In this section, we guide you through the market research basics, research methods, the type of information they can obtain, and practical ways to collect research that can help your organisation.
Market research is a must before business planning as it helps you to identify and understand your market, assess the demand for (or interest in) a product or service, and provide clues as to how what you’re offering might be made more marketable.
Gathering market research will not only save you time and money, done well, it can actually help you to achieve your trading and social objectives.
The main objective of market research is to find out whether a product or service is needed, whether people would buy it and who those people are. Market research helps answer questions such as:
- Is there a demand for your product and service?
- What are the preferences and needs of your potential customers?
- What is the size of your market or pool of potential customers?
- How many other businesses are offering similar products or services?
See 20 questions that research could help you answer. View here
What is market research?
Market research is the process of gathering and analysing information to help identify and define opportunities and problems in order to make sound decisions. Through it you can evaluate whether your ideas will work, find customers, evaluate your activities, monitor performance, assess competitors, and continuously improve your marketing processes and efforts.
A market is a defined group of consumers or organisations that are interested, or potentially interested, in what you have to offer and have the ability to buy. If you already know your market, you can concentrate your research efforts on learning more about it. If you’re not so sure, you can use market research to identify your market i.e. figure out who you should be focusing your energies on based on what you discover. A useful introduction to market research can be found here.
Types of research
There are two main types of research:
Primary research: Conducting new research, either yourself or engaging someone else to do it on your behalf. The benefit of primary research is that you can determine its purpose, focus, and how it’s carried out. It can be completely tailored to your needs. The drawback is that primary research can be costly, time consuming and often requires a certain level of skill.
Secondary (or desk) research: This involves reviewing existing research which has been conducted by someone else for another purpose, but can contribute to your research needs. There are vast amounts of existing research available in the public domain, relating to every sector. You can access industry figures, trends, large-scale surveys, and opinion polls, which for most organisations would simply be impossible to resource. The drawbacks are that much of this data will be collected for reasons that may not be aligned with your research objectives, or if you operate in a highly specialist market, desk research may be difficult to come by or access free of charge. The sort of information, intelligence, or ‘data’ you need, will determine the research methods you use.
Where to find secondary research:
- Internet. By typing in a few keywords, Google will immediately return a body of knowledge – research reports, facts and figures, calculations, up to the minute findings, but also blogs, and other personal accounts of experiences and perceptions – all at your fingertips. Trawling through does require a lot of patience, and often much of what comes back is out of date. Tip: Good research reports will provide a statement of how and why the work was conducted, establishing its reliability and credibility.
- Public or university libraries. Most large libraries provide access to industry reports, magazines and journals on every business sector, which you will usually find in the reference section. They will also have licences to databases such as Mintel, Key Note, and Emerald. If you can get access to a university library, even better. Beware, it’s easy to feel overwhelmed by the vast volumes of information at your disposal, so before you start your search, make a note of what you want to find out – your research objectives – these will keep you focused. And don’t forget, the librarians are there to help you find what you’re looking for.
- Industry bodies, trade associations and networks. These organisations regularly produce reports commenting on their industry sector and members. They can provide a useful insight; be sure to understand the underlying reasons for this kind of research. Social Enterprise UK, NCVO, ACEVO, Co-ops UK, and many other sector bodies publish research that is useful in terms of understanding opportunities for civil society organisations.
Types of data
Research can be divided into two basic categories: quantitative and qualitative. Each differs by the sort of information they can obtain.
If you need numbers, figures, and statistics – e.g. 23% of people said they make a monthly donation to a charity – you need quantitative research. Quantitative research is used to count and measure things, structured surveys are commonly used to obtain quantitative data.
If you’re undertaking this type of research yourself (i.e. primary research), be aware that:
… it only works if you talk to the right number of people
… it only works if you talk to the right type of people
… it only works if you ask the right questions and analyse the data you get in the right way.
On the other hand, if you don’t need numbers but need a particular sort of understanding i.e. if you want to know not only what people do but why they do it, not what they want but why they want it – you need qualitative research. Qualitative research is used to reveal and understand attitudes, opinions, behaviours and feelings. It can be used on its own, where numbers are not required. Equally, it can be used in advance of quantitative work, to help you decide which questions to ask and how to ask them.
Qualitative research is invariably undertaken using the following methods:
- In-depth face-to-face or telephone interviews
- Focus groups (a facilitated, structured group interview)
- Questionnaires using ‘open ended’ questions (as opposed to ‘closed’ questions which ask respondents to choose from pre-defined answers)