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Marketing Research - The Basics

Understanding markets and customers is the foundation on which successful business planning and strategy is built. Without understanding customer needs and wants and how these translate into consumer demand, a business is under constant threat from competitors and may be failing to extract the maximum value from its market.

Objectives of Market Research

The aim of market research should not just be about identifying areas of customer demand, it also has to identify areas that can be profitably exploited by a business.

This means understanding where a business's strengths and weaknesses lie and what the implications might be of pursuing a particular marketing strategy. Market research therefore involves communication and sharing of results, understanding production and supply implications and identifying stakeholder issues.

In terms of data capture and analysis there are two main types of market research project :

(1) Qualitative Research;

(2) Quantitative Research

Qualitative Research
Qualitative Research is about investigating whys and hows of a market through in-depth research that explores the background and context for decision making.

There are two main qualitative methods - depth interviews and focus groups. However qualitative research can also include techniques such as usability testing, brainstorming sessions and "vox pop" surveys.

Depth Interviewing
Depth interviews are the main form of qualitative research in most business markets. Here an interviewer spends time in a one-on-one interview finding out about the customer's particular circumstances and their individual opinions.

The majority of business depth interviews take place in person, which has the added benefit that the researcher visits the respondent's place of work and gains a sense of the culture of the business. However, for multi-national studies, telephone depth interviews, or even on-line depth interviews may be more appropriate.

Feedback is through a presentation that draws together findings across a number of depth interviews. In some circumstances, such as segmentation studies, identifying differences between respondents may be as important as the views that customers share.

The main alternative to depth interviews, focus group discussions, are typically too difficult or expensive to arrange with busy executives. However, on-line techniques increasing get over this problem.

Group Discussions
Focus groups, or group discussions are the mainstay of consumer research. Here several customers are brought together to take part in a discussion led by a researcher (or "moderator"). These groups are a good way of exploring a topic in some depth or to encourage creative ideas from participants.

Group discussions are rare in business markets, unless the customers are small businesses. In technology markets where the end user may be a consumer, or part of a team evaluating technology, group discussions can be an effective way of understanding what customers are looking for, particularly at more creative stages of research.

Quantitative Research

Quantitative research is about measuring a market and quantifying that measurement with data. Most often the data required relates to market size, market share, penetration, installed base and market growth rates.

However, quantitative research can also be used to measure customer's attitudes, satisfaction, commitment and a range of other useful market data that can tracked over time.

Quantitative research can also be used to measure customer awareness and attitudes to different manufacturers and to understand overall customer behaviour in a market by taking a statistical sample of customers to understand the market as a whole. Such techniques are extremely powerful when combined with techniques such segmentation analysis and mean that key audiences can be targeted and monitored over time to ensure the optimal use of the marketing budget.

At the heart of all quantitative research is the statistical sample. Great care has to be taken in selecting the sample and also in the design of the sample questionnaire and the quality of the analysis of data collected.


E-mail Steve Margetts