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Market Research

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Business Studies

The first step in formulating most marketing strategies is conducting market research. It is an essential step as it allows companies to explore whether certain ideas are likely to work or not. Before conducting market research it is important to figure out which type of research works best for your project. Let's take a look at how exactly this can be done.

Market research methods

There are two main methods of market research: qualitative and quantitative.

Qualitative research

Qualitative research focuses on gathering and analysing data that is not numerical.

This type of research tries to describe certain situations and understand characteristics, opinions, concepts, and experiences. It is used to understand complicated customer motivations that are difficult to study with quantitative methods. It is also used to illustrate the impacts of different factors on customer decision making.

Qualitative data is usually collected from smaller sample sizes. The goal of this type of research is to question and observe what people say, do, and how they react to certain situations or ideas. Questions are usually open-ended and it is up to the respondent how they answer each question (no predetermined answers).

Quantitative research

Quantitative research is the opposite of qualitative research. This type of research focuses on collecting numeric data which can, later on, be analysed by the researcher through different statistical measures.

Quantitative research usually involves structured questions, where responses to those questions are predetermined and respondents chose between one of the predetermined answers. Sample sizes are usually larger (more people being surveyed).

Understanding the effect age has on the number of clothes customers purchase each month is an example of a quantitative research project.

Types of market research

Market Research, the two types of market researchTwo types of market research. StudySmarter

Figure 1 above outlines the main differences between the two types of market research. There are advantages and disadvantages to both primary and secondary research. The type of research you choose will depend on the objectives and aims your business is trying to achieve.

Primary market research

Primary research involves collecting and interpreting primary data. This is new data that has not been collected before.

Understanding primary market research

Primary market research is sometimes called 'field research' because you need to take a direct approach to collect your data. This is a type of research that an organisation plans itself and involves collecting new data that has not been gathered before. Primary research involves collecting data based on a research problem or question that is specific and unique to the business. Primary market research can be carried out by the business itself or an external organisation, but the data collected will be brand new data. It often involves gathering data on the business's existing customers. Common means of collecting primary data is through surveys, focus groups, interviews, and questionnaires.

Advantages of primary market research

Some of the advantages of collecting primary market data include:

  • It is specific to the business.
  • It can provide unique insight into the wants and needs, characteristics, attitudes, and behaviours of a business's customers.
  • It can provide unique insight into chosen markets and the individual business's competitive environment.
  • It meets the exact needs of the business as they are the ones planning the research topic, (sometimes) collecting the data, and interpreting the results.
  • The business can discover insights that competitors do not have access to.
  • It can help in formulating a market strategy.

Disadvantages of primary market research

Some of the disadvantages of collecting primary market data include:

  • It can be quite costly.

  • It can be very time-consuming.

  • Needs specific knowledge and skills to be carried out.

  • You often need a specialised team to conduct the research and collect and interpret the data.

  • You might not end up gathering enough comprehensive information to guide you in creating an effective strategy or making appropriate decisions.

  • You might end up having to do further research.

Secondary market research

Secondary market research involves interpreting secondary data. This type of data has been collected before you began your research.

Understanding secondary market research

Secondary data has been collected before for some purpose other than your research question or problem. Secondary data can be collected both internally and externally. This could include things like sales and inventory records of your company (internal), internet research (external), market reports (external), or information from the UK Census (external).

Secondary research is often referred to as 'desk research' as it can be conducted from your desk. Your role as a secondary researcher is to find data that is relevant to your business research objectives.

Advantages of secondary market research

Some of the advantages of conducting secondary market research include:

  • It is less costly than conducting primary research.
  • It is more simple to gather.
  • It is quicker than conducting primary research.
  • It can be easier to analyse as the data has already been organised and formatted in one way or another.
  • It can provide access to industry-specific knowledge and information.

Disadvantages of secondary market research

Some of the disadvantages of secondary market research include:

  • It can provide data that is less specific to your business.
  • It provides data that is less specific to your research objectives.
  • The data you gather might not be sufficient to answer your research question.
  • The data could be gathered a long time ago, making it less relevant to your research needs.
  • It is not always formatted in the way you want or expect it to be.
  • It is available to everyone including your competitors.
  • It may be biased, incomplete, or inaccurate, if it is not conducted by a reputable organisation.

Market research examples

There is a multitude of ways in which you can conduct market research.

Example of primary market research

A popular type of primary market research is surveys. You can customise your survey to be as short or as extensive as you wish. Surveys can be digital, received via email for example, or they can be in a physical form, like a card you receive to share your thoughts after staying in a hotel. Surveys are useful when you want to measure something specific.

When you use certain services, you are likely to receive an online survey after completing the purchase and utilising the service. A specific example of this would be ordering food online through a delivery service. Once you have made your purchase and received your food you could find a survey in your inbox with prompts like:

How likely are you to recommend this service to a friend?Please rate your experience with this service on a scale from 1 to 5. How likely are you to use this service again?

Answers to these questions are then analysed and turned into useful data and actionable insights.

Example of secondary market research

Secondary market research can take several forms.

Imagine you are working for a company that is trying to develop a new product. Instead of conducting your own research, you decide that it would be more efficient to gather information from existing resources. You take a look at industry reports and look for data on whether the industry is growing and whether it seems profitable. You then examine market reports which describe customer needs and wants in the industry and predict customer attitudes and behaviours in the future. You also conduct internet research to examine how your competitors are acting in the industry. You then take a look at your company's internal records of sales and expenditure for current products and brands that you offer.

Based on the data and information gathered, you then decide whether it is worth developing a new product; the type of product you should develop (what are customers looking for?); how you could differentiate your product from competitors, and how much money you would need for the development of this new product (budget).

