, too.

7. Establishes customer trends

It’s important to recognize trends over time. A single major trend can render a business obsolete overnight; on the other hand, a missed opportunity might have been an organization’s chance to continue serving its customers into a new decade.

Here’s where ongoing market research can be particularly important. Customer acquisition costs can be sky-high, and any market research project, for best results, will be a long-term investigation into every factor that might impact business.

This routine market research might surface as weekly, monthly, quarterly, or annual reports. It’s important that these market research reports are shared with all key stakeholders (especially those resistant to change—you probably already know a few of those types at your own business).

Over time, it becomes easy to understand customer trends. Bonus: With that time, you’ll be able to compare past spending and resource allotment against past customer trends, which will allow your market research to reach new levels of value. How well did you meet yesterday’s changes, and what did you learn that will come in handy for tomorrow’s changing customer?

8. Monitors market position over time

You might be at the top of your game today, but tomorrow’s another story. That’s been the case for businesses since the dawn of time, and it will always continue to ring true.

With market research, you’re able to determine your market standing or position in the minds of those who are most important to it: customers. Proper market research allows you to understand how your customers think about you. Are you held in high regard? For what reasons might they think poorly of you or your products?

A market research project can also determine your customers’ thoughts toward your marketing campaigns. Funny, offensive, out of touch, you name it—we can all think of organizations with marketing campaigns that have fit any of those bills. Marketing research helps to make sure you’re held in high regard, and as often as possible.

9. Resolves conflicts between gut feeling and the actual insights

There’s a lot to be said about “gut feelings”—those moments when, evidence be damned, you just have a notion that one decision is better than another.

While that debate is free to continue (and it will), we’re sticking with data.

Market research allows you to minimize risks and develop business strategies that are based on solid feedback. Have a hunch? That’s fine, but let’s run it by what your customers are saying. You might have a change of heart when confronted with facts.

10. Helps define a brand promise

When you run a business, you deliver a lot more than just products and services. You provide customers with a promise to deliver on their expectations.

But are those expectations being met? Market research allows you to gain insight into the ways your brand promise might be successful, or failing. Every marketing strategy should include both primary research and secondary research to learn firsthand what customers think.

Conducting research isn’t just about asking the questions yourself. A successful business will be able to learn from data that others have collected, as well. It all leads back to making sure you’re keeping your brand’s promise.

Limitations of Market Research

Market research helps you understand your target audience’s motivations, and a thorough market research strategy includes both the insights you collect directly, along with secondary research from other sources. Remember to conduct research with both your own goals and those of competitors in mind.

Market research tools are evolving, though, and it’s key that you adapt to emerging technologies. Customer satisfaction and the future of business depend on it!

Technology magazine reported in 2021 that some of the most important emerging technologies and tools for market research will include virtual reality, AI, microdata, and social listening. While customer satisfaction polls can be valuable, there’s a lot more to market research than questionnaires.

Ready to learn how Creatives On Call can help with your market research journey? When you give us a call, we can get started today.

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Customer journey.

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Qualitative and quantitative reserach, data segmentation.

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9 Best Marketing Research Methods to Know Your Buyer Better [+ Examples]

Published: August 08, 2024

One of the most underrated skills you can have as a marketer is marketing research — which is great news for this unapologetic cyber sleuth.

From brand design and product development to buyer personas and competitive analysis, I’ve researched a number of initiatives in my decade-long marketing career.

And let me tell you: having the right marketing research methods in your toolbox is a must.

Market research is the secret to crafting a strategy that will truly help you accomplish your goals. The good news is there is no shortage of options.

How to Choose a Marketing Research Method

Thanks to the Internet, we have more marketing research (or market research) methods at our fingertips than ever, but they’re not all created equal. Let’s quickly go over how to choose the right one.

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1. Identify your objective.

What are you researching? Do you need to understand your audience better? How about your competition? Or maybe you want to know more about your customer’s feelings about a specific product.

Before starting your research, take some time to identify precisely what you’re looking for. This could be a goal you want to reach, a problem you need to solve, or a question you need to answer.

For example, an objective may be as foundational as understanding your ideal customer better to create new buyer personas for your marketing agency (pause for flashbacks to my former life).

Or if you’re an organic sode company, it could be trying to learn what flavors people are craving.

2. Determine what type of data and research you need.

Next, determine what data type will best answer the problems or questions you identified. There are primarily two types: qualitative and quantitative. (Sound familiar, right?)

• Qualitative Data is non-numerical information, like subjective characteristics, opinions, and feelings. It’s pretty open to interpretation and descriptive, but it’s also harder to measure. This type of data can be collected through interviews, observations, and open-ended questions.
• Quantitative Data , on the other hand, is numerical information, such as quantities, sizes, amounts, or percentages. It’s measurable and usually pretty hard to argue with, coming from a reputable source. It can be derived through surveys, experiments, or statistical analysis.

Understanding the differences between qualitative and quantitative data will help you pinpoint which research methods will yield the desired results.

For instance, thinking of our earlier examples, qualitative data would usually be best suited for buyer personas, while quantitative data is more useful for the soda flavors.

However, truth be told, the two really work together.

Qualitative conclusions are usually drawn from quantitative, numerical data. So, you’ll likely need both to get the complete picture of your subject.

For example, if your quantitative data says 70% of people are Team Black and only 30% are Team Green — Shout out to my fellow House of the Dragon fans — your qualitative data will say people support Black more than Green.

(As they should.)

Primary Research vs Secondary Research

You’ll also want to understand the difference between primary and secondary research.

Primary research involves collecting new, original data directly from the source (say, your target market). In other words, it’s information gathered first-hand that wasn’t found elsewhere.

Some examples include conducting experiments, surveys, interviews, observations, or focus groups.

Meanwhile, secondary research is the analysis and interpretation of existing data collected from others. Think of this like what we used to do for school projects: We would read a book, scour the internet, or pull insights from others to work from.

So, which is better?

Personally, I say any research is good research, but if you have the time and resources, primary research is hard to top. With it, you don’t have to worry about your source's credibility or how relevant it is to your specific objective.

You are in full control and best equipped to get the reliable information you need.

