market research definition in marketing

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What Is Market Research?

• How It Works
• Primary vs. Secondary
• How to Conduct Research

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How to Do Market Research, Types, and Example

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Market research examines consumer behavior and trends in the economy to help a business develop and fine-tune its business idea and strategy. It helps a business understand its target market by gathering and analyzing data.

Market research is the process of evaluating the viability of a new service or product through research conducted directly with potential customers. It allows a company to define its target market and get opinions and other feedback from consumers about their interest in a product or service.

Research may be conducted in-house or by a third party that specializes in market research. It can be done through surveys and focus groups, among other ways. Test subjects are usually compensated with product samples or a small stipend for their time.

Key Takeaways

• Companies conduct market research before introducing new products to determine their appeal to potential customers.
• Tools include focus groups, telephone interviews, and questionnaires.
• The results of market research inform the final design of the product and determine how it will be positioned in the marketplace.
• Market research usually combines primary information, gathered directly from consumers, and secondary information, which is data available from external sources.

Market Research

How market research works.

Market research is used to determine the viability of a new product or service. The results may be used to revise the product design and fine-tune the strategy for introducing it to the public. This can include information gathered for the purpose of determining market segmentation . It also informs product differentiation , which is used to tailor advertising.

A business engages in various tasks to complete the market research process. It gathers information based on the market sector being targeted by the product. This information is then analyzed and relevant data points are interpreted to draw conclusions about how the product may be optimally designed and marketed to the market segment for which it is intended.

It is a critical component in the research and development (R&D) phase of a new product or service introduction. Market research can be conducted in many different ways, including surveys, product testing, interviews, and focus groups.

Market research is a critical tool that companies use to understand what consumers want, develop products that those consumers will use, and maintain a competitive advantage over other companies in their industry.

Primary Market Research vs. Secondary Market Research

Market research usually consists of a combination of:

• Primary research, gathered by the company or by an outside company that it hires
• Secondary research, which draws on external sources of data

Primary Market Research

Primary research generally falls into two categories: exploratory and specific research.

• Exploratory research is less structured and functions via open-ended questions. The questions may be posed in a focus group setting, telephone interviews, or questionnaires. It results in questions or issues that the company needs to address about a product that it has under development.
• Specific research delves more deeply into the problems or issues identified in exploratory research.

Secondary Market Research

All market research is informed by the findings of other researchers about the needs and wants of consumers. Today, much of this research can be found online.

Secondary research can include population information from government census data , trade association research reports , polling results, and research from other businesses operating in the same market sector.

History of Market Research

Formal market research began in Germany during the 1920s. In the United States, it soon took off with the advent of the Golden Age of Radio.

Companies that created advertisements for this new entertainment medium began to look at the demographics of the audiences who listened to each of the radio plays, music programs, and comedy skits that were presented.

They had once tried to reach the widest possible audience by placing their messages on billboards or in the most popular magazines. With radio programming, they had the chance to target rural or urban consumers, teenagers or families, and judge the results by the sales numbers that followed.

Types of Market Research

Face-to-face interviews.

From their earliest days, market research companies would interview people on the street about the newspapers and magazines that they read regularly and ask whether they recalled any of the ads or brands that were published in them. Data collected from these interviews were compared to the circulation of the publication to determine the effectiveness of those ads.

Market research and surveys were adapted from these early techniques.

To get a strong understanding of your market, it’s essential to understand demand, market size, economic indicators, location, market saturation, and pricing.

Focus Groups

A focus group is a small number of representative consumers chosen to try a product or watch an advertisement.

Afterward, the group is asked for feedback on their perceptions of the product, the company’s brand, or competing products. The company then takes that information and makes decisions about what to do with the product or service, whether that's releasing it, making changes, or abandoning it altogether.

Phone Research

The man-on-the-street interview technique soon gave way to the telephone interview. A telephone interviewer could collect information in a more efficient and cost-effective fashion.

Telephone research was a preferred tactic of market researchers for many years. It has become much more difficult in recent years as landline phone service dwindles and is replaced by less accessible mobile phones.

Survey Research

As an alternative to focus groups, surveys represent a cost-effective way to determine consumer attitudes without having to interview anyone in person. Consumers are sent surveys in the mail, usually with a coupon or voucher to incentivize participation. These surveys help determine how consumers feel about the product, brand, and price point.

Online Market Research

With people spending more time online, market research activities have shifted online as well. Data collection still uses a survey-style form. But instead of companies actively seeking participants by finding them on the street or cold calling them on the phone, people can choose to sign up, take surveys, and offer opinions when they have time.

This makes the process far less intrusive and less rushed, since people can participate on their own time and of their own volition.

How to Conduct Market Research

The first step to effective market research is to determine the goals of the study. Each study should seek to answer a clear, well-defined problem. For example, a company might seek to identify consumer preferences, brand recognition, or the comparative effectiveness of different types of ad campaigns.

After that, the next step is to determine who will be included in the research. Market research is an expensive process, and a company cannot waste resources collecting unnecessary data. The firm should decide in advance which types of consumers will be included in the research, and how the data will be collected. They should also account for the probability of statistical errors or sampling bias .

The next step is to collect the data and analyze the results. If the two previous steps have been completed accurately, this should be straightforward. The researchers will collect the results of their study, keeping track of the ages, gender, and other relevant data of each respondent. This is then analyzed in a marketing report that explains the results of their research.

The last step is for company executives to use their market research to make business decisions. Depending on the results of their research, they may choose to target a different group of consumers, or they may change their price point or some product features.

The results of these changes may eventually be measured in further market research, and the process will begin all over again.

Benefits of Market Research

Market research is essential for developing brand loyalty and customer satisfaction. Since it is unlikely for a product to appeal equally to every consumer, a strong market research program can help identify the key demographics and market segments that are most likely to use a given product.

Market research is also important for developing a company’s advertising efforts. For example, if a company’s market research determines that its consumers are more likely to use Facebook than X (formerly Twitter), it can then target its advertisements to one platform instead of another. Or, if they determine that their target market is value-sensitive rather than price-sensitive, they can work on improving the product rather than reducing their prices.

Market research only works when subjects are honest and open to participating.

Example of Market Research

Many companies use market research to test new products or get information from consumers about what kinds of products or services they need and don’t currently have.

For example, a company that’s considering starting a business might conduct market research to test the viability of its product or service. If the market research confirms consumer interest, the business can proceed confidently with its business plan . If not, the company can use the results of the market research to make adjustments to the product to bring it in line with customer desires.

What Are the Main Types of Market Research?

The main types of market research are primary research and secondary research. Primary research includes focus groups, polls, and surveys. Secondary research includes academic articles, infographics, and white papers.

Qualitative research gives insights into how customers feel and think. Quantitative research uses data and statistics such as website views, social media engagement, and subscriber numbers.

What Is Online Market Research?

Online market research uses the same strategies and techniques as traditional primary and secondary market research, but it is conducted on the Internet. Potential customers may be asked to participate in a survey or give feedback on a product. The responses may help the researchers create a profile of the likely customer for a new product.

What Are Paid Market Research Surveys?

Paid market research involves rewarding individuals who agree to participate in a study. They may be offered a small payment for their time or a discount coupon in return for filling out a questionnaire or participating in a focus group.

What Is a Market Study?

A market study is an analysis of consumer demand for a product or service. It looks at all of the factors that influence demand for a product or service. These include the product’s price, location, competition, and substitutes as well as general economic factors that could influence the new product’s adoption, for better or worse.

Market research is a key component of a company’s research and development (R&D) stage. It helps companies understand in advance the viability of a new product that they have in development and to see how it might perform in the real world.

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How to Do Market Research: The Complete Guide

Learn how to do market research with this step-by-step guide, complete with templates, tools and real-world examples.

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Market research is the systematic process of gathering, analyzing and interpreting information about a specific market or industry.

What are your customers’ needs? How does your product compare to the competition? What are the emerging trends and opportunities in your industry? If these questions keep you up at night, it’s time to conduct market research.

Market research plays a pivotal role in your ability to stay competitive and relevant, helping you anticipate shifts in consumer behavior and industry dynamics. It involves gathering these insights using a wide range of techniques, from surveys and interviews to data analysis and observational studies.

In this guide, we’ll explore why market research is crucial, the various types of market research, the methods used in data collection, and how to effectively conduct market research to drive informed decision-making and success.

What is market research?

The purpose of market research is to offer valuable insight into the preferences and behaviors of your target audience, and anticipate shifts in market trends and the competitive landscape. This information helps you make data-driven decisions, develop effective strategies for your business, and maximize your chances of long-term growth.

Why is market research important? 

By understanding the significance of market research, you can make sure you’re asking the right questions and using the process to your advantage. Some of the benefits of market research include:

• Informed decision-making: Market research provides you with the data and insights you need to make smart decisions for your business. It helps you identify opportunities, assess risks and tailor your strategies to meet the demands of the market. Without market research, decisions are often based on assumptions or guesswork, leading to costly mistakes.
• Customer-centric approach: A cornerstone of market research involves developing a deep understanding of customer needs and preferences. This gives you valuable insights into your target audience, helping you develop products, services and marketing campaigns that resonate with your customers.
• Competitive advantage: By conducting market research, you’ll gain a competitive edge. You’ll be able to identify gaps in the market, analyze competitor strengths and weaknesses, and position your business strategically. This enables you to create unique value propositions, differentiate yourself from competitors, and seize opportunities that others may overlook.
• Risk mitigation: Market research helps you anticipate market shifts and potential challenges. By identifying threats early, you can proactively adjust their strategies to mitigate risks and respond effectively to changing circumstances. This proactive approach is particularly valuable in volatile industries.
• Resource optimization: Conducting market research allows organizations to allocate their time, money and resources more efficiently. It ensures that investments are made in areas with the highest potential return on investment, reducing wasted resources and improving overall business performance.
• Adaptation to market trends: Markets evolve rapidly, driven by technological advancements, cultural shifts and changing consumer attitudes. Market research ensures that you stay ahead of these trends and adapt your offerings accordingly so you can avoid becoming obsolete. 

As you can see, market research empowers businesses to make data-driven decisions, cater to customer needs, outperform competitors, mitigate risks, optimize resources and stay agile in a dynamic marketplace. These benefits make it a huge industry; the global market research services market is expected to grow from $76.37 billion in 2021 to $108.57 billion in 2026 . Now, let’s dig into the different types of market research that can help you achieve these benefits.

Types of market research 

• Qualitative research
• Quantitative research
• Exploratory research
• Descriptive research
• Causal research
• Cross-sectional research
• Longitudinal research

Despite its advantages, 23% of organizations don’t have a clear market research strategy. Part of developing a strategy involves choosing the right type of market research for your business goals. The most commonly used approaches include:

1. Qualitative research

Qualitative research focuses on understanding the underlying motivations, attitudes and perceptions of individuals or groups. It is typically conducted through techniques like in-depth interviews, focus groups and content analysis — methods we’ll discuss further in the sections below. Qualitative research provides rich, nuanced insights that can inform product development, marketing strategies and brand positioning.

2. Quantitative research

Quantitative research, in contrast to qualitative research, involves the collection and analysis of numerical data, often through surveys, experiments and structured questionnaires. This approach allows for statistical analysis and the measurement of trends, making it suitable for large-scale market studies and hypothesis testing. While it’s worthwhile using a mix of qualitative and quantitative research, most businesses prioritize the latter because it is scientific, measurable and easily replicated across different experiments.

3. Exploratory research

Whether you’re conducting qualitative or quantitative research or a mix of both, exploratory research is often the first step. Its primary goal is to help you understand a market or problem so you can gain insights and identify potential issues or opportunities. This type of market research is less structured and is typically conducted through open-ended interviews, focus groups or secondary data analysis. Exploratory research is valuable when entering new markets or exploring new product ideas.

4. Descriptive research

As its name implies, descriptive research seeks to describe a market, population or phenomenon in detail. It involves collecting and summarizing data to answer questions about audience demographics and behaviors, market size, and current trends. Surveys, observational studies and content analysis are common methods used in descriptive research. 

5. Causal research

Causal research aims to establish cause-and-effect relationships between variables. It investigates whether changes in one variable result in changes in another. Experimental designs, A/B testing and regression analysis are common causal research methods. This sheds light on how specific marketing strategies or product changes impact consumer behavior.

6. Cross-sectional research

Cross-sectional market research involves collecting data from a sample of the population at a single point in time. It is used to analyze differences, relationships or trends among various groups within a population. Cross-sectional studies are helpful for market segmentation, identifying target audiences and assessing market trends at a specific moment.

7. Longitudinal research

Longitudinal research, in contrast to cross-sectional research, collects data from the same subjects over an extended period. This allows for the analysis of trends, changes and developments over time. Longitudinal studies are useful for tracking long-term developments in consumer preferences, brand loyalty and market dynamics.

Each type of market research has its strengths and weaknesses, and the method you choose depends on your specific research goals and the depth of understanding you’re aiming to achieve. In the following sections, we’ll delve into primary and secondary research approaches and specific research methods.

Primary vs. secondary market research

Market research of all types can be broadly categorized into two main approaches: primary research and secondary research. By understanding the differences between these approaches, you can better determine the most appropriate research method for your specific goals.

Primary market research 

Primary research involves the collection of original data straight from the source. Typically, this involves communicating directly with your target audience — through surveys, interviews, focus groups and more — to gather information. Here are some key attributes of primary market research:

• Customized data: Primary research provides data that is tailored to your research needs. You design a custom research study and gather information specific to your goals.
• Up-to-date insights: Because primary research involves communicating with customers, the data you collect reflects the most current market conditions and consumer behaviors.
• Time-consuming and resource-intensive: Despite its advantages, primary research can be labor-intensive and costly, especially when dealing with large sample sizes or complex study designs. Whether you hire a market research consultant, agency or use an in-house team, primary research studies consume a large amount of resources and time.

Secondary market research 

Secondary research, on the other hand, involves analyzing data that has already been compiled by third-party sources, such as online research tools, databases, news sites, industry reports and academic studies.

Here are the main characteristics of secondary market research:

• Cost-effective: Secondary research is generally more cost-effective than primary research since it doesn’t require building a research plan from scratch. You and your team can look at databases, websites and publications on an ongoing basis, without needing to design a custom experiment or hire a consultant. 
• Leverages multiple sources: Data tools and software extract data from multiple places across the web, and then consolidate that information within a single platform. This means you’ll get a greater amount of data and a wider scope from secondary research.
• Quick to access: You can access a wide range of information rapidly — often in seconds — if you’re using online research tools and databases. Because of this, you can act on insights sooner, rather than taking the time to develop an experiment. 

So, when should you use primary vs. secondary research? In practice, many market research projects incorporate both primary and secondary research to take advantage of the strengths of each approach.

One rule of thumb is to focus on secondary research to obtain background information, market trends or industry benchmarks. It is especially valuable for conducting preliminary research, competitor analysis, or when time and budget constraints are tight. Then, if you still have knowledge gaps or need to answer specific questions unique to your business model, use primary research to create a custom experiment. 

Market research methods

• Surveys and questionnaires
• Focus groups
• Observational research
• Online research tools
• Experiments
• Content analysis
• Ethnographic research

How do primary and secondary research approaches translate into specific research methods? Let’s take a look at the different ways you can gather data: 

1. Surveys and questionnaires

Surveys and questionnaires are popular methods for collecting structured data from a large number of respondents. They involve a set of predetermined questions that participants answer. Surveys can be conducted through various channels, including online tools, telephone interviews and in-person or online questionnaires. They are useful for gathering quantitative data and assessing customer demographics, opinions, preferences and needs. On average, customer surveys have a 33% response rate , so keep that in mind as you consider your sample size.

2. Interviews

Interviews are in-depth conversations with individuals or groups to gather qualitative insights. They can be structured (with predefined questions) or unstructured (with open-ended discussions). Interviews are valuable for exploring complex topics, uncovering motivations and obtaining detailed feedback. 

3. Focus groups

The most common primary research methods are in-depth webcam interviews and focus groups. Focus groups are a small gathering of participants who discuss a specific topic or product under the guidance of a moderator. These discussions are valuable for primary market research because they reveal insights into consumer attitudes, perceptions and emotions. Focus groups are especially useful for idea generation, concept testing and understanding group dynamics within your target audience.

4. Observational research

Observational research involves observing and recording participant behavior in a natural setting. This method is particularly valuable when studying consumer behavior in physical spaces, such as retail stores or public places. In some types of observational research, participants are aware you’re watching them; in other cases, you discreetly watch consumers without their knowledge, as they use your product. Either way, observational research provides firsthand insights into how people interact with products or environments.

5. Online research tools

You and your team can do your own secondary market research using online tools. These tools include data prospecting platforms and databases, as well as online surveys, social media listening, web analytics and sentiment analysis platforms. They help you gather data from online sources, monitor industry trends, track competitors, understand consumer preferences and keep tabs on online behavior. We’ll talk more about choosing the right market research tools in the sections that follow.

6. Experiments

Market research experiments are controlled tests of variables to determine causal relationships. While experiments are often associated with scientific research, they are also used in market research to assess the impact of specific marketing strategies, product features, or pricing and packaging changes.

7. Content analysis

Content analysis involves the systematic examination of textual, visual or audio content to identify patterns, themes and trends. It’s commonly applied to customer reviews, social media posts and other forms of online content to analyze consumer opinions and sentiments.

8. Ethnographic research

Ethnographic research immerses researchers into the daily lives of consumers to understand their behavior and culture. This method is particularly valuable when studying niche markets or exploring the cultural context of consumer choices.

How to do market research

• Set clear objectives
• Identify your target audience
• Choose your research methods
• Use the right market research tools
• Collect data
• Analyze data 
• Interpret your findings
• Identify opportunities and challenges
• Make informed business decisions
• Monitor and adapt

Now that you have gained insights into the various market research methods at your disposal, let’s delve into the practical aspects of how to conduct market research effectively. Here’s a quick step-by-step overview, from defining objectives to monitoring market shifts.

1. Set clear objectives

When you set clear and specific goals, you’re essentially creating a compass to guide your research questions and methodology. Start by precisely defining what you want to achieve. Are you launching a new product and want to understand its viability in the market? Are you evaluating customer satisfaction with a product redesign? 

Start by creating SMART goals — objectives that are specific, measurable, achievable, relevant and time-bound. Not only will this clarify your research focus from the outset, but it will also help you track progress and benchmark your success throughout the process. 

You should also consult with key stakeholders and team members to ensure alignment on your research objectives before diving into data collecting. This will help you gain diverse perspectives and insights that will shape your research approach.

