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Methods of Market Research

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Business Studies

I love market research because you really have an idea of what your consumers are looking for."

- Aerin Lauder

It is important for businesses to undertake market research, as it helps them gain useful insight into different groups of consumers and competition. So, how do businesses know which method of market research is best for their brand or product? Let's find out.

Types of marketing research

When it comes to primary research, the various market research methods can be separated into five different categories.

Surveys

Surveys are one of the most commonly used market research tools. Surveys can be either digital (online surveys) or physical (survey card). Surveys are often used in the service industry to understand how customers experience different attributes of a service. For example, they are often used to measure customer satisfaction.

A survey asks the respondent several different questions. The questions usually have a set of predetermined answers respondents can choose from.

A survey might consist of questions like 'How likely are you to use this service again?'. The answers are usually provided in the form of a scale (e.g., 'strongly agree', 'somewhat agree', etc.).

Surveys are useful when you want to measure something quantitatively and when you have a relatively large sample to survey.

Focus groups

Focus groups involve getting a group of people together to conduct a group interview.

Usually, a small number of people take part in the focus group (smaller sample size than surveys). These people tend to share demographic traits or share similar characteristics. A focus group involves a moderator who asks the group open-ended questions and guides the discussion.

Focus groups are great for qualitative research, as participants are free to elaborate on a thought or experience they have regarding the research topic. However, focus groups can also lead to issues with bias if people do not feel comfortable expressing their true opinions in front of the rest of the group.

Interviews

Interviews are similar to focus groups, although they usually involve fewer people. The interview is usually focused on one individual, with a moderator asking them questions.

Interviews can be structured with a list of specific questions the moderator asks the interviewee.

Interviews can also be semi-structured where the interviewer asks a set of predetermined questions and then proposes a topic and lets the interviewee decide what they want to talk about, regarding the topic.

Interviews are useful for qualitative research, and deeply understanding a customer's thought process behind a decision or behaviour.

Observation

There are two different types of observations. In the first type, the researcher has no interaction with the subject and in the second type, the researcher has some interactions with the subject. There are many ways in which observation can be used for business research.

During an in-store observation, the researcher or digital camera software tracks how customers move around in a shop, how much time they spend in each section of the shop, and which products they notice first.

Observational research is useful as it lets researchers know the actual behaviour of customers rather than what they tell the researcher or report in a survey.

Field experiments

Field experiments tend to be a more scientific way of doing market research.

Field experiments usually involve testing a hypothesis or multiple hypotheses, and take place in the natural environment of subjects.

An example of field testing would be test marketing. A company would use test marketing when they want to launch a new product on the market. They would first market and make the product available to a small group of people only. For example, a group of people in one specific city. They would then explore how this set group of people reacts to the new product and decide whether to launch it to a larger group of people.

Field experiments are useful for quantitative research and beneficial for businesses as the experiment is specific to its product; the research meets the precise research needs of the business.

Marketing research process

The marketing research process is made up of six steps.

1. Define the research problem and objectives

During this step, the researcher needs to define the problem they are trying to solve with their research. You should make sure that the problem you decide to focus on is not too broad. The researcher then has to define their objectives and decide on the type of research they are going to conduct (e.g., is it going to be exploratory or descriptive research?). This step should result in a defined research question.

2. Develop the research plan

The researcher then has to develop the research plan. During this step, they decide whether they are going to be collecting primary or secondary data, and the type of research method they are going to use (surveys, focus groups, etc.). This step also involves coming up with a sampling plan. Sampling could either be:

Random

All people in the sample group have an equal chance of being selected.

Convenience

Choosing the people that volunteer to take part in the research.

Judgement

Deliberately choosing certain people to sample.

3. Collect the data

During this step, you conduct your research. If your research method is an online survey, this is when you would send participants the survey and ask them to complete it.

4. Data analysis

During this step, you would use various statistical tools if you were conducting quantitative research, or analyse different interviews if you were conducting qualitative research.

5. Present your findings

During this step, you would format your analysis and data into detailed insights. You would translate your data into useful recommendations for managers.

6. Make your decision

This is where your organisation would decide how to tackle the problem you were researching with the findings you presented. The step could also involve a decision on whether you launch your new product or not.

Examples of market research

Imagine you are working as a marketing manager for a chain of restaurants. You notice that your online customer reviews are not as good as you would ideally like them to be. To understand why customers are rating your restaurants poorly, you decide to do some market research.

You decide that the most effective way to research this problem is by collecting primary data. So, you ask your customers to complete an online survey after they have finished dining. The sampling method you use is convenience sampling, as you provide the survey to any customer that volunteers to complete it. The survey consists of questions like:

  • How would you rate the quality of food in our restaurant?

  • How would you rate service quality in our restaurant?

  • How would you rate the selection of food options in our restaurant?

Once enough people have completed your survey, you analyse your data. It is clear that the reason why people are rating your restaurant poorly is that they (for instance) are not satisfied with the food quality. As a result of your market research, you decide to inform management that they should invest in better quality ingredients. Finally, you decide to launch a marketing campaign informing consumers about your newly designed menu, with fresher ingredients than other chain restaurants.

Methods of Market Research - Key takeaways

  • There are five main types of primary research.
  • Surveys are useful when you want to measure something quantitatively and when you have a relatively large sample to survey.
  • Focus groups are great for qualitative research, as participants are free to elaborate on a thought or experience they have regarding the research topic.
  • Interviews are useful for qualitative research and deeply understanding a customer's thought process behind a decision or behaviour.
  • Observational research is useful as it lets researchers know the actual behaviour of customers rather than what they tell the researcher or report in a survey.
  • Field experiments are useful for quantitative research and beneficial for businesses as the experiment is specific to its product; the research meets the precise research needs of the business.
  • There are six steps to the marketing research process. You first need to define your problem and objectives, then develop your research plan. You then need to collect and analyse your data. Finally, you need to present your findings and make a decision.