3. Put it all together.

Once you know your objective and what kind of data you want, you’re ready to select your marketing research method.

For instance, let’s say you’re a restaurant trying to see how attendees felt about the Speed Dating event you hosted last week.

You shouldn’t run a field experiment or download a third-party report on speed dating events; those would be useless to you. You need to conduct a survey that allows you to ask pointed questions about the event.

This would yield both qualitative and quantitative data you can use to improve and bring together more love birds next time around.

Best Market Research Methods for 2024

Now that you know what you’re looking for in a marketing research method, let’s dive into the best options.

Note: According to HubSpot’s 2024 State of Marketing report, understanding customers and their needs is one of the biggest challenges facing marketers today. The options we discuss are great consumer research methodologies , but they can also be used for other areas.

Primary Research

1. interviews.

Interviews are a form of primary research where you ask people specific questions about a topic or theme. They typically deliver qualitative information.

I’ve conducted many interviews for marketing purposes, but I’ve also done many for journalistic purposes, like this profile on comedian Zarna Garg . There’s no better way to gather candid, open-ended insights in my book, but that doesn’t mean they’re a cure-all.

What I like: Real-time conversations allow you to ask different questions if you’re not getting the information you need. They also push interviewees to respond quickly, which can result in more authentic answers.

What I dislike: They can be time-consuming and harder to measure (read: get quantitative data) unless you ask pointed yes or no questions.

Best for: Creating buyer personas or getting feedback on customer experience, a product, or content.

2. Focus Groups

Focus groups are similar to conducting interviews but on a larger scale.

In marketing and business, this typically means getting a small group together in a room (or Zoom), asking them questions about various topics you are researching. You record and/or observe their responses to then take action.

They are ideal for collecting long-form, open-ended feedback, and subjective opinions.

One well-known focus group you may remember was run by Domino’s Pizza in 2009 .

After poor ratings and dropping over $100 million in revenue, the brand conducted focus groups with real customers to learn where they could have done better.

It was met with comments like “worst excuse for pizza I’ve ever had” and “the crust tastes like cardboard.” But rather than running from the tough love, it took the hit and completely overhauled its recipes.

The team admitted their missteps and returned to the market with better food and a campaign detailing their “Pizza Turn Around.”

The result? The brand won a ton of praise for its willingness to take feedback, efforts to do right by its consumers, and clever campaign. But, most importantly, revenue for Domino’s rose by 14.3% over the previous year.

The brand continues to conduct focus groups and share real footage from them in its promotion:

What I like: Similar to interviewing, you can dig deeper and pivot as needed due to the real-time nature. They’re personal and detailed.

What I dislike: Once again, they can be time-consuming and make it difficult to get quantitative data. There is also a chance some participants may overshadow others.

Best for: Product research or development

Pro tip: Need help planning your focus group? Our free Market Research Kit includes a handy template to start organizing your thoughts in addition to a SWOT Analysis Template, Survey Template, Focus Group Template, Presentation Template, Five Forces Industry Analysis Template, and an instructional guide for all of them. Download yours here now.

3. Surveys or Polls

Surveys are a form of primary research where individuals are asked a collection of questions. It can take many different forms.

They could be in person, over the phone or video call, by email, via an online form, or even on social media. Questions can be also open-ended or closed to deliver qualitative or quantitative information.

A great example of a close-ended survey is HubSpot’s annual State of Marketing .

In the State of Marketing, HubSpot asks marketing professionals from around the world a series of multiple-choice questions to gather data on the state of the marketing industry and to identify trends.

The survey covers various topics related to marketing strategies, tactics, tools, and challenges that marketers face. It aims to provide benchmarks to help you make informed decisions about your marketing.

It also helps us understand where our customers’ heads are so we can better evolve our products to meet their needs.

Apple is no stranger to surveys, either.

In 2011, the tech giant launched Apple Customer Pulse , which it described as “an online community of Apple product users who provide input on a variety of subjects and issues concerning Apple.”

"For example, we did a large voluntary survey of email subscribers and top readers a few years back."

While these readers gave us a long list of topics, formats, or content types they wanted to see, they sometimes engaged more with content types they didn’t select or favor as much on the surveys when we ran follow-up ‘in the wild’ tests, like A/B testing.”  

Pepsi saw similar results when it ran its iconic field experiment, “The Pepsi Challenge” for the first time in 1975.

The beverage brand set up tables at malls, beaches, and other public locations and ran a blindfolded taste test. Shoppers were given two cups of soda, one containing Pepsi, the other Coca-Cola (Pepsi’s biggest competitor). They were then asked to taste both and report which they preferred.

People overwhelmingly preferred Pepsi, and the brand has repeated the experiment multiple times over the years to the same results.

What I like: It yields qualitative and quantitative data and can make for engaging marketing content, especially in the digital age.

What I dislike: It can be very time-consuming. And, if you’re not careful, there is a high risk for scientific error.

Best for: Product testing and competitive analysis

Pro tip:  " Don’t make critical business decisions off of just one data set," advises Pamela Bump. "Use the survey, competitive intelligence, external data, or even a focus group to give you one layer of ideas or a short-list for improvements or solutions to test. Then gather your own fresh data to test in an experiment or trial and better refine your data-backed strategy."

Secondary Research

8. public domain or third-party research.

While original data is always a plus, there are plenty of external resources you can access online and even at a library when you’re limited on time or resources.

Some reputable resources you can use include:

• Pew Research Center
• McKinley Global Institute
• Relevant Global or Government Organizations (i.e United Nations or NASA)

It’s also smart to turn to reputable organizations that are specific to your industry or field. For instance, if you’re a gardening or landscaping company, you may want to pull statistics from the Environmental Protection Agency (EPA).

If you’re a digital marketing agency, you could look to Google Research or HubSpot Research . (Hey, I know them!)

What I like: You can save time on gathering data and spend more time on analyzing. You can also rest assured the data is from a source you trust.

What I dislike: You may not find data specific to your needs.

Best for: Companies under a time or resource crunch, adding factual support to content

Pro tip: Fellow HubSpotter Iskiev suggests using third-party data to inspire your original research. “Sometimes, I use public third-party data for ideas and inspiration. Once I have written my survey and gotten all my ideas out, I read similar reports from other sources and usually end up with useful additions for my own research.”

