It is basically in business, before starting in anything Whether you’re developing a new product line, entering a new territory or growing an already established business, you have to understand the marketplace, customers and competitors. There are two core methods of obtaining this priceless information: primary and secondary research, that is called that market research.
Primary market research
It is information that comes directly from the source. When conducting primary market research, you’re looking for one of two types of information – either specific or exploratory. Specific research is, very precise in its scope and involves precise questioning to help solve a problem that has often been identified during exploratory research. that is much more open-ended and unstructured, encouraging lengthier responses from your chosen respondents.
The goal of any primary market research for entrepreneurs is to gain relevant insight into their target market that could not otherwise be gleaned from existing data, get feedback about your website, assess demand for a proposed service, gauge response to various packaging options, find out how much consumers will pay for a new product.
primary research is usually based on statistical methodologies that involve sampling as little as 1 percent of a target market. it is conducted either by you or by a company that you pay to conduct the research for you. Focus groups, surveys, field tests, interviews, and observation are examples of primary market research.
Primary market research tends to take the raw data such as information collected through focus groups or surveys, and interpret the data for a variety of business purposes. so, we need to conduct primary market research in order to:
- Validate your product idea.
- See if people actually need your product/service.
- Find out how much potential consumers are ready to pay for your product.
The three common ways of primary research
A direct mail questionnaire tends to feature questions that are short and to the point and of interest to the respondent.
2- A group survey
It is used mostly by big business, group interviews or focus groups are useful brainstorming tools for getting information on product ideas, buying preferences, and purchasing decisions among certain populations.
The personal interview is one of the most effective forms of primary market research. it’s a great opportunity to build rapport with respondents and get their thoughts on product ideas, buying preferences and purchasing decisions.
Secondary Market Research
Secondary research is based on information from studies previously performed by official government bodies, trade associations and chambers of commerce or industry competitors, secondary market data is quantitative information that can often be procured for free or for a very low cost.
The drawbacks to secondary market research are that the data may not be customized to fit your research requirements. So although it might be cheaper and quicker to obtain, it might not be as useful as primary market research in terms of preparing your business to explore new markets and regions.
The two main methods of secondary market research
1- Quantitative Method
It’s simple, quantitative research gathers numerical data that help you understand how big the market is, what’s its valuation, whether there are any predictions about the potential growth of the market. Quantitative research data can also help you get insights into the demographics of customers, such as their age, gender, and location.
This method includes data from:
- Potential sales reports
- Online or phone questionnaires
- Financial trends.
2- Qualitative Method
Unlike quantitative, it gathers views and attitudes, provides insights regarding the feelings and the attitude of your customers or potential customers about the product or service you are offering. It also helps measure the level of satisfaction with your business on the part of your existing customers. In other words, qualitative research provides helps you gather people’s feelings regarding your product/service and improve the latter accordingly.
This method includes:
- Focus groups with customers and potential customers.
- Structures and non-structured conversations with customers.
- Observation and reviews of competitors.
- Qualitative research data.