With the massive amount of data that is being produced every day, it is very essential to analyze the data and include intensive research before extracting any relevant information from them.
If someone is planning to start a business, they need to do proper market research to understand their consumer requirements, before diving deep into the industry market.
This article is a beginner’s guide to market research analysis where we cover the following topics:
Let us learn more about market research.
What is Market Research?
Market Research is a process of data analysis that allows the evaluation of data regarding any new product and its viability in the market through direct customer research. This approach enables organizations or enterprises to identify their target market, gather and document feedback given by the potential customers, and make educated decisions.
Market Research can be performed by conducting surveys, interacting with samples (a group of people), and other similar methods by the company itself or by any outsourcing agency specializing in the feat. It is done to understand patterns and how the targeted audience will react to the product or service offered by the company.
The main objectives of market research, according to Question pro, are:
Market Research helps in the administrative development of any company through several ways like planning and organization. To satisfy all the needs of any market, human and material resource control is also required, which is done by market research.
The social aspects and requirements of the customer are also taken care of by Market research. It informs the business owners about the targeted customers and the specifications that will reach out to a wider variety of customers.
Every new and old company wants to reach out to a stage of economic stability as it determines the degree of success or failure of any business to some extent.
Market Research is very important for any business as it provides important customer insights that can be used to improve the quality of the product or service or change the marketing strategy according to newly devised marketing plans, ultimately making the business more customer-centric.
Businesses can anticipate their production and sales by knowing their consumers' demands. The market research also aids in choosing the best inventory goods to keep on hand. Thus, with market research and well-planned strategies, the company can stay ahead of its customers.
Types of Market Research
There are different types of Market research that are performed while marketing analysis. It depends upon the organization on what works best for them, but here are a few market research types and their methods that are used to draw meaningful conclusions:
Primary Market Research:
Primary market research is an amalgamation of both qualitative and quantitative research, where the consumers of any business are contacted directly, either by the company itself or through any other third party. The data collected can either be statistical data (quantitative) or generic information (qualitative).
There are generally two types of information collected during such analysis: exploratory and specific.
Exploratory research is a type of open-ended research in which an issue is investigated by asking open-ended questions in a thorough interview format, generally with a small group of people known as a sample.
Specific research, on the other hand, is more focused and utilized to tackle problems found by exploratory research.
The methods used in qualitative market research are:
It is a commonly used research method in which a small group of people responds to online surveys. This method does not require any personal interaction with the consumers and is used to collect important information.
Personal interviews consist of unstructured, open-ended questions asked by the researcher to the respondents personally, in the form of an interview. This approach is largely reliant on the interviewer's competence and expertise in asking questions that elicit replies.
This sort of detailed research is undertaken in the respondents' native environment. This approach necessitates the interviewer adapting to the respondents' native surroundings, which might be a metropolis or a distant village.
(Suggested reading: Top 10 B2C Marketing strategies)
Secondary Market Research:
Secondary research makes use of material that has been organized by an outside source such as government agencies, media, chambers of business, and so on. This knowledge is widely disseminated through newspapers, journals, books, corporate websites, free government and non-government organizations, and so on.
These are the methods of secondary market research:
Public Sources: Information can be collected from public sources like libraries or pre-recorded documents.
Commercial Sources: Commercial sources like newspapers, magazines, journals, media, etc. are great sources of information.
Educational institutions: Most colleges and educational institutions are a valuable source of knowledge since they conduct more research than any other corporate sector.
Techniques of Market Research Analysis:
In this article, we are going to discuss the two types of analysis techniques that are used for Market research analysis: Statistical Analysis techniques and Data Analysis techniques.
Statistics is a very important subfield of mathematics that gives numerical values in any analysis. The following statistical analysis techniques are used for market research analysis:
Regression analysis is a statistical technique that is used to find the relationship between two or more variables. There are both dependent and independent variables in this analysis, and any change in the dependent variable depends on the independent variables.
There are two types of regression techniques: Linear regression and Multiple regression. Regression analysis results in a ‘regression curve’ and analysts can study the degree of the curve to find relevant information.
Analysis of Variance Test:
It is also known as the ANOVA test and is used along with regression analysis to understand the effect of the independent variables over dependent variables. It may compare many groups at the same time to check whether there is a link between them.
Conjoint analysis is a technique where market researchers encourage individuals to make trade-offs when making decisions, much like they do in real life, and then analyse the outcomes to determine the most popular option. They conduct surveys and use conjoint analysis softwares to process the survey data to figure out the importance of every option that drove the customers.
The T-test helps the researchers to compare two datasets on whether they have different mean values and determines if the difference between them has some meaning to it or are purely coincidental.
(Related blog: T-test vs Z-test)
Crosstab analysis is a form of quantitative analysis that carries market research in order to analyse different and mutually exclusive data.
The following are the data analysis techniques for market research analysis:
Descriptive data analysis:
Market researchers analyse historical data sets using descriptive data analysis techniques, basically arranging raw information into groupings so that any current patterns may be easily recognised.
Some of the descriptive data analysis techniques are simple arithmetic tabulations like number of sales, website visits, etc. and data aggregation and mining systems as well.
(Must read: Multivariate data analysis)
Diagnostic data analysis:
Diagnostic analytics use increasingly complex algorithms to uncover the causes of results. Researchers may frequently identify correlation and/or causal connections by comparing and contrasting data sets.
Diagnostic data analysis approaches include conjoint and regression analyses, as well as probability measurements.
Predictive data analysis:
Businesses employ predictive data analysis techniques that rely on descriptive and diagnostic numbers to foresee probable outcomes. Market researchers use sophisticated statistical models based on current data to assist them forecast the likelihood of certain future occurrences occurring.
Analysts must thus be trained in sophisticated machine learning programming and understand how to apply algorithms to existing data sets in ways that allow for the depiction of relationships between numerous variables.
Regression models, such as linear regression and discrete choice analysis, are two of the most common methods through which academics may assist businesses in optimising their future business operations.
Prescriptive data analysis:
Prescriptive data analysis techniques are thought to be the most sophisticated of all data analysis approaches. Companies utilise them to assist them decide the measures they need to take to prevent future problems or capitalise on future possibilities.
Prescriptive data analysis techniques, similar to predictive analytics in that they seek to forecast the likelihood of certain events occurring, take the insight a step further, attempting to predict possible outcomes based on specific courses of action, as well as possible actions to take based on one or more targeted outcomes.
Tools of Market Research Analysis:
There are certain tools that are required for market research analysis.We have listed out a few of them:
Google Keywords tool: It shows the behavior of customers when online searching for similar products or services.
Questback: Questback is a premium service that connects a company with its target market. It may conduct extensive research on your behalf and offer useful input in a timely and effective manner.
Klout, Kred and Peerindex: To search for key influencers in a targeted market, tools like klout, kred and peerindex can be used.
KeySurvey: KeySurvey allows the creation of online questionnaires for surveys. It however does not source participants.
Google Analytics: Google analytics is used to provide feedback on customer behavior on the website. It can show which goods are popular but few people buy (or vice versa), and it can show which social media platforms the consumers are using, among other things.
FreeLunch: FreeLunch delivers global data across a variety of demographics and sectors, but it is particularly useful for firms targeting the United States, giving anything from thorough demographic breakdowns to insights into larger spending trends.
Market research is very essential for any starting or growing company. It allows the owners to have a clear vision of their market position and the activities they can perform to make the business better.
In this article we have learned in detail about what market research is and the types of market research. We also discuss statistical analysis in market research and data analysis. We list out a few popular market research analytics tools as well.