9. Buy Research

If the data you need isn’t available publicly and you can’t do your own market research, you can also buy some. There are many reputable analytics companies that offer subscriptions to access their data. Statista is one of my favorites, but there’s also Euromonitor , Mintel , and BCC Research .

What I like: Same as public domain research

What I dislike: You may not find data specific to your needs. It also adds to your expenses.

Best for: Companies under a time or resource crunch or adding factual support to content

Which marketing research method should you use?

You’re not going to like my answer, but “it depends.” The best marketing research method for you will depend on your objective and data needs, but also your budget and timeline.

My advice? Aim for a mix of quantitative and qualitative data. If you can do your own original research, awesome. But if not, don’t beat yourself up. Lean into free or low-cost tools . You could do primary research for qualitative data, then tap public sources for quantitative data. Or perhaps the reverse is best for you.

Whatever your marketing research method mix, take the time to think it through and ensure you’re left with information that will truly help you achieve your goals.

Don't forget to share this post!

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Last Updated: October 14, 2021

Estimated reading time: 5 minutes

Marketing Research

Table of Content

Marketing research process, benefits of marketing research, disadvantages of marketing research.

Want to know your customers better? Start with marketing research.

Marketing research is the compass that guides businesses through the ever-changing landscape of consumer preferences and market trends. By diving deep into customers’ minds, companies uncover valuable insights to inform product development, advertising strategies , and customer engagement. Imagine launching a new product without understanding what your audience truly wants—marketing research helps you avoid that gamble, ensuring your efforts resonate with the right people at the right time.

Effective marketers follow a structured process to maximize the potential of all resources and practices. Here are the six essential steps:

Define the Problem and Research Objective

The most crucial step in any marketing research project is determining the problem. Before conducting research or collecting data, you need to understand what you want to learn. Identifying the root problem or opportunity helps determine the necessary information and how to obtain it. For example, you might explore how to address a loss in market share or how to launch a product for a specific demographic.

Create the Research Plan

Marketing managers must decide on data sources, research methods, research instruments, sampling methods, contact methods, and research tools to design an effective research program.

• Data Sources : Researchers can collect secondary data, primary data, or both. Secondary data already exists and was collected for another purpose, while primary data is gathered first-hand for a specific project.
• Research Methods : Five main methods to collect primary data include observation, focus groups, surveys, behavioral data, and experiments.
• Research Instruments : Common instruments include questionnaires, qualitative measures, and technological devices. Questionnaires, with both closed-end and open-ended questions, are particularly flexible and useful.
• Sample Plan : This involves deciding on the sampling unit, sample size, and sampling procedure to ensure the sample is representative and reliable.
• Contact Methods : Respondents can be reached via email, phone, in person, or online.

Collect the Data

Data collection is usually the most costly and error-prone phase. Respondents might be unavailable, uncooperative, or dishonest, requiring follow-up or replacement.

Analyze the Data

Researchers tabulate data and create summary measures. They calculate averages, dispersions, and use advanced statistical techniques to test hypotheses and strengthen conclusions.

Report Findings

Researchers present their findings, often in a consultative role, translating data into insights and recommendations. Clear, persuasive reports are crucial for effective decision-making.

Take the Decision

Based on the research report, top management makes informed marketing decisions. If unsatisfied with the report, they might discard it and start a new research project.

Identify Marketing Opportunities

Marketing research allows companies to identify gaps in the market, understand consumer needs, and adapt products accordingly. This proactive approach helps in tailoring products or services to meet market demands, thereby increasing the chances of success.

Understand Customer Preferences

By continuously tracking consumer behavior, preferences, and feedback, companies can stay attuned to what their customers want. This knowledge enables businesses to create products and services that align with consumer expectations, fostering customer loyalty and satisfaction.

Inform Marketing Strategies

Data-driven insights from marketing research provide a solid foundation for developing marketing strategies. Companies can create targeted campaigns, choose appropriate marketing channels, and allocate budgets more effectively, leading to better outcomes and higher returns on investment.

Reduce Marketing Risk

Conducting thorough research helps companies avoid costly mistakes. By understanding market conditions, competition, and consumer preferences, businesses can make smart decisions about product launches, market entries, and other strategic moves, minimizing the risk of failure.

Calculate Market Size

Accurate assessment of the market size allows businesses to understand the potential demand for their products or services. This helps in setting realistic sales targets, planning production, and ensuring that resources are allocated efficiently.

Support New Product Launches

Marketing research plays a critical role in testing new products on a smaller scale before a full-scale launch. Feedback gathered during this phase can be used to make necessary adjustments, ensuring that the product meets consumer needs and expectations.

Monitor Market Trends

Keeping an eye on industry trends helps businesses stay ahead of the competition. By identifying emerging trends early, companies can innovate and adapt their offerings to meet changing market conditions, gaining a competitive edge.

Measure Company Position

Marketing research provides valuable insights into a company’s market position and reputation. This information helps management understand how their brand is perceived, identify areas for improvement, and develop strategies to enhance their market presence.

Marketing research can be expensive, especially if it involves hiring external agencies or conducting large-scale studies. Costs can include survey design, data collection, analysis, and reporting. For smaller companies with limited budgets, this can be a significant barrier.

Time-Consuming

Conducting comprehensive marketing research takes time. Designing studies, collecting data, analyzing results, and compiling reports can be a lengthy process. In fast-paced markets, this time investment might delay decision-making and implementation.

Inaccurate Information

Poorly designed research can lead to biased or inaccurate results. Issues such as leading questions, unrepresentative samples, or respondent dishonesty can skew data, leading to incorrect conclusions and misguided decisions.

Rapid Market Changes

The dynamic nature of markets means that research findings can quickly become outdated. What is relevant today may not apply tomorrow, making it challenging to rely solely on past data for future decisions.

Biased Results

Human involvement in research introduces the potential for bias. Researchers’ personal values, attitudes, and prejudices can influence the design and interpretation of studies. Additionally, respondents’ socio-cultural factors can affect their answers, leading to subjective results.