2. Identify your target audience

Next, you’ll need to pinpoint your target audience to determine who should be included in your research. Begin by creating detailed buyer personas or stakeholder profiles. Consider demographic factors like age, gender, income and location, but also delve into psychographics, such as interests, values and pain points.

The more specific your target audience, the more accurate and actionable your research will be. Additionally, segment your audience if your research objectives involve studying different groups, such as current customers and potential leads.

If you already have existing customers, you can also hold conversations with them to better understand your target market. From there, you can refine your buyer personas and tailor your research methods accordingly.

3. Choose your research methods

Selecting the right research methods is crucial for gathering high-quality data. Start by considering the nature of your research objectives. If you’re exploring consumer preferences, surveys and interviews can provide valuable insights. For in-depth understanding, focus groups or observational research might be suitable. Consider using a mix of quantitative and qualitative methods to gain a well-rounded perspective. 

You’ll also need to consider your budget. Think about what you can realistically achieve using the time and resources available to you. If you have a fairly generous budget, you may want to try a mix of primary and secondary research approaches. If you’re doing market research for a startup , on the other hand, chances are your budget is somewhat limited. If that’s the case, try addressing your goals with secondary research tools before investing time and effort in a primary research study. 

4. Use the right market research tools

Whether you’re conducting primary or secondary research, you’ll need to choose the right tools. These can help you do anything from sending surveys to customers to monitoring trends and analyzing data. Here are some examples of popular market research tools:

• Market research software: Crunchbase is a platform that provides best-in-class company data, making it valuable for market research on growing companies and industries. You can use Crunchbase to access trusted, first-party funding data, revenue data, news and firmographics, enabling you to monitor industry trends and understand customer needs.

• Survey and questionnaire tools: SurveyMonkey is a widely used online survey platform that allows you to create, distribute and analyze surveys. Google Forms is a free tool that lets you create surveys and collect responses through Google Drive.
• Data analysis software: Microsoft Excel and Google Sheets are useful for conducting statistical analyses. SPSS is a powerful statistical analysis software used for data processing, analysis and reporting.
• Social listening tools: Brandwatch is a social listening and analytics platform that helps you monitor social media conversations, track sentiment and analyze trends. Mention is a media monitoring tool that allows you to track mentions of your brand, competitors and keywords across various online sources.
• Data visualization platforms: Tableau is a data visualization tool that helps you create interactive and shareable dashboards and reports. Power BI by Microsoft is a business analytics tool for creating interactive visualizations and reports.

5. Collect data

There’s an infinite amount of data you could be collecting using these tools, so you’ll need to be intentional about going after the data that aligns with your research goals. Implement your chosen research methods, whether it’s distributing surveys, conducting interviews or pulling from secondary research platforms. Pay close attention to data quality and accuracy, and stick to a standardized process to streamline data capture and reduce errors. 

6. Analyze data

Once data is collected, you’ll need to analyze it systematically. Use statistical software or analysis tools to identify patterns, trends and correlations. For qualitative data, employ thematic analysis to extract common themes and insights. Visualize your findings with charts, graphs and tables to make complex data more understandable.

If you’re not proficient in data analysis, consider outsourcing or collaborating with a data analyst who can assist in processing and interpreting your data accurately.

7. Interpret your findings

Interpreting your market research findings involves understanding what the data means in the context of your objectives. Are there significant trends that uncover the answers to your initial research questions? Consider the implications of your findings on your business strategy. It’s essential to move beyond raw data and extract actionable insights that inform decision-making.

Hold a cross-functional meeting or workshop with relevant team members to collectively interpret the findings. Different perspectives can lead to more comprehensive insights and innovative solutions.

8. Identify opportunities and challenges

Use your research findings to identify potential growth opportunities and challenges within your market. What segments of your audience are underserved or overlooked? Are there emerging trends you can capitalize on? Conversely, what obstacles or competitors could hinder your progress?

Lay out this information in a clear and organized way by conducting a SWOT analysis, which stands for strengths, weaknesses, opportunities and threats. Jot down notes for each of these areas to provide a structured overview of gaps and hurdles in the market.

9. Make informed business decisions

Market research is only valuable if it leads to informed decisions for your company. Based on your insights, devise actionable strategies and initiatives that align with your research objectives. Whether it’s refining your product, targeting new customer segments or adjusting pricing, ensure your decisions are rooted in the data.

At this point, it’s also crucial to keep your team aligned and accountable. Create an action plan that outlines specific steps, responsibilities and timelines for implementing the recommendations derived from your research. 

10. Monitor and adapt

Market research isn’t a one-time activity; it’s an ongoing process. Continuously monitor market conditions, customer behaviors and industry trends. Set up mechanisms to collect real-time data and feedback. As you gather new information, be prepared to adapt your strategies and tactics accordingly. Regularly revisiting your research ensures your business remains agile and reflects changing market dynamics and consumer preferences.

Online market research sources

As you go through the steps above, you’ll want to turn to trusted, reputable sources to gather your data. Here’s a list to get you started:

• Crunchbase: As mentioned above, Crunchbase is an online platform with an extensive dataset, allowing you to access in-depth insights on market trends, consumer behavior and competitive analysis. You can also customize your search options to tailor your research to specific industries, geographic regions or customer personas.

• Academic databases: Academic databases, such as ProQuest and JSTOR , are treasure troves of scholarly research papers, studies and academic journals. They offer in-depth analyses of various subjects, including market trends, consumer preferences and industry-specific insights. Researchers can access a wealth of peer-reviewed publications to gain a deeper understanding of their research topics.
• Government and NGO databases: Government agencies, nongovernmental organizations and other institutions frequently maintain databases containing valuable economic, demographic and industry-related data. These sources offer credible statistics and reports on a wide range of topics, making them essential for market researchers. Examples include the U.S. Census Bureau , the Bureau of Labor Statistics and the Pew Research Center .
• Industry reports: Industry reports and market studies are comprehensive documents prepared by research firms, industry associations and consulting companies. They provide in-depth insights into specific markets, including market size, trends, competitive analysis and consumer behavior. You can find this information by looking at relevant industry association databases; examples include the American Marketing Association and the National Retail Federation .
• Social media and online communities: Social media platforms like LinkedIn or Twitter (X) , forums such as Reddit and Quora , and review platforms such as G2 can provide real-time insights into consumer sentiment, opinions and trends. 

Market research examples

At this point, you have market research tools and data sources — but how do you act on the data you gather? Let’s go over some real-world examples that illustrate the practical application of market research across various industries. These examples showcase how market research can lead to smart decision-making and successful business decisions.

Example 1: Apple’s iPhone launch

Apple ’s iconic iPhone launch in 2007 serves as a prime example of market research driving product innovation in tech. Before the iPhone’s release, Apple conducted extensive market research to understand consumer preferences, pain points and unmet needs in the mobile phone industry. This research led to the development of a touchscreen smartphone with a user-friendly interface, addressing consumer demands for a more intuitive and versatile device. The result was a revolutionary product that disrupted the market and redefined the smartphone industry.

Example 2: McDonald’s global expansion

McDonald’s successful global expansion strategy demonstrates the importance of market research when expanding into new territories. Before entering a new market, McDonald’s conducts thorough research to understand local tastes, preferences and cultural nuances. This research informs menu customization, marketing strategies and store design. For instance, in India, McDonald’s offers a menu tailored to local preferences, including vegetarian options. This market-specific approach has enabled McDonald’s to adapt and thrive in diverse global markets.

Example 3: Organic and sustainable farming

The shift toward organic and sustainable farming practices in the food industry is driven by market research that indicates increased consumer demand for healthier and environmentally friendly food options. As a result, food producers and retailers invest in sustainable sourcing and organic product lines — such as with these sustainable seafood startups — to align with this shift in consumer values. 

The bottom line? Market research has multiple use cases and is a critical practice for any industry. Whether it’s launching groundbreaking products, entering new markets or responding to changing consumer preferences, you can use market research to shape successful strategies and outcomes.

Market research templates

You finally have a strong understanding of how to do market research and apply it in the real world. Before we wrap up, here are some market research templates that you can use as a starting point for your projects:

• Smartsheet competitive analysis templates : These spreadsheets can serve as a framework for gathering information about the competitive landscape and obtaining valuable lessons to apply to your business strategy.
• SurveyMonkey product survey template : Customize the questions on this survey based on what you want to learn from your target customers.
• HubSpot templates : HubSpot offers a wide range of free templates you can use for market research, business planning and more.
• SCORE templates : SCORE is a nonprofit organization that provides templates for business plans, market analysis and financial projections.
• SBA.gov : The U.S. Small Business Administration offers templates for every aspect of your business, including market research, and is particularly valuable for new startups. 

Strengthen your business with market research

When conducted effectively, market research is like a guiding star. Equipped with the right tools and techniques, you can uncover valuable insights, stay competitive, foster innovation and navigate the complexities of your industry.

Throughout this guide, we’ve discussed the definition of market research, different research methods, and how to conduct it effectively. We’ve also explored various types of market research and shared practical insights and templates for getting started. 

Now, it’s time to start the research process. Trust in data, listen to the market and make informed decisions that guide your company toward lasting success.

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How to Do Market Research for a Startup: Tips for Success

Jaclyn Robinson, Senior Manager of Content Marketing at Crunchbase

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How To Do Market Research: Definition, Types, Methods

Jul 25, 2024

11 min. read

Market research isn’t just collecting data. It’s a strategic tool that allows businesses to gain a competitive advantage while making the best use of their resources. Research reveals valuable insights into your target audience about their preferences, buying habits, and emerging demands — all of which help you unlock new opportunities to grow your business.

When done correctly, market research can minimize risks and losses, spur growth, and position you as a leader in your industry. 

Let’s explore the basic building blocks of market research and how to collect and use data to move your company forward:

Table of Contents

What Is Market Research?

Why is market research important, market analysis example, 5 types of market research, what are common market research questions, what are the limitations of market research, how to do market research, improving your market research with radarly.

Market Research Definition: The process of gathering, analyzing, and interpreting information about a market or audience.

Market research studies consumer behavior to better understand how they perceive products or services. These insights help businesses identify ways to grow their current offering, create new products or services, and improve brand trust and brand recognition .

You might also hear market research referred to as market analysis or consumer research .

Traditionally, market research has taken the form of focus groups, surveys, interviews, and even competitor analysis . But with modern analytics and research tools, businesses can now capture deeper insights from a wider variety of sources, including social media, online reviews, and customer interactions. These extra layers of intel can help companies gain a more comprehensive understanding of their audience.

With consumer preferences and markets evolving at breakneck speeds, businesses need a way to stay in touch with what people need and want. That’s why the importance of market research cannot be overstated.

Market research offers a proactive way to identify these trends and make adjustments to product development, marketing strategies , and overall operations. This proactive approach can help businesses stay ahead of the curve and remain agile as markets shift.

Market research examples abound — given the number of ways companies can get inside the minds of their customers, simply skimming through your business’s social media comments can be a form of market research.

A restaurant chain might use market research methods to learn more about consumers’ evolving dining habits. These insights might be used to offer new menu items, re-examine their pricing strategies, or even open new locations in different markets, for example.

A consumer electronics company might use market research for similar purposes. For instance, market research may reveal how consumers are using their smart devices so they can develop innovative features.

Market research can be applied to a wide range of use cases, including:

• Testing new product ideas
• Improve existing products
• Entering new markets
• Right-sizing their physical footprints
• Improving brand image and awareness
• Gaining insights into competitors via competitive intelligence

Ultimately, companies can lean on market research techniques to stay ahead of trends and competitors while improving the lives of their customers.

Market research methods take different forms, and you don’t have to limit yourself to just one. Let’s review the most common market research techniques and the insights they deliver.

1. Interviews

3. Focus Groups

4. Observations

5. AI-Driven Market Research

One-on-one interviews are one of the most common market research techniques. Beyond asking direct questions, skilled interviewers can uncover deeper motivations and emotions that drive purchasing decisions. Researchers can elicit more detailed and nuanced responses they might not receive via other methods, such as self-guided surveys.

Interviews also create the opportunity to build rapport with customers and prospects. Establishing a connection with interviewees can encourage them to open up and share their candid thoughts, which can enrich your findings. Researchers also have the opportunity to ask clarifying questions and dig deeper based on individual responses.

Market research surveys provide an easy entry into the consumer psyche. They’re cost-effective to produce and allow researchers to reach lots of people in a short time. They’re also user-friendly for consumers, which allows companies to capture more responses from more people.

Big data and data analytics are making traditional surveys more valuable. Researchers can apply these tools to elicit a deeper understanding from responses and uncover hidden patterns and correlations within survey data that were previously undetectable.

The ways in which surveys are conducted are also changing. With the rise of social media and other online channels, brands and consumers alike have more ways to engage with each other, lending to a continuous approach to market research surveys.

3. Focus groups

Focus groups are “group interviews” designed to gain collective insights. This interactive setting allows participants to express their thoughts and feelings openly, giving researchers richer insights beyond yes-or-no responses.

One of the key benefits of using focus groups is the opportunity for participants to interact with one another. They spark discussions while sharing diverse viewpoints. These sessions can uncover underlying motivations and attitudes that may not be easily expressed through other research methods.

Observing your customers “in the wild” might feel informal, but it can be one of the most revealing market research techniques of all. That’s because you might not always know the right questions to ask. By simply observing, you can surface insights you might not have known to look for otherwise.

This method also delivers raw, authentic, unfiltered data. There’s no room for bias and no potential for participants to accidentally skew the data. Researchers can also pick up on non-verbal cues and gestures that other research methods may fail to capture.

5. AI-driven market research

One of the newer methods of market research is the use of AI-driven market research tools to collect and analyze insights on your behalf. AI customer intelligence tools and consumer insights software like Meltwater Radarly take an always-on approach by going wherever your audience is and continuously predicting behaviors based on current behaviors.

By leveraging advanced algorithms, machine learning, and big data analysis , AI enables companies to uncover deep-seated patterns and correlations within large datasets that would be near impossible for human researchers to identify. This not only leads to more accurate and reliable findings but also allows businesses to make informed decisions with greater confidence.

Tip: Learn how to use Meltwater as a research tool , how Meltwater uses AI , and learn more about consumer insights and about consumer insights in the fashion industry .

No matter the market research methods you use, market research’s effectiveness lies in the questions you ask. These questions should be designed to elicit honest responses that will help you reach your goals.

Examples of common market research questions include:

Demographic market research questions

• What is your age range?
• What is your occupation?
• What is your household income level?
• What is your educational background?
• What is your gender?

Product or service usage market research questions

• How long have you been using [product/service]?
• How frequently do you use [product/service]?
• What do you like most about [product/service]?
• Have you experienced any problems using [product/service]?
• How could we improve [product/service]?
• Why did you choose [product/service] over a competitor’s [product/service]?

Brand perception market research questions

• How familiar are you with our brand?
• What words do you associate with our brand?
• How do you feel about our brand?
• What makes you trust our brand?
• What sets our brand apart from competitors?
• What would make you recommend our brand to others?

Buying behavior market research questions

• What do you look for in a [product/service]?
• What features in a [product/service] are important to you?
• How much time do you need to choose a [product/service]?
• How do you discover new products like [product/service]?
• Do you prefer to purchase [product/service] online or in-store?
• How do you research [product/service] before making a purchase?
• How often do you buy [product/service]?
• How important is pricing when buying [product/service]?
• What would make you switch to another brand of [product/service]?

Customer satisfaction market research questions

• How happy have you been with [product/service]?
• What would make you more satisfied with [product/service]?
• How likely are you to continue using [product/service]?

Bonus Tip: Compiling these questions into a market research template can streamline your efforts.

Market research can offer powerful insights, but it also has some limitations. One key limitation is the potential for bias. Researchers may unconsciously skew results based on their own preconceptions or desires, which can make your findings inaccurate.

• Depending on your market research methods, your findings may be outdated by the time you sit down to analyze and act on them. Some methods struggle to account for rapidly changing consumer preferences and behaviors.
• There’s also the risk of self-reported data (common in online surveys). Consumers might not always accurately convey their true feelings or intentions. They might provide answers they think researchers are looking for or misunderstand the question altogether.
• There’s also the potential to miss emerging or untapped markets . Researchers are digging deeper into what (or who) they already know. This means you might be leaving out a key part of the story without realizing it.

Still, the benefits of market research cannot be understated, especially when you supplement traditional market research methods with modern tools and technology.

Let’s put it all together and explore how to do market research step-by-step to help you leverage all its benefits.

Step 1: Define your objectives

You’ll get more from your market research when you hone in on a specific goal : What do you want to know, and how will this knowledge help your business?

This step will also help you define your target audience. You’ll need to ask the right people the right questions to collect the information you want. Understand the characteristics of the audience and what gives them authority to answer your questions.

Step 2: Select your market research methods

Choose one or more of the market research methods (interviews, surveys, focus groups, observations, and/or AI-driven tools) to fuel your research strategy.

Certain methods might work better than others for specific goals . For example, if you want basic feedback from customers about a product, a simple survey might suffice. If you want to hone in on serious pain points to develop a new product, a focus group or interview might work best.

You can also source secondary research ( complementary research ) via secondary research companies , such as industry reports or analyses from large market research firms. These can help you gather preliminary information and inform your approach.

Step 3: Develop your research tools

Prior to working with participants, you’ll need to craft your survey or interview questions, interview guides, and other tools. These tools will help you capture the right information , weed out non-qualifying participants, and keep your information organized.

You should also have a system for recording responses to ensure data accuracy and privacy. Test your processes before speaking with participants so you can spot and fix inefficiencies or errors.

Step 4: Conduct the market research

With a system in place, you can start looking for candidates to contribute to your market research. This might include distributing surveys to current customers or recruiting participants who fit a specific profile, for example.

Set a time frame for conducting your research. You might collect responses over the course of a few days, weeks, or even months. If you’re using AI tools to gather data, choose a data range for your data to focus on the most relevant information.

Step 5: Analyze and apply your findings

Review your findings while looking for trends and patterns. AI tools can come in handy in this phase by analyzing large amounts of data on your behalf.

Compile your findings into an easy-to-read report and highlight key takeaways and next steps. Reports aren’t useful unless the reader can understand and act on them.

Tip: Learn more about trend forecasting , trend detection , and trendspotting .

Meltwater’s Radarly consumer intelligence suite helps you reap the benefits of market research on an ongoing basis. Using a combination of AI, data science, and market research expertise, Radarly scans multiple global data sources to learn what people are talking about, the actions they’re taking, and how they’re feeling about specific brands.

Our tools are created by market research experts and designed to help researchers uncover what they want to know (and what they don’t know they want to know). Get data-driven insights at scale with information that’s always relevant, always accurate, and always tailored to your organization’s needs.

