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Market research methods
The type of information you want to gather about your customers, market or competitors will influence the research methods you choose. There are different ways to gather information (from primary or secondary sources) and different types of information to gather (quantitative and qualitative). You may use any combination of these research approaches to get the results you need.
Primary and secondary research
Primary and secondary research relate to the way you gather information.
Primary research (or field research) gathers original information directly for your purpose, rather than being gathered from published sources. Primary research includes:
- direct observations
- interviews and focus groups that are developed and conducted by you or your researcher.
Primary research gives you control over the type of questions you ask and information you gather. Primary research results can be extremely valuable; however, they can also be much more time-consuming and costly to gather than secondary research.
You may choose to use primary research methods once you have conducted secondary research to determine what information already exists.
Secondary research (or desk research) gathers existing information through available sources. Secondary research examples include:
- information on the internet
- existing market research results
- existing data from your own stock lists and customer database
- information from agencies such as industry bodies, government agencies, libraries and local councils.
Secondary research allows you to make the most of existing information about your market. However, it can be a challenge to find the information you really need. Learn more about different research resources for business and industry.
You may use secondary research to get an initial understanding of your market. It is often faster to analyse than primary data because, in many cases, someone else may have already started analysing it. However, when using secondary research be careful how you interpret it, as it may have been collected for a different purpose or from a market segment that isn't relevant to your business. Also make sure that any secondary information isn't out-of-date, as the market can change quickly and this will affect your results.
As well as understanding your market, you can also use secondary research to examine factors inside your business, such as sales figures and financial records.
Quantitative and qualitative research
Quantitative and qualitative research defines the type of information you gather.
Quantitative research gathers numerical data. Quantitative research includes:
- surveys on customer return frequency
- sales figures
- industry product sales numbers
- online or phone questionnaires
- financial trends.
You can use this approach to identify the size of your market and how much it might be worth to your business, and to find areas for sales growth. Quantitative research can also help you understand the demographics of customers, such as their age and gender.
Quantitative research often produces a lot of statistics. These are useful as an overview of your market, but make sure you don't rely solely on statistics in your research. Consider all of the information you have. For example, the 'average' price your target market suggested it would pay for a product could be distorted if a few a participants selected a very high amount (i.e. not reflecting the high number who would not pay that much).
Qualitative research gathers views and attitudes. Qualitative research includes:
- focus groups with customers and potential customers to understand their feelings and attitudes towards your products and services
- formal and informal conversations with customers about their satisfaction with your business
- visits and reviews of competitors to understand their products and customer service practices.
You can use this approach to get a better understanding of your customers' interests, needs and habits, and identify opportunities for growing sales and improving customer service. Analysing qualitative data requires a different approach and can take longer to interpret than quantitative data because of the nature of the information.