Marketing research is essential for businesses to determine product demand, viability, and performance in the real world. By using primary and secondary data, companies gain unique insights that drive their success and growth. Research and development (R&D) are crucial components of this process, ensuring that companies stay competitive and meet market needs effectively.

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HOW TO: Use Books for Research: Using Books for Research

• Using Books for Research
• Table of Contents
• List of Illustrations
• Preface/Forward/Introduction
• Bibliography
• Evaluation Criteria

Why Use Books?

Books are excellent sources for information such as:       • in-depth coverage of a subject        • history and chronology       • overview of a big topic        

• background information           • bibliographies of additional sources. 

A book doesn't need to be read cover-to-cover to be used for research. To determine how appropriate and useful the book might be, look at its parts as outlined in the box below.

All sources of information need to be evaluated before they are used in a research project. To learn more about evaluating resources, click on the tab at the top of this guide.

How to Use a Book

Look at the parts of a book when deciding how it might be used in your research. To see examples, click on each link below or follow the tabs at the top of this guide.

The Title Page gives publication information such as complete title, names of all authors or editors, edition of the book, name of the publisher, city of publication, and date of publication.

The Table of Contents appears at the front of a book and gives a list of the chapters or sections in a book, usually with the corresponding page number.  The table of contents may give a general idea of the topics covered in the book as well as how the book is arranged (for example, chronologically or topically).

A List of Illustrations , which may appear at the front of a book, gives a list of photographs, drawings, tables, or other types of illustrations used to support the contents of the book, usually with corresponding page numbers.

A Preface, Forward, or Introduction may provide the reader with ideas about the author's intention or purpose for writing the book, and may give an indication of the depth of research presented.

A Bibliography is a list of materials related to a specific topic. The list may be sources that were used to create the work they accompany, or it may be a list of additional materials on the topic.   Bibliographies may be located at the ends of chapters throughout the book, or at the end of the book.

The Index , which is usually located in the back of the book, is an alphabetical list of the specific subjects in the book, along with the corresponding page numbers.  Indexes may provide names, dates, events, geographic locations, and other detailed terms related to the contents of the book.  Browsing an index is an excellent way to identify exactly where in the book relevant information may be located.  An index can also provide subject terms and keywords that might be useful for further research on a topic.

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• URL: https://libguides.cayuga-cc.edu/using_books

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5 Benefits of Market Research Reports

by Sarah Schmidt , on July 28, 2016

To illustrate the benefits of market research reports , we talked to a variety of professionals who use these reports in their day-to-day work. Read on to learn how these individuals use market research reports to their advantage.

1. Gather Industry Information Quickly

Max Robinson, Digital Marketing Manager at Aims Media Design in Glasgow, UK, uses market research reports to outline target audiences for clients before beginning any advertising campaign.

“Although we have a research team in place, we understand that there is a wealth of information out there that is relevant to our needs and has already been collected by another entity,” he explains. “Primary research is undoubtedly important, but in a fast-paced industry, we often need information quickly, and secondary market research is the best way to gather that information.”

Using market research reports takes much of the guesswork out of the process, saving Robinson “huge amounts of time."

2. Validate Internal Research 

Content Marketer Linda Pophal uses market research reports for her own needs, as well as for her clients. She uses these reports to research best practices, prepare RFPs, get ready for client meetings, and create content.

“Research reports save me time by providing insights into questions I might have but don’t have the time/resources to conduct primary research for,” she says. “In addition, I also find research reports can help me to validate information I may be gathering through primary sources."

3. Get a Holistic View of the Market

Nick Braun, Founder & CEO of PetInsuranceQuotes.com, also uses market research reports to double check his data. “We still do our internal analyses, but secondary reports guide our changes, and we look for ways to justify what third parties say so we aren’t myopic and caught up in our own data.”

In addition, secondary research reports help Braun stay up to date on the market as a whole. “These reports give us a holistic view of the market and allow us to benchmark all the companies in the industry, not just the ones we focus on,” he explains.

4. Use Objective Data to Make Informed Decisions

Another important benefit of market research reports is their impartiality. “Any third-party report is more unbiased, and so they provide a better picture of what’s really happening in our market,” Braun asserts. “It’s the best way to stay on the right path because we focus on the data and realities of our industry.”

Armed with information produced by sound research methods, you will have a more accurate understanding of the market landscape, issues that will affect the industry in the future, and how to best position specific brands to drive business growth . All of this insight will lead to actionable ideas and better decision-making. 

5. Strengthen Your Credibility and Reputation

By using objective analysis to make decisions, you will not only develop better business strategies, you will also improve your own professional reputation in the field and help others to have more confidence in your conclusions.

Braun explains it this way: “Instead of telling a client or partner, ‘This is what we’ve found,’ or ‘This is what we think,’ these reports allow us to say, ‘This is what the industry is doing,” and it lends more credibility and trust by not always being the sole source of data and information.”

Find Out More

Download MarketResearch.com's free white paper  to learn more about the benefits of market research and the value it brings to organizations today.

You May Also Like

• Why Is Market Research Important for Companies Today?
• The Strategic Value of a SWOT Report
• When to Consider Custom Market Research
• 7 Popular Sources for Company Information and Research

About the Author:  Sarah Schmidt is a Managing Editor at MarketResearch.com, a leading provider of global market intelligence products and services.

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Ad hoc use of genAI won’t deliver strategic benefits

Marketers and sales execs blithely experimenting with genAI risk repeating CRM mistakes of the past, where companies lost potentially valuable data capture opportunities.

If you look at industry surveys about the adoption of generative AI, there are a lot of marketers putting their toe in the water, or a foot.

But the easy access to these productivity tools means that adoption can sometimes be rather ad hoc and fragmented.

For example, Adobe’s 2024 trends survey found only a quarter of client-side senior executives had already conducted skill-building programmes on genAI. And yet new Marketing Week data shows almost half of marketers are using AI for market research , and more than two in five for audience segmentation and creative testing.

Anecdotally, I’m sure we have all spoken to people, within marketing and without, who have cracked on with using new tools to create imagery and copy, and advised others to do the same.

Is there any problem with having an open mind and keeping abreast of new technology? Isn’t this what any good marketer should do?