Learn more when you request a demo by filling out the form below:

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Market research is a cornerstone of all successful, strategic businesses. It can also be daunting for entrepreneurs looking to launch a startup or start a side hustle . What is market research, anyway? And how do you…do it?

We’ll walk you through absolutely everything you need to know about the market research process so that by the end of this guide, you’ll be an expert in market research too. And what’s more important: you’ll have actionable steps you can take to start collecting your own market research.

What Is Market Research?

Market research is the organized process of gathering information about your target customers and market. Market research can help you better understand customer behavior and competitor strengths and weaknesses, as well as provide insight for the best strategies in launching new businesses and products. There are different ways to approach market research, including primary and secondary research and qualitative and quantitative research. The strongest approaches will include a combination of all four.

“Virtually every business can benefit from conducting some market research,” says Niles Koenigsberg of Real FiG Advertising + Marketing . “Market research can help you piece together your [business’s] strengths and weaknesses, along with your prospective opportunities, so that you can understand where your unique differentiators may lie.” Well-honed market research will help your brand stand out from the competition and help you see what you need to do to lead the market. It can also do so much more.

The Purposes of Market Research

Why do market research? It can help you…

• Pinpoint your target market, create buyer personas, and develop a more holistic understanding of your customer base and market.
• Understand current market conditions to evaluate risks and anticipate how your product or service will perform.
• Validate a concept prior to launch.
• Identify gaps in the market that your competitors have created or overlooked.
• Solve problems that have been left unresolved by the existing product/brand offerings.
• Identify opportunities and solutions for new products or services.
• Develop killer marketing strategies .

What Are the Benefits of Market Research?

Strong market research can help your business in many ways. It can…

• Strengthen your market position.
• Help you identify your strengths and weaknesses.
• Help you identify your competitors’ strengths and weaknesses.
• Minimize risk.
• Center your customers’ experience from the get-go.
• Help you create a dynamic strategy based on market conditions and customer needs/demands.

What Are the Basic Methods of Market Research?

The basic methods of market research include surveys, personal interviews, customer observation, and the review of secondary research. In addition to these basic methods, a forward-thinking market research approach incorporates data from the digital landscape like social media analysis, SEO research, gathering feedback via forums, and more. Throughout this guide, we will cover each of the methods commonly used in market research to give you a comprehensive overview.

Primary vs. Secondary Market Research

Primary and secondary are the two main types of market research you can do. The latter relies on research conducted by others. Primary research, on the other hand, refers to the fact-finding efforts you conduct on your own.

This approach is limited, however. It’s likely that the research objectives of these secondary data points differ from your own, and it can be difficult to confirm the veracity of their findings.

Primary Market Research

Primary research is more labor intensive, but it generally yields data that is exponentially more actionable. It can be conducted through interviews, surveys, online research, and your own data collection. Every new business should engage in primary market research prior to launch. It will help you validate that your idea has traction, and it will give you the information you need to help minimize financial risk.

You can hire an agency to conduct this research on your behalf. This brings the benefit of expertise, as you’ll likely work with a market research analyst. The downside is that hiring an agency can be expensive—too expensive for many burgeoning entrepreneurs. That brings us to the second approach. You can also do the market research yourself, which substantially reduces the financial burden of starting a new business .

Secondary Market Research

Secondary research includes resources like government databases and industry-specific data and publications. It can be beneficial to start your market research with secondary sources because it’s widely available and often free-to-access. This information will help you gain a broad overview of the market conditions for your new business.

Identify Your Goals and Your Audience

Before you begin conducting interviews or sending out surveys, you need to set your market research goals. At the end of your market research process, you want to have a clear idea of who your target market is—including demographic information like age, gender, and where they live—but you also want to start with a rough idea of who your audience might be and what you’re trying to achieve with market research.

You can pinpoint your objectives by asking yourself a series of guiding questions:

• What are you hoping to discover through your research?
• Who are you hoping to serve better because of your findings?
• What do you think your market is?
• Who are your competitors?
• Are you testing the reception of a new product category or do you want to see if your product or service solves the problem left by a current gap in the market?
• Are you just…testing the waters to get a sense of how people would react to a new brand?

Once you’ve narrowed down the “what” of your market research goals, you’re ready to move onto how you can best achieve them. Think of it like algebra. Many math problems start with “solve for x.” Once you know what you’re looking for, you can get to work trying to find it. It’s a heck of a lot easier to solve a problem when you know you’re looking for “x” than if you were to say “I’m gonna throw some numbers out there and see if I find a variable.”

How to Do Market Research

This guide outlines every component of a comprehensive market research effort. Take into consideration the goals you have established for your market research, as they will influence which of these elements you’ll want to include in your market research strategy.

Secondary Data

Secondary data allows you to utilize pre-existing data to garner a sense of market conditions and opportunities. You can rely on published market studies, white papers, and public competitive information to start your market research journey.

Secondary data, while useful, is limited and cannot substitute your own primary data. It’s best used for quantitative data that can provide background to your more specific inquiries.

Find Your Customers Online

Once you’ve identified your target market, you can use online gathering spaces and forums to gain insights and give yourself a competitive advantage. Rebecca McCusker of The Creative Content Shop recommends internet recon as a vital tool for gaining a sense of customer needs and sentiment. “Read their posts and comments on forums, YouTube video comments, Facebook group [comments], and even Amazon/Goodreads book comments to get in their heads and see what people are saying.”

If you’re interested in engaging with your target demographic online, there are some general rules you should follow. First, secure the consent of any group moderators to ensure that you are acting within the group guidelines. Failure to do so could result in your eviction from the group.

Not all comments have the same research value. “Focus on the comments and posts with the most comments and highest engagement,” says McCusker. These high-engagement posts can give you a sense of what is already connecting and gaining traction within the group.

Social media can also be a great avenue for finding interview subjects. “LinkedIn is very useful if your [target customer] has a very specific job or works in a very specific industry or sector. It’s amazing the amount of people that will be willing to help,” explains Miguel González, a marketing executive at Dealers League . “My advice here is BE BRAVE, go to LinkedIn, or even to people you know and ask them, do quick interviews and ask real people that belong to that market and segment and get your buyer persona information first hand.”

Market research interviews can provide direct feedback on your brand, product, or service and give you a better understanding of consumer pain points and interests.

When organizing your market research interviews, you want to pay special attention to the sample group you’re selecting, as it will directly impact the information you receive. According to Tanya Zhang, the co-founder of Nimble Made , you want to first determine whether you want to choose a representative sample—for example, interviewing people who match each of the buyer persona/customer profiles you’ve developed—or a random sample.

“A sampling of your usual persona styles, for example, can validate details that you’ve already established about your product, while a random sampling may [help you] discover a new way people may use your product,” Zhang says.

Market Surveys

Market surveys solicit customer inclinations regarding your potential product or service through a series of open-ended questions. This direct outreach to your target audience can provide information on your customers’ preferences, attitudes, buying potential, and more.

Every expert we asked voiced unanimous support for market surveys as a powerful tool for market research. With the advent of various survey tools with accessible pricing—or free use—it’s never been easier to assemble, disseminate, and gather market surveys. While it should also be noted that surveys shouldn’t replace customer interviews , they can be used to supplement customer interviews to give you feedback from a broader audience.

Who to Include in Market Surveys

• Current customers
• Past customers
• Your existing audience (such as social media/newsletter audiences)

Example Questions to Include in Market Surveys

While the exact questions will vary for each business, here are some common, helpful questions that you may want to consider for your market survey. Demographic Questions: the questions that help you understand, demographically, who your target customers are:

• “What is your age?”
• “Where do you live?”
• “What is your gender identity?”
• “What is your household income?”
• “What is your household size?”
• “What do you do for a living?”
• “What is your highest level of education?”

Product-Based Questions: Whether you’re seeking feedback for an existing brand or an entirely new one, these questions will help you get a sense of how people feel about your business, product, or service:

• “How well does/would our product/service meet your needs?”
• “How does our product/service compare to similar products/services that you use?”
• “How long have you been a customer?” or “What is the likelihood that you would be a customer of our brand?

Personal/Informative Questions: the deeper questions that help you understand how your audience thinks and what they care about.

• “What are your biggest challenges?”
• “What’s most important to you?”
• “What do you do for fun (hobbies, interests, activities)?”
• “Where do you seek new information when researching a new product?”
• “How do you like to make purchases?”
• “What is your preferred method for interacting with a brand?”

Survey Tools

Online survey tools make it easy to distribute surveys and collect responses. The best part is that there are many free tools available. If you’re making your own online survey, you may want to consider SurveyMonkey, Typeform, Google Forms, or Zoho Survey.

Competitive Analysis

A competitive analysis is a breakdown of how your business stacks up against the competition. There are many different ways to conduct this analysis. One of the most popular methods is a SWOT analysis, which stands for “strengths, weaknesses, opportunities, and threats.” This type of analysis is helpful because it gives you a more robust understanding of why a customer might choose a competitor over your business. Seeing how you stack up against the competition can give you the direction you need to carve out your place as a market leader.

Social Media Analysis

Social media has fundamentally changed the market research landscape, making it easier than ever to engage with a wide swath of consumers. Follow your current or potential competitors on social media to see what they’re posting and how their audience is engaging with it. Social media can also give you a lower cost opportunity for testing different messaging and brand positioning.

SEO Analysis and Opportunities

SEO analysis can help you identify the digital competition for getting the word out about your brand, product, or service. You won’t want to overlook this valuable information. Search listening tools offer a novel approach to understanding the market and generating the content strategy that will drive business. Tools like Google Trends and Awario can streamline this process.

Ready to Kick Your Business Into High Gear?

Now that you’ve completed the guide to market research you know you’re ready to put on your researcher hat to give your business the best start. Still not sure how actually… launch the thing? Our free mini-course can run you through the essentials for starting your side hustle .

About Mary Kate Miller

Mary Kate Miller writes about small business, real estate, and finance. In addition to writing for Foundr, her work has been published by The Washington Post, Teen Vogue, Bustle, and more. She lives in Chicago.

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A Plain-English Guide to Market Research

Published: January 21, 2021

In some circles, market research is a catch-all term for asking the industry what it wants. "Do we know what the demand is for this product? Who's even looking for our services? Let me do some market research to find out," someone might say.

But what does that actually mean?

Here's a simple definition of market research that encompasses all the possible goals of this practice, in fewer than 100 words:

Market Research Definition

Market research is the process of examining an industry's buyers, the product these buyers want, and where they're currently getting it. By engaging the right people and data, a business can use this research to position itself in the market and predict where the market will go in the future.

Market research can answer various questions about the state of an industry, but it's hardly a crystal ball that marketers can rely on for insights on their customers. Market researchers investigate several areas of the market, and it can take weeks or even months to paint an accurate picture of the business landscape.

However, researching just one of those areas can make you more intuitive to who your buyers are and how to deliver value that no other business is offering them right now.

Certainly you can make sound judgment calls based on your experience in the industry and your existing customers. However, keep in mind that market research offers benefits beyond those strategies. There are two things to consider: 

• Your competitors also have experienced individuals in the industry and a customer base. It's very possible that your immediate resources are, in many ways, equal to those of your competition's immediate resources. Seeking a larger sample size for answers can provide a better edge. 
• Your customers don't represent the attitudes of an entire market. They represent the attitudes of the part of the market that is already drawn to your brand. 

Why is market research important?

Market research allows you to get information from a larger sample size of your target audience, eliminating bias and assumptions so that you can get to the heart of consumer attitudes. As a result, you can make better business decisions from knowing the bigger picture.

Here are some examples of insights you can gain from market research:

• Consumer attitudes about a particular topic, pain, product, or brand
• Whether there's demand for the business initiatives you're investing in
• Where to advertise or sell to (geographically or online)
• Unaddressed or underserved customer needs that can be flipped into selling opportunity
• Attitudes about pricing for a particular product or service

Getting answers to these questions based on real data can help you make sound business decisions and minimize risk.

Types of Market Research

To give you an idea of how extensive market research can get, consider that it can either be qualitative or quantitative in nature -- depending on the studies you conduct and what you're trying to learn about your industry. Qualitative research is concerned with public opinion, and explores how the market feels about the products currently available in that market. Quantitative research is concerned with data, and looks for relevant trends in the information that's gathered from public records.

Let's talk about four different types of market research studies you can conduct , a potential goal of each one, and how these studies help you better understand your market.

Qualitative information

Interviews are the personal, one-on-one conversations you can have with the buyers in your industry. You can conduct interviews in person or over the phone.

Your interviewees can answer questions about themselves to help you design your buyer personas. These buyer personas describe your ideal customer's age, family size, budget, job title, the challenges they face at work, and similar aspects of their lifestyle. Having this buyer profile in hand can shape your entire marketing strategy, from the features you add to your product to the content you publish on your website.

Focus Groups

Focus groups are similar to interviews, but in this case, you're assembling a large group of people for one shared interview. A focus group consists of people who have at least one element of your buyer persona in common -- age or job title, for instance.

This type of market research can give you ideas for product differentiation, or the qualities of your product that make it unique in the marketplace. Consider asking your focus group questions about (and showing them examples of) your services, and ultimately use the group's feedback to make these services better.

Quantitative information

Surveys are a form of quantitative research, and you can distribute them over the phone, via email, or through an online survey. A survey could cater to people who've downloaded content from your website or interacted with a member of your business.

Enough completed surveys can help you determine your customer satisfaction level. This denotes how happy your customers are with what you're selling them. You might include questions like, "How well did we solve your problem?" and "Would you recommend our product to a friend?"

Secondary Data

The interviews, focus groups, and surveys are all sources of primary data. Secondary data , on the other hand, is the public information -- online and offline -- that characterizes your industry. This includes competitor websites, social media business pages, trade magazines, market reports, and even census data published by the government.

If you examine enough secondary data, you can learn how much brand awareness you have in the marketplace compared to the companies that provide the same product or service as you.

The market research you perform doesn't have to include every source of information described above. What data you collect will depend on the needs of your business and what you might be most interested in at the moment. 

Editor's note: This post was originally published in July 2018 and has been updated for comprehensiveness.

Don't forget to share this post!

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What is market research?

What is market research used for? How important is it? And, how do you choose the right type of research for your business?

Sit back, take five, and I’ll explain the different types of research , what tools are best for the job, and how you can leverage them to grow your business and master your market .

Market research definition:

Market research means to systematically collect and analyze data about a target market or defined segment. It’s a multivariate process that uncovers key facts and insights to inform decisions.

Whether you’re launching a new product , looking for ways to expand a business, or seeking out efficiencies in an existing company, market research is a highly effective way to flesh-out ideas, innovate, and grow. 

Advantages of market research

Market research helps you identify your greatest strengths, threats, and opportunities. It can help you find your way when markets become tough to predict and find efficient ways to grow your business .

• Reduce costs
• Define detailed customer personas
• Make data-driven decisions
• Find new opportunities for growth
• Unpack competitor’s successes
• Develop an informed content marketing strategy
• Identify trends
• Inform market analysis
• Discover the best marketing channels to use
• Find the best ways to communicate with customers
• Benchmark performance against rivals

Online market research can help the whole business at any stage of its life. When practiced consistently and systematically, you can realize its many benefits.

Why is market research important?

Market research helps you identify your greatest threats. And it also gives you a clear picture of opportunities you can capitalize on for greater returns on your business investments, or ROI.

Understanding your specific market on different levels and from different perspectives helps you reach well-informed, data-informed decisions . The process can involve multiple phases. But, if you follow a systematic approach using a market research template , your efforts will pay off.

For more, check out our blog: Importance of Market Research: 9 Reasons Why It’s Crucial for Your Business

To skip ahead and start right now, download our free pack of market research templates.

Different types of market research

Market research is a questions and answers game. Once you’ve asked the important questions, you’ll need to choose the right type of research to get your answers. There are four core types of research, each of which can be applied to help you solve a problem or gather insights to inform key decisions.

Primary market research

Primary market research is the first-hand collection of data. It’s data that’s not available to others, and can be obtained in a number of ways. Here are the most common.

• Web Metrics Use analytics software that provides traffic and engagement metrics to understand how audiences behave.
• Observation To observe how users behave and navigate your site, you can install software that records visits and creates heatmaps. Such tools are useful for qualitative research regarding your UX/UI and at the same time, quantify the findings.
• Customer surveys Survey questionnaires and polls can be distributed to any number of customers through email, SMS, your site, or social media. They let you collect both qualitative and quantitative data from respondents using open-ended questions.
• Focus groups You select a small number of people for a group discussion. A moderator leads the session with questions and records the conclusions. This is also a form of qualitative research, and you would use it to get in-depth information.
• Face-to-face interviews Another qualitative assessment method is one-on-one interviews. Consumers representative of your target audience or a segment of it are selected to answer questions about a specific research topic.
• Phone calls To involve a larger number of people and get more answers, you can conduct surveys over the phone. These interviews would be less specific and include fewer questions.

Helpful: A complete guide to doing primary market research

Secondary market research

Secondary research is second-hand data that has already been produced. It’s available to all who wish to consume it. Using this type of data is preferred by those who wish to keep costs low, as it can be quicker and freely available.

• Government reports and census data Annual, quarterly, and other periodic industry reports are a rich data source to tap into. Government organizations publish statistics in areas of trade, ecommerce, and finance.
• Academic papers and educational resources University research is a source of high-quality information. This is useful for in-depth background information on a broad scale.
• Online articles and case studies, public and commercial sources Industry-specific publications can be a valuable source of information for market segmentation, providing you with data and insights on market trends or a specific market segment or niche.

Further reading: A complete guide to doing desk research

Qualitative market research

Qualitative market research is one of the best ways to understand how people think or feel about a brand, product, or service. It takes more time to plan and analyze the results than other market research types. However, with tools like market research surveys , there are quick and effective ways to do it.

As some of the methods are outlined in the primary and secondary research sections, I’ve included a short list of qualitative research methods below.

• Focus groups
• Case study or whitepaper 
• Online forums
• Biometrics 
• Ethnography

Helpful: Read the complete guide to qualitative research and 83 qualitative research questions & examples

Quantitative market research

Quantitative market research is all about numbers. It collects numerical data to help answer specific research questions . The information collected can be easily quantified and analyzed to establish trends, insights, and patterns.

With this type of research, you’ve got three core data collection methods. However, you’ve also got to consider the design of the research, which can impact which method is used.

What is market research used for?

The applications for market research are virtually limitless. Market research can help you unravel the most complex of business challenges to reach data-driven decisions , and when used consistently, it can help you navigate turbulent times, fuel growth, and support your success . Here are just a few examples of what market research is used for, with a few real-world examples thrown in for good measure.

