Market Research and How It Works
Conducting market research involves the collection and analysis of information about the target market for your products or services. This includes data on prospective customers, competitors, and the overall industry. The accumulation of such relevant information allows you to assess the viability of a proposed business prior to investing a significant amount of time and money. Market research also assists established businesses in planning various aspects of the dissemination of their products and services. Here are some fundamentals on market research to help you get started.
Types of Data in Market Research
Primary information is data that you, your employees, or contracted research teams collect firsthand. This information may be exploratory, or open-ended, in which you search for and define situations or difficulties, or it may be specific and focused, in which you attempt to solve problems that you have already pinpointed. Secondary information includes all the data you can draw from sources that have been compiled by others.
Methods of Primary Research
One of the most cost-effective methods of primary market research is the telephone survey. When conducting interviews by phone, you can cover a wide geographical area in a short amount of time. Be sure to prepare beforehand what you want to ask, keep the conversation moving, and request the possibility of a follow-up call. Personal interviews, either one-on-one or in groups, are also highly efficient in brainstorming ideas or gathering details by asking predetermined questions. Response from direct-mail questionnaires is usually low. If you attempt this method of market research, address the questionnaire to specific audiences, keep it and the questions short, explain the motivation for the survey in a cover letter, and include a self-addressed, postage-paid envelope.
Sources of Secondary Research
For your secondary research, obtain magazines, newspapers, pamphlets, and other material from industry associations, government agencies, educational institutions, chambers of commerce, and the media. Specific government sources include the Small Business Administration, the U.S. Census Bureau, the U.S. Industry and Trade Outlook, and the online bookstore at the U.S. Government Printing Office. Don’t forget business sections in local libraries and commercial information sources such as trade associations.
For more advice on market research, contact Alpine Digital Marketing.