Will GenAI be a timesaver or will it frazzle marketers at scale?

Is it benefitting the wider organisation?

The danger to look out for is when ad hoc experiments deliver small local benefits while missing the opportunity to capture larger benefits for the wider organisation.

I spoke to one experienced data and analytics leader earlier this year who used the analogy of the early days of CRM systems in B2B businesses, and the difficulty in ensuring adoption by salespeople.

“For 10-plus years, [businesses said] manage your contacts and key sales processes in CRM. They never did that properly. And then suddenly they realised they can [manage contacts] on their smartphones. They can find a customer, they can use WhatsApp, they can do their own small campaign within minutes. They create contacts, groups of customers… So, basically the company has not got its hands on this customer data asset. It’s on people’s devices. It’s fragmented. It’s lost,” they told me.

“If they had strategised properly on a CRM system and found ways to get that data in, they would be very rich with customer data. They would have a unified data set. Their customers would be happy, the sales reps will have all the productivity they need, the asset will be managed as a corporate asset.

“I’ve seen a lot of companies that missed that opportunity. The same could happen in AI.”

The risks of free rein

The potential downsides of allowing a salesperson or marketer or customer service associate to add Large Language Models (LLMs) to their workflow have been well documented.

CEOs may perceive genAI to be a threat to both compliance and competitiveness, with issues such as hallucinations and privacy breaches often front of mind.

The challenge of aligning genAI usage with company strategy, and bolstering institutional knowledge is one that vendors are well aware of too.

Salesforce, for example, on marketing pages for its Einstein Trust Layer, talks about ‘dynamic grounding’, which it describes as adding “domain-specific knowledge and customer information” to prompts, to generate more accurate responses, such as using “CRM data, knowledge articles, service chats, and more” to “reduce the chance of hallucinations”. There is also detail on “data masking” and “zero retention architecture”, shielding data from external LLMs.

One might argue, in the case of ad hoc use of LLMs, that productivity tools are, by their nature, dispersed, and that employees already need to take personal responsibility for their use of everything from Google search and social media to enterprise software.

This is undoubtedly true, and the first step in training is to make sure employees are aware of what constitutes responsible use of new tools. However, the broader point still stands: Is there a need for AI to solve a business problem, or not? If there is, then that solution will need to be aligned to company strategy.

Cassie Kozyrkov, CEO at Data Scientific and former chief decision scientist at Google, wrote in a post on LinkedIn last month that AI, “should be what you try after traditional programming fails. When you have something to automate, but you aren’t able to do it with your existing bag of tricks. When the need is so critical that you’re willing to add complexity and the reduction of control that comes with it.”

Ritson: Synthetic data is as good as real – next comes synthetic strategy

In the comments underneath her post, when asked whether genAI tools improve efficiency for all organisations, Kozyrkov pointed out, “It has been shown to decrease efficiency when mismanaged.”

Expectations for genAI are sky-high, with two-thirds of senior executives in Adobe’s recent survey saying they are optimistic the technology will deliver business transformation across analytics, content, customer service and sales. But without strategic oversight, and with the self-starters simply left to follow their noses, those expectations are likely to be unmet.

Ben Davis is insights editor at Econsultancy, which provides e-learning, live-learning online workshops and skills mapping in digital, marketing and ecommerce.

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Embracing Gen AI at Work

• H. James Wilson
• Paul R. Daugherty

The skills you need to succeed in the era of large language models

Today artificial intelligence can be harnessed by nearly anyone, using commands in everyday language instead of code. Soon it will transform more than 40% of all work activity, according to the authors’ research. In this new era of collaboration between humans and machines, the ability to leverage AI effectively will be critical to your professional success.

This article describes the three kinds of “fusion skills” you need to get the best results from gen AI. Intelligent interrogation involves instructing large language models to perform in ways that generate better outcomes—by, say, breaking processes down into steps or visualizing multiple potential paths to a solution. Judgment integration is about incorporating expert and ethical human discernment to make AI’s output more trustworthy, reliable, and accurate. It entails augmenting a model’s training sources with authoritative knowledge bases when necessary, keeping biases out of prompts, ensuring the privacy of any data used by the models, and scrutinizing suspect output. With reciprocal apprenticing, you tailor gen AI to your company’s specific business context by including rich organizational data and know-how into the commands you give it. As you become better at doing that, you yourself learn how to train the AI to tackle more-sophisticated challenges.

The AI revolution is already here. Learning these three skills will prepare you to thrive in it.

Generative artificial intelligence is expected to radically transform all kinds of jobs over the next few years. No longer the exclusive purview of technologists, AI can now be put to work by nearly anyone, using commands in everyday language instead of code. According to our research, most business functions and more than 40% of all U.S. work activity can be augmented, automated, or reinvented with gen AI. The changes are expected to have the largest impact on the legal, banking, insurance, and capital-market sectors—followed by retail, travel, health, and energy.

• H. James Wilson is the global managing director of technology research and thought leadership at Accenture Research. He is the coauthor, with Paul R. Daugherty, of Human + Machine: Reimagining Work in the Age of AI, New and Expanded Edition (HBR Press, 2024). hjameswilson
• Paul R. Daugherty is Accenture’s chief technology and innovation officer. He is the coauthor, with H. James Wilson, of Human + Machine: Reimagining Work in the Age of AI, New and Expanded Edition (HBR Press, 2024). pauldaugh

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Money blog: Couples reveal how they split finances when one earns more than other

Welcome to the Money, your place for personal finance and consumer news and tips. Read our weekend feature on relationship finances below and let us know how you and your partner divide money in the comments box. We'll be back with live updates on Monday.

Saturday 17 August 2024 12:43, UK

Essential reads

• Couples on how they split finances when one earns more than other
• What's gone wrong at Asda?
• The week in money
• Best of the Money blog - an archive of features

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Ask a question or make a comment

By Emily Mee , news reporter

Openly discussing how you split your finances with your partner feels pretty taboo - even among friends.

As a consequence, it can be difficult to know how to approach these conversations with our partner or what is largely considered fair - especially if there's a big imbalance salary-wise. 

Research by Hargreaves Lansdown suggests in an average household with a couple, three-quarters of the income is earned by one person. 

