Market research is an essential component of any business plan, whether for an embryonic start-up or large corporate.
Knowing there is a sustainable market for your product and understanding what your audience expects is vital to a successful launch.
Market research can generally be split into two categories: primary and secondary. I am explaining their respective merits and appropriate uses.
Secondary research
Secondary research uses existing data from available sources. There are government censuses, Mintel surveys, and many private market research agencies that allow access to their data, some of it for free.
Secondary research, more often than not, is a solid base on which to develop your own primary research
It can be hugely advantageous, especially as a starting point. Secondary research, more often than not, is a solid base on which to develop your own primary research.
It plays the same role as research in relation to your product launch and should be seen as equally important. Also, this is of course far cheaper and generally quicker than creating your own research from scratch.
Negatives
The downsides are that neither picked a panel to suit your needs nor the questions. It is feasible to find some research that corresponds to your goals, but it will almost certainly require some tweaking, and will not necessarily be with the people you wish to interrogate; the use of qualitative research designed by someone else will almost certainly make the target specialised away from your goals.
Another problem with secondary research is that by the time it reaches you it’s often outdated. Markets change so quickly in business that the only way to be truly current is through new research.
This is not to rubbish the quality of secondary research, however.
Primary research
Primary research is essentially conducting your own research, whether a question posed to friends and family or a survey of a broader section of people. Primary research will instantly give you greater control.
You choose the questions and select your panel through qualitative research, and you get detailed responses. You decide how, when and where your research is administered.
You can keep your research focused: the number of participants and their backgrounds, the number and nature of the questions, the amount of time your survey takes, and so on. This is the most accurate way to research a market sector specific to you and your product.
Negatives
It is of course more expensive, whether financially or on your time. If performing primary research alone it will take even longer, and require some experience of producing questionnaires. It will also take time for your questionnaire to be completed if you don’t have direct access to a panel who can fill in the survey straightaway.
Most of this can be avoided by using an agency, but at a cost higher than performing your research alone.
So what’s the best option?
Neither type of research alone will be enough, but a combination of both will give you all the information you need.
Using primary research alone, without first investigating what has or hasn’t worked for other companies and perhaps overlooking significant existing data, is likely to lead to irrelevant questions or missed opportunities. At the same time, relying solely on secondary research is likely to leave you with answers that are vague or inappropriate to your specific audience.
The two complement each other, and used in conjunction they provide a well-rounded, accurate portrayal of the needs and opinions of your market sector.
