As aspiring business students, we understand the crucial role of market research in decision-making and business growth. Primary market research, in particular, empowers companies to gain valuable firsthand insights and information about their operating market.
In this blog post, we will explore the common methods of primary market research and delve into the key benefits and drawbacks associated with this powerful tool.
Learn more by watching the video and reading the blog post below:
Understanding Primary Market Research
Primary market research involves conducting research directly by the business itself or through external parties, such as specialised market research agencies. Its primary purpose is to collect new data and information that is not readily available, allowing businesses to identify customer needs, uncover market gaps, reduce risk, and ultimately make better-informed decisions.
Methods of Primary Market Research
There is a range of methods available to businesses when conducting primary research. These methods are tailored to provide specific and contextualised results. The most common primary market research methods include surveys and questionnaires, focus groups and interviews, observations, and test marketing.
Surveys and Questionnaires
Surveys and questionnaires are widely used tools to gather information from customers or the target market. Surveys offer a convenient and cost-effective solution, with options for online platforms like Survey Monkey, Google Forms, and Typeform. Additionally, surveys can be conducted in person, such as through interviews or focus groups. It is important to strike the right balance in survey length to ensure sufficient data collection without overwhelming participants.
For example Sky, a prominent business, uses text message surveys to gather feedback from customers about their experience with the company's customer service team. Similarly, Argos collects customer thoughts on purchases through email campaigns sent out a week after the product is bought.
Focus Groups and Interviews
Focus groups and one-to-one interviews provide businesses with in-depth information that surpasses what can be obtained from questionnaires alone. Focus groups involve a select group of people, while one-to-one interviews focus on individual participants. Both methods enable businesses to gain detailed insights and track trends in their target market's wants and needs.
These more formal research approaches often result in fewer participants but yield more thoughtful answers. Participants, whether volunteering or being paid, tend to provide in-depth feedback, allowing researchers to explore key points further.
Observations
Observing customer behavior offers genuine insights into their experiences with a business, identifying both positive and negative influences. By analysing patterns and trends, businesses can better understand customer journeys, preferences, and purchasing behaviors. Information such as store layout, promotions, and product placements can be instrumental in improving customer experiences and influencing behaviour positively. But,
It is important to note that observational research can be subjective and may not answer all questions definitively.
Test Marketing
Test marketing allows businesses to trial their products, minimise risk, and gather feedback from the target market before a full-scale launch. This approach is commonly employed in industries like food retail, where products are new to the market. Test marketing is conducted in smaller geographical areas, enabling businesses to assess the product's viability, pricing, distribution channels, and effectiveness of promotional strategies.
The benefits of test marketing include obtaining real data and insights from actual customers, reducing the risk of a nationwide launch failure, and creating hype around the product. However, test marketing can be expensive and time-consuming, and the results may not always accurately represent the entire target market.
The Power and Limitations of Primary Market Research
Primary market research offers numerous advantages for businesses, including the ability to tailor research to meet specific requirements, access relevant and up-to-date information, and design studies that combine quantitative and qualitative data. Furthermore, primary research provides a competitive edge as competitors do not have access to the collected data.
However, it is essential to recognise the potential drawbacks. Primary research can be costly, time-consuming, and subject to bias if the participants or research samples are not representative of the target market. Moreover, attracting participants to engage seriously in the research process can be a challenge, potentially compromising the accuracy of the findings.