Even when there is a large disparity, some couples will want to pay the same amount on bills as they want to contribute equally. 

But for others, one partner can feel resentful if they are spending all of their money on bills while the other has much more to spend and is living a different lifestyle as a result. 

At what stage of the relationship can you talk about money?

"We've kind of formally agreed there is some point in a relationship you start talking about kids - there is no generally agreed time that we start talking about money," says Sarah Coles, head of personal finance at Hargreaves Lansdown. 

Some couples may never get around to mentioning it, leading to "lopsided finances". 

Ms Coles says if you want to keep on top of finances with your partner, you could set a specific date in the year that you go through it all. 

"If it's in the diary and it's not emotional and it's not personal then you can properly go through it," she says.

"It's not a question of 'you need to pull more weight'.  It's purely just this is what we've agreed, this is the maths and this is how we need to do that."

While many people start talking about finances around Christmas, Ms Coles suggests this can be a "trying time" for couples so February might be a "less emotional time to sit down". 

How do you have the conversation if you feel the current arrangement is unfair?

Relationship counsellor at Relate , Peter Saddington, says that setting out the balance as "unfair" shouldn't be your starting point. 

You need to be honest about your position, he says, but your conversation should be negotiating as a couple what works for both of you. 

Before you have to jump into the conversation, think about: 

• Letting your partner know in advance rather than springing it on them;
• Making sure you and your partner haven't drunk alcohol before having the conversation, as this can make it easy for it to spiral;
• Having all the facts to hand, so you know exactly how much you are spending;
• Using 'I' statements rather than 'you'. For example, you could say to your partner: "I'm really worried about my finances and I would like to sit down and talk about how we manage it. Can we plan a time when we can sit down and do it?"

Mr Saddington says if your partner is not willing to help, you should look at the reasons or question if there are other things in the relationship that need sorting out. 

If you're having repeated arguments about money, he says you might have opposite communication styles causing you to "keep headbutting". 

Another reason could be there is a "big resentment" lurking in the background - and it may be that you need a third party such as a counsellor, therapist or mediator to help resolve it. 

Mr Saddington says there needs to be a "safe space" to have these conversations, and that a third party can help untangle resentments from what is happening now. 

He also suggests considering both of your attitudes to money, which he says can be formed by your early life and your family. 

"If you grew up in a family where there wasn't any money, or it wasn't talked about, or it was pushed that you save instead of spend, and the other person had the opposite, you can see where those conversations go horribly wrong. 

"Understanding what influences each of you when it comes to money is important to do before you have significant conversations about it."

What are the different ways you can split your finances?

There's no one-size-fits-all approach, but there are several ways you can do it - with Money blog readers getting in touch to let us know their approach...

1. Separate personal accounts - both pay the same amount into a joint account regardless of income

Paul Fuller, 40, earns approximately £40,000 a year while his wife earns about £70,000. 

They each have separate accounts, including savings accounts, but they pay the same amount (£900) each a month into a joint account to pay for their bills. 

Paul says this pays for the things they both benefit from or have a responsibility for, but when it comes to other spending his wife should be able to spend as she likes. 

"It's not for me to turn around to my wife and expect her to justify why she thinks it's appropriate to spend £150 in a hairdresser. She works her backside off and she has a very stressful job," he says. 

However, their arrangement is still flexible. Their mortgage is going up by £350 a month soon, so his wife has agreed to pay £200 of that. 

And if his wife wants a takeaway but he can't afford to pay for it, she'll say it's on her.

"Where a lot of people go wrong is being unable to have those conversations," says Paul.

2. Separate personal accounts - whoever earns the most puts more into a joint account

This is a more formal arrangement than the hybrid approach Paul and his wife use, and many Money blog readers seem to do this in one form or another judging by our inbox.

There's no right or wrong way to do the maths - you could both put in the same percentage of your individual salaries, or come up with a figure you think is fair, or ensure you're both left with the same amount of spending money after each payday.

3. Everything is shared

Gordon Hurd and his wife Brenda live by their spreadsheet. 

Brenda earns about £800 more a month as she is working full-time while Gordon is freelance. Previously Gordon had been the breadwinner - so it's a big turnaround.

They each have separate accounts with different banks, but they can both access the two accounts. 

How much is left in each account - and their incomings and outgoings - is all detailed in the spreadsheet, which is managed weekly. 

Whenever they need to buy something, they can see how much is left in each account and pay from either one. 

Gordon says this means "everyone knows how much is available" and "each person's money belongs to the other". 

"We have never in the last decade had a single disagreement about money and that is because of this strategy," he says.

Money blog reader Shredder79 got in touch to say he takes a similar approach. 

"I earn £50k and my wife earns just under £150k. We have one joint bank account that our wages go into and all our outgoings come out of. Some friends can't get their head around that but it's normal for us."

Another reader, Curtis, also puts his wages into a joint account with his wife. 

"After all, when you have a family (three kids) it shouldn't matter who earns more or less!" he says. 

Reader Alec goes further and says he questions "the authenticity of any long-term relationship or the certainly of a marriage if a couple does not completely share a bank account for all earnings and all outgoings". 

"As for earning significantly more than the other, so what? If you are one couple or long-term partnership you are one team and you simply communicate and share everything," he says. 

"Personally I couldn't imagine doing it any other way and I do instinctively wonder what issues or insecurities, whether it be in trust or something else, sit beneath the need to feel like you need to keep your finances separate from one another, especially if you are a married couple." 

A reader going by the name lljdc agrees, saying: "I earn half of what my husband does because I work part-time. Neither of us has a solo account. We have one joint account and everything goes into this and we just spend it however we like. All bills come out of this too. Sometimes I spend more, sometimes he spends more."

4. Separate accounts - but the higher earner pays their partner an 'allowance'

If one partner is earning much more than the other, or one partner isn't earning for whatever reason, they could keep separate accounts and have the higher earner pay their partner an allowance. 

This would see them transfer an agreed amount each week or month to their partner's account.

Let us know how you and your partner talk about and split finances in the comments box - we'll feature some of the best next week

By Jimmy Rice, Money blog editor

The centre-point of a significant week in the economy was inflation data, released first thing on Wednesday, that showed price rises accelerated in July to 2.2%.