1. Company research

Market research allows you to shine a spotlight on any business and unpack its wins and losses for your own gain. Let’s say you are doing market research for a business plan ; you’ll likely want to evaluate the successes of others in your industry. Doing systematic company research is a proven way to inform a SWOT analysis .

Doing industry analysis can show you who your industry leaders are , along with any emerging players showing exponential growth.

Let’s say I want to find out which companies to research, I would use Similarweb Digital Research Intelligence to analyze an industry. Here, I can see who my top companies to watch are instantly. It also shows me other companies showing rapid growth in my market.

Read More: How to Research a Company: The Ultimate Guide

2. Competitive benchmarking

Most of your relevant data will come from your competition. If you plan to offer something that’s new for you but already exists in the market, learn from other’s mistakes and successes. If your goal is to evaluate and optimize, collect competitors’ data, and compare it to yours. See what works for them, find their weak spots, and improve on them.

What market research gives you here, is the ability to systematically compare each of your rivals. And, it’s not as complex as it sounds either. Simply choose a type of competitive analysis frameworks to use, complete the template for each; then compare the results to uncover relevant insights.

Read More: The Why and How of Competitive Benchmarking

3. Trendspotting

Another objective for market researchers is to forecast upcoming trends. Data collection over time helps you understand the dynamics of the market. Some markets have strong seasonal fluctuations. Increased shopping during December is an obvious example, but often these shifts are not always evident unless you measure and analyze them specifically.

With the data from your historical market research, you can evaluate their impact and the likelihood you will keep seeing these trends. Based on that, you can make predictions about future developments.

4. Audience analysis

Who will find your product most useful and why? 

Examining the size of your audience and the existing demand for your product or services is crucial. Understanding  your target audience allows you to build your product offering and marketing strategy more efficiently. You also want to learn first-hand where people buy this type of product and how much they are willing to spend so that you can estimate your reachable market share .

Here’s a quick example of how we use Similarweb to do effective audience analysis . You can unpack key audience demographics for any site you choose. And get up-to-date stats about gender, age, location, interests, browsing habits, and more.

5. Market segmentation

There are lots of ways to segment a market. Doing this well can deliver higher conversions, reduce costs, redefine marketing strategies, and help you connect with customers on a more personal level. Market research can help you do most types of market segmentation, the most widely adopted of all is demographic segmentation . Here, you look for shared but specific characteristics of a target audience.

Using Similarweb, I can view audience demographics for a website, and compare it side-by-side with rival sites. In this example, I am looking at hotel booking sites to try and spot any difference between the respective audiences of each.

Helpful: Read our complete guide to market segmentation

6. Marketing strategy

Market research can also help you reach the right decision regarding where to advertise or market your business. After analyzing the data, you’ll know which marketing channels are most effective with your target audience. You can also use research to look at the specific keywords and ad creatives that are generating the best responses and ROI.

Similarweb Digital Research Intelligence makes this type of research effortless. Within the marketing channels tab, you can analyze an entire industry or hone in on a specific site of interest. View the various channels across social media, email, direct, organic search, paid search, and display ads to see which channels convert and where the highest channel traffic comes from.

7. Customer experience

Market research is your best way to get information that isn’t naturally visible but that may significantly affect your business. Just think, the fact that your users don’t complain doesn’t necessarily mean they are all delighted with what you offer.

While some customers tend to keep their criticism to themselves, others will be vocal and leave reviews online. Market research is a powerful tool to help inform improvements to services and products alike. Asking for feedback, listening to it, and looking at the feedback left for rivals in your market can uncover telling insights that can shape service offerings, marketing campaigns, and new feature development.

To see what people use market research for and view real-world instances of research in action, head over to our market research examples page.

Tools for market research

When we look at what market research is, the answer is always rooted in data . Over 100 years ago, vehicle manufacturers undertook extensive research to help them develop different models to suit various segments of society. Fast-forward 100 years, and we find similar applications still exist. However, what’s changed are the tools being used and, more importantly, the accessibility of those tools to a far broader audience .

There are more market intelligence tools in existence today than ever before. Here’s a quick summary of a few you can use to collect information for your market research.

• Google Trends Google Trends is a valuable resource for quantitative research data about market tendencies and user behavior.

• Similarweb Research Intelligence Get the freshest digital intelligence from a platform that shows the insights that count. With the ability to analyze an entire market in an instant and unpick competitors’ wins and losses online, you can count on it to help you perform quick and effective market research.
• Hotjar The digital tool lets you observe and record user behavior on your website. It also creates heatmaps of your pages so you can analyze how visitors navigate.
• SurveyMonkey Create your own online survey with this free tool. SurveyMonkey provides templates for questionnaires and lets you distribute them through your various channels, then collect and interpret results.
• YouGov This platform offers its users daily with thousands of data points and statistics on consumer attitudes, opinions, and behavior.
• Pew Research Center This non-profit organization conducts and publishes public opinion polling, demographic research, content analysis, and other data-driven social science research.
• Living Facts The site provides current statistics about the American population, including demographics, social and health issues, opinions, and more.

Read this post to see what market research tools are hot right now.

Wrapping up: what is market research

Market research is insight. It gives you information to fuel key decisions in your business. Without it, companies must navigate their market uncertainly and make key decisions based on instinct or outdated data.

Similarweb transforms the way companies do market research . There’s no expensive outlay for prolonged research reports that take an age to produce. The data is the freshest there is; it’s credible and shows traffic trends and comparable performance like no other.

Try using it to answer your next big market research question.

Stop Guessing, Start Analyzing

Get actionable insights for market research here

What are the benefits of market research?

Effective market research helps businesses understand and improve their position while also identifying potential threats and opportunities, while also spotting emerging trends .

What is the main purpose of market research?

The main benefit of market research is insight. It can give you access to the data you need to make decisions in your business. Before you invest money or time in any venture, use market research to inform your decision.  

What’s the difference between primary and secondary market research?

Primary research is research you conduct on your own that uses numbers and metrics, and secondary research is research that was done by someone else with a qualitative focus.

by Liz March

Digital Research Specialist

Liz March has 15 years of experience in content creation. She enjoys the outdoors, F1, and reading, and is pursuing a BSc in Environmental Science.

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How to do market research: The complete guide for your brand

Written by by Jacqueline Zote

Published on  April 13, 2023

Reading time  10 minutes

Blindly putting out content or products and hoping for the best is a thing of the past. Not only is it a waste of time and energy, but you’re wasting valuable marketing dollars in the process. Now you have a wealth of tools and data at your disposal, allowing you to develop data-driven marketing strategies . That’s where market research comes in, allowing you to uncover valuable insights to inform your business decisions.

Conducting market research not only helps you better understand how to sell to customers but also stand out from your competition. In this guide, we break down everything you need to know about market research and how doing your homework can help you grow your business.

Table of contents:

What is market research?

Why is market research important, types of market research, where to conduct market research.

• Steps for conducting market research
• Tools to use for market research

Market research is the process of gathering information surrounding your business opportunities. It identifies key information to better understand your audience. This includes insights related to customer personas and even trends shaping your industry.

Taking time out of your schedule to conduct research is crucial for your brand health. Here are some of the key benefits of market research:

Understand your customers’ motivations and pain points

Most marketers are out of touch with what their customers want. Moreover, these marketers are missing key information on what products their audience wants to buy.

Simply put, you can’t run a business if you don’t know what motivates your customers.

And spoiler alert: Your customers’ wants and needs change. Your customers’ behaviors today might be night and day from what they were a few years ago.

Market research holds the key to understanding your customers better. It helps you uncover their key pain points and motivations and understand how they shape their interests and behavior.

Figure out how to position your brand

Positioning is becoming increasingly important as more and more brands enter the marketplace. Market research enables you to spot opportunities to define yourself against your competitors.

Maybe you’re able to emphasize a lower price point. Perhaps your product has a feature that’s one of a kind. Finding those opportunities goes hand in hand with researching your market.

Maintain a strong pulse on your industry at large

Today’s marketing world evolves at a rate that’s difficult to keep up with.

Fresh products. Up-and-coming brands. New marketing tools. Consumers get bombarded with sales messages from all angles. This can be confusing and overwhelming.

By monitoring market trends, you can figure out the best tactics for reaching your target audience.

Not everyone conducts market research for the same reason. While some may want to understand their audience better, others may want to see how their competitors are doing. As such, there are different types of market research you can conduct depending on your goal.

Interview-based market research allows for one-on-one interactions. This helps the conversation to flow naturally, making it easier to add context. Whether this takes place in person or virtually, it enables you to gather more in-depth qualitative data.

Buyer persona research

Buyer persona research lets you take a closer look at the people who make up your target audience. You can discover the needs, challenges and pain points of each buyer persona to understand what they need from your business. This will then allow you to craft products or campaigns to resonate better with each persona.

Pricing research

In this type of research, brands compare similar products or services with a particular focus on pricing. They look at how much those products or services typically sell for so they can get more competitive with their pricing strategy.

Competitive analysis research

Competitor analysis gives you a realistic understanding of where you stand in the market and how your competitors are doing. You can use this analysis to find out what’s working in your industry and which competitors to watch out for. It even gives you an idea of how well those competitors are meeting consumer needs.

Depending on the competitor analysis tool you use, you can get as granular as you need with your research. For instance, Sprout Social lets you analyze your competitors’ social strategies. You can see what types of content they’re posting and even benchmark your growth against theirs.

Brand awareness research

Conducting brand awareness research allows you to assess your brand’s standing in the market. It tells you how well-known your brand is among your target audience and what they associate with it. This can help you gauge people’s sentiments toward your brand and whether you need to rebrand or reposition.

If you don’t know where to start with your research, you’re in the right place.

There’s no shortage of market research methods out there. In this section, we’ve highlighted research channels for small and big businesses alike.

Considering that Google sees a staggering 8.5 billion searches each day, there’s perhaps no better place to start.

A quick Google search is a potential goldmine for all sorts of questions to kick off your market research. Who’s ranking for keywords related to your industry? Which products and pieces of content are the hottest right now? Who’s running ads related to your business?

For example, Google Product Listing Ads can help highlight all of the above for B2C brands.

The same applies to B2B brands looking to keep tabs on who’s running industry-related ads and ranking for keyword terms too.

There’s no denying that email represents both an aggressive and effective marketing channel for marketers today. Case in point, 44% of online shoppers consider email as the most influential channel in their buying decisions.

Looking through industry and competitor emails is a brilliant way to learn more about your market. For example, what types of offers and deals are your competitors running? How often are they sending emails?

Email is also invaluable for gathering information directly from your customers. This survey message from Asana is a great example of how to pick your customers’ brains to figure out how you can improve your quality of service.

Industry journals, reports and blogs

Don’t neglect the importance of big-picture market research when it comes to tactics and marketing channels to explore. Look to marketing resources such as reports and blogs as well as industry journals

Keeping your ear to the ground on new trends and technologies is a smart move for any business. Sites such as Statista, Marketing Charts, AdWeek and Emarketer are treasure troves of up-to-date data and news for marketers.

And of course, there’s the  Sprout Insights blog . And invaluable resources like The Sprout Social Index™  can keep you updated on the latest social trends.

Social media

If you want to learn more about your target market, look no further than social media. Social offers a place to discover what your customers want to see in future products or which brands are killin’ it. In fact, social media is become more important for businesses than ever with the level of data available.

It represents a massive repository of real-time data and insights that are instantly accessible. Brand monitoring and social listening are effective ways to conduct social media research . You can even be more direct with your approach. Ask questions directly or even poll your audience to understand their needs and preferences.

The 5 steps for how to do market research

Now that we’ve covered the why and where, it’s time to get into the practical aspects of market research. Here are five essential steps on how to do market research effectively.

Step 1: Identify your research topic

First off, what are you researching about? What do you want to find out? Narrow down on a specific research topic so you can start with a clear idea of what to look for.

For example, you may want to learn more about how well your product features are satisfying the needs of existing users. This might potentially lead to feature updates and improvements. Or it might even result in new feature introductions.

Similarly, your research topic may be related to your product or service launch or customer experience. Or you may want to conduct research for an upcoming marketing campaign.

Step 2: Choose a buyer persona to engage

If you’re planning to focus your research on a specific type of audience, decide which buyer persona you want to engage. This persona group will serve as a representative sample of your target audience.

Engaging a specific group of audience lets you streamline your research efforts. As such, it can be a much more effective and organized approach than researching thousands (if not millions) of individuals.

You may be directing your research toward existing users of your product. To get even more granular, you may want to focus on users who have been familiar with the product for at least a year, for example.

Step 3: Start collecting data

The next step is one of the most critical as it involves collecting the data you need for your research. Before you begin, make sure you’ve chosen the right research methods that will uncover the type of data you need. This largely depends on your research topic and goals.

Remember that you don’t necessarily have to stick to one research method. You may use a combination of qualitative and quantitative approaches. So for example, you could use interviews to supplement the data from your surveys. Or you may stick to insights from your social listening efforts.

To keep things consistent, let’s look at this in the context of the example from earlier. Perhaps you can send out a survey to your existing users asking them a bunch of questions. This might include questions like which features they use the most and how often they use them. You can get them to choose an answer from one to five and collect quantitative data.

Plus, for qualitative insights, you could even include a few open-ended questions with the option to write their answers. For instance, you might ask them if there’s any improvement they wish to see in your product.

Step 4: Analyze results

Once you have all the data you need, it’s time to analyze it keeping your research topic in mind. This involves trying to interpret the data to look for a wider meaning, particularly in relation to your research goal.

So let’s say a large percentage of responses were four or five in the satisfaction rating. This means your existing users are mostly satisfied with your current product features. On the other hand, if the responses were mostly ones and twos, you may look for opportunities to improve. The responses to your open-ended questions can give you further context as to why people are disappointed.

Step 5: Make decisions for your business

Now it’s time to take your findings and turn them into actionable insights for your business. In this final step, you need to decide how you want to move forward with your new market insight.

What did you find in your research that would require action? How can you put those findings to good use?

The market research tools you should be using

To wrap things up, let’s talk about the various tools available to conduct speedy, in-depth market research. These tools are essential for conducting market research faster and more efficiently.

Social listening and analytics

Social analytics tools like Sprout can help you keep track of engagement across social media. This goes beyond your own engagement data but also includes that of your competitors. Considering how quickly social media moves, using a third-party analytics tool is ideal. It allows you to make sense of your social data at a glance and ensure that you’re never missing out on important trends.

Email marketing research tools

Keeping track of brand emails is a good idea for any brand looking to stand out in its audience’s inbox.

Tools such as MailCharts ,  Really Good Emails  and  Milled  can show you how different brands run their email campaigns.

Meanwhile, tools like  Owletter  allow you to monitor metrics such as frequency and send-timing. These metrics can help you understand email marketing strategies among competing brands.

Content marketing research

If you’re looking to conduct research on content marketing, tools such as  BuzzSumo  can be of great help. This tool shows you the top-performing industry content based on keywords. Here you can see relevant industry sites and influencers as well as which brands in your industry are scoring the most buzz. It shows you exactly which pieces of content are ranking well in terms of engagements and shares and on which social networks.

SEO and keyword tracking

Monitoring industry keywords is a great way to uncover competitors. It can also help you discover opportunities to advertise your products via organic search. Tools such as  Ahrefs  provide a comprehensive keyword report to help you see how your search efforts stack up against the competition.

Competitor comparison template

For the sake of organizing your market research, consider creating a competitive matrix. The idea is to highlight how you stack up side-by-side against others in your market. Use a  social media competitive analysis template  to track your competitors’ social presence. That way, you can easily compare tactics, messaging and performance. Once you understand your strengths and weaknesses next to your competitors, you’ll find opportunities as well.

Customer persona creator

Finally, customer personas represent a place where all of your market research comes together. You’d need to create a profile of your ideal customer that you can easily refer to. Tools like  Xtensio  can help in outlining your customer motivations and demographics as you zero in on your target market.

Build a solid market research strategy

Having a deeper understanding of the market gives you leverage in a sea of competitors. Use the steps and market research tools we shared above to build an effective market research strategy.

But keep in mind that the accuracy of your research findings depends on the quality of data collected. Turn to Sprout’s social media analytics tools to uncover heaps of high-quality data across social networks.

• Marketing Disciplines
• Social Media Strategy

Social media RFPs: The best questions to include (plus a template)

Template: Essential Questions to Ask in Your Social Media Management Software RFP

• Team Collaboration

How to build a marketing tech stack that scales your business

• Customer Experience

Brand trust: What it is and why it matters

• Now on slide

Build and grow stronger relationships on social

Sprout Social helps you understand and reach your audience, engage your community and measure performance with the only all-in-one social media management platform built for connection.

• Start free trial

Start selling with Shopify today

Start your free trial with Shopify today—then use these resources to guide you through every step of the process.

How To Do Market Research: Types and Templates (2024)

Want to do market research for your brand? Get the best templates and a step-by-step guide in this article.

Market research consists of systematically gathering data about people or companies—a market—and then analyzing it to better understand what that group needs. The results of market research are then used to help business owners make informed decisions about the company’s strategies, operations, and potential customer base.

Market research can help businesses run more efficiently and market more effectively. Ahead, you’ll learn how to do market research for your business, whether you’re breaking into a new market or developing a product .

What is market research?

Market research is the process of gathering data about people or companies and analyzing it to figure out what they’re looking for. Using market research, which is usually summarized in a report, you can make better decisions about your company’s strategy, operations, and potential customers. There are two main types of market research: primary and secondary.

Primary market research

Primary data is first-hand information you gather yourself, or with the help of a market research firm. You control it. Common ways to do primary market research include surveys, interviews, focus groups, and observations. 

Doing your own research has its benefits. You’ll learn exactly what customers want, because you’ve asked them directly. Information is fresh, and you can understand the nuances of your customers, like taste preferences or pricing.

Secondary market research

Secondary data is pre-existing public information, such as data shared in magazines and newspapers or government or industry reports. 

Say you’re a fashion brand expanding its product line to sustainable options, you’d use secondary research to understand market potential. You’d read market reports from Mintel or Nielsen Company to understand consumer demands for sustainable products.

Why is market research important?

Reduce risks for entering new markets.

Misjudging market demand for a new product leads to big financial losses. Market research lowers that risk by providing insights to inform your go-to-market plan, such as:

• Market size
• Income range
• Employment rate
• Market saturation

Gathering this information beforehand helps you understand opportunities and challenges for getting new customers. It also helps you understand emerging trends to stay competitive and identify new growth opportunities.

Understand the competition

A competitive analysis helps you understand the business landscape of a new market and uncovers gaps your business can fill. By analyzing your competitors’ offerings, marketing strategies, and customer feedback, you can create a plan to differentiate yourself in a crowded market. 

