Market research is primarily concerned with understanding the nature of a market. Some of the questions that a market research typically seeks to answer are:
- Who are our typical buyers?
- Where do our buyers come from?
- How big is our market?
- What are our customers’ aspirations?
- How do our customers shop and with whom?
- What do our customers buy?
- Why do customers refuse to buy our products?
The processes involved in conducting market research can be outlined as follows:
Define the Problem and Research Objectives. The problem should not be defined too broadly nor too narrowly. In fact, great care should be taken when defining the problem as this will determine the very nature and direction of the research.
Develop the Research Plan. The Research plan is composed of the following components:
- Data Sources. Secondary data involves the gathering of prior and related research works since it is possible that other parties have already developed useful findings on the matter being studied. Primary data involves actually undertaking the research itself in order to get first-hand knowledge on the matter.
- Research Approaches. Research can be conducted through observation, focus groups, survey research, behavioral data, and experimental research.
- Research Instruments. These include questionnaires or mechanical instruments such as video recorders.
- Sampling Plan. This addresses (1) sampling unit (Who is to be surveyed?), (2) sampling size (How many people should be surveyed?), and (3) sampling procedure (How should they be chosen?).
- Contact Methods. Contact with the survey sample could be done via personal or impersonal means. Methods include the use of mail questionnaires, telephone surveys, personal interviews, or the internet.
Collect the information. This involves the actual gathering of the data. For surveys, for instance, this would involve mobilizing a suitable number of field workers who will then find respondents according to the sampling plan. For a research that involves the conduct of interviews, field workers will have to be trained first in order to be responsive enough to properly interact with respondents.
Analyze the data. Once all the data has come in (whether in the form of surveys, interviews, group discussions, or through electronic means such as online ballots), the next step involves the actual processing of the data. Quantitative data can be processed through software such as statistical packages, while qualitative data (such as interviews) can be processed through data reduction or summarization techniques.
Present the findings. Once processed, the data can now become a useful information. However, its usefulness will still be a function of how well it is presented. Quantitative information, for instance, may best be digested in the form of graphs and charts so that trends can be more easily seen. Qualitative data, on the other hand, may best be presented in the form of clear examples and case studies.