Methods of Market Research

There are numerous different ways a business can conduct market research. One of the first decisions to make is whether you want to collect primary or secondary data. If you decide to collect primary data, market research can be in the form of surveys, questionnaires, focus groups, observations, interviews, or field experiments. On the other hand, secondary research involves gathering data that has already been collected by someone else. Secondary research could include internet research, published market reports, or government statistics. 

There are several steps you can take to improve the validity of your market research. The first one would be to select the appropriate instrument. For example, if you are looking to conduct quantitative research, you would choose a survey instead of a focus group. Another way to improve validity is by asking specific and relevant questions. You should also make sure that your sample is representative of the population. This can be done by avoiding sampling methods like convenience sampling. 

There are several different types of marketing research methods available to marketers. One of the most common types of research instruments is surveys. Surveys are used when the researcher is trying to collect primary data. Other ways to collect primary data include interviews, focus groups, observation, field experiments, and questionnaires. Researchers could also decide to collect secondary data. Secondary data is a form of data that has already been collected prior to your research for a purpose other than the objective of your research.

Final Methods of Market Research Quiz

Question

Name the five basic primary research methods.

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Answer

  • Surveys 

  • Focus groups 

  • Interviews 

  • Observation

  • Field experiments 

Show question

Question

What is one of the advantages of using surveys? 


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Answer

Surveys are a useful tool for conducting quantitative research.

Show question

Question

What is one of the disadvantages of focus groups? 


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Answer

Focus groups can lead to issues with bias if certain participants do not feel comfortable with expressing their true opinions.

Show question

Question

What is a moderator? 


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Answer

Focus groups and interviews involve a moderator who asks the group/individual questions and guides the discussion.

Show question

Question

Name two examples of field experiments. 


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Answer

Test marketing, and A/B testing.

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Question

Name two different types of interview styles. What is the difference between them? 


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Answer

Interviews can be structured with a list of specific questions the moderator asks the interviewee. Interviews can also be semi-structured where the interviewer asks a set of predetermined questions and then proposes a topic and lets the interviewee decide what they want to talk about, regarding the topic.

Show question

Question

Which of the following statements is correct? 


  1. Observational research is useful as it lets researchers know the actual behavior of customers. 

  2. Surveys are useful for quantitative research. 

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Answer

Both statements are correct. 

Show question

Question

What is the first step of the marketing research process?

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Answer

Defining the research problem and objectives.

Show question

Question

What are the steps you would take during the second phase of the marketing research process? 


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Answer

During this step (step 2: developing the research plan) the researcher would decide whether they are going to be collecting primary or secondary data and the type of research method they are going to use (surveys, focus groups, etc.). This step also involves coming up with a sampling plan.  

Show question

Question

Name three different types of sampling methods. 


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Answer

  • Random 

  • Stratified 

  • Convenience 

Show question

Question

What would you do during steps 3 and 4 of the marketing research process?


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Answer

During step three you collect the data. In step four, you analyse the data.

Show question

Question

What is the fifth step of the marketing research process? 


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Answer

Presenting your findings. During this step, you would format your analysis and data into detailed insights. You would translate your data into useful recommendations for managers.

Show question

Question

What is the last step of the marketing research process? 


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Answer

During the last step (step 6) you are going to be making your decision. This is where your organisation decides how to tackle the problem you were researching with the findings you presented. The step could also involve a decision on whether you launch your new product or not.

Show question

Question

What is a survey?

Show answer

Answer

A survey asks the respondent several different questions. The questions usually have a set of predetermined answers respondents can choose from.

Show question

Question

Surveys are useful when you want to measure something:

Show answer

Answer

Quantitatively 

Show question

Question

Which question/prompt are you more likely to encounter in a survey?

Show answer

Answer

How likely are you to use this service again?

Show question

Question

What is a focus group?

Show answer

Answer

Focus groups involve getting a group of people together to conduct a group interview.

Show question

Question

Focus groups are more likely to be used for:

Show answer

Answer

Qualitative research

Show question

Question

In structured interviews, the interviewer asks a set of predetermined questions and then proposes a topic and lets the interviewee decide what they want to talk about.

Show answer

Answer

False

Show question

Question

In structured interviews _______ .

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Answer

the moderator asks the interviewee a set of predetermined questions

Show question

Question

Interviews are useful for: 

Show answer

Answer

deeply understanding a customer's thought process behind a decision or behaviour

Show question

Question

Outline the two different types of observation in market research.

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Answer

In the first type, the researcher has no interaction with the subject and in the second type, the researcher has some interactions with the subject.

Show question

Question

Observational research is useful as it lets researchers know ______ rather than ______ .

Show answer

Answer

Observational research is useful as it lets researchers know the actual behaviour of customers rather than what they tell the researcher or report in a survey. 

Show question

Question

Test marketing is an example of:

Show answer

Answer

A field experiment

Show question

Question

What is convenience sampling?

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Answer

Convenience sampling includes choosing the people that volunteer to take part in the research. 

Show question

Question

Random sampling is when:

Show answer

Answer

all people in the sample group have an equal chance of being selected.

Show question

Question

What should the first step of the marketing research process result in?

Show answer

Answer

A defined research question.

Show question

Question

A sampling plan can be:

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Answer

Random

Show question

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