Make your business customer-centric

Market research reveals the needs, preferences, and behaviors of potential customers in a new market. For example, if you were expanding into South Korea, you’d want to take into account that shoppers value fast delivery times, readily available products, and the best price possible. 

Armed with this information, you’d want to create a seamless mobile shopping experience with quick load times and quick delivery to appeal to the local market. 

Types of market research

Surveys .

Surveys consist of a list of questions that can be shared with an individual by phone, in person, on a card or paper, or online using a survey software like SurveyMonkey or Qualtrics. 

Ask customers a series of questions to better understand how they feel about a product’s features, or about the experience they had. 

Focus groups

Bringing together groups of people with a common characteristic, such as age, hobby, or buying habits, to better understand their likes and dislikes is a focus group. 

Focus groups typically consist of eight to 12 people and a moderator who poses questions for the group to discuss. They are useful ways of getting feedback on a new product, new features, or new ad campaign.

Observation

When the researcher gathers information simply by watching how a subject interacts with a product, the technique is observation. This is often used in comparing preferences for several types of products.

In-depth interviews

Another market research technique is the one-on-one interview with an individual, during which probing questions are posed to better understand that person’s thoughts, opinions, challenges, and product preferences.

Secondary sources

Secondary research is often a good place to start when conducting market research to better understand industry trends and broader shifts. 

Some of the most useful sources include:

• Industry associations and trade groups
• Trade journals specific to your industry
• Government reports, such as the census or annual federal procurement results
• Industry analysts
• University faculty members 

You can also analyze competitor websites and materials to uncover what convinces potential customers to buy from them.

How to conduct market research

1. choose your focus.

Start by defining what you want to achieve from your research. You might want to:

• Understand a target audience
• Develop new product features
• Create a brand identity
• Improve customer experience

If you’re launching a new line of eco-friendly packaging, for example, your focus might be to understand customer attitudes toward sustainability. 

2. Determine your research methods 

Choose how you’ll capture the data based on your objectives and budget. Combine qualitative research (like interviews and focus groups) with quantitative data (like surveys) to understand attitudes and perceptions.

Maybe you’ll decide to conduct a focus group with environmentally conscious consumers to explore their feelings about packaging materials.

3. Collect the data

Depending on your research methods, you might need to prepare questionnaires, conduct interviews, or analyze data courses. You can conduct the process in-house or outsource it to a third party to help speed things along.

4. Analyze the data

Now it’s time to turn that raw data into insights. Identify any patterns or trends that answer your objectives. For example, you may analyze and identify the percentage of customers who prefer sustainable packaging over traditional options.

5. Report your findings

Prepare a report that includes key insights, data, and recommendations based on your findings. Go beyond stating the findings and explain what they mean for your business. What can you conclude about your market, audience, or product? 

For example, if your research finds high demand for eco-friendly packaging amongst the 25-to-34 demographic, you can conclude a targeted marketing campaign to this group could increase sales. 

Market research templates and guides

Behind every successful business is solid market research. But the hardest part is knowing where to start, and that’s where the following templates come in. These guides can help you stay on track and prepare for your market research process. 

• Shopify’s Market Research Competitor Analysis Template : Contains a free template to help you find your product market fit, so you can sell successfully right away. 
• HubSpot’s Market Research Kit : Contains an instructional guide, SWOT analysis template, focus group template, survey template, and more.
• Qualtrics XM : Qualtrics XM offers a collection of pre-made customer, product, and brand survey templates with a free account.

Online vs. offline marketing research

Online marketing research involves using digital platforms and tools to collect data from your audience. It includes surveys, polls, online focus groups, web analytics, and social media listening . 

The benefit of online research is that you can reach a wide audience quickly and at an affordable price. Because it’s done online, it’s convenient for both researchers and participants. However, online marketing research has some drawbacks, like low response rates and poor data quality. People may not give in-depth explanations or observations if they don’t sit in front of you.

In offline research, data is collected through in-person methods, such as interviews or observations. This allows researchers to examine people’s nonverbal cues and emotions in greater detail. However, offline research is expensive to conduct and analyze, and in-person methods may also limit sample size and diversity. 

How market research helps with competitive analysis

Knowing what your competitors are doing makes it easier to break into the market (or stay ahead of it). If you’re starting an ecommerce business , market research can help you:

• Identify industry trends
• Create a benchmark against competitors 
• Determine competitive pricing strategies
• Find gaps in the market

All these elements inform your competitive analysis, whether you’re developing a new product or entering a new market. In this way, you can uncover areas where competition is intense and gain leverage over your competitors.

Free competitor research template

Find a strategic angle to achieve sales success, uncover your product-market fit, and stand out from the competition with our free template.

Market research examples

Before launching a premium cocktail machine into a new category, the team at Bartesian had to identify a common problem: how hard it was to make great-tasting cocktails at home without any professional skill. 

It was a problem the founder, Ryan Close, struggled with himself, as he explains in a Shopify Masters interview . 

“I could never get [drinks] right, so I understood it was difficult to make great tasting cocktails at home if you’re not a bartender,” Ryan says. 

For his market research, Ryan carried a prototype of the machine around the country, getting in-person feedback. He’d go to trade shows and networking events to talk with people, ask about their pain points, and find out what they’d be willing to pay for his cocktail-making machine. These events helped give Ryan the market research needed to launch Bartesian. 

💡 Read more about how Ryan Close launched Bartesian

Beardbrand 

Beardbrand has become a popular men’s grooming brand since its launch in 2012. In 2023, it was estimated to have generated $25.7 million in revenue. Its founder, Eric Bandholz, took an informal approach to market research rooted in his personal experiences. 

He identified the potential for Beardbrand through several key insights:

• Observation: Noticing an increase in beards and mustaches, and a general interest in male grooming in urban areas, Eric recognized a growing trend that had yet to be fully capitalized on.
• Community engagement: By being an active member of the beard community and blogging about beard care and lifestyle, Eric immersed himself in the target market. This direct engagement provided him with firsthand insights into the needs and wants of his potential customers.
• Participation in events: Attending the 2012 West Coast Beard & Mustache Championships in Portland, Oregon, was a pivotal moment. It was here Eric realized the existence of a like-minded community that was underserved in terms of products and content tailored to their interests.
• Using social media for feedback and ideas: Eric leveraged social media platforms, especially Tumblr, to gather product ideas and gauge community interest. This approach allowed for immediate feedback and helped shape the product offering.

Before officially launching Beardbrand, Eric experimented with blogging about beard care products and engaging with the community. This phase acted as an informal market test, providing insights into the market’s receptivity to various products.

Abel Samet and Samuel Bail started Troubadour after unsuccessfully searching for a high-performing weekender bag. This personal experience highlighted a gap in the market for bags that were both aesthetically pleasing and functionally equivalent to sports gear—lightweight, waterproof, and comfortable.

They did market testing by initially offering their products to friends, family, and colleagues, which allowed them to gather valuable feedback. The brand continued to collect qualitative feedback from customers on their likes and dislikes about the bags, as well as quantitative data on sales and returns to understand needs and buying behavior. This allowed them to innovate and expand, taking calculated risks that paid off.

📚  Read: 10 Lessons Learned From Troubadour’s 10 Years in Business

Qualitative vs. quantitative market research

Qualitative and quantitative research are two fundamental approaches to doing market research. 

Qualitative research

Focuses on understanding concepts, thoughts, or experiences through subjective data. It explores the howand why of customers’ behaviors through open-ended questions and discussions. It can involve interviews, observations, and textual analysis to develop a more detailed understanding of the participant. 

Quantitative research

Rooted in quantifying a problem through numerical data, like statistics. You’ll normally use quantitative data to generalize results from a larger sample population. These include surveys, questionnaires, and experiments with fixed questions or conditions. 

Even though these two approaches are different, you can combine them to conduct a mixed methods study. This helps further validate your findings and get a better understanding of the issue at hand. 

Conduct your own market research today

Understanding industry shifts, changing consumer needs and preferences, and legislative trends, among other things, can shape where a business chooses to focus its efforts and resources. That’s the value of market research. Use the templates and market research techniques above to improve your process and grow your business. 

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• What Is Media Planning? Definition and Guide
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• What Is Telemarketing? Definition and Guide
• What Is a Trade Show? Definition and Guide
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• Website Builder & Website Maker by Shopify

What is market research? FAQ

What are the 4 types of marketing research.

• Exploratory research
• Descriptive research
• Causal research
• Predictive research

What is an example of market research?

An example of market research would be a company conducting a survey to learn more about their target audience’s preferences and buying habits. They might ask questions about age, gender, income level, and what types of products they purchase. The research would then inform the company’s business and marketing strategy. 

How often should market research be conducted?

Businesses can conduct market research on an as-needed basis. If you are launching a new product or entering a new market, you’ll do market research to support the initiative. Some businesses do market research on an annual basis to stay competitive. 

What are the 4 main purposes of market research?

• Identifying and understanding the target market: Market research helps organizations better identify and understand their target market. It can provide insights into customer demographics, preferences, needs and motivations.
• Product/service development and innovation: Market research helps organizations identify and develop new products or services that meet the needs of their target market. It also helps them understand how new products or services can be positioned in the marketplace.
• Market entry and expansion: Market research helps organizations plan and execute successful market entry and expansion. It can help them identify target markets, assess market potential and evaluate the competitive landscape.
• Brand and reputation management: Market research helps organizations maintain and improve their brand and reputation. It can provide insights into customer perception and help organizations differentiate their brand from competitors.

How much does market research cost?

How much market research costs depends on the research method used. For example, face-to-face interviews are more expensive than phone interviews. The sample size required is also a factor. The larger your sample size, the more expensive it will cost. On average, you can expect to pay between $20,000 and $60,000 for a round of market research from a marketing research firm.

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How to do market research in 4 steps: a lean approach to marketing research

From pinpointing your target audience and assessing your competitive advantage, to ongoing product development and customer satisfaction efforts, market research is a practice your business can only benefit from.

Learn how to conduct quick and effective market research using a lean approach in this article full of strategies and practical examples. 

Last updated

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A comprehensive (and successful) business strategy is not complete without some form of market research—you can’t make informed and profitable business decisions without truly understanding your customer base and the current market trends that drive your business.

In this article, you’ll learn how to conduct quick, effective market research  using an approach called 'lean market research'. It’s easier than you might think, and it can be done at any stage in a product’s lifecycle.

How to conduct lean market research in 4 steps

What is market research, why is market research so valuable, advantages of lean market research, 4 common market research methods, 5 common market research questions, market research faqs.

We’ll jump right into our 4-step approach to lean market research. To show you how it’s done in the real world, each step includes a practical example from Smallpdf , a Swiss company that used lean market research to reduce their tool’s error rate by 75% and boost their Net Promoter Score® (NPS) by 1%.

Research your market the lean way...

From on-page surveys to user interviews, Hotjar has the tools to help you scope out your market and get to know your customers—without breaking the bank.

The following four steps and practical examples will give you a solid market research plan for understanding who your users are and what they want from a company like yours.

1. Create simple user personas

A user persona is a semi-fictional character based on psychographic and demographic data from people who use websites and products similar to your own. Start by defining broad user categories, then elaborate on them later to further segment your customer base and determine your ideal customer profile .

How to get the data: use on-page or emailed surveys and interviews to understand your users and what drives them to your business.

How to do it right: whatever survey or interview questions you ask, they should answer the following questions about the customer:

Who are they?

What is their main goal?

What is their main barrier to achieving this goal?

Pitfalls to avoid:

Don’t ask too many questions! Keep it to five or less, otherwise you’ll inundate them and they’ll stop answering thoughtfully.

Don’t worry too much about typical demographic questions like age or background. Instead, focus on the role these people play (as it relates to your product) and their goals.

How Smallpdf did it: Smallpdf ran an on-page survey for a couple of weeks and received 1,000 replies. They learned that many of their users were administrative assistants, students, and teachers.

Next, they used the survey results to create simple user personas like this one for admins:

Who are they? Administrative Assistants.

What is their main goal? Creating Word documents from a scanned, hard-copy document or a PDF where the source file was lost.

What is their main barrier to achieving it? Converting a scanned PDF doc to a Word file.

💡Pro tip: Smallpdf used Hotjar Surveys to run their user persona survey. Our survey tool helped them avoid the pitfalls of guesswork and find out who their users really are, in their own words. 

You can design a survey and start running it in minutes with our easy-to-use drag and drop builder. Customize your survey to fit your needs, from a sleek one-question pop-up survey to a fully branded questionnaire sent via email. 

We've also created 40+ free survey templates that you can start collecting data with, including a user persona survey like the one Smallpdf used.

2. Conduct observational research

Observational research involves taking notes while watching someone use your product (or a similar product).

Overt vs. covert observation

Overt observation involves asking customers if they’ll let you watch them use your product. This method is often used for user testing and it provides a great opportunity for collecting live product or customer feedback .

Covert observation means studying users ‘in the wild’ without them knowing. This method works well if you sell a type of product that people use regularly, and it offers the purest observational data because people often behave differently when they know they’re being watched. 

Tips to do it right:

Record an entry in your field notes, along with a timestamp, each time an action or event occurs.

Make note of the users' workflow, capturing the ‘what,’ ‘why,’ and ‘for whom’ of each action.

Don’t record identifiable video or audio data without consent. If recording people using your product is helpful for achieving your research goal, make sure all participants are informed and agree to the terms.

Don’t forget to explain why you’d like to observe them (for overt observation). People are more likely to cooperate if you tell them you want to improve the product.

💡Pro tip: while conducting field research out in the wild can wield rewarding results, you can also conduct observational research remotely. Hotjar Recordings is a tool that lets you capture anonymized user sessions of real people interacting with your website. 

Observe how customers navigate your pages and products to gain an inside look into their user behavior . This method is great for conducting exploratory research with the purpose of identifying more specific issues to investigate further, like pain points along the customer journey and opportunities for optimizing conversion .

With Hotjar Recordings you can observe real people using your site without capturing their sensitive information

How Smallpdf did it: here’s how Smallpdf observed two different user personas both covertly and overtly.

Observing students (covert): Kristina Wagner, Principle Product Manager at Smallpdf, went to cafes and libraries at two local universities and waited until she saw students doing PDF-related activities. Then she watched and took notes from a distance. One thing that struck her was the difference between how students self-reported their activities vs. how they behaved (i.e, the self-reporting bias). Students, she found, spent hours talking, listening to music, or simply staring at a blank screen rather than working. When she did find students who were working, she recorded the task they were performing and the software they were using (if she recognized it).

Observing administrative assistants (overt): Kristina sent emails to admins explaining that she’d like to observe them at work, and she asked those who agreed to try to batch their PDF work for her observation day. While watching admins work, she learned that they frequently needed to scan documents into PDF-format and then convert those PDFs into Word docs. By observing the challenges admins faced, Smallpdf knew which products to target for improvement.

“Data is really good for discovery and validation, but there is a bit in the middle where you have to go and find the human.”

3. Conduct individual interviews

Interviews are one-on-one conversations with members of your target market. They allow you to dig deep and explore their concerns, which can lead to all sorts of revelations.

Listen more, talk less. Be curious.

Act like a journalist, not a salesperson. Rather than trying to talk your company up, ask people about their lives, their needs, their frustrations, and how a product like yours could help.

Ask "why?" so you can dig deeper. Get into the specifics and learn about their past behavior.

Record the conversation. Focus on the conversation and avoid relying solely on notes by recording the interview. There are plenty of services that will transcribe recorded conversations for a good price (including Hotjar!).

Avoid asking leading questions , which reveal bias on your part and pushes respondents to answer in a certain direction (e.g. “Have you taken advantage of the amazing new features we just released?).

Don't ask loaded questions , which sneak in an assumption which, if untrue, would make it impossible to answer honestly. For example, we can’t ask you, “What did you find most useful about this article?” without asking whether you found the article useful in the first place.

Be cautious when asking opinions about the future (or predictions of future behavior). Studies suggest that people aren’t very good at predicting their future behavior. This is due to several cognitive biases, from the misguided exceptionalism bias (we’re good at guessing what others will do, but we somehow think we’re different), to the optimism bias (which makes us see things with rose-colored glasses), to the ‘illusion of control’ (which makes us forget the role of randomness in future events).

How Smallpdf did it: Kristina explored her teacher user persona by speaking with university professors at a local graduate school. She learned that the school was mostly paperless and rarely used PDFs, so for the sake of time, she moved on to the admins.

A bit of a letdown? Sure. But this story highlights an important lesson: sometimes you follow a lead and come up short, so you have to make adjustments on the fly. Lean market research is about getting solid, actionable insights quickly so you can tweak things and see what works.

💡Pro tip: to save even more time, conduct remote interviews using an online user research service like Hotjar Engage , which automates the entire interview process, from recruitment and scheduling to hosting and recording.

You can interview your own customers or connect with people from our diverse pool of 200,000+ participants from 130+ countries and 25 industries. And no need to fret about taking meticulous notes—Engage will automatically transcribe the interview for you.

4. Analyze the data (without drowning in it)

The following techniques will help you wrap your head around the market data you collect without losing yourself in it. Remember, the point of lean market research is to find quick, actionable insights.

A flow model is a diagram that tracks the flow of information within a system. By creating a simple visual representation of how users interact with your product and each other, you can better assess their needs.

You’ll notice that admins are at the center of Smallpdf’s flow model, which represents the flow of PDF-related documents throughout a school. This flow model shows the challenges that admins face as they work to satisfy their own internal and external customers.

Affinity diagram

An affinity diagram is a way of sorting large amounts of data into groups to better understand the big picture. For example, if you ask your users about their profession, you’ll notice some general themes start to form, even though the individual responses differ. Depending on your needs, you could group them by profession, or more generally by industry.

We wrote a guide about how to analyze open-ended questions to help you sort through and categorize large volumes of response data. You can also do this by hand by clipping up survey responses or interview notes and grouping them (which is what Kristina does).

“For an interview, you will have somewhere between 30 and 60 notes, and those notes are usually direct phrases. And when you literally cut them up into separate pieces of paper and group them, they should make sense by themselves.”

Pro tip: if you’re conducting an online survey with Hotjar, keep your team in the loop by sharing survey responses automatically via our Slack and Microsoft Team integrations. Reading answers as they come in lets you digest the data in pieces and can help prepare you for identifying common themes when it comes time for analysis.

Hotjar lets you easily share survey responses with your team

Customer journey map

A customer journey map is a diagram that shows the way a typical prospect becomes a paying customer. It outlines their first interaction with your brand and every step in the sales cycle, from awareness to repurchase (and hopefully advocacy).

The above  customer journey map , created by our team at Hotjar, shows many ways a customer might engage with our tool. Your map will be based on your own data and business model.