Economists attributed part of the rise to energy prices - which have fallen this year, but at a much slower rate than they did last year. 

As our business correspondent Paul Kelso pointed out, it felt like the kind of mild fluctuation we can probably expect month to month now that sky high price hikes are behind us, though analysts do expect inflation to tick up further through the remainder of the year...

Underneath the bonnet, service inflation, taking in restaurants and hotels, dropped from 5.7% to 5.2%.

This is important because a large part of this is wages - and they've been a concern for the Bank of England as they plot a route for interest rates.

On Tuesday we learned average weekly earnings had also fallen - from 5.7% to 5.4% in the latest statistics.

High wages can be inflationary (1/ people have more to spend, 2/ employers might raise prices to cover staff costs), so any easing will only aid the case for a less restrictive monetary policy. Or, to put it in words most people use, the case for interest rate cuts.

Markets think there'll be two more cuts this year - nothing has changed there.

Away from the economy, official data also illustrated the pain being felt by renters across the UK.

The ONS said:

• Average UK private rents increased by 8.6% in the 12 months to July 2024, unchanged from in the 12 months to June 2024;
• Average rents increased to £1,319 (8.6%) in England, £748 (7.9%) in Wales, and £965 (8.2%) in Scotland;
• In Northern Ireland, average rents increased by 10% in the 12 months to May 2024;
• In England, rents inflation was highest in London (9.7%) and lowest in the North East (6.1%).

Yesterday, we found the UK economy grew 0.6% over three months to the end of June. 

That growth rate was the second highest among the G7 group of industrialised nations - only the United States performed better with 0.7%, though Japan and Germany have yet to released their latest data.

Interestingly, there was no growth at all in June, the Office for National Statistics said, as businesses delayed purchases until after the general election.

"In a range of industries across the economy, businesses stated that customers were delaying placing orders until the outcome of the election was known," the ONS said.

Finally, a shout for this analysis from business presenter Ian King examining what's gone wrong at Asda. It's been one of our most read articles this week and is well worth five minutes of your Friday commute or weekend...

We're signing out of regular updates now until Monday - but do check out our weekend read from 8am on Saturday. This week we're examining how couples who earn different amounts split their finances.

Each week we feature comments from Money blog readers on the story or stories that elicited most correspondence.

Our weekend probe into the myriad reasons for pub closures in the UK prompted hundreds of comments.

Landlords and campaigners, researchers and residents revealed to Sky News the "thousand cuts" killing Britain's boozers - and what it takes to survive the assault.

Here was your take on the subject...

I've been a publican for 19 years. This article is bang on! It's like you've overheard my conversations with my customers - COVID, cost of living, wages - the traditional British boozer going out of fashion. (My place: no food, no small children). Hey Jood

I own a small craft ale bar or micropub as some say. The current climate is sickening for the whole hospitality sector. This summer has been ridiculously quiet compared to previous ones. Micropubs were on the rise pre-COVID, but not now even we're struggling to survive… Lauren

I am an ex-landlord. It's ridiculous you can buy 10 cans for £10 or one pint for £5 now. It's not rocket science, it's a no-brainer: reverse the situation. Make supermarket beer more expensive than pub beer, then people will start to go out and mix again rather than getting drunk at home. Ivanlordpeers

Bought four pints of my regular drink at a supermarket for less than one pint in our local pub. It's becoming a luxury to go to a pub these days. Torquay David

Traditional pubs are being taken over by conglomerates who don't sell traditional beer, only very expensive lager, usually foreign, and other similar gassy drinks. How can they be called traditional pubs? Bronzestraw

The main reason for pubs closing is twofold! 1: The out-of-reach rents that the big groups charge landlords. 2: Landlords are told what stock they can hold and restrict where they can purchase it from. Strange, but most pubs belonged to the same groups! A pub-goer

Less pubs are managed now, pub companies are changing them to managed partnerships, putting the pressure onto inexperienced young ex-managers. Locals complain that their local pub has gone. but they don't use them enough. Can government regulate rents and beer prices for business owners? John Darkins

I was a brewery tenant in Scotland for many years and sequestrated because of the constant grabbing at my money by greedy brewers who wanted more and more. I made my pub very successful and was penalised by the brewery. James MacQuarrie 

The only reason pubs are closing is locals only use them on Boxing Day, New Year's Eve, and one Sunday a year. Plus breweries don't need pubs, they sell enough through supermarkets! Use them or lose them. Peter Smith

The closing of pubs is a terrible shame. I still go to my local and have great memories of getting drunk in many in my hometown. They are important places in society. As someone once said: "No good story ever started with a salad." Kev K

It's the taxman killing pubs. £1 of every £3 sold. Utter disgrace. Stef

I go with my girlfriend, Prue, every day to my local. It's a shame what's happening to prices. It used to be full of people and joy but now it's a ghost town in the pub since prices are too high now. I wish we could turn back time and find out what went wrong. Niall Benson

Minimum wage is around £11 and the tax threshold is £12,600 per year. How can you possibly afford a night in a pub out when a pint costs between £3 and £8 a pint on those wages? Allan7777blue

Unfortunately, the very people who have kept these establishments going over the years (the working man) have been priced out, and they're paying the price. Dandexter

The pubs are too expensive for people to go out regularly as we once did a decade or so ago. People's priorities are on survival, not recreation. Until the living wage increases beyond an inflation that wages haven't risen above in years, then we will see shops, pubs, etc. close JD

Who wants to spend hard-earned money going into a pub that's nearly always empty. It takes away one of the main attractions - socialising. Michael

Monzo has been named the best bank in the UK for customer satisfaction, according to a major survey. 

More than 17,000 personal current account customers rated their bank on the quality of its services and how likely they would be to recommend to friends or family. 

Digital banks made up the top three, with Monzo coming out on top, followed by Starling Bank and then Chase. 

Some 80% of Monzo customers said they would recommend the bank. 

The digital banking app said topping the tables "time and time again" was not something it would "ever take for granted". 

Royal Bank of Scotland (RBS) was bottom of the ranking for another year. 

The banks with the best services in branches were Nationwide, Lloyds Bank and Metro Bank. 

