First, it is important to establish clear goals for the market research activity you will undertake. You need to make sure you have defined what you need to know and why.
Once you have established your goals, it is important develop a strategy and select techniques you will use to gather data. The two broad types of research you can use are primary and secondary research.
Primary research is original information gathered through your own efforts (or on your behalf by a hired research firm) to respond to a specific question or set of questions. This information is normally gathered through surveys, observation, or experimentation.
The following are examples of questions that can be addressed through primary research:Who are my customers and how can I reach them?
- Customer profiles
- Prospective business locations
- Marketing strategies
What factors influence the buying decisions of my customers?
- Price, service, convenience, branding, etc.
- Customer expectations
Some drawbacks of primary research are that it can be time consuming and expensive if not performed yourself, and the results are not available immediately. Fennec Consulting offers Marketing Research and Analytics services.
The benefits of this type of research are that you can specifically target desired groups (such as your customers or the geographic market for your business) and can tailor your research instrument to answer specific questions. In addition to keeping the costs down, an added benefit of doing the research on your own is that you will get to know the market for your business better.
Surveys are the most common way to gather primary research. Surveys can be conducted:Through direct mail
- Hand out at the place of business or mail out with survey returned in person or via mail
- Questionable effectiveness; follow-up reminders necessary
- Can be difficult to reach participants
- Little appetite in the public for telephone interruptions
- Allows participants to complete the survey on their own time with little effort
- Personal interviews or focus groups
- Can introduce follow-up questions or change the focus of the survey on the spot
- Can be difficult to recruit participants
When designing your own research questionnaire, be sure to:
- Keep it as short and simple as possible
- Make sure it is visually appealing and easy to read
- Move from general questions to more specific questions
- Make sure questions are brief and easily understood
- Avoid leading questions, questions with ambiguous words, questions that are too difficult to answer (due to recall problems, etc.)
- Make sure any response scales used are logical with categories that are mutually exclusive
- Always pre-test your questionnaire to identify potential problems
The web is a good resource for sample questionnaire questions that can be adapted to answer your suit your particular research needs. There are also a number of online resources that allow you to create and conduct surveys online.
Some business owners are reluctant to ask their customers to complete a questionnaire for fear that their customers will be made to feel uncomfortable or annoyed at the inconvenience. A good way to reduce any awkwardness is to offer your customers an incentive to fill out a questionnaire. You might reward them with coupons or hold a prize drawing for customers that turn in a completed questionnaire.
Good information on your customers can often be obtained without engaging them directly. Interviewing your employees can provide excellent insight, as they are in constant contact with your customers and can provide information on:
- Customer profiles
- Goods and services that customers demand
- Satisfaction with price levels and quality of service
- Experiences with your competitors
Secondary research exploits existing resources like company records, surveys, research studies and books and applies the information to answer the question at hand. It is normally less time consuming than primary research, and can be less expensive as well.
While secondary research is less targeted than primary research, it can yield valuable information and answer some questions that are not practical to address through primary research (such as assessing macro-economic conditions) or questions that may make customers uncomfortable if asked directly (such as questions on age and income levels).
The following are examples of questions that can be addressed through secondary research:What are the current economic conditions that my business is operating in and are these conditions changing?
- International, national, provincial and local economic conditions
- Consumer preferences
- Technological shifts
- Prices for goods and services
Are there international markets for my products or services that could help me to grow my business?
What are the demographic characteristics of my customers or where do they live?
- Populations, age groups, income levels, etc.
- How many people have the skills I require?
- How much should I expect to pay my employees?
Existing company records such sales invoices, receipts and formal complaints are important secondary resources that businesses can utilize. Often times these records shed light on the same issues businesses seek to address through primary research, and therefore an examination of company records should be done before considering a customer survey or other form of primary research. Some specific examples of using existing company data in market research include:
- Examining sales receipts to find trends in the demand for particular goods and services
- Cross referencing sales receipts with customer addresses or products and services to determine the effectiveness of advertising
- Compiling complaints to determine areas for improvement in customer service, prices or products and services offered
Another key secondary resource is statistical data from official statistics providers and other organizations. These statistics in turn can feed into analytical papers and market profiles that can help to put the numbers in context.
Identifying statistics and analysis that can help you with your business decisions can be difficult, and some datasets are expensive to purchase. Fennec Consulting will help you help you through the difficult process and avoid the complications.