📚 Read more: if you’re new to customer journey maps, we wrote this step-by-step guide to creating your first customer journey map in 2 and 1/2 days with free templates you can download and start using immediately.

Next steps: from research to results

So, how do you turn market research insights into tangible business results? Let’s look at the actions Smallpdf took after conducting their lean market research: first they implemented changes, then measured the impact.

Implement changes

Based on what Smallpdf learned about the challenges that one key user segment (admins) face when trying to convert PDFs into Word files, they improved their ‘PDF to Word’ conversion tool.

We won’t go into the details here because it involves a lot of technical jargon, but they made the entire process simpler and more straightforward for users. Plus, they made it so that their system recognized when you drop a PDF file into their ‘Word to PDF’ converter instead of the ‘PDF to Word’ converter, so users wouldn’t have to redo the task when they made that mistake. 

In other words: simple market segmentation for admins showed a business need that had to be accounted for, and customers are happier overall after Smallpdf implemented an informed change to their product.

Measure results

According to the Lean UX model, product and UX changes aren’t retained unless they achieve results.

Smallpdf’s changes produced:

A 75% reduction in error rate for the ‘PDF to Word’ converter

A 1% increase in NPS

Greater confidence in the team’s marketing efforts

"With all the changes said and done, we've cut our original error rate in four, which is huge. We increased our NPS by +1%, which isn't huge, but it means that of the users who received a file, they were still slightly happier than before, even if they didn't notice that anything special happened at all.”

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Market research (or marketing research) is any set of techniques used to gather information and better understand a company’s target market. This might include primary research on brand awareness and customer satisfaction or secondary market research on market size and competitive analysis. Businesses use this information to design better products, improve user experience, and craft a marketing strategy that attracts quality leads and improves conversion rates.

David Darmanin, one of Hotjar’s founders, launched two startups before Hotjar took off—but both companies crashed and burned. Each time, he and his team spent months trying to design an amazing new product and user experience, but they failed because they didn’t have a clear understanding of what the market demanded.

With Hotjar, they did things differently . Long story short, they conducted market research in the early stages to figure out what consumers really wanted, and the team made (and continues to make) constant improvements based on market and user research.

Without market research, it’s impossible to understand your users. Sure, you might have a general idea of who they are and what they need, but you have to dig deep if you want to win their loyalty.

Here’s why research matters:

Obsessing over your users is the only way to win. If you don’t care deeply about them, you’ll lose potential customers to someone who does.

Analytics gives you the ‘what’, while research gives you the ‘why’. Big data, user analytics , and dashboards can tell you what people do at scale, but only research can tell you what they’re thinking and why they do what they do. For example, analytics can tell you that customers leave when they reach your pricing page, but only research can explain why.

Research beats assumptions, trends, and so-called best practices. Have you ever watched your colleagues rally behind a terrible decision? Bad ideas are often the result of guesswork, emotional reasoning, death by best practices , and defaulting to the Highest Paid Person’s Opinion (HiPPO). By listening to your users and focusing on their customer experience , you’re less likely to get pulled in the wrong direction.

Research keeps you from planning in a vacuum. Your team might be amazing, but you and your colleagues simply can’t experience your product the way your customers do. Customers might use your product in a way that surprises you, and product features that seem obvious to you might confuse them. Over-planning and refusing to test your assumptions is a waste of time, money, and effort because you’ll likely need to make changes once your untested business plan gets put into practice.

Lean User Experience (UX) design is a model for continuous improvement that relies on quick, efficient research to understand customer needs and test new product features.

Lean market research can help you become more...

Efficient: it gets you closer to your customers, faster.

Cost-effective: no need to hire an expensive marketing firm to get things started.

Competitive: quick, powerful insights can place your products on the cutting edge.

As a small business or sole proprietor, conducting lean market research is an attractive option when investing in a full-blown research project might seem out of scope or budget.

There are lots of different ways you could conduct market research and collect customer data, but you don’t have to limit yourself to just one research method. Four common types of market research techniques include surveys, interviews, focus groups, and customer observation.

Which method you use may vary based on your business type: ecommerce business owners have different goals from SaaS businesses, so it’s typically prudent to mix and match these methods based on your particular goals and what you need to know.

1. Surveys: the most commonly used

Surveys are a form of qualitative research that ask respondents a short series of open- or closed-ended questions, which can be delivered as an on-screen questionnaire or via email. When we asked 2,000 Customer Experience (CX) professionals about their company’s approach to research , surveys proved to be the most commonly used market research technique.

What makes online surveys so popular?  

They’re easy and inexpensive to conduct, and you can do a lot of data collection quickly. Plus, the data is pretty straightforward to analyze, even when you have to analyze open-ended questions whose answers might initially appear difficult to categorize.

We've built a number of survey templates ready and waiting for you. Grab a template and share with your customers in just a few clicks.

💡 Pro tip: you can also get started with Hotjar AI for Surveys to create a survey in mere seconds . Just enter your market research goal and watch as the AI generates a survey and populates it with relevant questions. 

Once you’re ready for data analysis, the AI will prepare an automated research report that succinctly summarizes key findings, quotes, and suggested next steps.

An example research report generated by Hotjar AI for Surveys

2. Interviews: the most insightful

Interviews are one-on-one conversations with members of your target market. Nothing beats a face-to-face interview for diving deep (and reading non-verbal cues), but if an in-person meeting isn’t possible, video conferencing is a solid second choice.

Regardless of how you conduct it, any type of in-depth interview will produce big benefits in understanding your target customers.

What makes interviews so insightful?

By speaking directly with an ideal customer, you’ll gain greater empathy for their experience , and you can follow insightful threads that can produce plenty of 'Aha!' moments.

3. Focus groups: the most unreliable

Focus groups bring together a carefully selected group of people who fit a company’s target market. A trained moderator leads a conversation surrounding the product, user experience, or marketing message to gain deeper insights.

What makes focus groups so unreliable?

If you’re new to market research, we wouldn’t recommend starting with focus groups. Doing it right is expensive , and if you cut corners, your research could fall victim to all kinds of errors. Dominance bias (when a forceful participant influences the group) and moderator style bias (when different moderator personalities bring about different results in the same study) are two of the many ways your focus group data could get skewed.

4. Observation: the most powerful

During a customer observation session, someone from the company takes notes while they watch an ideal user engage with their product (or a similar product from a competitor).

What makes observation so clever and powerful?

‘Fly-on-the-wall’ observation is a great alternative to focus groups. It’s not only less expensive, but you’ll see people interact with your product in a natural setting without influencing each other. The only downside is that you can’t get inside their heads, so observation still isn't a recommended replacement for customer surveys and interviews.

The following questions will help you get to know your users on a deeper level when you interview them. They’re general questions, of course, so don’t be afraid to make them your own.

1. Who are you and what do you do?

How you ask this question, and what you want to know, will vary depending on your business model (e.g. business-to-business marketing is usually more focused on someone’s profession than business-to-consumer marketing).

It’s a great question to start with, and it’ll help you understand what’s relevant about your user demographics (age, race, gender, profession, education, etc.), but it’s not the be-all-end-all of market research. The more specific questions come later.

2. What does your day look like?

This question helps you understand your users’ day-to-day life and the challenges they face. It will help you gain empathy for them, and you may stumble across something relevant to their buying habits.

3. Do you ever purchase [product/service type]?

This is a ‘yes or no’ question. A ‘yes’ will lead you to the next question.

4. What problem were you trying to solve or what goal were you trying to achieve?

This question strikes to the core of what someone’s trying to accomplish and why they might be willing to pay for your solution.

5. Take me back to the day when you first decided you needed to solve this kind of problem or achieve this goal.

This is the golden question, and it comes from Adele Revella, Founder and CEO of Buyer Persona Institute . It helps you get in the heads of your users and figure out what they were thinking the day they decided to spend money to solve a problem.

If you take your time with this question, digging deeper where it makes sense, you should be able to answer all the relevant information you need to understand their perspective.

“The only scripted question I want you to ask them is this one: take me back to the day when you first decided that you needed to solve this kind of problem or achieve this kind of a goal. Not to buy my product, that’s not the day. We want to go back to the day that when you thought it was urgent and compelling to go spend money to solve a particular problem or achieve a goal. Just tell me what happened.”

— Adele Revella , Founder/CEO at Buyer Persona Institute

Bonus question: is there anything else you’d like to tell me?

This question isn’t just a nice way to wrap it up—it might just give participants the opportunity they need to tell you something you really need to know.

That’s why Sarah Doody, author of UX Notebook , adds it to the end of her written surveys.

“I always have a last question, which is just open-ended: “Is there anything else you would like to tell me?” And sometimes, that’s where you get four paragraphs of amazing content that you would never have gotten if it was just a Net Promoter Score [survey] or something like that.”

What is the difference between qualitative and quantitative research?

Qualitative research asks questions that can’t be reduced to a number, such as, “What is your job title?” or “What did you like most about your customer service experience?” 

Quantitative research asks questions that can be answered with a numeric value, such as, “What is your annual salary?” or “How was your customer service experience on a scale of 1-5?”

 → Read more about the differences between qualitative and quantitative user research .

How do I do my own market research?

You can do your own quick and effective market research by 

Surveying your customers

Building user personas

Studying your users through interviews and observation

Wrapping your head around your data with tools like flow models, affinity diagrams, and customer journey maps

What is the difference between market research and user research?

Market research takes a broad look at potential customers—what problems they’re trying to solve, their buying experience, and overall demand. User research, on the other hand, is more narrowly focused on the use (and usability ) of specific products.

What are the main criticisms of market research?

Many marketing professionals are critical of market research because it can be expensive and time-consuming. It’s often easier to convince your CEO or CMO to let you do lean market research rather than something more extensive because you can do it yourself. It also gives you quick answers so you can stay ahead of the competition.

Do I need a market research firm to get reliable data?

Absolutely not! In fact, we recommend that you start small and do it yourself in the beginning. By following a lean market research strategy, you can uncover some solid insights about your clients. Then you can make changes, test them out, and see whether the results are positive. This is an excellent strategy for making quick changes and remaining competitive.

Net Promoter, Net Promoter System, Net Promoter Score, NPS, and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld, and Satmetrix Systems, Inc.

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Home Market Research

Marketing research: Definition, steps, uses & advantages

What is marketing research?

Marketing research is defined as any technique or a set of practices that companies use to collect information to understand their target market better. Organizations use this data to improve their products, enhance their UX, and offer a better product to their customers. Marketing research is used to determine what the customers want, and how they react to products or features of a product.

Gather research insights

Four standard marketing research methods

The four most common marketing research methods are surveys, interviews, customer observations, and focus groups. You can research various ways without limiting yourself to just one way. Let’s dive deeper into each of these marketing research techniques.

Researchers collect responses by deploying surveys and managing data via online questionnaires or on-screen surveys at the POS. These surveys contain closed-ended and open-ended questions. They are popular and are the most widely used research techniques.

Why are online surveys popular?

Surveys are inexpensive, simple to set-up, deploy, and gather responses. It gets easy to collect multiple answers from a tailored audience group using surveys. Researchers rely on quantitative data, and online surveys provide quick responses compared to the more traditional offline methods. You can collect large amounts of data within minutes from anywhere in the world.

2. Interviews

Face-to-face or personal interviews are a more traditional way of doing marketing research. It is a slow and more expensive way of collecting responses. Researchers doing large scale marketing research do not prefer this method to collect a large number of responses. Interviews are conducted both in-person and on the telephone (CATI). 

Why are interviews important?

Personal interviews may not be widely used but play a significant role in understanding precisely what the respondent feels. You can record more than just verbal responses and understand the customer better. Often, when two humans interact with each other, more information is shared because of the dialogue. Personal interviews are useful in small-scale studies, where the researcher wants to interview a specific group of local respondents. CATI’s are helpful when the respondent base is more expansive.

3. Focus groups

Focus groups or online focus groups involve several respondents who participate in discussions about a particular topic. A researcher conducts focus groups to obtain richer information. The main reason for a focus group is to hold a dialogue between various people on a particular topic of interest. Unlike interviews, focus group members are allowed to interact with each other and influence one another.

Why are focus groups impactful?

It is no secret that focus groups are hugely impactful in decision making. Researchers gain a lot of information by organizing focus groups. Often, focus groups bring up issues not foreseen by researchers. Online or video focus groups have a broad reach, and many organizations have now started creating and nurturing research communities for better respondent handling and data gathering. Direct interaction of business groups and customers positively impacts users because they feel that their voices are heard.

4. Observation

Observation, though not popular and widely used, gives intuitive feedback. Research companies organize customer observation sessions to gather information on how they engage with the product or service (or a similar competitor product or service). Feedback from people’s behavioral attitudes is a powerful tool for researchers looking to improve their products and services.

What makes observation so powerful?

Observational market research is an excellent alternative to focus groups. It’s not only an inexpensive research tool, but you will also witness people interacting with and using your product in a natural environment. The downside is that you will have to make inferences about their feelings and reactions.

LEARN ABOUT: market research trends

How to conduct marketing research

Follow these four marketing research steps to help you understand what your users think and feel about your product, service, or business.

LEARN ABOUT: Behavioral Research

1. Create simple user personas

A user persona is nothing more than a fictional character that represents a user or a customer. Understanding user personas will help you gauge how different persons react to other products and services to understand their needs. To create a persona, your questions must answer these types questions about the user or customer:

• Who are they?
• What’s their primary goal?
• What stops them from achieving that goal?

2. Conduct observational research

Use both overt and covert observation methods to observe and take notes while users use your products or a similar one.

Overt vs. covert observation

• Overt observation asks users if they will allow you to watch them use your product. 
• Covert observation studies users in a natural environment without them knowing. This type of observation generally works only if you sell a product that consumers buy and use regularly. It brings in the purest observational research data as people act naturally while using the products. 

3. Conduct personal interviews

One-on-one conversations with your target population allow you to explore and dig deep into their concerns, revealing answers to many questions. Here are a few tips for conducting personal interviews.

• Be a journalist and not a salesperson. Ask users about their frustrations, needs, and areas where they think they need an improvement in the product. 
• Pose the ‘why’ question to dig deeper. Dive into the details to know more about their past behavior.
• Recording the conversation helps you focus on it rather than take notes simultaneously.

4. Analyze the data

The idea of conducting lean marketing research is to receive quick, actionable insight data. Analyze the information you have collected using various techniques to draw patterns into what customers like and dislike, what they want, and what they do not need. Create a simple visual representation of how people will interact with each other and the product to assess their needs in a better way.

LEARN ABOUT: Marketing Insight

Why is research so valuable?

Without research, it is impossible to gauge and understand your customers. Of course, you will have an idea of what they need and who they are and, but you must dive deeper to win their loyalty. Here is why marketing research matters:

• Attract potential customers: The primary aim of marketing research is to find ways to attract potential customers. It also helps to keep current happy and coming back for more. Understanding your customers entirely is the only way to progress. You’ll lose potential customers if you stop caring about improving your user experience.
• Answer the why’s: Marketing research gives you the answer to the ‘why.’ Make use of user analytics, big data, and reporting dashboards in marketing research to tell you what your users are thinking and why they think and act that way. For example, only marketing research can explain why customers leave you.
• Data-backed decisions: Research beats trends, assumptions, and so-called best business practices. Bad decisions are often taken due to emotional reasoning and guesswork. Focusing on customer experience by listening to your customers directs you in the right direction.
• Better planning: Research keeps you from making absurd decisions by planning in a vacuum. You might not fully gauge what your customers experience and feel while using your product. Customers may use products in a way that surprises you, and they may get confused by features that seem obvious to you. Conducting too much planning but not testing your assumptions will waste your money, time, efforts, and resources. Research helps you save up on all these factors.

LEARN ABOUT: 12 Best Tools for Researchers

Advantages of MKT research

Marketing research and user experience (UX) design help you continuously improve your product by acting on your feedback. Here are the advantages of conducting marketing research:

• Improved efficiency: Efficiency draws you closer to your users. You can improve the efficiency of delivering the product to the market and also increase its usability.
• Cost-effective: Marketing research helps you make the right decisions based on consumer demand, thus saving you costs in creating something that customers do not like or want.

LEARN ABOUT:  Test Market Demand

• Competitive edge: Quicker, more robust insights can help you place your services and products strategically, gaining a competitive advantage over others.
• Build strategies: You can quickly build, alter, or design new approaches to attract your users and consumers.
• Improved communication: Bridge the communication gap by interacting with consumers and hearing them out. This helps consumers feel wanted and special.
• LEARN ABOUT: Market research vs marketing research

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What is Marketing Research? Examples and Best Practices

12 min read

Marketing research is essentially a method utilized by companies to collect valuable information regarding their target market. Through the common practice of conducting market research, companies gather essential information that enables them to make informed decisions and develop products that resonate with consumers. It encompasses the gathering, analysis, and interpretation of data, which aids in identifying consumer demands, anticipating market trends, and staying ahead of the competition.

Exploratory research is one of the initial steps in the marketing research process. It helps businesses gain broad insights when specific information is unknown. If you are seeking insight into how marketing research can influence the trajectory of your SaaS, then you have come to the right place!

• Market research is a systematic and objective process crucial for understanding target markets, refining business strategies, and informing decisions, which includes collecting, analyzing, and interpreting data on customers, competitors, and the industry.
• Primary market research gathers specific data directly from the target audience using tools like surveys and focus groups, while secondary market research utilizes existing data from various sources to provide broader market insights.
• Effective market research combines both qualitative methods, which explore consumer motivations, and quantitative methods, which provide measurable statistics, to create comprehensive insights that guide business strategy and decision-making.

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Defining marketing research

Launching a product without knowing what your target audience wants is like walking in the dark. Market research lights the way, helping you collect, analyze, and understand information about your target market. This allows you to refine your business strategies and make decisions based on solid evidence.

Gone are the days when just intuition or subjective judgment was enough. Objective insights from market research help avoid costly mistakes and meet consumer needs by identifying trends and changes in the market. This is crucial for assessing a product’s potential success, optimizing marketing strategies, and preparing for market shifts.

Market research is a systematic approach that provides essential information, helping businesses navigate the complexities of the commercial world. Partnering with market research companies can offer additional benefits, leveraging their expertise in understanding market demands, trends, market size, economic indicators, location, market saturation, and pricing. Whether starting a new business, developing products, or updating marketing plans, understanding how to conduct effective market research is key to success.

To conduct market research effectively, businesses must determine study goals, identify target consumers, collect and analyze data, and use the findings to make informed decisions. This process is vital for evaluating past performance, measuring changes over time, and addressing specific business needs. It guides businesses in product development, marketing strategies, and overall decision-making, ensuring a better ROI and providing an eye-opening view of the market through various research methods, whether conducted in-house or outsourced.