Gail's bakery chain has come under fire for repurposing unsold pastries into croissants and selling them for almost £4 the next day.

The retailer lists the "twice baked" chocolate almond croissants as part of its "Waste Not" range, which means it is made using leftover croissants that are then "topped with almond frangipane and flaked almonds".

The scheme has been hit with criticism online, with many pointing out the £3.90 price tag is 95p more than the original croissant.

One X user said: "The audacity of bragging about it being part of their 'Waste Not' range like we should be grateful to them and proud of ourselves for contributing to reducing food waste when they could just sell it for less money – not one pound more than yesterday.

"Unsure whether to be impressed or horrified that someone has come up with a concept to capitalise on yellow sticker goods to make more profit."

It should be added, however, that the practice was not invented by Gail's - and almond croissants were originally created by French boulangeries to reuse day-old croissants and stop them going stale.

When factoring in the extra ingredients (almond frangipane and flaked almonds) and baking time, the bakery chain would likely defend the increased price by pointing to the additional costs incurred.

It comes as locals in a trendy London neighbourhood signed a petition against a Gail's bakery setting up shop in their area.

After (unconfirmed) rumours began circulating that the chain was looking to open a site in Walthamstow village, more than 600 have signed a petition opposing the plans.

The petition says the village "faces a threat to its uniqueness" should Gail's move into the area (see yesterday's 11.54am post for more).

Gail's has been contacted for comment.

British retailers saw a rise in sales last month after a boost from Euro 2024 and summer discounting, according to official figures.

High street retailers said sales of football shirts, electronics such as TVs, and alcoholic drinks were all stronger amid the Three Lions' journey to the final.

Total retail sales volumes rose by 0.5% in July, the Office for National Statistics (ONS) said. It was, however, slightly below predictions, with economists forecasting a 0.7% increase.

It followed a 0.9% slump in volumes in June as retail firms blamed uncertainty ahead of the general election and poor weather.

ONS director of economic statistics, Liz McKeown, said: "Retail sales grew in July led by increases in department stores and sports equipment shops, with both the Euros and discounting across many stores boosting sales.

"These increases were offset by a poor month for clothing and furniture shops, and falling fuel sales, despite prices at the pump falling."

The data showed that non-food stores saw a 1.4% rise, driven by a strong performance from department stores, where sales grew by 4% for the month as summer sales helped to stoke demand.

However, clothing and footwear shops saw a 0.6% dip, whilst homeware retailers also saw volumes fall 0.6%. Food stores, meanwhile, saw sales remain flat for the month.

There are fears that the £2-cap on single bus fares could be scrapped after the government declined to say whether the policy would continue past December.

Bus companies said it was vital the cost of using their services is kept low for young people to "enhance their access to education and jobs".

Alison Edwards, director of policy and external relations at industry body the Confederation of Passenger Transport, said: "Bus operators are working closely with the government so that together we can find a way to avoid a cliff edge return to commercial fares.

"Analysis has shown that supporting fares, which can be done in a range of different ways, is great value for money and can support many other government objectives.

"For example, keeping fares low for young people would enhance their access to education and jobs, while also encouraging them to develop sustainable travel habits to last a lifetime."

Transport Secretary Louise Haigh said in a recent interview with the PA news agency that her officials were "looking at various options" in relation to the cap, including whether they could "target it better".

It's been a busy week on the economic front.

There was no major shift in the overall outlook - since Monday we've had it confirmed that the UK economy has lower inflation and more growth than the last two years, while wages have grown faster than the overall pace of price rises.

On the back of all that news the pound is at the highest rate since early this month against the dollar, worth $1.2882, and the highest since July when it comes to buying euro with one pound equal to €1.1733. 

Signs of a recovery from the global market sell-off of Monday last week can be seen in the share prices of companies listed on the London Stock Exchange.

Share prices have grown among the most valuable companies on the stock exchange, those that comprise the Financial Times Stock Exchange (FTSE) 100 list of most valuable companies.

Today though, this benchmark UK index fell 0.19% but finishes the week higher than the start.

Also finishing the week higher than the start are the more UK-based companies of the FTSE 250 (the 101st to the 250th most valuable firms on the London Stock Exchange).

On Friday morning that index was up 0.08%. 

With tensions in the Middle East and Eastern Europe high as Iran mulled a retaliatory strike on Israel and Ukraine made incursions into Russian territory, there had been concern about energy price spikes.

But the benchmark oil price has remained steady at $80.13 dollars for a barrel of Brent crude oil.

Gas prices have remained below the Monday high of 100 pence a therm (the measurement for heat) and now are 94.50 pence a therm. 

A Cabinet Office minister has said it is "unfair" to suggest other public sector workers will be queuing up for a pay rise after the government's offer of a 15% increase for train drivers and junior doctors.

"I think that's an unfair characterisation as well," paymaster general Nick Thomas-Symonds told Times Radio.

"I think what is absolutely crucial here is we are a Government again that is sticking to the promises we made in opposition.

"We promised we would sit down and find solutions, and people expressed scepticism about that, but actually that is precisely what we have done in Government."

Last month, the government and the British Medical Association struck an improved pay deal for junior doctors in England worth 22% on average over two years.

Meanwhile, train drivers will vote on a new pay deal following talks between representatives of drivers' union ASLEF and the Department for Transport.

The new offer is for a 5% backdated pay rise for 2022/23, a 4.75% rise for 23/24, and 4.5% increase for 24/25.

The Dartford Crossing is the highest-earning toll road in the UK, new data shows. 

The Kent to Essex route raked in £215.9m in the last year - 2,159 times more than the Whitney toll bridge in Hereford. 

The crossing, which was supposed to stop charging customers in 2003, costs between £2 and £6 to use (depending on the vehicle you're driving) between 10am and 6pm every day. 

Car finance company Moneybarn found it earned just over £209m in 2022. 

It topped the chart of 13 toll roads in the country, making over £100m more than the second highest-earning road in 2023 - the M6 Toll in the West Midlands. 

In third place was the Mersey Gateway Bridge between Halton and Cheshire, which made £48.9m. 

You can see how the other toll roads fared below... 

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