Market Research - Key takeaways

  • Qualitative research focuses on gathering and analysing data that is non-numerical. This type of research tries to describe certain situations and understand characteristics, opinions, concepts, and experiences.
  • Quantitative research is the opposite of qualitative research. This type of research focuses on collecting numeric data which can, later on, be analysed by the researcher through different statistical measures.
  • Primary research involves collecting and interpreting primary data. This is new data that has not been collected before.
  • Secondary market research involves interpreting secondary data. This type of data has been collected before you began your research.
  • Primary research provides effective and specific insight into your research question, but it can be quite costly and time consuming to conduct.

Market Research

Market research is the process through which we collect data about customers and markets in order to help us construct a better marketing strategy. Market research helps us understand why customers purchase certain products or brands. Market research is directly related to the marketing mix, as it helps us make decisions about product, price, promotion and place through the data we collect during market research. 


There are two different types of market research: primary and secondary. There are advantages and disadvantages to both primary and secondary research. The type of research you choose will depend on the objectives and aims your business is trying to achieve. 

Market research helps us understand our customers' wants and needs. Market research can also help us predict customer preferences and purchase patterns. This can help us decide how to position our products or brand in relation to competitors. Market research is essential because it helps us come up with effective strategies. 

Primary market research is a type of research that an organization plans itself and involves collecting new data that has not been gathered before. Primary research involves collecting data based on a research problem or question that is specific and unique to the business. Primary market research can be carried out by the business itself or an external organization but the data collected will be brand new data. It often involves gathering data on the business's existing customers.

Secondary market research involves the collection and analysis of secondary data. Secondary data has been collected before for some purpose other than your research question or problem. Secondary data can be collected both internally and externally. Secondary research is often referred to as 'desk research' as it can be conducted from your desk. The role of a secondary researcher is to find data that is relevant to your business research objectives. 

The purpose of market research is to understand what our customers want and need within our market or industry. It is also useful for gaining insight into customer behaviour and customers' attitudes towards different products and services. Market research is essential for developing new products, introducing new brands or coming up with a new marketing strategy.

Final Market Research Quiz

Question

What is qualitative research?

Show answer

Answer

Qualitative research focuses on gathering and analyzing data that is non-numerical. This type of research tries to describe certain situations and understand characteristics, opinions, concepts, and experiences.

Show question

Question

What is quantitative research?


Show answer

Answer

Quantitative research is the opposite of qualitative research. This type of research focuses on collecting numeric data which can, later on, be analyzed by the researcher through different statistical measures.

Show question

Question

Which of the following statements is correct about market research? 


  1. The qualitative researcher usually poses open-ended questions. 

  2. Quantitative research involves smaller sample sizes. 

Show answer

Answer

Only statement I. is correct. 

Show question

Question

What are the two types of market research?


Show answer

Answer

The two different types of market research are primary and secondary research.

Show question

Question

What is primary market research?


Show answer

Answer

Primary market research is a type of research that an organization plans itself and involves collecting new data that has not been gathered before.

Show question

Question

What is secondary market research?


Show answer

Answer

Secondary market research is a type of research that involves gathering data that already exists. This can include internet research, examining market reports or government data. This type of information has been collected before for a purpose other than your research.

Show question

Question

What are two advantages of primary market research?


Show answer

Answer

  • It is specific to the business. 

  • It can provide unique insight into the wants and needs, characteristics, attitudes, and behaviors of a business's customers. 

Show question

Question

What are two advantages of secondary market research? 


Show answer

Answer

  • It is less costly than conducting primary research. 

  • It is simpler to gather. 

Show question

Question

Secondary market research can _____________. 


Show answer

Answer

Provide access to industry-specific information

Show question

Question

One of the disadvantages of secondary research is: 

  1. It can be quite costly. 

  2. It can be very time consuming. 

  3. It is available to your competitors. 

  4. It requires specific skills to be carried out. 

Show answer

Answer

C.

Show question

Question

Which of the following is a disadvantage of primary research? 

  1. It can provide data that is less specific to your business. 

  2. You often need a specialized team to conduct the research. 

  3. The information is available to your competitors. 

  4. The data could have been gathered a long time ago.

Show answer

Answer

B.

Show question

Question

Which of the following statements is correct about market research? 


  1. Primary research can take a long time to complete. 

  2. Secondary research can provide access to industry-specific knowledge. 

Show answer

Answer

Both statements are correct. 

Show question

Question

How are marketing strategies formulated?

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Answer

Through market research

Show question

Question

Types of market research are the same as methods of market research

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Answer

True

Show question

Question

...... is a type of market research specific to a company

Show answer

Answer

Primary research

Show question

Question

.... is a type of market research which applies existing results 

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Answer

Secondary research

Show question

Question

...... focuses on gathering and analysing non-numerical data

Show answer

Answer

Qualitative research 

Show question

Question

.... focuses on collecting numerical data and used through different statistical measurement

Show answer

Answer

Quantitative research

Show question

Question

Collecting and interpreting primary data is 

Show answer

Answer

a. Primary

Show question

Question

Collecting and interpreting data is ......

Show answer

Answer

a. Primary research

Show question

Question

Survey is a popular type of ....... market research 

Show answer

Answer

Primary

Show question

Question

The following are all disadvantages of secondary market research except

Show answer

Answer

Data is less specific to the business

Show question

Question

The following are all disadvantages of primary market research except

Show answer

Answer

It is not cost efficient 

Show question

Question

...... is a research type that gives a business specific data

Show answer

Answer

Primary

Show question

Question

Other means of primary research are surveys, focus groups, collecting data from other researcher

Show answer

Answer

True

Show question

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