The purpose of marketing research

Conducting marketing research is more than just gathering data; it’s about turning that data into actionable insights to refine your business strategies. This process helps you understand what motivates your customers, enabling you to tailor your products and services to minimize risks from the start. Importantly, market research plays a pivotal role in measuring and enhancing customer satisfaction and loyalty, which are critical for understanding key demographics, improving user experience, designing better products, and driving customer retention. Customer satisfaction is measured as a key outcome, directly linked to the success of marketing strategies and business activities.

For SaaS product managers, market research, including competitive analysis, is crucial. It evaluates past strategies and gauges the potential success of new offerings. This research provides essential insights into brand strength, consumer behavior, and market position, which are vital for teams focused on sales, marketing, and product development.

A key aspect of market research is analyzing customer attitudes and usage. This analysis offers detailed insights into what customers want, the choices they make, and the challenges they face. It helps identify opportunities in the market and aids in formulating effective strategies for market entry.

Overall, market research equips SaaS entrepreneurs with the knowledge to meet their target audience’s needs effectively, guiding product adjustments and innovations based on informed decisions.

Key components of market research

Conducting market research is analogous to preparing a cake, requiring precise ingredients in specific quantities to achieve the intended outcome. Within this realm, necessary components consist of primary and secondary data gathering, thorough analysis, and insightful interpretation.

Primary research techniques such as exploratory studies, product evolution inquiries, estimations of market dimensions and shares, and consumer behavior examinations play a crucial role in collecting targeted information that can be directly applied. These methods afford a deeper understanding of your target demographic, allowing for customized strategy development.

In contrast, secondary research enriches the specificity of primary findings by adding wider context. It taps into external resources encompassing works from other investigators, sector-specific reports, and demographics data, which provide an expansive yet less particularized landscape view of the marketplace.

The subsequent phase involves meticulous analysis of collated data offering unbiased perspectives critical for identifying deficiencies while recognizing emerging patterns. Technological progress now facilitates examination efforts on both structured and unstructured datasets effectively addressing large-scale analytical complexities.

Ultimately, it’s through expert-led interpretation that value transcends raw figures, yielding strategies grounded in deep comprehension. Akin to decoding recipes using selected ingredients—this interpretative step enables crafting optimal business maneuvers just as one would bake their ideal confectionery creation utilizing proper culinary guidance.

Types of market research: primary and secondary

Now that you know the importance of clear research objectives, let’s explore the different types of market research and the techniques available to achieve these goals. Market research methods can be divided into two main categories: primary research and secondary research . The choice between these depends on factors like your budget, time constraints, and whether you need exploratory data or definitive answers.

Primary research involves collecting new data directly from sources. This process is like mining for precious metals, as it requires using various methods to gather fresh insights.

• Surveys (here – in-app survey templates from Userpilot ).

• Interviews.

• Focus groups.
• Product trials.

This approach gives you first-hand insight into your target audience.

Conversely, secondary research uses already established datasets of primary data – which can add depth and reinforcement to your firsthand findings.

Conducting your own market research using primary research tools can be a cost-effective strategy, allowing businesses to gather valuable insights directly and tailor their research to specific needs.

Let’s look a bit deeper into them now.

What is primary market research?

Market research uses primary market research as an essential tool. This involves collecting new data directly from your target audience using various methods, such as surveys , focus groups, and interviews.

Each method has its benefits. For example, observational studies allow you to see how consumers interact with your product.

There are many ways to conduct primary research.

Focus Groups : Hold discussions with small groups of 5 to 10 people from your target audience. These discussions can provide valuable feedback on products, perceptions of your company’s brand name, or opinions on competitors. Additionally, these discussions can help understand the characteristics, challenges, and buying habits of target customers, optimizing brand strategy.

Interviews : Have one-on-one conversations to gather detailed information from individuals in your target audience.

Surveys : These are a common tool in primary market research and can be used instead of focus groups to understand consumer attitudes. Surveys use structured questions and can reach a broad audience efficiently.

Navigating secondary market research

While marketing research using primary methods is like discovering precious metals, secondary market research technique is like using a treasure map. This approach uses data collected by others from various sources, providing a broad industry view. These sources include market analyses from agencies like Statista, historical data such as census records, and academic studies.

Secondary research provides the basic knowledge necessary for conducting primary market research goals but may lack detail on specific business questions and could also be accessible to competitors.

To make the most of secondary market research, it’s important to analyze summarized data to identify trends, rely on reputable sources for accurate data, and remain unbiased in data collection methods.

The effectiveness of secondary research depends significantly on how well the data is interpreted, ensuring that this information complements the insights from primary research.

Qualitative vs quantitative research

Market research employs both qualitative and quantitative methods, offering distinct insights that complement each other. Qualitative research aims to understand consumer behaviors and motivations through detailed analysis, while quantitative research collects measurable data for statistical analysis.

The selection of qualitative or quantitative methods should align with your research goals. If you need to uncover initial insights or explore deep consumer motivations, qualitative techniques like surveys or interviews are ideal.

On the other hand, if you need data that can be measured and analyzed for reliability, quantitative methods are more suitable.

However, these approaches don’t have to be used separately. Combining qualitative and quantitative methods in mixed-method studies allows you to capture both detailed exploratory responses and concrete numerical data. This integration offers a comprehensive view of the market, leveraging the strengths of both approaches to provide a fuller understanding of market conditions.

Implementing market research tools: Userpilot’s role

Similar to how a compass is essential for navigation at sea, businesses need appropriate instruments to carry out effective market research. Userpilot’s suite of product analytics and in-app engagement tools are critical components for this purpose.

Acting as a Buyer Persona Research instrument, Userpilot’s product analytics provide key quantitative research capabilities. This helps clearly define and comprehend the attributes and behaviors of potential customers, providing you with insights into your ICP (Ideal Customer Persona), user preferences, and product-market fit.

Beyond product analytics, Userpilot offers robust in-app engagement features such as modals and surveys that support real time collection of market research information. These interactive features work synergistically with the analytical tools to enable companies to gather detailed data and feedback crucial for informed business decision-making.

Marketing research process: Step-by-step guide

Marketing research conists of several critical stages:

• Defining precise goals.
• Delving into the knowledge of your target demographic.
• Collecting and scrutinizing data.
• Revealing insights that can be translated into tangible actions.

Following these steps allows you to gather critical information that guides business decisions.

An effective research strategy is crucial and involves:

• Properly allocating funds.
• Formulating testable hypotheses.
• Choosing appropriate methods for the study.
• Determining the number of study participants.
• Considering external variables.

A well-planned strategy ensures that your market research is focused, efficient, and produces useful outcomes.

After collecting data, the next step is to analyze it. This involves comparing the data to your initial questions to draw conclusions relevant to your business strategies.

Userpilot makes your data analysis easier by providing handy analytics dashboards for key user metrics such as activation, engagement, core feature adoption, and retention out of the box:

Finally, you report the findings and the process, providing recommendations based on the evidence. This is like solving a puzzle: each piece helps to complete the overall picture.

Challenges and best practices in market research

Delving into market research comes with its own set of hurdles. Those conducting the research must deliver more profound insights within increasingly shorter timespans, and they need to cultivate strategic, continuous research methods to stay abreast of an ever-changing business landscape.

Ensuring high-quality data can be demanding due to issues such as disjointed tools or insufficient analytical expertise. New solutions like Userpilot are surfacing that make these obstacles less daunting by offering accessible and user-friendly options. Maintaining clear lines of communication with your market research team is crucial for achieving both punctuality and quality in outcomes.

The advantages of engaging in marketing research cannot be overstated.

Real-life examples of successful market research

Real-life examples of market research in the SaaS industry often showcase innovative approaches to understanding customer needs and product-market fit.

For instance, Slack, the communication platform, utilized extensive market research to identify gaps in communication tools and understand the workflows of teams. This led to the development of features that seamlessly integrated with other tools and catered to the needs of various team sizes and structures.

Another example is HubSpot, which conducted market research to understand the pain points of small to medium-sized businesses in managing customer relationships. The insights gained helped shape their all-in-one inbound marketing, sales, and service platform, which has become integral to their users’ daily operations. These examples demonstrate how SaaS companies can employ market research to inform product development, improve user experience, and strategically position themselves in a competitive market.

Choosing the right market research tools

For B2B SaaS product managers aiming to do market research, having the right set of tools can make a significant difference. Here’s a list of valuable SaaS tools that can be leveraged for effective market research:

• Userpilot : A comprehensive Product Growth Platform offering in-depth product analytics, a code-free in-app experience builder, bespoke in-app survey capabilities, and robust integration options with platforms like Salesforce and Hubspot. This tool is particularly useful for understanding user behavior, enhancing user engagement, and gathering targeted feedback.
• Qualtrics : Known for its powerful survey tools, Qualtrics helps businesses gather and analyze customer feedback effectively. Its advanced analytics features are ideal for testing market hypotheses and understanding customer sentiments.
• SurveyMonkey : A versatile tool that enables product managers to create, send, and analyze surveys quickly and easily. SurveyMonkey is suitable for gauging customer satisfaction and collecting feedback on potential new features.
• Mixpanel : Specializes in user behavior analytics, offering detailed insights into how users interact with your product. This is essential for identifying patterns and optimizing product features.
• Hotjar : Combines analytics and feedback tools to give teams insights into user behavior and preferences. Hotjar’s heatmaps and session recordings are invaluable for understanding the user experience on a deeper level.
• Tableau : A leading platform for business intelligence and data visualization, Tableau allows product managers to create comprehensive visual reports that can inform strategic decisions based on user data analysis.

Each of these tools provides unique functionalities that can assist SaaS product managers in conducting thorough market research, thereby ensuring that their products are perfectly aligned with user needs and market demands.

Measuring the impact of market research

The pivotal challenge for market research lies in demonstrating its return on investment (ROI) and overall influence on corporate success sufficiently enough to justify regular financial commitment from company leaders. The worth attributed to a market research firm hinges not only on their ability to deliver relevant and high-caliber information, but also on their pricing structures and their contribution towards propelling organizational growth.

To gauge how effectively business choices made based on market research findings succeed, various metrics and key performance indicators (KPIs) are utilized. These numerical tools act as navigational aids directing enterprises toward achieving objectives while simultaneously verifying that efforts invested in conducting market analysis are yielding fruitful guidance.

Throughout our look at market research, we’ve seen its importance and impact. Our discussion covered the basics of market research, its key components, and different types, including both qualitative and quantitative methods, and the role of Userpilot’s tools. We’ve examined the details of the market research process, tackled challenges, identified best practices, and shared success stories. We also provided advice on choosing the right market research partner and how to measure the effectiveness of your market research.

In today’s data-driven world, comprehensive market research is crucial for companies that want to succeed. It acts like a guide, helping businesses navigate the complex market landscape. Start your own detailed research today, supported by insightful analytics to help you succeed.

Frequently asked questions

What is market research and why is it important.

Understanding your target market, honing business strategies, and making informed decisions are all essential components that depend heavily on effective market research. It offers objective insights to help avoid expensive errors and foresees the needs of customers .

What is the difference between primary and secondary market research?

Primary market research is characterized by the direct gathering of data, in contrast to secondary market research which leverages existing information from alternative sources for addressing research inquiries.

Such a distinction can guide you in selecting an approach that aligns with your precise needs for conducting specific research.

What are some examples of successful market research?

Examples of successful market research are evident in the operations of well-known companies such as Starbucks, Apple, and McDonald’s. They have harnessed this tool to fine-tune their business strategies and make decisions based on solid information.

By employing market research, these businesses have managed to gain insight into their customers’ desires and needs, which has contributed significantly to their success.

How can I choose the right market research partner?

Selecting an ideal market research ally involves identifying a firm that resonates with your project requirements, financial plan, and corporate goals while also verifying their track record of dependability and consistency via reviews from previous clients.

Best wishes on your endeavor!

How is the impact of market research measured?

The effectiveness of market research hinges on the precision, representativeness, and pertinence of its data, along with how successful business decisions are when they’re based on the findings from this research. These elements define the impact of the research conducted.

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The 8 types of market research: definitions, uses and examples.

13 min read What are the different types of market research that can help you stay ahead of the curve with your marketing strategy? Understand how to use each type, and what the advantages and disadvantages are.

Market research (also called marketing research) is the action or activity of gathering information about market needs and preferences. This helps companies understand their target market — how the audience feels and behaves.

There are 8 types of market research, each with their own methods and tools:

• Primary research
• Secondary research
• Qualitative research
• Quantitative research
• Branding research
• Customer research
• Competitor research
• Product research

Let’s start our list by exploring primary and secondary research first.

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1. Primary research

Primary research is research that you collect yourself but going directly to the target market through a range of methods. Because it is data you create, you own the data set.

Two types of results — exploratory information (determines the nature of a problem that hasn’t yet been clearly defined) and conclusive information (carried out to solve a problem that exploratory research identified) — from participants are collected as raw data and then analyzed to gather insights from trends and comparisons.

This method is good for getting the views of a lot of people at one time, especially when time is short, but it comes with its own management issues. The interviewer must prepare a way to gather answers and record these, while engaging in conversation with many people.

Participants may be affected by the group setting, either from acquiescence bias (the desire to say yes to please the interviewer), dominance bias (stronger participants can alter the results from less dominant participants) or researcher bias (where the research leads or impacts the participant responses indirectly).

This provides a structured setting where the interviewer can listen to what’s being said and investigate further into an answer. The interviewer can also pick up on non-verbal cues from body language can help the interview understand where to deep-dive and broaden their understanding.

However, some of the same biases (acquiescence and researcher) still exit in this format. The method is time consuming to do the interviews and collect the data afterwards.

A survey is an excellent method for carrying out primary research as participants do need to be physically present with the interviewer to carry it out. The survey can be completed anywhere there is an internet connection, meaning there is flexibility for the participants to use different devices and for interviewers to contact participants in different geographical time-zones.Preparation is key, however, as the researchers must segment the market and create a list of participants to send the survey to. Hiring a panel or using existing marketing lists can help with this.

2. Secondary research

Secondary research is the use of data that has previously been collected, analysed and published (and therefore you do not own this data). An example of this for market research is:

Most information is freely available, so there are less costs associated with this kind of secondary research over primary research methods.

Secondary research can often be the preparation for primary research activities, providing a knowledge base. The information gathered may not provide the specific information to explain the results, which is where primary market research would be used to enhance understanding.

There is also a logistics planning need for a recording solution that can handle large datasets, since manual management of the volumes of information can be tricky.

Both primary and secondary research have its advantages and disadvantages, as we’ve seen, but they are best used when paired together. Combined, the data can give you the confidence to act knowing that any hypothesis you have is backed up.

Learn more about primary vs secondary research methods

The next market research types can be defined as qualitative and quantitative research types:

3. Qualitative research

Qualitative market research is the collection of primary or secondary data that is non-numerical in nature, and therefore hard to measure.

Researchers collect this market research type because it can add more depth to the data.

This kind of market research is used to summarise and infer, rather than pin-points an exact truth held by a target market. For example, qualitative market research can be done to find out a new target market’s reaction to a new product to translate the reaction into a clear explanation for the company.

4. Quantitative research

Quantitative research is the collection of primary or secondary data that is numerical in nature, and so can be collected more easily.

Researchers collect this market research type because it can provide historical benchmarking, based on facts and figures evidence.

There are a number of ways to collect this data — polls, surveys, desk research, web statistics, financial records — which can be exploratory in nature without a lot of depth at this stage.

Quantitative market research can create the foundation of knowledge needed by researchers to investigate hypotheses further through qualitative market research.

The next four variations of market research are specific to topics areas, that bring about specific information.:

5. Branding research

Branding market research assists a company to create, manage and maintain the company brand. This can relate to the tone, branding, images, values or identity of the company.

Research can be carried out through interviews, focus groups or surveys. For example, brand awareness surveys will ask your participants whether the brand is known to them and whether it is something they would be interested in buying.

Additional areas for brand research is also around brand loyalty, brand perception , brand positioning , brand value and brand identity .

The aim of research will be to understand how to know if:

• Your brand is performing in relation to other competitors
• There are areas to improve your brand activities
• There are positives to showcase to enhance your brand’s image

6. Customer research

Customer market research looks at the key influences on your target customers and how your company can make changes to encourage sales.

The aim of this research is to know your customer inside out, and continuously learn about how they interact with the company. Some themes covered by this include:

• Customer satisfaction – Exploring what keeps customers happy, as higher customer satisfaction is more likely to lead to increased customer retention.
• Customer loyalty – This looks at what experiences have happened to lead to greater customer loyalty across the customer lifecycle.
• Customer segmentation research – Discovering who the customers are, what their behaviour and preferences are and their shared characteristics.

Relevant desk research may look at historical purchase records, customer journey mapping , customer segmentation, demographics and persona templates.

Primary research, such as NPS and customer satisfaction surveys , or customer satisfaction interviews at the end of customer support calls, can also give more details.

7. Competitor research

Competitor market research is about knowing who your competition is and understanding their strengths and weaknesses, in comparison to your organization. It can also be about your competitive offering in the market, or how to approach a new market.

The aim of this research is to find ways to make your organization stand out and future planning through horizon scanning and listening to customer preferences.

For example, for competitive analysis, researchers would create a SWOT for your business and your competitors, to see how your business compares.

Primary research could interview customers about their buying preferences, while secondary sources would look at competitor’s market dominance, sales, structure and so on. With this thorough analysis, you can understand where you can change to be more competitive, and look for ideas that make you stand out.

8. Product research

Product market research is a key way to make sure your products and services are fit for launching in the market, and are performing as well as they can.

The aim of this research is to see how your product is perceived by customers, if they are providing value and working correctly. Ideas can also be formed about upgrades and future product development.

There are a number of avenues within product research:

• Product branding – Does the product brand and design attract customers in the intended way?
• Product feature testing – this can happen at various stages of development with target markets (in early development, between versions, before product launch, etc.) to check if there are positive reaction to new or improved features
• Product design thinking – what solutions would solve your customers’ current or future problems?
• Product marketing – Do the marketing messages help your product’s memorability and saleability, or can they be improved?

Primary research methods have a clear advantage in this kind of market research: Surveys can ask for rankings on the popularity or usefulness of features or conduct conjoint analysis, while in-person observation interviews (where the participant can handle a product) can be particularly useful in seeing what customers do with the product in real time.

How to use market research types in your company

In a good marketing strategy, it’s preferable to have a mixture of data across:

• Qualitative and quantitative research
• Primary and secondary research
• Your specific topic area or area of focus

With these three components, you can make sure your market strategy gives you a complete picture of your market’s operational data and experience data , — what your market does and why .

Economical experience data (O data)

This type of experience data is quantitative in nature (including operations, featuring sales data, finance data and HR data ). As it can be quantified into numerical values, it can be measured over and over, providing datasets.

There is the opportunity to use a data-driven approach to understanding the results and making predictions based on historical trends.

This sort of data can be measured more easily than emotions and feelings. But it can only tell you about past activities and what happened. It can’t tell you what will happen in the future and why things will happen — this is where X data comes in.

Emotional experience data (X data)

This type of experience data seeks to find reasons to explain emotional decisions and how brands ‘sit’ in people’s minds. In this way, this data is qualitative in nature.

Companies that have X data have a ‘mental advantage’ over other companies,  as they are able to understand the perceptions of the customer, their needs and values.

When you have tangible insights on the audience’s needs, you can then take steps to meet those needs and solve problems. This mitigates the risk of an experience gap – which is what your audience expects you deliver versus what you actually deliver.

Related resources

Market intelligence 10 min read, marketing insights 11 min read, ethnographic research 11 min read, qualitative vs quantitative research 13 min read, qualitative research questions 11 min read, qualitative research design 12 min read, primary vs secondary research 14 min read, request demo.

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What is marketing research? Definition and examples

Marketing Research involves systematically collecting data about consumers, rivals, and other entities. That data is analyzed to gain a better understanding of consumers’ needs and other features of the market. Marketing people then summarize the data and conclusions in a report. The report helps senior managers and business owners make informed decisions regarding future plans and strategies.

Effective marketing research also aids in identifying potential new markets or customer segments, allowing companies to expand their reach and diversify their customer base.

Moreover, marketing research continuously evolves to adapt to emerging trends and technologies, ensuring that businesses stay competitive in rapidly changing markets.

“Marketing research is the systematic gathering, recording, and analysis of qualitative and quantitative data about issues relating to marketing products and services. The goal is to identify and assess how changing elements of the marketing mix impacts customer behavior.”

Three main types of marketing research

Marketing research generally consists of three main types of research: 1. Market research . 2. Product researc h. 3. Consumer research .

Market research

You should not make important decisions regarding your products without carrying out market research first.

Market research is a study of the market, specifically who purchase a product, why they buy it, how competitors behave, and how something is sold.

It is an organized effort to gather and analyze data about target markets. The following quote comes from our article that defines market research:

“We often use the term with the same meaning as marketing research. However, marketing research concentrates on the marketing processes, while market research is about the market in general.”

Product research

Product research involves identifying a need or want and the characteristics of the product or service that will satisfy it. In other words, if consumers have a desire or want, what features or benefits of your product satisfies them and to what extent.

This type of research helps companies determine what consumers really want or need. They can then tailor their goods or services to match those consumer wants and needs.

According to mnbaskool.com:

“Product research is the marketing research that provides information on the desired characteristics of a product or service . Product research helps companies to understand what the customers really want, so that the product can be tailored to match the needs of the customer. This research can help to refine new product ideas.”

Consumer research

Consumer research is all about identifying consumer preferences, motivations, and purchasing behaviors. Specifically, the consumers that the company is focusing on; in other words, the target consumer.

Many marketing experts say that consumer research is part of market research. Marketers gather information through published sources, direct observation, face-to-face interviews, and mail surveys. Telephone interviews are also popular.

Who performs this type of research?

Some companies perform the research themselves while others hire third-party experts or consultants.

Hiring a consulting firm has both advantages and disadvantages. The main advantage is that consultants are marketing research experts. They probably have more experience and training than employees within the company.

The main disadvantage is that they may not understand some the products or services as well as company employees do. The same may also apply to customers and potential customers.

Compound phrases with ‘marketing research’

A compound phrase consists of two or more words. In business and marketing English, there are many compound phrases with the term ‘marketing research’ in them. Let’s have a look at the give most common ones:

Marketing Research Techniques

Refers to the specific methods and tools used in conducting marketing research. As in:

“The company employed various marketing research techniques, such as surveys and focus groups, to understand consumer preferences.”

Marketing Research Analysis

The process of examining and interpreting data collected through marketing research. For example:

“After conducting surveys, the marketing research analysis revealed a growing demand for eco-friendly products among consumers.”

Marketing Research Ethics

Principles and standards guiding the conduct of marketing research to ensure honesty, fairness, and responsibility. For instance:

“Adhering to marketing research ethics, the firm ensured all participant data was kept confidential and used solely for research purposes.”

Global Marketing Research

Research conducted to understand marketing dynamics, consumer behavior, and trends in international markets. As in:

“In their global marketing research, the company discovered significant cultural differences in consumer behavior across different regions, impacting their product strategy.”

Digital Marketing Research

Involves collecting and analyzing data related to digital marketing efforts, such as online consumer behavior, social media trends, and digital advertising effectiveness. For example:

“The digital marketing research showed that the company’s target audience predominantly engaged with their brand through social media platforms, leading to an increased focus on social media advertising.”

Vide – What is Marketing Research?

This video presentation, from our YouTube partner channel – Marketing Business Network , explains what a ‘Marketing Research’ is using simple and easy-to-understand language and examples.

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Market Research

Published on :

21 Aug, 2024

Blog Author :

Edited by :

Reviewed by :

Dheeraj Vaidya

What Is Market Research?

Market research refers to a business strategy wherein an organization analyzes the market trends, competition, and consumer preferences ahead of launching new products or services. It involves collecting and interpreting data during product development or marketing to help businesses make informed decisions.

The research process includes getting feedback from existing and potential customers through surveys and interviews to understand the demand for a specific product type. Besides introducing new products, many organizations do this to identify the target market when planning to launch a new business. Either a business can choose to do it by itself or hire a third-party company for the job. Its purpose is to give them a competitive advantage in the industry.

Table of contents

How to do market research, #1 - defining the problem, #2 - deciding an approach, #3 - preparing a research design, #4 - collecting data, #5 - analyzing data, #6 - drafting reports, #1 - primary research, #2 - secondary research, frequently asked questions (faqs), recommended articles.

• The   market research definition refers to gathering market and consumer data by a business to make informed decisions about launching its new products and services.
• It requires a business to set up an in-house research and development division or hire a third-party firm to evaluate how its products or services will perform post-launch.
• The steps involved in conducting research include – defining the problem, deciding the approach, preparing a research design, collecting and analyzing data, and drafting a research report for presentation.
• Two types of marketing research are primary research (exploratory and specific) and secondary research through online, public, and commercial resources.

Knowing target consumer interests, market demand, and competition is essential for a business before rolling out new products or services or upgrading the existing ones. The process of gaining all this information is known as market research. For this, the business sets up an in-house research and development segment, appoints a market research analyst, or takes the services of a third-party firm. The product differentiation and market segmentation allow them to devise an effective marketing strategy.

Most of the time, businesses trust their instincts when it comes to launching their products successfully. But this is not always the case. The results could be harsh enough to show how their beliefs can go wrong.

Before going into the market research methods, let us understand what makes the process so important for businesses.

• It helps businesses understand the target market and implement product development and marketing strategies accordingly.
• The research ensures that the soon-to-be-launched product or service will meet the market demand and consumer requirements.
• It helps firms become customer-centric by narrowing down customer segments.
• The research allows businesses to study the performance of products from their competitors.
• It gives an idea of how better the sales would be and how profitable the production would prove.

Market Research Process

Marketing research involves gathering data from different sources to identify market trends and consumer behavior. It then analyzes and interprets the collected data to develop innovative products, offer unique services, or launch new businesses. The process is an essential part of business strategy and helps in decision-making. It usually involves the following steps:

Identifying issues or defining problems that consumers face with existing products or services is the first step. The research and development team should prepare questionnaires directed at those issues for respondents to find the optimum solution.

The business must define an approach to study consumer behavior and market trends correctly. It can include everything from establishing analytical models for a research design to defining research objectives and hypotheses.

Next, the business should outline the process and the goal that the research intends to achieve. Starting with data collection and ending with data analysis, the research design should cover it all.

It is the most critical aspect of marketing research as results would be as accurate as the data collected. A business can use online surveys, emails with questions, one-to-one interviews, and so on to get feedback from customers.

The data collected must be analyzed to understand how the market and consumers will react to soon-to-be-released products.

The business needs to draft the final research report for presentation based on the data collection and analysis. It would help investors and top management create an effective business plan for future products.

Let us consider the below-mentioned market research examples to understand the concept better.

Shelly distributed her handmade soaps to friends and relatives to get feedback and decide whether to sell her products. She received a tremendous response from them but decided to do a little more research.

She ran a poll on her social media accounts to check how many people would prefer handmade soap. Simultaneously, she read reviews for similar products on e-commerce websites. It helped her understand what customers want.

After the marketing research, she found that people seem satisfied with handmade soaps but only if the packaging is eco-friendly. Hence, Shelly opted to focus on packaging design while considering market viability and consumer behavior.

First Book, a non-profit social enterprise, has set up the First Book Research & Insights research division to understand the significance of  human-centered design  in the social sector. It aims to conduct marketing research to gain insights on promoting educational equity by removing barriers to learning.

The data includes feedback from educators from under-resourced schools and programs across the United States that support underserved children ages 0-18. Academics, organizations, and curriculum developers use this data for developing strategies and providing human-centered design solutions to benefit underserved children.

Types of Market Research 

Businesses gather information from publicly available sources or through surveys, feedback, etc. After analyzing the data, they can evaluate whether to introduce new products. Based on the sources available, the process of marketing research can be of two types:

When businesses interact with consumers directly or via a third-party firm, it becomes their primary data source. In this case, they do not rely on third-party or publicly available resources. Instead, they create their data to understand consumer requirements and market trends. This type of research exists in two phases – Exploratory and Specific.

• Exploratory Research –  It involves preparing open-ended questionnaires to identify the problems faced by consumers. It helps in the launch of new products or upgrade of existing ones.
• Specific Research –  It aims to find solutions to problems identified in the exploratory research. Besides, it explores opportunities based on customer needs and market trends.

Primary research comprises the following data collection methods:

• Handing out a questionnaire or creating an online poll to collect feedback from customers
• Conducting surveys via phone, Internet, or in-person about the existing and soon-to-be-launched products
• Interacting with focus group remotely through online surveys or in-person
• Doing telephonic, online, or one-on-one in-depth interviews

This type of marketing research entails data collection from publicly accessible resources, either online or offline. For online research, analysts can use various tools to find trending keywords and focus on them when promoting products or services on virtual platforms. The keyword research provides insight into the types of products that customers want.

The online/offline methods that comprise the secondary research include:

• Accessing sources like articles, newspapers, magazines, journals, and social media
• Using census data, report, and studies from the government
• Referring to trade association research reports, academic papers, literature reviews, and case studies

Marketing research is a part of marketing strategy enabling a business to analyze market trends and understand consumer requirements before introducing new products or services. It follows a data-driven approach to make an informed decision.

Conducting market research is essential as it lets businesses evaluate how their products will perform post-launch. A well-prepared research report guarantees successful product launch and performance. It saves both their precious time and money while giving them a competitive advantage in the respective industry.

Marketing research involves gathering information about relevant target markets and consumers. The collection of data relies on the resources available either online or offline. Interacting with customers directly through various mediums or referring to publicly available resources are more common methods.

This has been a guide to What is Market Research and its definition. Here we discuss how to do the market research and process along with examples & types. You may also have a look at the following articles to learn more –

• Direct Marketing
• Segmented Market Theory
• Market Index

What is Market Research? Definition, Types & Methods

Table of Contents

What is Market Research

Definition. Market research is the process of gathering, analyzing and interpreting information about the market, products, and services, consumers and competitors to have a bird’s-eye view and make a more informed decision. It is considered necessary for successful business planning.

Business conduct market research for different reasons, for example, looking for new markets and prospects, testing new products and services, business innovation, product placement and the industry as a whole.

Importance of Market Research

Acquiring new customers and sales is the main focus of every business; market research ensures both of that. Whether it’s a sole proprietorship or a large corporation, market research is equally important for every business. Here are some of the following reasons why it’s important;

Identify Problem Areas in Business

Market research helps us to look for some new opportunities that our business is lacking. Once the market research is finished, then it becomes clear to us about our targeted customers and how we can approach them. There at this point, you’ll see the problems and the opportunities to manage those problematic areas. For example, it would require you to be partnered up with other businesses. Or the new sale location, or add some product bundle offer. 

Minimize Business Risks

Having said earlier that new customers and a steady flow of sales is the main focus of every business; market research helps you to find those opportunities with minimum risk involved to achieve your market goal. However, you can minimize the risk by the number of ways like; test the product or service before launching it into the market. If your product is failing, then it would answer the questions like why your customers aren’t coming back. It would also give you a clear insight of the problem, if the sale has started dropping, then it would give you the suggestions like lower quality, problem in the site or distribution channel is taking more time.

Well-informed Business Decisions

When you know your problems and you also know how you can solve them by using the minimum risk. For instance, who and where your customers are and why they are dissatisfied; whether to launch a new product or discontinue the old product or service; or make some improvement in the existing product. In other words, you have all the necessary ingredients to make a clear business decision.

New Areas for Expansion

One of the major problems that all the business face while advertising is exactness. They don’t exactly know which audience to target. Market research tells you the demographics of your audience, their nationality, their language, and culture. Once you know your targeted market, now you can target your customers by using the paid ads tool of social media. For instance, separate ads for students on campus, completely different ads for single dads, pregnant ladies, and single moms. Market research allows you to follow a separate approach for each separate niche.

Market Trends

The market research gives you a clear idea about market trends like what problems people are facing and how you can solve them. The interest of people these days; whether they are playing video games or watching movies, which niche is more competitive; people want necessity products or want a luxury product and service.

SWOT Analysis

Market research provides you a detailed SWOT analysis like strengths, weaknesses, opportunities, and threats of business. With the help of internal and external analysis, you can make a better decision.

PESTLE Analysis

Political, economic, social, technology, legal and environmental are known as the external factors that can affect your business operations and performance. Market research provides you a well-detailed PESTLE analysis about the environment in which you are running your business.

Methods of Market Research

We have been talking about market research; now the question is how we can perform market research. However, there are two methods of market research, primary and secondary. 

Primary Market Research Methods

As the name implies primary method means that collecting the information by using the direct and primary source because it involves an in-depth analysis of some particular problem or an issue. Some of the important primary market research methods are given below;

Either conducting a face to face interview or a telephonic interview; it’s an open-ended and two-way process in which the interviewer and the interview can both ask questions. Now the success of the interview depends on the quality of questions asked by the researchers. Focus only on those points where you need information, omit rest.

Online Surveys

A form with a list of checkpoints is sent to the audience either via email or direct message to get the feedback of the people. Some organizations offer rewards after the online survey, the purpose is to keep the interest level up. Online surveys shouldn’t be too lengthy, so the people would leave the form without even finishing and it should be made interesting.

Focus Groups

It is a very famous method used by businesses to observe views of experts from different fields; a focus group involves 6 to 10 people. Moderation starts the discussion and stimulates it from time to time; views, gestures and body language of the people are observed. Businesses learn which niche to focus on.

Observation

Observation also falls in the category of primary research method, but it doesn’t involve a direct connection between the observer and the subject. Bakery is the most common example; where cameras are installed at different locations, at which product customer spends more time is observed.

Secondary Market Research Methods

The secondary market research method means that information is collected by using the already existing data. Research reports and other documents similar to this are common examples of the secondary method. Some of the important methods of secondary market research are given below;

Data available on the Internet

Googling or internet surfing is a very common method of secondary data collection. Thousands of websites are there online to provide information on almost every topic. The best thing about this method is that it is free.

Government & Non-government agencies

Government, non-government agencies and small business centers are also a great source of secondary data collection source; where you just have to pay a certain price to get the relevant information and data that you require. Data obtained from such organizations is usually considered authentic and trustworthy.

Commercial information

TV stations, magazines, newspapers, Radio, and journals also fall in the category of secondary commercial data collection sources. These sources usually have the direct and first-hand link with the information. Commercial sources have a vast range of data, businesses, and organizations that want to collection collect data from these sources, and then they have to be specific about their category.

Types of Market Research

When a business wants to know the behavior and buying pattern of the customer of their target market, then researchers perform different types of studies and use different tools to get the required results. Types of market research are as follows;

Primary Research

Primary research means that the researcher is in direct contact with the targeted customer. Companies usually hire third parties to conduct primary market research for them. Data collected from primary research could be quantitative (numerical) or qualitative (non-numerical) depending on the planning and question prepared by the researcher.

Secondary Research

Secondary research is comprised of outside sources like the chamber of commerce, government, media, agencies, etc. Information from such sources is usually published on websites, newspapers, journals, TV channels, radio, etc. We can categories the secondary sources into three main domains; public source, educational institutions, and commercial sources.

Quantitative Research

Quantitative market research is a type and method like surveys, focus groups, observation, interviews, poles, online questioners and phone surveys. As the name implies that the data collected from the quantitative research is in the form of figures and numbers.

Qualitative Research

Qualitative market research is also like quantitative type and methods like surveys, focus groups, observation, interviews, poles, online questioners and phone surveys. But in the qualitative market research, data is collected in the exploratory and open-ended which can be interpreted later on.

Descriptive Research

In the descriptive type of market research, the focus is to find the accurate and correct answer about the market problems. The following types of questions are focused, for instance, how is the consumption of our product? What type of people buying our product? What exactly are the targeted buyers of our product?

Exploratory Research

In the exploratory type of market research, researchers usually have basic and clear knowledge about the issue but research is conducted to get a better insight into the problem. The researcher must be clear about his ideas; irrelevant and impractical ideas should be avoided.

Causal Research

In the causal type of market research, the relation between cause and effect and variable is established to observe the changes. If the packaging is changed of a certain product; then how it will affect the product sale and its durability.

Market Research Process

We live in a very competitive business world where the market keeps on changing; high sales at one time and zero in the next month. When businesses face such issues, then market research is performed. However, market research is a step by step process , it starts with;

Define the problem

First of all, the main focus is to find out the exact problem. Finding the exact problem is the key to the success of market research.

Develop Market Research Plan

Once the problem is identified, the next step is to develop a plan that how you’re going to conduct market research.

Data Collection

Once the plan is laid out for the market research, collect relevant data that is helping the market research plan and answer the problem defined earlier.

Analyze the Data

When you have sufficient data collection to answer questions; now analyze the data to see if any pattern is being formed. If it does, then what it means to research.

Present the Data

If you see any patterns being developed, now put on the paper to see it clearly, or draw a graph or chart to find some relevancy.

Take Action

At this stage, you know the answers based on the information available to you. If your answers address the questions of the stage, then take action and apply the plan.

About The Author

Ahsan Ali Shaw